BP, Property Rights, and Rachel Maddow

Posted by Jason | Posted in Miscellaneous | Posted on 05-05-2010

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It seems like the BP oil spill has both sides of the isle clamoring to point fingers at the other. As usual, Democrats are mocking Republicans for their “Drill Baby, Drill”, and Republicans are out talking about Obama’s slow response and all the donations BP gave to Obama. Both sides make pointless arguments that do nothing the improve life in our country.

If we want to have affordable energy, then we must “Drill Baby, Drill”. Also, what was Obama going to do that was going to make this situation any better? The last thing we should all want is for Obama to get involved. He’s liable to nationalize the whole energy industry. Lastly, I don’t think BP handed Obama money saying “Hey, we are going explode an oil platform. Just let it slide and respond slowly.”

So what are the issues that should really be discussed? Well to start, why do we think morons sitting in Washington can regulate accidents out of existence? I mean, our highways are regulated to the point where I can be pulled over for not having my headlights on while my windshield wipers are running. Guess what. There are accidents constantly all over the place. You can pass regulation after regulation until the cows come home. The problem is no one can predict the future, and no one in congress has a clue about anything other than how to steal money, so don’t expect them to even come close to writing regulations that make a difference.

If we want to lessen the chances of something like this happening, we need to move more towards property rights. When property is owned collectively, everyone assume someone else is watching out for it. This is known as the Tragedy of Commons. On the other hand, when you have private property, private owners typically look out for their land. After all, their land has value, and they do not want to have the value diminished without being compensated for it. How you could get private ownership of the oceans is something I have not studied, so I can’t comment exactly how it could be done. The point is government owned property always leads to a higher chance of environmental catastrophe.

Let’s take an example. If you owned 1000 acres of land, and let’s say BP wanted to drill on it. They come to you to negotiate. If you are a prudent owner, you are going to want to know what safe guards there are, risks involved, compensation, compensation in event of disaster, and if they are insured for their project. An insurance company, who would be pledging and backing the oil company would not want to risk having to pay a claim, so they would then do further due diligence into the oil companies safety measures, technologies, past history, etc. They may even do inspections of the drilling site periodically to make sure things are done to the highest standards. All of these are costs that will be taken into account prior to an agreement being made. These are real costs that force the company to bear the full costs of their production.

On the other hand, when government controls land, all it takes is greasing the palm of some slimeball politician to get your drilling project approved. The government may charge you something, but with the purchase of the right politician, that can be altered to the benefit of the oil company. Once a government employee is bribed, companies can put all kinds of escape clauses in their contracts that could limit their liability, expenses, etc. Instead the full cost of production is then not bore by the producer. In the case of this oil spill, the costs will be bore by the tax payer. Yeah, BP will pay some, but make no mistake the tax payer will eat it. What tax payer has the time or money to send a lobbyist to DC to fight for their money? On the other hand, BP has plenty of money to lobby and make sure they come out on top. OK, I know, I’m getting off topic here. The point is the government, although it’s classified as owner of the land, is not a person. They aren’t invested in the property like a person, and they can be bribed with just a little money. Private property is the best solution to environmental problems.

OK, the next thing that is cracking me up with this BP oil spill is people blasting Big Oil. It’s the people like Rachel Maddow, who talk like we don’t need oil. They sit on their stupid TV shows acting like we have some alternative that is comparable, and we’re all just being a bunch of idiots for not switching.  Here’s her video.

Don’t you wish someone would ask her what the alternative is? Of course it is sad that people die in these accidents, that animals die, and that pollution occurs, but what is the alternative? Are we to believe that even with the accidents she mentions (as limited as they are), we’d be better off without oil? How many people would die each day without the power and energy that oil delivers? How many goods including food and water are delivered to stores and homes, so people don’t starve to death. It’s oil that gets those deliveries there. How would we heat our homes, power out hospitals, or build things with machinery, if it was not for oil? It would be great if Rachel Maddow would get down off her high liberal horse, and say thank you to the companies that provide this energy we need at a low price.  Instead she sits in her well lit, power hogging studio running her mouth every night, not producing anything for society other than hot air, which unfortunately we cannot use to produce energy.

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Speaking of limited liability on government “owned” property – The Oil Pollution Act has a cap of the amount of private party damages a company can be liable for of $75M. Talk about skewing incentives.

Rachael Maddow is a clown, I don’t know how you could listen to her for more than 30 seconds. Do you know any budding entrepreneurs? I bet they could come up with a machine that turns hot air into energy.

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