14 Comments

Ah. OK, then.

Um… why?

“for his analysis of trade patterns and location of economic activity”

Krugman has played his hand well, getting the press to lap up every bit of drivel that comes out of his mouth. He’s got book smarts in a narrow area of a soft/pseudo-science area, and suddenly he feels like he can opine on anything.
This is like Linus Pauling when after two Nobels his theories turned to crackpot science way outside his area of career science and expertise (megadose vitamins). Krugman is trying to flame out his legacy the same way but only as fast as he can.

Wasn’t BP trying to claim that the spill wasn’t actually their fault? But it fell under the liability of the contractor they were working with?

The actual situation is that BP did contract Transocean to do the drilling, but the site with the government is under contract to BP. As a result, I would imagine that BP is primarily responsible, although they might have a suit against Transocean. Not that this will stop the lawyers from suing everyone including probably the steel companies that made the pipe, Cabot if, as I expect, they made the pumping mud, and probably Goldman Sachs. It must be Goldman Sachs fault, they have so much money.

Bob

Oh…and don’t forget to sue the food service company running the mess hall on the rig. Obviously if their coffee had been better the various folks in charge would have been more alert and hence been able to prevent this screw up.

…and don’t forget Mexico, they should sue Mexico. After all, it’s the Gulf of Mexico where the spill occurred, so Mexico must bear some moral responsibility for the spill, even if it wasn’t in an area under their jurisdiction.

I think it is amazing you have a company like BP pretty much agreeing is screwed up and people use THAT case to rally around the idea of frivolous lawsuits. Why not just argue LeBron James is the best basketball player in the world and play a video of the Celtics Cavaliers series to prove it? Folks, little heads up here: you have better places to make your arguments. To the man with a hammer, everything seems to be a nail.

Wait, I should be telling you any of this. Continue as you were.

This is all well and good but you didn’t provide any evidence that what you say is true. You need to make your case!

I worked for a data center a few years ago, and having to be available 24/7, they had a backup generator in case they were to lose their power line. The way it worked was they had a one in a thousand chance of loosing the power line on a given day and a one in a thousand chance of loosing the generator. So they had a one in a million chance of loosing power on a given day. The actual probabilities would be different in magnitude, but not in substance for this comment. The generator failed a periodic test and the company ordered a replacement part. Sure enough, the power line was lost while the part was on order. The error was in treating the backup system as less important than the power line. Backups have to carefully managed or else the multiplication rule will not apply.

From the Gulf Spill hearings I learned that the blow out protector was engineered with layers of redundancy and was constructed of high performance materials. The problem that I gleaned from the hearings was that the operation of the blow out protector was of secondary importance to the well drillers. Regulation didn’t work because it relied on the passing of some stipulated tests. PB management relied on the regulator’s tests and their knowledge that the blow out protector had a robust design. But they should have known that the robustness of the blowout protector had to maintained trough diligence. They were human. DRAT!

And that, I am afraid, William, is where the matter falls apart. Although when the finger pointing finally ends — if it ever does — it is just as likely that Trans Ocean will turn out to be the ones who skimped, I have had my concerns about BP for a decade and a half — and this, not as a regulator, but as someone who looks at companies for investment possibilities and is convinced that it is better to spend money on regular maintenance now than clean-up and lawsuits later.

It is true enough that, given enough employees, some d***ed thing is going to happen sooner or later, and certainly Exxon-Mobil — my chosen investment in the field — has quite a few skeletons rattling around their closet. But BP seems to have been the Major to have consistently skimped and have it catch them, from oil lines leaking on the tundra to refinery fires.

BP’s position as a green company seems largely a pose and while I have never examined Trans Ocean, it seems clear that BP was not running any expensive supervisory routines on the back-up systems. Were they reasonably and legally obliged to? The courts will give us an answer and Congress will confirm or deny that in its own time.

But I do want anyone here to realize this: this blow-out was inevitable. Were the management of every company absolutely committed to making sure that something like this didn’t happen, if they spent all the money they could in developing procedures to prevent it, if they reduced the chance to whatever low level of probability you wish, with as many zeroes following the decimal place before you got to a non-zero integer — it will happen. Whatever is not absolutely impossible is inevitable. It will happen. Again.

Bob

Bob, I was unclear. I was not talking about putting profits above safety. “The rig won an award from the MMS for its 2008 safety record, and on the day of the disaster, BP and Transocean managers were on board to celebrate seven years without a lost-time accident.”

I was talking about two deviations from ration management. One is to see backup systems as secondary to a core mission. and two is to over rely on redundancy and design.

The Minnesota bridge collapsed because people relied on engineering calculation done when the bridge was constructed. Nobody noticed that the refurbishing of the bridge added to its weight; the additional weight exceeded the design criterion.

The fire in the BP refinery was horrible. But I blame more the NIMBY phenomenon that kept the oil industry from building new state-of-the-art facilities. Instead tight management allowed existing refineries to be run at mind boggling rates.

I don’t think we’re disagreeing, William. I was trying to state the general principle. You were more concerned with the specific issues of the case.

Bob

[…] Roger Parloff at Fortune answers some frequently asked questions. Last week he wrote about the supposed, but largely irrelevant, $75 million “cap,” in actuality, according to one expert, a provision of a law “designed to expand liability.” Earlier here. […]

Ron Miller: Plpainly, you have not been following–in the newspapers, on TV, cable, etc.–the same pattern over and over again when something big like this happens.
Observe, please, the next time there is:
–> A building collapse: Not only is the prime contractor sued, so are the sub-contracots, the company who sold the cement, the one who sold the metal girders and beams, the architect(s), even the agency(s) which set the building codes for that building and inspect the building.
–> An airplane crash: The airline, the maker of the plane, the subcontractors on that plane, the local fire/rescue agencies, the airport (if nearby or the crash happens on the airport grounds), and even agencies like the FAA and NWS.
–> Drunk-driving resulting in a death(s): The bar or liquor store(s), the makers of the beer or spirits, the local distributors of same, the person(s) who sold the booze in the bar or store, etc.
–> Not convinced? Look how many lawsuits were filed over 9/11/2001 from the World Trade Center collapses, BEFORE all of the health concerns on asbestos, etc. started happening.

Ron, I could go on and on, but I hope you are getting the idea–this has happened LONG before Overlawyered came online a decade ago.
I wish I still had the cartoon I had cut out–this was at least 20 years or so ago; it was in a courtroom, with a farmer in the witness chair. The lawyer was pointing at the farmer, and the lawyer said:
“AHA! So you are the farmer who grew the grain, whosold it to the beer company, who then made the beer, who then sold it to the distributor, who sold it to the bar, who then sold it to my client, making him drunk!”
At the time, I remember thinking how funny that was, but how true it was as well–and again that was more than twenty years ago.
It is NOT the fact the BP case might be “frivolous”–not a chance here!–but the fact of who ELSE would be sued even if they had little or no direct cause of the original accident. Bob Lipton’s post above yours, Ron, says THAT part better than I could.