On BP

I’ve been thinking about BP quite a bit these days, though I’ve not written on the topic of the gulf oil spill to date. However, the federal government’s statement via Mr. Holder, that it is opening an investigation into both civil and criminal penalties against BP seems poorly executed. At the very least, one would think that an investigation could be opened without great public fanfare, or even that the investigation could be kept quiet until the current issue–the continued expulsion of crude into the Gulf of Mexico–is addressed.  It almost appears as though the federal government is more interested in prosecution than the negatives which have come with the crude.

I’ve heard radio reports that some are now boycotting BP over the spill. This, like the government’s public antipathy toward BP, would seem counterproductive. The last thing one would want to do is to drive up costs for BP (by driving down profits) to the point where they go bankrupt. If they should go bankrupt, then there will be little if any satisfaction received for the damages done and the US government (that is, the taxpayers) will be on the hook for the entirety of the clean-up costs. The best thing we can hope for at this point is that BP is able to stay afloat financially and recover from this so as to be able to pay for the portion of the costs which can be reasonably deemed its responsibility.

Monty at Ace has a few thoughts on the British angle as well:

It may be that there was some gross negligence on BP’s part. But the fact remains that deepwater drilling is a dangerous and risky business. Putting BP out of business to “punish” the company for the accident will have the undesirable side-effect of hurting one of our best allies: Britain. Many British pensions hold large shares of BP stock, and if BP goes under, then British pensions suffer. Which means that British citizens suffer. And many of them may blame the Americans for their financial pain, whatever BP’s liability may have been.

There is a time for assigning blame and penalizing those who contributed to the disaster in the gulf. I would posit that now is not the time.