Editore"s Note
Tilting at Windmills

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May 4, 2010

CHALLENGING CHENEY.... The lead headline at The New Republic this morning reads, "Is Dick Cheney To Blame for the Oil Spill? Signs Point to Yes." Well, that's an attention grabber.

The piece is from William Galston, hardly a liberal firebrand, and it's worth a look. Of particular interest, it notes that the Deepwater Horizon rig did not have a remote-control acoustic shutoff switch, routinely used by rigs elsewhere. Why the switch wasn't there is what matters.

As the Wall Street Journal, reports, after a spill in 2000, the [Minerals Management Service] issued a safety notice saying that such a back-up device is "an essential component of a deepwater drilling system." The industry pushed back in 2001, citing alleged doubts about the capacity of this type of system to provide a reliable emergency backup. By 2003, government regulators decided that the matter needed more study after commissioning a report that offered another, more honest reason: "acoustic systems are not recommended because they tend to be very costly." I guess that depends on what they're compared to.

The system costs about $500,000 per rig. BP is spending at least $5 million per day battling the spill, the well destroyed by the explosion is valued at $560 million, and estimated damages to fishing, tourism, and the environment already run into the billions.

The Minerals Management Service is the part of the Interior Department responsible for offshore drilling. Towards the end of the Clinton administration, MMS officials wanted rigs to have the acoustic shutoff switches, but by 2003, the agency had changed direction.

What happened in those three years? Well, for one thing, the MMS in the Bush/Cheney era became one of the most corrupt government agencies in American history. The Minerals Management Service proudly embraced an anything-goes atmosphere that led to literally Caligula-like corruption and debauchery -- federal officials traded cocaine and sex for lucrative oil contracts, for example.

For another, Dick Cheney's secretive energy task force concluded that $500,000 for remote shutoff was simply too great a burden, and the former V.P. and his team didn't want to force BP and other oil companies to spend the money.

I realize the White House is generally reluctant to blame the failed previous administration for the messes President Obama has to clean up, but when the oil-soaked shoe fits....

Steve Benen 10:45 AM Permalink | Trackbacks | Comments (31)

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Comments

Far from the first time Cheney made a Cost/Benefit decision on his own. Prior to the 2001 earthquake in Seattle, the city was included in a seven city program to instruct home owners on the benefits of retro fitting their homes to limit damage from earthquakes. This became very popular, as home owners could either learn the How To aspects at seminars or learn of qualified retro-fitting contractors in the Greater Seattle area. However, Cheney wanted to cut the funding. Following the 2001 quake, he and Bullet Head Joe of FEMA flew over the area, several thousand feet high, and decided the retro fitting had not worked. He never took a ground inspection of the many homes which had been saved. He is ever sooo wise when safety provisions are concerned.

Posted by: berttheclock on May 4, 2010 at 10:58 AM | PERMALINK

Yeah, even-the-liberal NPR has been all about connecting the dots between the lax Republican regulatory regime and the disasters in West Virginia and the Gulf.

Oh, wait, not so much.

Posted by: Gregory on May 4, 2010 at 10:59 AM | PERMALINK

Any way they can get Cheney out there with a sponge and a bucket??

Seriously, now is the time for all of the info to come out on the secret meetings 'behind closed doors' that Cheney had with the oil industry. There needs to be a clamor for all notes/emails/transcripts etc. etc. to be released.

Posted by: Gridlock on May 4, 2010 at 11:01 AM | PERMALINK

I take it then, that it is now ok to blame a prior administration for the damage its decisions cause during the current?

Cue in Clinton, Al Queda, Bush, and 9/11.

Posted by: dik on May 4, 2010 at 11:02 AM | PERMALINK

Thanks for pointing this out. People easily forget that rules and regulations are almost always put in place because of accidents and abuses. Also, thanks for pointing out the costs of installing the safety deveice versus the costs of not doing so. Prevention is almost always a far less expensive alternative and a prudent business practice (unless you can others to pay).

Posted by: tomb on May 4, 2010 at 11:02 AM | PERMALINK

I'd be so much happier about the whole mess if DICK was down there skimming with his big, ignorant mouth. Might as well put the thing to real use for once.

Posted by: mistamatic on May 4, 2010 at 11:04 AM | PERMALINK

Someone ring up Nader. I need to be reminded how there was no difference between Al Gore and George W. Bush.

Though who knows what Lieberman would have done...

Posted by: doubtful on May 4, 2010 at 11:04 AM | PERMALINK

And this critical issue of course has NOT been mentioned or brought up any of the main corporate news outlets: NBC, CBS, ABC .. or the stupid talking asshohles on the Sunday shows .. even Tapper on his Sunday show had the fucking BP CEO on and he never, ever, asked about this crtical issue ... of course it's corporation protecting corporations ...

Posted by: stormskies on May 4, 2010 at 11:07 AM | PERMALINK

Anybody else see a pattern here? 29 miners killed because Massey was too cheap to spend more money on safety and now an environmental catastrophe in the Gulf because BP was too cheap to spend more money on safety. Deregulation = we don't give a damn if our workers die, as long as our fat bottom line and massive bonuses are protected. There you have it folks, Republican values. If there's any cosmic justice, Dick Cheney will spend eternity on an a perpetually exploding oil rig covered in hot, sticky crude.

Posted by: dalloway on May 4, 2010 at 11:09 AM | PERMALINK

You are forgetting one other thing that happened: the Supreme Court, in Exxon V. Baker, showed that punitive damages don't apply to oil companies.

Exxon V. Baker is the Exxon Valdez case. The jury in the case decided Exxon should be fined 5 billion dollars. This was meant to be one years profit for Exxon. Of course, this was 1989 profit, not 2009 profit. The supreme court decided, based on nothing whatsoever, that that was too much money and that Exxon should be liable for 10% of what the jury said it should. 500 million, to Exxon, was not truly punitive. A true punitive damages award would need to be large enough to actually stop certain bad behaviors.

Oil companies are beyond the citizens ability to punish. We have literally socialized the losses of big oil and privatized the gains.

If the oil companies knew that not having the better valve could lead to punitive damages that were truly punitive, maybe the regulations wouldn't have been needed in the first place. Isn't that the idea behind the Free Market? Indeed, there is NO free market where oil is concerned. The entire industry is protected from on high, and totally untouchable.

Posted by: nisl on May 4, 2010 at 11:13 AM | PERMALINK

God damn Dick Cheney's shit-filled soul to hell.

Posted by: neill on May 4, 2010 at 11:16 AM | PERMALINK

From 2001 and until this very moment to a large degree because of inertia and unfilled positions (can you say holds) the federal government is being run by and for multi-national corporations. This is true at every level and in every sector but nowhere is it more evident than in the energy sector. DOE and Interior is completely corrupted at this point and all that has changed is the very top two layers of political appointees.

Posted by: SW on May 4, 2010 at 11:18 AM | PERMALINK

back when cheney was ceo of halliburton, he pushed through a merger with dresser industries, not bothering to take into account the considerable asbestos liabilities that dresser brought with it.

so the failure of due diligence is an old habit with this asswipe.

Posted by: howard on May 4, 2010 at 11:20 AM | PERMALINK

My first thought is, "I guess the MMS was too busy with hookers & blow to do their actual work." Sounds about right.

And, a friend of mine posted a status line like, "I just bought BP gas today, all proceeds go to the cleanup effort" yesterday. PLEASE SOMEONE TELL ME THAT WAS SARCASTIC, and BP is not actually issuing appeals like this to consumers.

Posted by: ajw93 on May 4, 2010 at 11:23 AM | PERMALINK

Oil and feathers anybody?


Posted by: koreyel on May 4, 2010 at 11:31 AM | PERMALINK

Inverse socialism

nisl: We have literally socialized the losses of big oil and privatized the gains.

And all the while screaming "Socialism!" at the top of their Fox-driven lungs...
Like the sky is falling...
It is quite a scheme they got going here.
It makes shock capitalism look like a friendly game of marbles.

Posted by: koreyel on May 4, 2010 at 11:37 AM | PERMALINK

Notice that when the mining accident in WV happened, not a peep from the Cheneys.

Was Massey CEO Blankenship in the secret closed door energy policy meeting with Dick Cheney?

Is that why Cheney tried to classify and hide the Secret Service visitor logs.

Did they perhaps discuss weakening the federal safety inspection regime to allow Massey to make more profit?

Why isn't Cheney or his loathsome daughter out blasting Obama on this?

Also, I thought Sarah Palin was supposed to be the workin' stiffs champion. Why isn't she up in West Virginia praying with and for the families of the dead miners? How about using her star power to raise money for the families?

Sarah?

Sarah?

Are you out there?

Well, mayber she's headin' down to Louisiana to help out her fellow fishermen.

She was all over the TeeVee talkin' about Obama hurtin' America by signin' a newkular treaty with the Russians that she can see from her porch.

Now, on something she should reasonably be able to speak about intelligently, commercial fishing and the effect a massive oil spill might have on the lives and incomes of fishermen, not a peep or a tweet. That was her business right?

Drill baby drill didn't destroy the fisherys out in Alaska where she made a show of slow walking around in waders and gloves pretending she knew what she was doing? I couldn't help but notice she never handled a fish. Kind of like Bush the horseless Texas rancher.

I wish Maddow or Olbermann would point out the total lack of response form the Cheneys and Palin Mining and oil spill disaster.

I'll bet they'll both have about how Obama and Holder fucked up the Times Square Bombing attempt.

Posted by: Winkandanod on May 4, 2010 at 12:06 PM | PERMALINK

Winkandanod says, "Drill baby drill didn't destroy the fisherys out in Alaska..."

Not true. The herring fisheries in Prince William Sound? The Exxon Valdez did away with it.

Palin and hubby do subsistance fishing in Bristol Bay. That hardly even qualifies as commercial fishing.

Besides, Palin is a dunderhead, anybody who puts any value in the nonsense she spews is bound to be misinformed.

Posted by: nisl on May 4, 2010 at 12:20 PM | PERMALINK

nisl, thanks for the info. Next question, Palin was Governor of Alaska, had first-hand knowledge of the devastating impact of oil spills on fisheries and still ran around mindlessly spouting "drill baby drill?"

She should be monkey-stomped by an oil-drenched polar bear.

Fisherman/Sportsman should be outraged.

Posted by: Winkandanod on May 4, 2010 at 12:41 PM | PERMALINK

Perhaps Big Dick Cheney (or his offspring) will be on the Sunday morning talk shows to explain this. If there's any such thing as karma or cosmic justice, he will remain in his undisclosed location for the rest of his life to avoid doing just that.

Posted by: Marko on May 4, 2010 at 1:50 PM | PERMALINK

Hi winkandanod-Alaska lives off oil money-so there is never any real problem with oil companies

Posted by: golack on May 4, 2010 at 2:22 PM | PERMALINK

What I don't understand is that the $500K is a one-time cost. You don't (typically) use a new blow-out preventer on each well. The Deep Water Horizon rig cost something like $350 million to fabricate in 2001. Adding 500K to that adds 0.1% to the cost of the drilling system (probably less than that). If you could have controlled that well sometime in the first 24 hours the rig could have been saved. You would have had a terrible tragedy but BP and Transocean would have saved possibly billions of dollars.

The lesson here is that business people often do not understand what policies are in their best interests. Irrespective of limits to their liability under various federal laws BP, Transocean and Halliburton are all going to end up
spending a great deal of money. It wasn't necessary and the acoustic switch may have been one decision on the road to disaster.

Posted by: rk on May 4, 2010 at 2:49 PM | PERMALINK

Too bad Halliburton didn't make the devices. They would've been required to have two per well.

Posted by: drkrick on May 4, 2010 at 2:53 PM | PERMALINK

The system costs about $500,000 per rig. BP is spending at least $5 million per day battling the spill, the well destroyed by the explosion is valued at $560 million, and estimated damages to fishing, tourism, and the environment already run into the billions. -- Galston

Yes but... On the one hand, nobody could have anticipated such an act of God (vide Perry's statement). On the other hand, if they *had* spent the half mil on the gizmo and no accident followed, they'd have wasted that money. Which could be better applied to CEOs' bonuses. It's simple rithmetic.

Posted by: exlibra on May 4, 2010 at 3:28 PM | PERMALINK

I'm shocked...shocked, I tell you.

Posted by: Cal Gal on May 4, 2010 at 3:33 PM | PERMALINK

Unfortunately, having the acoustic device, while a good idea from the point of redundancy, would not have prevented this catastrophe. At the time of the blow out, the workers signaled the "blow out preventer" (BOP)a large valve on the ocean floor, to shut off the well, and it communicated back that it had done so. Unfortunately, it did not succeed in doing so. Improved communications would not have changed the fact that the device did not work.

The MMS knew that this was a possibility, a report they commissioned back in 2002 showed that half the BOPs tested failed to fully shut off the well....
http://www.mms.gov/tarprojects/455.htm

Included in the failures were BOPs manufactured by Cameron, who made the BOP on the Ocean Horizon.

the best coverage of this by far is at theoildrum.com, esp in the comments.
http://www.theoildrum.com/node/6427

Posted by: an old guy on May 4, 2010 at 7:30 PM | PERMALINK

Steve doesn't do anyone any favors by putting out, or quoting, bad information.

The MMS notice didn't describe the acoustic device as "an essential component of deepwater drilling systems," but was describing BOP backup systems in general. There is a difference.

The independent report commissioned by MMS did not just cite cost as a factor in not recommending the acoustic back up system, but also questioned its reliability.

hhttp://www.nytimes.com/gwire/2010/05/04/04greenwire-warnings-on-backup-systems-for-oil-rigs-sounde-30452.html

BTW, the regulatory division of MMS is not the division charged with impropriety...that was the royalty- collection division.

Posted by: Scrumpy on May 6, 2010 at 12:41 PM | PERMALINK

"...Dick Cheney's secretive energy task force concluded that $500,000 for remote shutoff was simply too great a burden, and the former V.P. and his team didn't want to force BP and other oil companies to spend the money."
--------------------------------

Where's the evidence to support this?

Steve links to a Guardian piece which in turn links to an Ed Schultz interview with a plaintiff's attorney who spouts one preposterous claim after another, including a completely unsupported claim about a Cheney connection.

On the other hand, there is plenty of evidence that the MMS came to its decision after an opern and public process that included the publication of an independent report, and that its ultimate decision was not just based on cost. That's right there in the WSJ article Steve linked to earlier. It's also here:

http://www.nytimes.com/gwire/2010/05/04/04greenwire-warnings-on-backup-systems-for-oil-rigs-sounde-30452.html

Sloppy work. Bordering on irresponsible.

Posted by: Scrumpy on May 6, 2010 at 1:18 PM | PERMALINK

The accustic communication system would not have made an iota of difference. People making this claim have no idea what they are talking about.

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