The New York Times’ business columnist, Joe Nocera, writes an astonishing industry shilling piece on why the US Government should not impose a deepwater drilling moratorium. Nocera’s arguments, which swallow the pro-industry federal court ruling whole, are either irrelevant or so deeply dishonest that they warrant a strong retraction from the Times’ editors.
In this post, I listed a few of what I believe are compelling arguments why a deepwater drilling ban in the Gulf is fully justified, at least until we figure out how to drill safely, how to minimize the risks of another deepwater blowout catastrophe and develop far better techniques to contain and quickly recover the spillage from a blow out when it occurs. None of those problems has been solved, notwithstanding the argument that existing drilling rigs have been reinspected under current rules. It’s the rules and solutions we don’t have that are the problem. Thus, a strong case, if properly pleaded, should leave a reviewing court with more than enough support to uphold a conditioned moratorium.
That case would lay out the substantial health, environmental, and safety risks posed by the continued deepwater drilling, based on what we’ve learned from the BP oil disaster and its mostly unsuccessful control and recovery efforts. But it would also need to address the counter-arguments and the likely economic harm a moratorium would impose on affected companies and workers who rely on further drilling. A reviewing court would then determine whether the government had acted reasonably — or arbitrarily and capriciously — in striking that balance of interests.
Joe Nocera’s Saturday column, Moratorium Won’t Cut Risks of Deepwater Drilling, doesn’t even acknowledge the powerful arguments that should compel a moratorium. His editors should have demanded a balanced rewrite there, but they didn’t. Instead, Nocera accepts and repeats oil industry talking points, some of which are irrelevant to the case, some misleading or dishonest, and some so inimical to the public interest they should be summarily dismissed by a disinterested, fair-minded court.
Nocera begins with an intellectual slight of hand, mentioning the size of world oil production and the scope of Gulf oil production with the much smaller scope of new drilling, whose tiny proportion he neglects to mention:
As a percentage of the world’s oil production — some 84.5 million barrels a day — the 1.75 million barrels a day that is extracted from the Gulf of Mexico is not a huge number. (That’s why oil prices haven’t risen as a result of the Deepwater Horizon disaster.) . . .
Uh, no; oil prices remain unaffected because nothing about an incomplete well or a moratorium on new drilling that may not affect production for years affects current supplies or likely production in the near future. He continues:
. . . But in terms of the country’s domestic production, it is extremely important. According to Gibson Consulting, a third of all United States oil production comes from the Gulf of Mexico.
This argument is completely irrelevant. No one is proposing to disrupt any portion of the world’s current oil production, nor even stop any current or near-term production in the Gulf. US supplies aren’t affected yet. The moratorium is aimed at new drilling, not existing production at well’s already drilled. As Rachel Maddow, whom Nocera disparages, reminds us, there are over 36,000 operating production wells in the Gulf, none of them affected by the moratorium, which affects only 33 new drilling efforts.
Nocera next adds this irrelevant point:
What’s more, virtually every new well being drilled in the gulf is a deepwater well — because, after all, that’s where the oil is. . . . And . . . 80 percent of the reserves that remain in the gulf are either in deep or ultra deepwater.
So? His next argument is that we can’t shut down Gulf drilling because we absolutely have to have the oil, even though we don’t.
So the first point is: Until that glorious day comes that our cars are fueled by batteries and our homes are heated by solar power, we need as much domestic oil as we can get our hands on, oil that exists in the deep waters of the Gulf of Mexico. Shutting down drilling in the gulf — even temporarily — means we’ll be importing even more oil from other countries than we already do.
Never mind that Americans have shown repeatedly they can reduce their demand in response to prices. It’s true that if the world stopped drilling new wells, eventually supplies would dwindle. But new wells rarely go into production immediately, so whatever effects there might be in theory from a six-month moratorium are likely years away if ever.
But suppose, as Nocera warns, the moratorium lasted longer than a few months. What that would mean is that the US Government had determined that after a six-month moratorium, it still had no assurance that the industry could conduct deepwater drilling safely, had adequate recovery measures to stop another deepwater blowout quickly before it caused massive damage, and/or still had inadequate resources and techniques to contain and cleanup damages of the magnitude we’re now witnessing. He’s suggesting we should have more unsafe drilling anyway.
Nocera’s argument thus amounts to: "That’s too bad, America. You have to risk that now plausible damage to the Gulf because the industry has convinced me I don’t want to change anything I’m doing."
In fact, if the industry failed to devise safe enough drilling and/or containment/clean-up methods, the long-run effect could be to reduce world supplies and raise prices. Why, prices might even rise to levels we’ve seen in the past, which encouraged people to drive less. Of course, if all of the health/safety/environmental costs of oil dependency (only some of which have been exposed by the BP oil disaster) were included in oil prices, the same effect would occur. So Nocera is essentially arguing that we should continue to drill without limits and consume without paying the costs, because . . . well, because we just have to consume oil as though it didn’t have these costs.
Next, Nocera says that if we hold up drilling here for a few months, the drillers will go elsewhere:
Meanwhile, there are only so many floating rigs in the world, and Brazil, for instance, has just embarked on a $200 billion drilling program. (You read that right: $200 billion.) It takes a month to move an idle rig from the Gulf of Mexico to Brazil, where it will likely stay for years. So a six-month moratorium would quite likely have far greater effect on American oil production that it would seem at first glance.
Yes, that probably would happen, assuming every other country ignored lessons from the BP disaster and did nothing to improve their own safety/environmental oversight. Nocera assumes other nations would do nothing to change their regulations.
We are not lessening the chance of a spill; we’re just transferring that risk to Nigeria and Brazil. We are not helping the world. We are just saying, ‘Brazil, we prefer to despoil your beaches, but not ours.’ ”
No, no one is saying that. Nocera just made that up. What the BP disaster is telling the world — not just the US — is that no deepwater drilling should continue anywhere unless and until the industy’s now obvious laxity and deficient safety procedures are fixed, not just here, but in Brazil and the North Sea, and Nigeria. This is an industry-wide problem.
Finally, Nocera repeats the cynical industry talking point that since they’ve already decimated the Gulf fishing industry, they should be allowed to keep drilling more wells because those are the only jobs left. That’s an argument for even more actions that put other jobs and businesses at risk, instead of forcing the industry that caused the economic damages to fix it’s problems before starting more risks.
The logic of Nocera’s column doesn’t end with a six-month drilling moratorium. It’s really an argument against almost any government regulation of any industry, not just deepwater oil drilling. In essence, he’s arguing that government should never impose additional health, safety or environmental costs on industry, because that might drive them to other places, reduce supplies of their products, or affect employment by that industry. Those are the same arguments unsafe industries have been using for more than 100 years.
All those effects are possible, but Nocera’s argument that we should not balance industry costs against any of the massive costs to the public of under-regulated industry actions is an argument for massive corporate looting and unfettered destruction of the planet. Some of us think there’s already too much of that.
Financial Times, Norway enacts own moratorium on new deepwater drilling
Deutsche Welle, on Nigera, The Oil Disaster the World Would Prefer to Ignore