Warning – this is a political (well, kinda) opinion, so if you don’t care too much about this kinda stuff, wait till the next update, which will inevitably contain fart jokes and pictures of nipples. Ok, maybe not the nipples.
So, as we’re all well aware, things went a bit tits up in the Gulf of Mexico with BP’s Deepwater Horizon drilling platform and well. For whatever reasons, the safety mechanisms didn’t kick in when they should have done and oil is gushing everywhere. Bad news.
US President Obama, the saviour of the world, holder of the Nobel Peace Prize for stuff he hasn’t actually done yet, has come out guns a-blazing in a PR storm, criticizing BP for this, that and the other, giving them deadlines to fix it or else (what, a detention, six of the best?) and now has threatened to introduce laws to force them not to pay a dividend to shareholders. I’ll come back to this point in a minute.
The way Obama has yelled and carried on at BP, you’d think they actually did this on purpose. That somehow they wanted this and or really don’t care about fixing it. Obama even threatened to take BP off the case and replace them with a Government Task Force (led by Homeland Security I think).
Yes, spilled oil is a bad thing, we know this, but lets not get too carried away burning witches.
Lets look at this in more detail.
1. Someone, somehow, stuffed up somewhere with the safety gear and it didn’t work. Was it deliberate? Unlikely. Shoddy workmanship? Possibly, but these things are not built in the back of someone’s shed, they’re expensive pieces of equipment operating in extreme environments and used all over the world. Shit happens? Probably. Design flaws that only got exposed under extreme test? I’d bet that’s it. The thing didn’t work cos the circumstances of the situation hadn’t been foreseen. It happens in engineering all the time. Its nobody’s fault per se, it’s just really bad luck. If corners were cut and they scrimped on some of this stuff, then they deserve criticism, but not without looking at all other deep water wells from all other companies as well. If this is an industry wide thing then they ALL need to be brought to book over it.
2. Obama’s deadlines and rhetoric at BP. You think BP wants this? You think they don’t care about a gargantuan oil spill off the US coast? Geeze, I can’t imagine anything further from the truth. Even if you’re the most rabid anti-capitalist and anti-globalisation nut, you’d have to realise that even just using the corporate greed angle, this is REALLY bad for business.
I’d be willing to bet they are doing all they can and at all costs to fix this as fast as possible. The entire future for BP’s oil exploration in deep oceans is under question right now – you think they don’t care about this? And that’s just taking the dimmest view possible. Remember, a company is made up entirely of people. Nothing else, just people. Saying BP doesn’t care is accusing every single BP worker of not caring about what happens to the environment when the oil gets out. I’ll bet they care every bit as much as the environmental hardcore do.
The simple matter is, there’s oil, we need it, they’re spending billions getting it out, refining it and selling it at quite small margins to all and sundry around the world. And they do this, generally, without too many stuff ups. Can you say the same thing about other industries? Nope, its industry, they all stuff up sometime.
They’re not bad guys. I’m sure they could do better, like we all could at things we do in our lives, but I seriously doubt they set out to do this difficult deep water well on a shoestring budget, cut corners everywhere and thought ‘ah well, if it all goes tits and a billion barrels of oil washes up all over the Gulf we’re only liable for a few million dollars of cleanup under US law’
You’d have to be a complete idiot to think that. And yet, those are almost the words coming from President Obama’s mouth.
3. Obama’s take over. He wanted, for a short while, to take over the capping mission, shove BP out the way, let the Government sort it out. Just a moment there, the US government now has deep water well drilling and capping experience that is somehow better than anyone else? Oh really.. Yeah, the silence on that idea matter speaks volumes for how much of a dumb-arsed empty-headed piece of nonsense it was. Let BP sort it out, they, more than anyone else on the planet, want this to stop.
4. The dividend law. Apparently, Obama rules the world and can impose laws on a foreign-owned company telling them what they can and can’t do. The dividend is paid in the UK, under UK law, to shareholders and investors. You know, pension funds, that kind of thing. If they choose (and can afford to after the costs of the gulf) – they can pay a dividend and there’s not a damn thing Obama can do about it. It would set such a slippery precedent that it would have global corporations and the financials markets in meltdown. So he should shut the hell up about it.
5. Compensation. Obama wants BP to pay compensation to the thousands of people laid off in the gulf of mexico as a result of the total drilling and exploration ban. Its bad news for those people and they have my sympathy, but how is that BP’s fault?
Obama shut down the Gulf, not BP.
Obama should be paying. It’s a bit like being made to pay for everyone’s time and all business lost as a result of that lost time if your car breaks down and blocks the road and holds traffic up for an hour. Actually, its worse, it’s a bit like you breaking down or having a crash and the Highways Agency deciding that all driving is dangerous, closing all the roads and then asking you to pay for everyone’s lost income and business. Its nuts. I have no problem asking BP to clean up, and if part of that is payments to fishermen and coastal areas hit, then that’s fine, but rampant sweeping payments from BP to everybody who has even the slightest knock on effect due the actions of the Government is just nonsense. Can I get compensation from BP when the price of petrol goes up due to the drop in global supply and the rise in oil prices? Of course not, but it’s not far from what Obama is asking for.
So yeah, that’s my summary – Obama is not being helpful, quite the reverse, he’s almost certainly hindering BP’s attempts at sorting problem by his highly negative and distracting PR campaign.
The best managers help to solve and sort the problem and then worry about the how’s and why’s later. If there is genuine blame, then that stuff will come out later and there are laws and procedures in place to deal with that. None of that stuff helps stop the oil now.
In the meantime, ask yourself just how much the Obama administration has actually done to help solve the problem vs how much finger-pointing and arse covering they are doing.
That’s the acid test of good management vs bad management.
I should point out that I’m not tied to, funded by or connected to BP in any way other than sometimes filling my car up with BP petrol. I think the oil spill is really bad news and I’m not advocating letting BP off the hook, this is just commentary on the media frenzy. I will comfirm that I think Obama is both good and bad as a president. – he’s not as good as he was touted to be, but he’s certainly not a total numpty
Without getting into a political argument…
I actually feel kind of badly for Obama in this situation. He is getting so much crap from all over the place over here. His harsh words came on the coattails of people here criticizing him for not being hard enough on the situation. It’s like he’s damned if he does and damned if he doesn’t.
I will just say that I am 100% against BP on this. Of course they didn’t want it to happen, but at the same time the cover ups over here have been massive. And not from a government stand point.
Thats a good point – he is caught between a rock and a hard place with this thing – its looking like the worst spill in some time and he has to be seen to be doing something and being strong. Personally, I’d rather see him actually helping not blaming, but there ya go. Maybe there are hundreds or thousands of resources on the case already, I suspect there are, but he’s not really championed that part of his strategy. I hope it gets stopped soon and they work out how to do things safer in future – our need for oil isn’t going away any time soon.
Well, that was interesting breakfast reading. You but together a well thought out and balanced piece there Charlie.
You’re right Charlie, no-one wants this cleaned up any faster than BP. Obama is grand-standing during an election year for the Gulf state Dems to some degree, but I think he is forward looking enough to know this might bite him in 2012 if he’s seen as not doing what’s necessary.
But as you point out, he threatened to take responsibility, then likely realized there is no Hollywood ending here, and tossed the hot potato back to BP.
What is truly frustrating is that Obama refused assistance from knowledgeable nations early on, invoking our Jones Act. The Jones Act is a US protectionist measure designed to protect union ship workers. The Jones Act states that only US ships crewed by a US crew can operate in US waters. Instead of allowing the Dutch and Norwegians to come over and assist, Obama instead settled for allowing the Dutch and Norwegians to train US crews. They should be ready soon, but we don’t have the specialized ships yet. No doubt we’ll buy the gear and retrofit some of our ships, as our ship yards only churn out Navy vessels.
Sadly, the Jones Act contains a waiver provision that has been enacted by presidents in the past. It truly seems there is some degree of a political move here, as hard as that is for me to imagine. I accept this is difficult, and I don’t necessarily have any good ideas. Better minds than mine are on the task.
Thankfully, none of this oil will make it down your way; ironically, the Gulf Stream will carry it to the north Atlantic and possibly the shores of the UK.
As an aside, I sure hope the Australian government correctly addresses the matter with the Chinese tanker ship than ran aground on the Great Barrier Reef. Hope clean up is going well there.