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So You Think You Can Clean an Oil Spill?


Jun 10 2010, 05:13 AM (Post #1)
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Kevin Costner thinks he can.

BP thinks, to no success, that it can.

CNN showcased some 5th graders who performed a play and thought they could.

What do you think of BP? What do you think of this oil spill? And how should America proceed in legislating, if at all, for prevention of future disasters?
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Jun 11 2010, 06:07 AM (Post #2)
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I'm not sure what's the best course of action now to correct the BP spill, but I believe that in the future it should be codified into law that companies are responsible for the damage they cause, plus punitive fees on top of that. Damages include the cost of cleanup, the effect on various economies (i.e. fishing), the environmental damage, etc, and companies can be pushed into bankruptcy and their assets sold if they lack the liquidity or equity to pay for the cost. Smaller companies that are likely unable to deal with such disasters themselves will be required to insure themselves against all contingent costs.

The main point is that everyone is responsible for paying for the full opportunity cost (of their actions) on the sum of everyone else. That is socially optimal, and I believe fair. That is the key insight behind the VCG mechanism.

In the long run, we just need to stop using oil.
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Jun 12 2010, 12:26 AM (Post #3)
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QUOTE (Jinghao @ Jun 11 2010, 01:07 AM)
but I believe that in the future it should be codified into law that companies are responsible for the damage they cause, plus punitive fees on top of that. Damages include the cost of cleanup, the effect on various economies (i.e. fishing), the environmental damage, etc, and companies can be pushed into bankruptcy and their assets sold if they lack the liquidity or equity to pay for the cost.
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What do you mean, "in the future"? BP is already paying significant costs for the cleanup, and will have to pay damages and punitive fees.
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Jun 12 2010, 03:31 AM (Post #4)
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QUOTE (Jermajesty Jodi Gajadar @ Jun 11 2010, 04:26 PM)
What do you mean, "in the future"? BP is already paying significant costs for the cleanup, and will have to pay damages and punitive fees.
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I am referring to the 75m law.
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Jun 12 2010, 07:42 AM (Post #5)
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QUOTE (Jinghao @ Jun 11 2010, 10:31 PM)
I am referring to the 75m law.
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Leftist propaganda, that is. BP will be paying billions, you will see. Just like the Exxon-Valdez...they are still paying for that all these years later.
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Jun 12 2010, 04:07 PM (Post #6)
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QUOTE (Jermajesty Jodi Gajadar @ Jun 11 2010, 11:42 PM)
Leftist propaganda, that is. BP will be paying billions, you will see. Just like the Exxon-Valdez...they are still paying for that all these years later.
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According to Goldman Sachs the total costs will be $40k/barrel. Since 25k barrels are escaping each day, their daily loss is $1B at this rate.

Will they pay for all the costs?
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Jun 12 2010, 07:52 PM (Post #7)
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I think you answered your own question. Not only will they be paying tremendous penalties, but the loss alone is "paying" too.
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Jun 13 2010, 05:19 AM (Post #8)
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QUOTE (Jermajesty Jodi Gajadar @ Jun 12 2010, 11:52 AM)
I think you answered your own question. Not only will they be paying tremendous penalties, but the loss alone is "paying" too.
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My concern is that they will not pay that full cost.

The $40k includes externalities.
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Jun 13 2010, 06:07 AM (Post #9)
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I dont follow the news, but from this topic i gather the BP gas station spilled some gas somewhere?

Didn't jesse jackson tell black people to boycott them a while back?
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Jun 13 2010, 04:39 PM (Post #10)
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QUOTE (AWESOM-O @ Jun 12 2010, 11:07 PM)
I dont follow the news, but from this topic i gather the BP gas station spilled some gas somewhere?

Didn't jesse jackson tell black people to boycott them a while back?
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Oh man -- BP spilled a bunch of gas in the Gulf. Think....Exxon Valdez 1989.
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Jun 13 2010, 04:40 PM (Post #11)
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QUOTE (Jinghao @ Jun 12 2010, 09:07 AM)
According to Goldman Sachs the total costs will be $40k/barrel. Since 25k barrels are escaping each day, their daily loss is $1B at this rate.

Will they pay for all the costs?
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Doubtful -- but who's going to let them off the hook? Obama doesn't seem like he will, with his "who am I going to kick in the ass" comment.
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Aug 9 2010, 05:42 PM (Post #12)
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So, it's plugged and such. And apparently much of the oil is being "consumed" by "nature" or what have you.

Lingering problems: oil dispersants which have been far more destructive than the oil itself; tar built-up in marshes, seafood spawning ground, and seabird rookeries; oil particulates seeping into crustacean eggs...

And of course, what about drilling, itself? More active enforcement of regulations? Elimination of a liability cap?
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