Tracing consequences both seen and unseen.
Wirkman VirkkalaBubblin’ Crude
Posted at 8:22 pm on June 18, 2010, by Wirkman Virkkala

As billions of gallons of “Texas Tea” bubble up into the Gulf of Mexico, I understand the rising tide of ill will directed against BP. The company’s smarmy, eco-friendly logo seems radically dissonant with the catastrophe they caused.

And yet, demanding that the company pay for every dime of recovery, every opportunity squelched, every harm to life and property (as Rosie O’Donnell did, as many on the left are wont to do), this is a bit disingenuous, no?

The Gulf is a commons. Congress is the relevant regulator of that commons. BP drilled where they drilled in no small part because citizens did not want to see closer-to-the-shore oil rigs dotting the Gulf’s lovely horizon. So, by law, BP was set out into deep waters to engage in riskier-than-necessary behavior  we (the American people) demanded it. In many cases, we felt so very righteous for demanding it. And on top of that, Congress limited the company’s liability, thereby enticing BP to take further risks.

Demanding that BP suffer the full extent of the damage the company has caused is not only to engage in ex post facto law, but also to shift the burden of responsibility solely onto the company and away from Congress, and, indeed, away from the environmental aesthetes who pushed the electorate to insist that safer, less risky shoreline drilling be prohibited.

As readily as we despise BP, the justice of our hatred and revulsion only goes so far. If we do not direct some of that responsibility back to ourselves (as voters) and to our politicians (as legislators), then we are being dishonest. By going into hysterics about BP, without ever directing primary responsibility to those who actually took the responsibility off of BP, beforehand — when it counted — we become worse than BP itself.

After all, BP was just doing what it does in a context the complainers set up and then supported . . . right up until the accident.

To call for “more regulation” is to add nonsense onto poppycock, of course. After all, the prohibition of near-beach drilling is itself the primary form of regulation that set BP drilling outwards, while Congress’s limits on liability is a fine example of actually existing regulation and a perfect instantiation of the “Congress Knows Best” mentality that “more regulation” would itself necessitate.

It makes no more sense dragging BP through the polluted surf than it does to criticize a welfare mother for feeding her children Jiffy Pop popcorn as the night’s repast. Both have acted understandably under incentives that the self-righteous voting public has insisted they operate under.

Take away responsibility, you get less responsible behavior. It’s not a mystery. It’s established economic principle.

Cross-posted on Wirkman Netizen.

Filed under: Environment, Regulation
Comments: 2 Comments


  1. I’m confused. “Take away responsibility, you get less responsible behavior. It’s not a mystery. It’s established economic principle.” So to make Big Oil companies more responsible, we should shift responsibility from them on to the government instead?

    Is the idea to make Government and voters more responsible, so that in the future they will vote for more regulation of the oil industry?

    I don’t understand how this fits in with your idea that to make drilling safer, we need to get rid of safety regulations.

    Your post seems self-defeating. Other than the idea that people shouldn’t overreact to any huge crisis, I don’t really understand the reason for this post. Also, in this case, BP was negligent, so even thought they were “just doing what it does in a context the complainers set up and then supported . . . right up until the accident.”, that doesn’t change the fact that BP did not exercise the level of competence expected of them.

    Comment by Edwin A Miller — 2010-07-18 @ 10:47 pm

  2. Take a step back. Consider responsibility. Is regulation the best way to demand it? I suggested a very proper method of holding people responsible: Not limiting their liability. Or, at least, not limiting their liability far below their ability to pay and the extent of their damages.

    Perhaps I did not express myself very well. But I did try to indicate that responsibility should be a rule, and liability its primary means. Our politicians — indeed, our very votes — indicate that we like to take away that responsibility in advance, and then, vindictively, try to affix it, again, when things go terribly wrong.

    This is irresponsible of us.

    Comment by wirkman — 2010-07-21 @ 12:20 am

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.

Henry Hazlitt"[T]he whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."
Henry Hazlitt, Economics in One Lesson






Recent Entries