Corporate Values, Ethics, and Consequences

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    The overly optimistic oil spill recovery projections made by BP are part of a routine charade corporations use to shift real production costs from the books and immediate consumers to a vague future debtor. It ignores risk, assigning low cost to potential consequences on a wager with others’ futures.

    The failure to capture the costs of this particular unassigned risk are dramatic and, in this case, quantifiable. Further, the casual dismissal of potential responsibility and the attempt to fix it on others is transparent. Both Marine Spill Response Corporation and National Response Corporation were set up to be the fall guys in the event of a less tragic event where BP would be positioned to claim it had been misled about the capabilities, dust itself off, and carry on.

    It is much more difficult to fix costs when, for instance, mountaintop removal is used to mine coal that will produce poisonous pollutants as an end product. With this oil spill, the damage is impossible to disguise and easier to assess. Other industries that create waste that will either one day have to be cleaned up or will create permanent wastelands while reaping exorbitant margins by shifting real cost are harder to indict. Consumers who enjoy the benefit of such arrangements through lower prices at the counter are just as irresponsible as the corporations. But theirs are often acts of omission while the corporations’ are acts of commission.

    The BP obfuscation continues in the stories of skimming efforts. While it reports that more than 671,428 barrels of oil-water mixture have been captured, they are remiss in failing to mention that 90% of the mixture is water. In the end, $20 billion may not cover making the Gulf region whole. And equally as dangerous is the prospect that BP may be the victim of a corporate raid by our close ally, Libya. Imagine if the long term cost of this spill had been included in the price of a gallon of gasoline in anticipation of risk.

    Bottom line: if the true cost of oil production or coal production, or battery production, or whatever, were captured by the producers and passed to the consumers, the free market could function more closely to the ideal manner described by the Chicago acolytes. The actual cost of energy would make the green alternative dynamic and profitable in a world where truth has value.  

    • TomPaine

      The first three words are an oxymoron and any consequences are to be avoided at all costs!

    • Teddy Goodson

      which has dominated Western capitalism for the past 50-60 years absolutely ensures the unethical behavior you describe. Its wonderful equations and clever descriptions of economic activity, with its emphasis on short-term profits above absolutely everything else, do not include environmental costs or social costs, so they seem to work well for a single company or market.

      Free Market capitalism as promulgated by “the Chicago Boys” has as a result promoted greed, dishonest bookkeeping, corporate colonialism in third world countries (and even right here in the USA), what amounts to rape of the landscape and resources of the world, over-fishing of the oceans, toxic waste dumps, disastrous oil spills, and casino financing that finally crashed Wall Street spectacularly.

      This perverse theory has such a death grip on both political parties and corporate leadership that, even after all its destructive failures, attempts to rein in the behavior it induces are useless.It is inexorably rushing us into a form of global corporate feudalism, and it must be replaced, or, somehow, expanded as a theory to include consideration of environmental and social costs on a macro scale. I’m waiting. I’m waiting….