Whether the problem is blood spilled in the workplace or oil spilled in the oceans, a series of recent disasters show why more regulation of profit-hungry industries is needed.
“Twenty-nine dead coal miners in West Virginia, seven dead workers at an oil refinery in Washington State and 11 dead on a Gulf of Mexico oil rig followed by an ecological calamity, all in the span of a month, illustrate in blood the need for more regulation and stiffer enforcement,” said Leo W Gerard, president of the United Steelworkers (USW). He added: “Improving regulation and enforcement may cost money. But then, what is the value of the lives of those 47 workers killed in three workplace explosions in one month? What is the value of the oil-polluted Gulf waters and coastline?”
He said BP was a “perfect example” of why it is better to regulate than clean up the mess after disasters. The London-based multinational was found to be at fault in the March 2005 Texas City refinery blast that killed 15 workers and injured 170 more. But lessons weren’t learned and more offences, deaths and disasters followed.
“These were not natural disasters, not earthquakes like in Haiti or hurricanes like Katrina,” said USW’s Leo Gerard. “These are man-made disasters.” After the Texas City tragedy, USW met with oil industry representatives in an attempt to write new safety guidelines. “USW vice president Gary Beevers abandoned the effort because he felt the industry was more concerned about image than safety,” recalls Gerard. “As this year of fatal explosions has tragically illustrated, less government is a problem. More regulation is the solution.”
The Gulf of Mexico disaster – it became a disaster for BP not when 11 workers died, but when it became apparent the company was facing a costly environmental catastrophe as the Deepwater Horizon oil slick slimed the US coast – was not prevented by market forces, or self-regulation. Nor were earlier disasters, where it was workers that were the victims.
According to ‘The bottom line’, published this month in Hazards magazine: “On 27 April 2010, just one week after a Gulf of Mexico oil rig hired by the company exploded with the loss of 11 lives, the London-based multinational said its profits hit for the first three months of 2010 $5.6 billion (£3.6bn), up 135 per cent on the same quarter last year.” It adds: “Oil lapping against a shore is bad news for a company, and the bad smell lingers. Workplace deaths, though, don’t cause lasting reputational harm, because the bottom line really is the bottom line for investors.
“The 2010 first quarter bumper profits, exceeding market expectations, came after a quarter in which BP attracted the USA’s largest ever safety fine. The 30 October 2009 penalty, at $87.4 million, was for failing to remedy safety problems identified after the Texas City refinery blast.
“The money markets, inevitably, weren’t interested. BP earned $2.6 million profit every hour round the clock for the first quarter of 2010. It could pay off the fine with profits pocketed before lunch on 2 January.”
The article notes that “while the official safety agencies talk tough after a disaster, the companies can frequently enjoy their quiet support or at least benefit from their regulatory impotence between outbreaks of bloodshed.
“BP had successfully lobbied against more stringent US offshore safety regulations and oversight prior to the Deepwater Horizon blast. In the UK, as a series of investigations left the safety reputation of BP’s London-based global board in tatters, The Health and Safety Executive (HSE) continued to feature the company as an exemplar of ‘director leadership’. The case history was only removed in November 2009, after the official PR for BP was exposed by Hazards.”