BP to pay for "gross negligence"

The US is holding BP accountable.

According to Reuters, the US Justice department has recently confirmed that it will hold BP accountable for gross negligence. This recent sharpening of the DoJ’s attitude towards BP’s responsibility in the 2010 Deepwater Horizon oil spill (the largest in history) foreshadows steeper than predicted reparations; if BP is found to have been guilty of misconduct, under the Clean Water Act, it faces charges of up to $21 billion (four times what was previously predicted) - on top of punitive and compensatory damages. As Reuters notes, both BP and Transocean ltd. (owner of the platform) were found guilty of cutting corners by the government-filed report:

Specifically, errors made by BP and Swiss-based Transocean Ltd, owner of the Deepwater Horizon platform, in deciphering a key pressure test of the Macondo well are a clear indication of gross negligence, the Justice Department said.

"That such a simple, yet fundamental and safety-critical test could have been so stunningly, blindingly botched in so many ways, by so many people, demonstrates gross negligence," the government said in its 39-page filing.

As noted by an Economist blog in 2010, the Horizon debacle stands as “one way to price in externalities”; the oil spill highlights the more obvious negative side-effects of our reliance on fossil fuels, and is – for now – the only way that oil companies’ income will reflect (an infinitesimal part) of their harm to society. Cynics at the time commented that the US government is far too shortsighted to hold BP accountable, and that the incident would soon blow over (in sharp contrast to the oil that still lingers in the Gulf). Two years down the line, Obama can only be praised for ensuring that big business is not above the Clean Water Act. The DoJ’s perseverance will serve as a glaring reminder that the oil industry is shirking some serious debits and is not as profitable as it appears.

It’s a shame there is no Clean Skies Act to hasten the market’s demand for renewable energy.

(On that note, BrainPickings reminds us that 35 years ago today, the Voyager 1 was launched to explore the solar system. Follow the link to watch an animated version of Carl Sagan's Pale Blue Dot. It kind of puts things into perspective.)

Photograph: Getty Images
Photo: Getty
Show Hide image

Can Philip Hammond save the Conservatives from public anger at their DUP deal?

The Chancellor has the wriggle room to get close to the DUP's spending increase – but emotion matters more than facts in politics.

The magic money tree exists, and it is growing in Northern Ireland. That’s the attack line that Labour will throw at Theresa May in the wake of her £1bn deal with the DUP to keep her party in office.

It’s worth noting that while £1bn is a big deal in terms of Northern Ireland’s budget – just a touch under £10bn in 2016/17 – as far as the total expenditure of the British government goes, it’s peanuts.

The British government spent £778bn last year – we’re talking about spending an amount of money in Northern Ireland over the course of two years that the NHS loses in pen theft over the course of one in England. To match the increase in relative terms, you’d be looking at a £35bn increase in spending.

But, of course, political arguments are about gut instinct rather than actual numbers. The perception that the streets of Antrim are being paved by gold while the public realm in England, Scotland and Wales falls into disrepair is a real danger to the Conservatives.

But the good news for them is that last year Philip Hammond tweaked his targets to give himself greater headroom in case of a Brexit shock. Now the Tories have experienced a shock of a different kind – a Corbyn shock. That shock was partly due to the Labour leader’s good campaign and May’s bad campaign, but it was also powered by anger at cuts to schools and anger among NHS workers at Jeremy Hunt’s stewardship of the NHS. Conservative MPs have already made it clear to May that the party must not go to the country again while defending cuts to school spending.

Hammond can get to slightly under that £35bn and still stick to his targets. That will mean that the DUP still get to rave about their higher-than-average increase, while avoiding another election in which cuts to schools are front-and-centre. But whether that deprives Labour of their “cuts for you, but not for them” attack line is another question entirely. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

0800 7318496