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Oil Companies Can’t Watch Themselves – And They Know It

By Benjamin Ross


The Deepwater Horizon oil spill has been plugged, but the fire on another oil platform recently is a disturbing reminder of the unfinished business that it leaves behind. The root cause of the disaster – an absence of outside supervision that allows profit-driven managers to set their own priorities – has yet to be remedied. As long as the oil companies are left free to pursue short-term cost savings at the expense of safety, new catastrophes are all but inevitable.

The vast scale of this summer’s spill offers no guarantee that there will be real change. Its oil slicks are far from being the first to afflict our coasts – floating oil first became a national scandal nearly a century ago. The issue has been a political football ever since, with the oil industry exercising its political muscle again and again to fend off outside oversight.

Remarkably, it’s not just environmentalist outsiders who have criticized the petroleum producers’ resistance to regulation. Since oil spills first became an issue, the industry’s own experts have told their employers that to prevent spills, the discretion of company management must be limited.  Controls work only when they are imposed from the outside.

The controversy first arose in the years after World War I, when floating oil became a national scandal. Fouled beaches and dead birds shut down ocean resorts, whose owners organized to seek relief. They were joined – so severe was the problem – by fire insurance companies, burdened by claims for burning docks.

As in the Gulf this summer, the search for causes brought finger-pointing. Oil companies blamed steamships and their practice of filling drained fuel tanks with seawater. The unfiltered ballast was dumped into harbors when it was time to reload. Shipowners pointed back at wastes from refineries.

After a fierce lobbying battle, the Oil Pollution Act of 1924 exempted the refineries. But as the price of this victory, the newly formed American Petroleum Institute promised that the industry would police itself.  An API technical committee quickly came up with a program to control the oil discharges. It designed devices to separate oil from ballast water and wrote a long manual on refinery waste. The committee recommended that the trade association send out inspectors with the power to compel compliance with these practices. But this idea was shot down by objections from member companies, and self-regulation became purely voluntary.

The New Deal put water pollution control back on the national agenda. The oil industry, advised by the API to “play poker rather than throwing down its cards in advance,” adopted a strategy of undeviating opposition to federal oversight. This effort was crowned with success in 1940 when a bill to regulate new sources of pollution, passed by the House, died in conference committee.

Peacetime concerns, the environment among them, returned with the end of World War II, and oil companies received another expert warning. The chair of the API’s committee on refinery wastes admonished the readers of National Petroleum News in 1946 against “the futility of adhering further to the policy of objection and obstruction.”

This message too went unheard. The industry continued to resist outside control, and a Republican congress gave them a sympathetic ear. The toothless Water Pollution Control Act of 1948 limited the federal role to research, training, and grants to local governments.

Laws were at last passed to put polluters under federal supervision in the 1970s, following a well blowout off Santa Barbara and other well-publicized ecological disasters. Statutes governing oil spills were further tightened after the Exxon Valdez spill of 1989.

But laws by themselves provide no guarantee of effective supervision.  The people who write and enforce the rules must have the knowledge, the will, and the strength to make them work. Too often, government officials have surrendered to the political clout of big business. At worst – and worst is what we got from the Mineral Management Service – regulators simply rubber-stamp decisions made by officials of the corporations they are supposed to oversee.

Effective pollution control comes only when good laws are complemented with strong and consistent enforcement.  The managers who make decisions day-to-day must be made to face real consequences when they take undue risks.  The oil that poured into the Gulf this summer was only the latest proof of the limits of self-regulation, and of government’s essential role in protecting our endangered environment.

Benjamin Ross is President of the Washington consulting firm, Disposal Safety, Inc. He is both environmental scientist and commentator on current affairs, and has served on committees of the National Academy of Sciences and the USEPA Science Advisory Board. Ross is author with Steven Amter of of The Polluters: The Making of Our Chemically Altered Environment.

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