Asleep at the Wheel: What BP, Goldman Sachs and Massey Have in CommonMay 10, 2010 at 6:32 pm | Posted in Shareholder Advocacy | Leave a comment
By Dale Wannen
With an array of disasters occurring around the world as we speak, it is tempting to take a step back and think about how we have ended up in such a lovely state. Ah yes, the delight of disaster due to corporate greed. Robert Reich’s recent article “Bring Back Regulation” does a great job demonstrating how all of these problems are mainly due to the lack of regulation by big brother who was supposed to be keeping an eye on things. Well, it seems as if big brother was out on one too many smoke breaks recently.
BP’s dirty oil
Every 10 years we face a major oil spill of some kind. The current spill, courtesy of BP, could be the worst ever as thousands of barrels of oil continue to spill into the Gulf every day. The Department of Interior’s Minerals Management Service was supposed to be the big brother in this case. Clearly it hasn’t done its job as there isn’t even a technology known that can stop oil from leaking at 5,000 feet below the surface (though in the last day we have learned quickly). Keep in mind this is the same federal service that takes in about $10 billion in royalties every year and is one of the government’s largest sources of revenue besides taxes. With all of that said, BP will be slapped with a billion dollar bill on this one, but for a $160 billion dollar company, that’s hardly a drop in the bucket.
Massey’s dirty coal
The regulator in charge of this operation is the U.S. Mine Safety and Health Administration. As Massey Energy Company’s revenues continued to skyrocket, their attention to safety seemed to have diminished. In fact, the MSHA has said it ordered parts or all of the Massey’s Upper Big Branch Mine closed more than 60 times in 2009 and 2010. Wait, was that 60 times? Clearly, the MSHA was asleep at the wheel this time and was not reacting proactively in its positions, or else this mine would have never been reopened in the first place. Regardless, there is a grand movement movement against Massey and its operations at the moment with Greenpeace at the helm.
Goldman’s dirty money
And yes we cannot forget about the creepy monster that still sleeps under your bed every night. Goldman Sachs is not out of the woods yet. As Reich points out, the Securities and Exchange Commission seemed to be out on the golf course while the American public witnessed the largest financial meltdown in 75 years. Again we witness a regulator who was asleep at the wheel during a historical lack of regulation on the derivatives market.
Because of the power of corporations and their influence on high end regulators, cutting corners has become the norm. Executives have been bred to create quick quarterly profits. In order to do this they forget about things like leaky pipes 5,000 feet below the oceans surface. Clearly leaving the markets to act free of regulation only leads to disaster. It will be the public’s duty to be the whistleblower in most cases as long as regulators continue to be influenced by corporate interests.