Monday, July 12, 2010
More government failure and market failure (although the market failure itself may be induced by government limits on liability, which causes moral hazard). This Reason article explains some of it. It is getting a bit familiar. I will never miss Bush -- let us not forget that his incompetence got us much of this -- but it is getting harder and harder to take the Obama Administration. Two excerpts from the Reason article:
We have learned that the oil could have been skimmed early on so that very little—if any—would have reached shore. [But stupid environmental regulations and labor protections prevented that. This needs to be shouted from the rooftops.]
In Europe the laws governing oil spills are distinct from ours. They are prepared for spills and handle them as national emergencies to be quickly resolved. In Congress, however, the extreme environmentalists are now urging impossibly severe “punishment” conditions and sky high uninsurable liability on individual companies that will almost certainly shutter all medium-sized oil companies, since they would be unable to acquire the needed insurance. In America it has been smaller companies which have led technological discoveries, such as the horizontal fracking which has now made natural gas abundant. Yet Obama’s energy advisor, Carol Brawner, says non-major oil companies could be excluded from Gulf drilling when they, of necessity, are much more careful since spills could ruin them and put them out of business.