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May 03, 2010

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Who approved this oil drill and others like it, and what was the process? I'm sure that industry had plenty of input, but who were the scientists consulted, and what were their concerns? Were any philosophers or theologians asked for their appraisal of the risks, since a decision to play both god and russian roulette with the environment is a moral issue too. We need answers, we need humility, we need truth.

Modern Life IS Rubbish

Yes, who better to help author industry regulations than the very businesses to be regulated. After all, those businesses are dedicated (and bound by fiduciary duty to their stockholders) to maximize profits, so there's no conflict of interest there.

Exactly! The Free Market Magic at work! Clearly there was an unexpected increase in demand for polluted Gulf of Mexico Seawater and dead oil covered waterfowls, not to mention assorted pollution of other sealife and for the closure of Gulf coast beaches, and BP cleverly manuevered to supply such things at market rates. Indeed, I don't think BP even charged a thing for this valuable service, no doubt intending to cash in on increased sales from the resulting publicity. I mean, how many people even knew what BP stood for a few short days ago, and now are intimately familiar with its CEO? You couldn't pay for such coverage.

In fact, I'm willing to bet that BP is not going to charge for the decrease in skin-cancer rates among gulf coast residents that is sure to result from the beach closures. Who says the free market can't provide health care?

BP: Meeting your energy needs one dead seagull at a time.

There's a good Onion piece for this occasion:
http://www.theonion.com/articles/shell-executives-accuse-oilcovered-otter-of-playin,2818/

The hard core truth on this issue, as with so many others, is that the people who write the policies:

1) Seldom if ever experience, or even see, the consequences of those policies impact their own lives in a meaningful way; and

2) Their political careers depend in a very real way on getting big money from big business - whose own executives and senior management teams also do not ever have to suffer the consequences of bad policies.

Any and every attempt by government at any level to stop the flow of oil from this wellhead 5000 feet under the Gulf of Mexico (why has the Arizona State Legislature not yet renamed this body of precious fluid the Gulf of America or the Gulf or Reagan or the Norquist Shithole, or the Palin Sea of Death. Why, the very mollusks themselves who charitably have offered to filter this oil through the good offices of their privately owned bivalves should rise up in mucousy revolt against this tyranny) is a direct attack on my personal freedom and the liberty of the American people.

Any and every attempt by BP to pay for the damage caused by this oil spill is a direct attack on shareholder rights and the principles of fiduciary responsibility.

All is theft.

The very thought that individuals who work for governments should be trying to clean up this oil spill while being paid more than the oil rig workers themselves AND provided with pensions and health insurance at public cost (I learned this over at TIO from an individual who has all the wrong friends) is a travesty.

They should be paying me and BP and every mother's free-born son for the opportunity to ameliorate this spill.

We know that Barack Obama was spotted in a diving bell dressed inside as an African witch doctor with a bone through his nose near the wellhead at the bottom of the Gulf just before the explosion.

By God, as the readers of Redstate Diaries can attest with regard to the immigration issue and the tyranny of the Federal Government, it is growing near the time when violence will be required to stem the liberal tyranny.

Moe Lane would have put a stop to such talk but he was busy making a full-frontal video of himeself throttling his chicken with an eye towards trading it for a prostate exam.

Redstaters hold out hope that liberals will be the first to start the violence because conservative cowardly, anti-American filth just don't have the guts to start a fight they can't finish.

It would be nice to get some GOP support as well, but I'm not holding my breath.

the mouthpiece of the GOP has decreed that this was the work of eco-terrorists. blame has been deferred.

Bobby "Feds Get In The Way Of Private Response To Disasters" Jindal has requested more federal aid.

There's a huge part of me that wants to tell him that we'd hate to get in the way of all those good folks with our pesky federal aid and stuff, and see what he does.

But I won't because it would be petty, thoughtless, and supremely d--kish. And I'm not a Republican, so I'm none of those things.

The problem was too much regulation. If the entire Gulf of Mexico had been walled up and drained for easier access to the oil, this wouldn't have been such a problem.

And yet, in one of the most regulated countries in the world, you got a Chernobyl. Go figure. Regulation, per se, isn't proof against man-made or natural disasters, as much as regulatory enthusiasts would like to believe and to have others believe. Shut off valves, if they work, only work downstream of the valve. A line failure upstream of the valve gets you nothing. And, if the same cataclysm that produces the spill in the first place also damages the valve, then so much for the regulation. The point is that perhaps a valve would have made a difference, perhaps not.

I guess what I am wondering is why isn't the Obama administration taking the hits at this site (and others of like mind) that Bush took in the aftermath of Katrina? Bush didn't cause the hurricane, Obama didn't cause the spill, but if fixing things that break is what effective governments do best, then why isn't Obama in the same soup Bush was?

And yet, in one of the most regulated countries in the world, you got a Chernobyl.

I started to make a response to this, then I figured why beat my head against the wall.

why isn't Obama in the same soup Bush was?

If his response proves to be as I-don't-give-a-crap, what-me-worry ineffectual as Bush's was, then he will be.

Here is a precis of the federal response so far.

Hope you're not on the coast McKinney. Good luck.

The White House faced claims last night that the Gulf Coast oil spill could have been contained and kept far from land within days of the Deepwater Horizon explosion if oil from the gushing wellhead had been burnt off in line with a plan drafted by the US Government for precisely this sort of disaster.

The plan requires the immediate deployment of specialised “fire booms” capable of burning 95 per cent of a slick— but not one boom was available on the Gulf Coast at the time of the blast, according to a supplier who eventually provided one eight days later.

“The whole reason the plan was created was so that we could pull the trigger right away,” Ron Gourget, a former federal oil spill response co-ordinator and one of those who drafted the document, said yesterday.
[...]

Link to above:

US had burn-off plan for oil spills but the equipment wasn’t there

Chernobyl today.

Yeah, maybe the American Gulf Coast will end up being our very own Chernobyl.

And Jesus H Christ, won't that suck.

Drill baby drill. God forbid we should have to change any freaking aspect of our precious lifestyles.

What a God damn waste.

I'm not sure I'm following the nuances of the argument.

"U.S. regulators considered requiring the mechanism several years ago. They decided against the measure when drilling companies protested, saying the cost was too high, the device was only questionably effective, and that primary shut-off measures were enough to control an oil spill."

The first thing that jumps out at me is "U.S. regulators".

So are we all agreed that this was subject to regulation?

How is this an argument about deregulation at all? Oil drilling, and the switch now in question, were absolutely subject to regulation.

"They decided against the measure..."

Who? Isn't the 'they' in that sentence "the US government regulators"?

How is this a story about DEregulation?

This looks a lot like a story about the tendency of government regulation to be captured by the industries they are regulating, but of course that can't be it becuase I got reamed for mentioning that concern in the context of financial regulation and the brand new health care bill.

Maybe there is something to this regulatory capture idea.

US had burn-off plan for oil spills but the equipment wasn’t there

So far, when I google on this I only find a bunch of right-wing sites eagerly spreading the story of "Obama's Katrina".
Aside from fapping material, I dont think this is going anywhere unless it develops some meat, fantasies about "Obama's Katrina" nonwithstanding.

And yet, in one of the most regulated countries in the world, you got a Chernobyl. Go figure.

If one were to point out the problems of being an orphan, presumably McKinney would be there to point out that, on occasion, parents hurt their children. Parents, he would explain, can sometimes be more trouble than they're worth.
Go figure.

Regulation, per se, isn't proof against man-made or natural disasters, as much as regulatory enthusiasts would like to believe and to have others believe.

That's good- we were running out of straw in the barn, and McKinney has thoughtfully supplied a boatload for us here.

"Obama's Katrina"

That is just so awesome I don't even know where to start. I guess, how many people have died after the initial disaster as a result of Obama appointing a hack to head the relevant agency/agencies? How many dead bodies have we seen floating around a major metro area in the richest country on earth? How many days have we seen footage of people pleading for help from rooftops and shelters from said country? How many days warning did the Obama administration get prior to this disaster?

Obviously, completely comparable.

I eagerly await:

Obama's military surveillance aircraft crash landing on Chinese soil

Obama's 9/11 (or did we have that already?)

Obama's Anthrax Attack

Obama's DC Sniper Attack

Obama's Abu Ghraib

Obama's Extraordinary Rendition

Obama's Torture regime

Obama's Secret Overseas Prisons

Obama's imprisonment and torture of US citizens on US soil without trial

Obama's war of choice based on lies

Etc etc etc

(And yes I realize that Obama is just as bad on certain issues as Bush, but for fncks sake, "Obama's Katrina"? Fnck)

Charles WT:

Look, gummint regulators were too busy down-loading porn to tend to Bobby Jindal's double life as an assho.. and a liar.

Sebastian:

Hey, I get the idea of the capture of the regulators. Something tells me however that during the last 8 years before Obama, and let's be bi-partisan, during the Clinton years too for triangulation reasons, the regulators weren't captured, they were under orders from the White house to stand down and ignorant, young Christianists, who weren't otherwise engaged in f--king up the Green Zone, were deployed stateside to stop government regulation.

Spare us the innocent face.


All these years after the Exxon Valdez spill there is still oil in Prince William Sound. Two thirds of the wildlife are still in the process of recovery. Exxon chose not to use double hulled ships because of the expense. They also resisted efforts to make them pay for the clean up.

That spill was a p*ss in the ocean compared to this catastrophe.

The thing about Katrina was not so much the initial failure of the federal response as the failure to recognize the failure and remedy it. You had one guy who literally could have had military aid convoys on the way if they had to commandeer supplies at Wal-Mart en route, instead off doing trivial social crap. What the hell is the point in paying $700bn a year for national defense if those helicopters and trucks and transport planes can't be put to use when we need them?

But anyway. Regulation is boring, annoying, and gets in the way of getting things done. In exactly those ways, the persistent call for deregulation reminds me of a Joel Spolsky bit - about software, in that case - about Things You Should Never Do, the thing being "rewrite from scratch because your current codebase has too much cruft". The arguments for deregulation are very similar: all this paperwork is getting in the way of our being able to get things done. But what that regulation actually represents is the accumulated wisdom of the past. Like, oil wells sometimes blow up, and oil companies are run by people who are optimistic about them not blowing up, and who can afford to gamble that a blowup won't happen on their shift - or that if it does, they won't be held personally responsible in any way that matters. So you gotta make laws that tell them they have to prepare for blowups.

I'm not saying simplification of regulations can't be a good idea, or that technology can't make some regulations obsolete. It can't be entirely a one-way ratchet. But generally regulations exist for the same reason that all that crufty code that checks for weird conditions exists in an old codebase: it's there because it fixes a bug that actually showed up in the past. This isn't the first oil well to blow up and it won't be the last, regulation or no regulation. But given the scale of the consequences when we screw this stuff up, a quasi-religious belief that regulation can't reduce the incidence and severity of future accidents is of no help at all.

Armies are another institution notorious for their regulation and by-the-book systems. They do that because effective armies know that stuff goes wrong, that people are stupid, and that when you find a way to prevent things from going wrong, you sure as hell better write it down for next time. You can mock their reliance on rulebooks, but armies that do this win wars.

In software, the rule is: find a bug; document the fix; write a test. Boring? You bet. Inhibits productivity on a day-to-day basis? Sure - right up until you let it slip and blow everything up. Just as with regulation, there are always vocal, smart, talented programmers who don't want to play along, arguing that their talent & diligence will save the day. You have to fire those people. Sadly, we don't have a way to fire employees of oil companies who think regulation is a pain in the ass or an impediment to them getting that nice big house in the Hamptons (or maybe Houston). We do, however, have laws, which ideally have the same effect.

Regulation, per se, isn't proof against man-made or natural disasters, as much as regulatory enthusiasts would like to believe and to have others believe. Shut off valves, if they work, only work downstream of the valve. A line failure upstream of the valve gets you nothing.

"Regulation per se" is indeed like a "shut off valve" in that neither can do much about problems upstream of where they're applied.

So McKinneyTexas has a point. But what point? Is the point that regulations requiring shut-off valves at the well head are kind of pointless? Or that we need regulation farther "upstream"? Or what?

--TP

I hardly blame the current administration for not having some obscure equipment ready to go in case of an oil spill in the Gulf. Obviously this approach to dealing with spills has been allowed to languish since it was developed in 1994. Plus a major spill is a low probably event. There can be dozens to close to a hundred rigs operating in the Gulf at any given time. The last major spill was in 1979.

On the other hand, everyone could see Katrina coming for days.

This looks a lot like a story about the tendency of government regulation to be captured by the industries they are regulating

Yes, I agree that that is an important part of the story.

So, what do we do about it? Throw up our hands and abandon any attempt to regulate industry, because of the constant tendency toward capture?

Or do we take this as an opportunity to take steps to prevent and mitigate capture?

To me, capture seems like entropy. Yes, all systems are subject to it, yes, absent some concerted effort it will win the day.

But we still get up each and every day and act purposefully, in spite of the fact that we, each and every one of us, are ultimately going to end up, basically, as dirt.

I agree that you got an undeserved ass-kicking in that other thread. Your point was reasonable there, and it's reasonable here.

I just don't understand what we're supposed to do with it. Give up?

In addition to being a demonstration of the effects of regulatory capture, the current spill in the Gulf is also a demonstration of how industry generally, and corporations specifically, shift the risk and cost of what they do to the public at large.

It's going to cost BP an unbelievable pile of money to clean this stuff up. Maybe they'll even go out of business.

It may well cost the rest of us the loss of one of the most complex and productive natural environments in the world, for something like a generation. Maybe less than that, but maybe not.

The United States is addicted to cheap energy in the form of oil, natural gas, and other fossil fuels. There are about 1,000 things to say about it, but they pretty much boil down to the fact that we are, as a nation, possessed of an unbelievable, unjustifiable sense of entitlement. It's made us lazy, spoiled, and stupid.

Unfortunately, pandering to that sense of entitlement is going to cost us a lot, and it's going to continue to cost us a lot until we give it up.

We can't continue to live the way we do. That will continue to be brought to our attention by things like this until we get the message. We can accept it gracefully, or we can have it pounded by force of circumstance into our thick unwilling skulls.

Whatever.

But we can't continue living the way we do. If we try, we'll kill ourselves off.

It's a matter of homeostasis. We can object all we want, but we might as well argue with the tides.

This spill is going to hurt a lot of people, and it's going to suck, in a big way, for a long time.

I'm not sure I'm following the nuances of the argument....So are we all agreed that this was subject to regulation?

Not to speak for others, but: BP (Or Transocean or whomever) could've put in such a system if they'd chosen to. Bowing to the profit motive, they (perhaps incorrectly) calculated that it would be better to put this money in their pockets.
Insofar as it's a story about regulation, it's a story about regulation failing and regulatory capture (or about an administration that didn't need to be captured). But there's also a story about deregulation- advocates of deregulation either need a storyline where deregulation would've prevented this disaster, or to argue that it's an acceptable cost of doing business. Or, I suppose, that getting regulation right is impossible somehow.
Otherwise, getting regulation right seems like the correct course.

WASHINGTON — A federal law may limit how much BP has to pay for damages such as lost wages and economic suffering in the Gulf Coast oil spill, despite President Barack Obama's assurances that taxpayers will not be on the hook.

A law passed in response to the 1989 Exxon Valdez spill in Alaska makes BP responsible for cleanup costs. But the law sets a $75 million limit on other kinds of damages.

Economic losses to the Gulf Coast are likely to exceed that. In response, several Democratic senators introduced legislation Monday to raise the liability limit to $10 billion, though it was not clear that it could be made to apply retroactively.

White House press secretary Robert Gibbs said Monday the administration's commitment was for BP to pay for all costs associated with the spill.
[...]

Federal law may limit BP liability in oil spill

Michael Brown, yeah, that one, has just weighed in on regulatory capture in the Obama administration.... or something.

Check it out at TPM.

See, what I like about the two parties in America right now is that liberal Democratic idiots like me keep to the fringes and shoot our mouths off where we do no harm .. like Obsidian Wings.

The Republican Party finds the dumbest, most corrupt hacks it can and hires them to run the country and the government agencies. Then, when they are done ruining as much as possible, the media (an ass) sticks a microphone in their faces or gives them an editorial stipend and permits them to advise us about how to keep it ruined.

In other news, President Obama, fresh from blowing up the oil rig, was picked up trying to leave the country after his latest explosive enterprise in Times Square.

How the guy can manage to so effectively take out an oil rig in 5000 feet of saltwater and yet not blow up the Marlboro Man in Times Square is a study in inconsistency.

That spill was a p*ss in the ocean compared to this catastrophe.

Depends on how long this catastrophe lasts. Right now estimates are that there have been maybe 1.6 million gallons spilled in the Gulf, as compared with EV's 11 million.

If they can stop it in the next week or two, at a rate of spillage of a couple hundred thousand gallons a day, it'll be a smaller catastrophe than EV. Otherwise, maybe not.

"I'm from BP, and I'm here to help."

The first thing that jumps out at me is "U.S. regulators".

So are we all agreed that this was subject to regulation?

How is this an argument about deregulation at all? Oil drilling, and the switch now in question, were absolutely subject to regulation.

"They decided against the measure..."

Who? Isn't the 'they' in that sentence "the US government regulators"?

How is this a story about DEregulation?

Part of the GOP's move to DEregulate included appointing industry insiders to head the agencies designated to oversee those very same industries. Either former insiders, or people who take a very hostilve view toward regulation.

So, if "capture" is the better word, so be it. But it stems from an ethos that it is better for government to stay out of the way of business interests, and not push for regulations. Either by stripping away actual regulations, making judgment calls about potential new ones or underfunding the agencies themselves.

It's all part and parcel of the same philosophy, even if there are semantic differences worth parsing.

McKinneyTexas: And yet, in one of the most regulated countries in the world, you got a Chernobyl. Go figure.

I'm fairly sure this will do no good in McKinney's case, but for the benefit of anyone who wants a basic summary of how Chernobyl became the worst nuclear power plant disaster ever, the previous link and this one form a pair of interesting summaries.

You can find similar decisions being made that caused the Bhopal disaster, the political decision to underplay the health risks of the WTC site, or the set of failures from local to federal that led to Hurricane Katrina being allowed to become a major catastrophe.

The problem in each case is not regulation: it's that other considerations (political or financial) are given a much higher priority than preserving the lives of the people who live and/or work in the disaster area. Whether those considerations are mandated by regulation, or merely always assumed to be of paramount importance (technically, there were regulations to prevent Union Carbide from gassing a city and killing 20,000 people - but Union Carbide chose to ignore them, confident that they would get away with it) doesn't seem to be much of a factor.

It's a rule of thumb that large disasters always have multiple causes. If Louisiana had been as well-prepared as Cuba in August 2005: if Bush hadn't made FEMA a crony appointment: if anyone in the Bush administration had actually cared about the risk of natural disaster or terrorist attack to actual people, rather than cared about the political capital to be made in pretending to be concerned; if there had been plans and funding in place to evacuate everyone who didn't have a car or a place to stay; if if if if...

If the oil industry hadn't got their very own President and Vice President appointed in 2000, it's possible you wouldn't be looking at an oil spill in the Gulf today.

Sebastian,

This looks a lot like a story about the tendency of government regulation to be captured by the industries they are regulating, but of course that can't be it becuase I got reamed for mentioning that concern in the context of financial regulation and the brand new health care bill.

Maybe there is something to this regulatory capture idea.

Yes. There is something to it. But what exactly? Would this not have happened with no regulation? Unless you're prepared to make that argument, and claim as well that no disasters have actually been prevented by regulations, then I have a hard time seeing the relevance of this.

Sure, regulatory systems are not perfect, but that's an impossible standard. It's getting a little tiresome to hear how they are worthless because they failed to prevent some specific catastrophe.

Well, yeah. The point is to make them stronger, and to push for an ethos that values tough, independent regulation.

One of the provisions in the new financial reform bill would establish a consumer protection agency.

One of the big fights going on right now is whether to make it independent, or fold it into the Fed.

The GOP wants to fold it into the Fed. The Dems are worried that this move would put it in the "captured" and toothless category.

The answer is not "no regulation" but better.

Yes. There is something to it. But what exactly? Would this not have happened with no regulation? Unless you're prepared to make that argument...

There is also the possible argument that regulation cannot be effective- that capture is inevitable and therefore regulation isn't capable of stopping disasters such as this one either. I think that there are too many examples of regulation being effective for this to work as an effective argument though.
On the third hand, there is certainly an limit to effective regulation, both in terms of red tape and in terms of foreseeing every possible scenario. I suppose one could argue that we've reached that already in this area, but again I dont see a lot of support for that proposition given that an improvement to prevent this exact scenario was discussed and abandoned (based on cost savings rather than regulatory burden).

In a way this mirrors arguments about taxation (nb not putting these words into Seb's mouth): clearly there are rates of taxation which would significantly discourage labor or investment, but absent any evidence that this is where we are on the curve the conservative position is that we need to cut taxes to avoid this burden. This ignores the alternate risk that we need a certain amount of regulation/a certain level of spending to avoid disasters/debt. We act to avoid a possible problem while inviting a certain one.

I'd like to dissent from Jacob's comment about software, regulation, and armies. I think it muddles the issues on all three.

On software, I think Joel Spolsky is pretty obviously wrong. There are many cases where throwing all the code out and starting over are the right thing to do. There are a bunch of cognitive biases that compel us to keep the existing system even we logically shouldn't (status quo bias, investment bias, inability to consider the long term costs of maintenance and reduced development velocity, etc). I mean, the vast majority of broken crummy code doesn't deal with any significant bugs and most of the code that does deal with bugs only fixes defects that are artifacts of the crummy implementation rather than fundamental problems associated with the domain. The original Mosaic code had tons of bugs related to crappy X-windows code; what value is there in preserving such knowledge.

More practically, I don't think anyone can really say that Linux developers should have just worked on NetBSD since there was already an open source unix kernel and thus there was no reason to make another one from scratch.

As for armies, well, the US Army's procedures served it very well in terms of rapidly destroying an enemy force, except that was a pretty counterproductive thing to do in Iraq, wasn't it?

All these areas are pretty complex on their own terms and I really don't think we gain anything from tossing them into a blender. Especially when the original insights are, at the very least, widely contested. Many of the best developers I know think Spolsky is a flake who occasionally has very good ideas but has lots of nutty wrong ideas as well. Citing him doesn't really advance the discussion.

Ah, yes, better regulations. Not too stringent, not too lenient, just the right blend of enlightened governmental oversight to reign in that profit-driven energy. Oh happy day. Because one thing we know for sure, the humans who regulate are objective and wise and care only for the greater good. They can contain those brutish profit seekers.

Or, alternatively, bureaucrats have their own, not-always-pure agendas, just as private sector folks are largely in it for the money. Putting one's faith in voluntary self-restraint is as unwise as putting it in the beneficence and discretion (if that word applies to any regulated enterprise) of civil servants with no skin in the game whatsoever.

The well in question had a blow out preventer (they all do, BTW, which I should have mentioned in my earlier comment). It failed. Should there have been a second blow out preventer? A third? Would a regulation requiring that blow out preventers not fail have made any difference?

The issue isn't whether regulations are good or bad per se. The issue is rather one of where the bias against regulating economic activity ought to kick in. Industry assurances of voluntary compliance or the adequacy of the status quo may be valid or may be just so much crap. The balance, it seems to me, can be accomplished in a two-tiered fashion. In the offshore drilling context, Company X either demonstrates compliance with the more heavily regulated regime or it (1) posts a bond equal to the amount of a projected worst case clean up cost and (2) the total personal assets (less debt service on one home, basic living expenses, etc.) of the top thirty earners employed by Company X are frozen until the clean up, including collateral third party damage, is accomplished within the face amount of the bond. If the bond is inadequate, the top thirty (or fifty, whatever) big shots become the guarantors of their bullshit. My guess is that if the big shots had to personally guarantee the cost of their company's screw ups, a hell of a lot more care would be taken or they would just go along with the more stringent regulatory program as their get out of jail free card.

"Yes, I agree that that is an important part of the story.

So, what do we do about it? Throw up our hands and abandon any attempt to regulate industry, because of the constant tendency toward capture?"

Of course not. But it is rather important to get the diagnosis right if you want to treat the actual problem. At the moment, until maybe late in this thread, the diagnosis has been that it is deregulation that is the problem. That diagnosis, by Eric here (until maybe recently) and a whole bunch of regulars in the previous thread has pretty much led us down a rabbit hole of a discussion.

My point on the finance thread, and the health care thread, and this thread, is that capture is a very likely outcome of agency regulation, and if you want to do very large scale regulations, one of the very most important things to design is how to keep the agency engaged in the public's interest in whatever the regulated area is. (Agencies going off and drifting into other areas are a related but different problem).

And it isn't all about corruption (or even largely about corruption). Agency capture is one side of a very human tendency to overreact emotionally to people you work very closely with. This tendency is to either over-demonize them (see many police officer's views of drug users) or to over-sympathize with them.

This ends up with a very different set of structural designs than if you think the main way you end up with bad regulation is corruption. The question is then not "how do I punish bribery" but "how do I make sure that the agency strikes the balance between demonizing its subjects and becoming too sympathetic to them".

It is a hard problem. But part of the answer is to make things more politically accountable. The current agency design by Congress seems to be "pass it and forget it" or even worse to use agency design as a form of political cover for them. The problem with this design is that it lacks accountability, and thus lets agencies start to drift off in whichever direction they are likely to drift (on the demonizing-sympathizing axis). Instead, Congress should be providing a check to bring them back in line with the public's interest.

Another proposal is to have commission deciders be chosen by chance at the end of the system (sort of like a jury). In the current system you have proposals on a five man commission chosen by vote, so the industry incentive is to make proposals that can get three votes. Under a more jury like system you could have the 5 work on the proposal, but when it comes down to it the commissioner who chooses the ultimate form of the regulation is chosen by chance. Industries are thus under the incentive to make proposals that would not alienate the least favorable commissioner, and the commissioners would be incentivized to convince each other of their positions rather than just get a slight majority of votes.

This can be gamed too by a determined institutional actor (see for example the court manipulation by the 6th Circuit in choosing the panels for the Michigan affirmative action cases, which are supposed to be random). But it changes the incentives of how the proposal process works.

There are lots of other possibilities too, which we can discuss if we want to talk about the balance.

And yet, in one of the most regulated countries in the world, you got a Chernobyl. Go figure.

There's regulation, and then there's regulation. Make a case that the Soviet Union had strong public safety regulations on its nuclear activities, with independent enforcement authority, and that Chernobyl happened despite such a regulatory program. The Chernobyl reactor was a horrible design and had no containment building. There is no place in North America, Western Europe, Japan or South Korea where such an installation would have been licensed.

Should there have been a second blow out preventer?

Yes. It's done in the North Sea with great success. Good question. Some oil companies have put them in voluntarily in juristictions not requiring them because they work so well. Unfortunately, the US doesn't require them, and wasn't one of the juristictions not requiring them where they were installed, anyway, in the case at hand. Too bad we didn't require them, aye?

The well in question had a blow out preventer (they all do, BTW, which I should have mentioned in my earlier comment). It failed. Should there have been a second blow out preventer? A third?

I would expect the regulators to weigh the risk v cost and put in the correct number of safeguards. An infinite number is probably too many. Zero is probably too few.

For this sort of situation, other counties have required a remote backup. We have not. Given the cost-benefit, that appears to have been a poor decision, even without the hindsight.
Im genuinely not sure what you're trying to argue here- any regulation is equivalent to infinite regulation? That regulation isn't at all linked to costs or benefits, and is done in some absurd manner?

Ah, yes, better regulations. Not too stringent, not too lenient, just the right blend of enlightened governmental oversight to reign in that profit-driven energy. Oh happy day. Because one thing we know for sure, the humans who regulate are objective and wise and care only for the greater good. They can contain those brutish profit seekers.

Again, if you're arguing with those who believe that all regulation is perfect, you should do it elsewhere- specifically, where there are people who believe that.
Your reliance on these sorts of regulation-as-religion argument suggests that you cannot offer a reasoned critique.

Would a regulation requiring that blow out preventers not fail have made any difference?

Straw. You are producing it.

posts a bond equal to the amount of a projected worst case clean up cost

Not a terrible idea in principle, but insurance seems like it'd be sufficient. A bond of this size (one estimate is 14 billion USD, and that is for this particular accident, not necessarily worst case) would potentially deter businesses from entering the field- exactly the effect one hopes to avoid with excessive regulation.

At the moment, until maybe late in this thread, the diagnosis has been that it is deregulation that is the problem.

Well, it's not that the industry is unregulated, I dont think anyone is arguing that. But I do think that the impetus to not require these measures was (at least in part) based on the same philosophical basis as deregulation: that businesses make the best decisions on these sorts of matters, weighing costs and benefits, without government interference.
There are two other possible sources for the decision: 1)that the remote shutoffs were actually bad on the cost-benefits, and 2)regulatory capture (ie anywhere from friendly behavior to those one works with to tacit bribery). 1 would be pretty indefensible, so I think that leaves us with veniality or the belief in the wisdom of the market.

More practically, I don't think anyone can really say that Linux developers should have just worked on NetBSD since there was already an open source unix kernel and thus there was no reason to make another one from scratch.

Indeed, at the time, there were at least three reasons why Linux developers should not have just worked on BSD.

First, the initial versions of Linux were developed while there were still legal clouds over the use of BSD sources. I installed my first Linux distribution early in 1992; the final settlement between Novel and the University of California did not occur until early 1994. There was a more-than-two-year window when Linux was open but it was not clear whether any BSD derivative was going to be.

Second, there was considerable debate over open source licensing terms. Linux was distributed under the GNU Public License, which required anyone distributing modifications to make their source code changes available under the same terms. The BSD license allowed for proprietary uses: people distributing modified versions of the software were not required to make their source code freely available.

Third, there were multiple BSD development teams, and all of them were generally regarded at the time (correctly or not) as being less open to contributions from a wide group of coders than Linus was. Arguably, many of the Linux developers would not have been allowed to be BSD developers.

My guess is that if the big shots had to personally guarantee the cost of their company's screw ups, a hell of a lot more care would be taken or they would just go along with the more stringent regulatory program as their get out of jail free card.

As much as I really, really like this suggestion (which is quite a lot), I'm not sure it scales to industrial production at the offshore oil drilling platform level.

Want to extend it to the shareholders?

The well in question had a blow out preventer (they all do, BTW, which I should have mentioned in my earlier comment). It failed. Should there have been a second blow out preventer? A third? Would a regulation requiring that blow out preventers not fail have made any difference?

The well lacked the type of redundant measures required by regulators in other markets. Namely, Norway and Brazil.

Ah, yes, better regulations. Not too stringent, not too lenient, just the right blend of enlightened governmental oversight to reign in that profit-driven energy. Oh happy day. Because one thing we know for sure, the humans who regulate are objective and wise and care only for the greater good. They can contain those brutish profit seekers.

Or, alternatively, bureaucrats have their own, not-always-pure agendas, just as private sector folks are largely in it for the money. Putting one's faith in voluntary self-restraint is as unwise as putting it in the beneficence and discretion (if that word applies to any regulated enterprise) of civil servants with no skin in the game whatsoever.

After all that you propose...a regulation requiring companies to post a bond!

Mind you, I don't, at first glance, hate your proposed regulation. But the irony is as thick as...well, light sweet crude.

Remainder:

The Chernobyl analogy, as facile as it was, has been neatly dispense with by M. Cain and others. I outsource my response to them.

Ditto to the field in terms of Katrina - which is almost exactly the same in absolutely zero ways other than loose geographical proximity. But yeah.

As much as I really, really like this suggestion (which is quite a lot), I'm not sure it scales to industrial production at the offshore oil drilling platform level.

I'm in the same boat (on the same rig?). People, even very smart people, regularly do all sorts of things that are against their own interests. So while this might help, I think it has severe limits. One of the big problems in any organization is the normalization of deviance. Groups find ways to assess risks as being lower than they really are and then they're genuinely surprised when a risk blows up. Whocoudlanode?!?! Because their surprise is genuine, being more personally invested in the outcome wouldn't change it.

Groups find ways to assess risks as being lower than they really are and then they're genuinely surprised when a risk blows up. Whocoudlanode?!?! Because their surprise is genuine, being more personally invested in the outcome wouldn't change it.

Ive always suspected that most of this came from the divorce between the decision-makers and the money; if it's actually hitting them in the bank account, I imagine that it would be a serious deterrent to groupthink.
Like the banks and the mortgage/CDO/CDS disaster- it's easy to minimize risk when you're making big paychecks but don't suffer too seriously when the black swam crashes the party.

But that sort of thing (institutionalized thinking) certainly does happen with risk sometimes too. Hard to tell how much of it is disguised self-interest and how much is groupthink.

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