BP: The Case for Public Ownership

If arrogant disregard for humanity and the natural world were qualities that triggered the seizure of assets, BP would have been under public ownership long ago. It still isn’t.

But BP’s criminal act of polluting the Gulf of Mexico with an estimated 2.5 million gallons of oil per day–easily the worst environmental disaster in American history, and on the verge of becoming the worst ever in the Gulf–is only half the reason that U.S. assets of the global energy giant should be brought under public control immediately. The other is the increasingly desperate crisis of global warming triggered, in large part, by a suicidal dependence on pollution-producing fossil fuels. Public ownership is the answer to both the short-term crisis caused by BP and the longer-term threat to the ecological stability of our planet.

Congressional hearings have indicated that BP management deviated from standard safety procedures and that its anti-worker culture prevented whistleblowers from halting production. BP CEO Tony Hayward’s continual evasion of questions stands as a shocking symbol of corporate arrogance and disregard for public oversight.

In the days immediately after the April 20 explosion and sinking of the Deepwater Horizon oil rig, which killed 11 workers, BP focused resources on what it understood as its most pressing problem – public-relations damage control. Early plans to stem the tide of the oil flow were confused and prioritized media strategies. The company blocked scientists who wanted to estimate how much oil was flowing into the Gulf in order to develop a more precise cleanup plan. It quickly became apparent that BP had no established plan or protocol to deal with the gushing oil and that they were reluctant to shift resources toward stemming the flow of the oil and cleaning the environment. There was no profit in it.

BP employed various domes and caps on the gushing pipe because, if successful, they would serve the company’s dual corporate purpose of stemming the immediate flow and preserving the well for future drilling. Only after these failed, and millions of gallons of oil were released, did BP move to more invasive measures such as the failed “top-kill” attempt. And only significant government pressure forced BP to carry out more costly strategies such as digging relief wells around the site.

Meanwhile, environmentalists protested BP’s use of the toxic oil dispersant Corexit, claiming that it may do as much environmental damage as the oil itself. Even after the Environmental Protection Agency issued an order for BP to use a less toxic alternative, the company took weeks to comply, preferring to pay the fine instead of buying a less toxic agent.

BP has also continued to employ its standard anti-worker tactics. When clean-up workers complained about dizziness, nausea, headaches, and a lack of safety equipment, company officials claimed that the symptoms were probably the result of food poisoning. Internally, BP sent a directive to clean-up workers stating that future complaints about illness would result in termination.

BP must be placed under public control because its botched attempts at closing the well, its use of toxic dispersants and its negligent treatment of workers are evidence that BP is incapable of managing this catastrophe. Why? Not from lack of resources or expertise, but from the absence of any profit motive to act. It’s against the company’s one-dimensional corporate interests to do so.

Public ownership, and the road to a new energy system

The U.S. government should immediately seize the U.S. assets of British-based BP. After the clean-up is completed and claims against the company are settled, a hearing can be held to propose compensation for BP. Until then, the company’s American arm, BP America Inc., should be operated as a publicly owned company that provides employees with full worksite protections and a significant voice in the day-to-day operations through a program of workplace democracy. Public ownership would put the full resources of BP to work stopping the oil leak and engaging in an effective clean-up of the Gulf. Such a measure would be unprecedented in the United States, but has proven, in other nations, to be an effective tactic in transforming industries acting against the public interest.

However, merely exercising public control over BP would, in effect, empower the very same officials who facilitated the oil explosion by granting waivers to BP and accepting campaign contributions. Prior to the April 20 explosion, BP benefited from a series of “categorical exclusions” from safety studies by the Minerals Management Services (MMS). Officials in the MMS relied on promises from BP management that the likelihood of a major spill was “minimal or non-existent.” Such lax regulation represents a major continuity between the Bush and Obama regimes. Big energy companies lavished handsome campaign contributions onto President Barack Obama and Department of the Interior (DOI) head Ken Salazar in order to ensure business as usual continued. And it did, to the tune of more than 250 waivers for energy companies per year.

That is why public ownership must come along with the immediate removal of Ken Salazar as head of DOI and the removal of any official involved in the granting of waivers to energy companies engaged in resource extraction.

It is important to note that the concept of public ownership differs from the idea of “temporary receivership” being circulated by liberal economists such as Robert Reich. Under the receivership plan, government officials would operate BP until the crisis is resolved, at which time it would return to private control.

In contrast, public ownership would transform BP America Inc. into a linchpin of a national energy policy moving the country away from its reliance on fossil fuels, and toward an eco-socialist agenda. BP and other energy companies have used foot-dragging and campaign contributions for years to prevent the transition to renewable energy sources. For them, the shift represents a costly endeavor that endangers their current market position. But for our planet, the transition to renewable energy could be the difference between life and death.

BP has the resources, expertise and infrastructure necessary to affect such a shift. Retrofitting existing facilities and developing new green infrastructure could spring out of public ownership. Just like with the Gulf cleanup, the main roadblock to moving in such a direction is corporate profit-motive. Taking BP into public control would be a necessary first step to taking the entire energy sector away from private hands and placing it into the public trust. Public ownership of all energy companies is the single most efficient way to create a green energy transition and, in the process, renew a natural world spoiled by capitalist production.

Why Obama won’t do it

Of course, neither Obama nor Democratic or Republican congressional representatives will enact the plan outlined above, despite the fact that they hold the legal power to do so. Significant authority was provided to the executive branch as part of the Oil Pollution Act of 1990. Obama could use the implicit rights in this law to take immediate control of BP America Inc., while Congress prepares legislation to take the company into public ownership.

However, it is likely that even a significant amount of grassroots pressure would not force mainstream politicians in this direction. Obama and nearly every member of Congress is so desperately dependent on energy companies’ campaign contributions that public control is not even a topic of conversation. Instead, Obama will likely flounder along, holding press conferences and giving speeches about how regrettable the incident is while praying that BP finally plugs the hole. There may be a glitzy announcement about a toothless green initiative, but don’t expect any substantive change.

If the American people want change, change that can save and protect the environment while strengthening workplace rights, we will have to do it ourselves. One place to begin is by picketing a local BP station, beginning a petition drive to demand the kind of public ownership described above, or even by beginning the difficult, but necessary, process of challenging the two major political parties at the ballot box.

A solution to the great crime perpetrated by BP can come from the source that has generated so much of what is good about America–the efforts of everyday Americans organized to challenge the powerful. But we have to move quickly. Oil is still flowing into the Gulf, and the environmental crisis is graver than ever.