Chapter 1 The Politics of Policy
“You never want a serious crisis to go to waste,” [Rahm] Emanuel, the incoming White House chief of staff, said at a Wall Street Journal conference last month. “And what I mean by that is an opportunity to do things that you think you could not do before. … What used to be long-term problems, be they in the health care area, energy area, education area—things … that were long-term are now immediate and must be dealt with.”
NPR News, December 23, 2008 1
Shortly before 10:00 p.m. on April 20, 2010, the massive drilling platform straddling the deepest drilling well in the world, a symbol of America’s quest for energy security, exploded in the Gulf of Mexico fifty miles offshore. The fireball hurling thousands of feet into the tropical night unleashed the worst environmental disaster in US history and the second worst oil spill in world history. What followed the explosion of the Deepwater Horizon drilling platform was a human and ecological tragedy rapidly transformed into a signature event in the narrative of American energy regulation.
The Deepwater tragedy unfolded on the threshold of a decade now predicted to transform profoundly the way Americans use energy. Before 2017, it is expected that the United States will
overtake Saudi Arabia and Russia to become the world’s leading oil producer after decades of increasing dependence upon imported oil,
become a net exporter of natural gas while natural gas increasingly displaces coal as the major fuel for producing electricity,
experience a gradual decline in coal production as the electric power industry turns increasingly to natural gas for fuel,
rely on renewable energy as a significant source of electric power,
witness the failed revival of the commercial nuclear power industry, and
enact new regulation to reduce significantly US global climate warming emissions.
The Deepwater explosion itself left a triple legacy. First, the decision to permit the platform and the incompetent regulation that facilitated the disaster were issues of energy governance, and the tragedy intensified an already embittered policy conflict over the future of American offshore energy exploration. Moreover, Deepwater added another disputed matter in the greater national controversy concerning how to govern all the nation’s richly abundant energy resources—a deeply contentious and enduring debate pervading the whole history of American energy development. These matters are the substance of future chapters.
This chapter concerns the remaining legacy. Deepwater also created a political arena. The national media swiftly converged on the unfolding disaster to produce, before a huge national audience, a stage throwing into sharp relief many of the actors, institutions, and events inherent to the nation’s energy policymaking and destined to appear among others throughout the chapters to follow. Deepwater provides a short but practical introduction to this chapter, which concerns the actors, institutions, and setting of American energy policymaking.
The “Well From Hell”
The drilling platform, managed by Transcon Corporation for British Petroleum (BP), the world’s largest energy corporation, had operated inconspicuously for seven years before the explosion. What followed was a horrific spectacle. The aftermath became a gripping human tragedy staged before a huge national audience produced when national cable and network television devoted more than half their daily airtime to the disaster for more than a month.
”I Had No Idea It Could Do What It Did”
The disaster began when dangerously high methane gas pressure, building up in the underwater borehole, breached the elaborate safety equipment designed to prevent a gas blowout. First, an enormous volume of mud and oil rushed up the pipeline, erupted through the drilling platform, and cascaded down on the rig. A suffocating mist of methane gas rapidly followed, spread across the rig, and ignited. “Crew members were cut down by shrapnel, hurled across rooms and buried under smoking wreckage,” reported the New York Times. “Some were swallowed by fireballs that raced through the oil rig’s shattered interior. Dazed and battered survivors, half-naked and dripping in highly combustible gas, crawled inch by inch in pitch darkness, willing themselves to the lifeboat deck.”2 The crew had been meticulously prepared for the most plausible disasters. This one was wholly unimagined. “I had no idea it could do what it did,” later remarked one veteran crew member.
In the furious fire consuming the drilling platform, eleven crew members died. The disaster left 126 survivors, including many badly injured crew members and four executives from BP and Transcon who were visiting the rig to celebrate its seven-year safety record. In little more than a day, the Deepwater platform incinerated, rolled over, and sank, beginning a frantic, eighty-nine-day struggle to cap the well and suppress the steady stream of crude oil leaking into the Gulf.
A Massive Impact
It is an axiom of modern energy politics that energy and environmental issues have become inseparably bonded. The media abundantly demonstrated this reality and the public quickly got the message that an unprecedented environmental disaster was unfolding. The Gulf event quickly engaged hundreds of environmental organizations from international to local in efforts to mitigate the emergency and intensified a continuing environmentalist campaign to reform radically American regulation of offshore energy exploration.
Before the wellhole was finally capped, an estimated 205 million gallons of crude oil and two million gallons of toxic dispersant intended to counteract the petroleum had spilled into the Gulf. The final magnitude of the environmental impact is still unresolved. The oil fouled 1,100 miles of beaches and marshes along the coasts of Louisiana, Mississippi, Alabama, and Mississippi together with 2,400 miles of levees. Despite a massive cleanup attempt involving at its peak more than 47,000 personnel, large patches of buried oil remain along Gulf beaches. The short-term damage to aquatic flora and fauna, especially to the ecology of coastal wetlands rimming the Gulf was severe; the long-term damage to the deep sea ecosystems, especially marine species, and the human health impact from exposure to the toxic dispersant Corexit are still under investigation. Estimates of the economic consequences of the oil spill also defy accurate calculation but will certainly exceed $8 billion, including a multiyear loss of employment and productivity to offshore fisheries, an especially severe problem for Louisiana, Texas, Alabama, and Mississippi because more than 87,000 square miles of commercial fishing grounds—about a third of the Gulf area—was closed for months, throwing thousands of workers out of employment.3
No corporation paid, and continues to pay, a greater price for the Deepwater incident than British Petroleum (BP). Corporate interests are inevitably stakeholders in every form of domestic energy production, but few petroleum producers had made a greater international effort than BP to cultivate a reassuring image of corporate environmental stewardship. The platform explosion made hash of BP’s environmental image and depreciated its political clout. BP’s subsequent frantic, frustrating efforts to cap the oil leak provoked international censure and anger from a growing legion of critics who held BP responsible for the catastrophe. The damaged corporate reputation was further diminished by the inept performance of the corporation’s CEO, Tony Hayward, in a global interview following the event.
BP’s economic damage continues to soar, the final cost unpredictable. By 2014, BP’s own estimated expenses had exceeded $40 billion, including an initial $20 billion trust fund it has provided to satisfy