the risk is socialized

Oil drilling: the risk is socialized

“Privatize the profit, but socialize the risk” is the meme of the moment: it’s what happens when you let a company take home the benefit from operations but bail it out with public money when times turn bad, and as we all know it leads to heedless corporate behavior and eventually, to tears. You would think that now of all times our government would reject deals of this sort. But the House quietly passed yet another “privatize the profit, socialize the risk” scheme yesterday: it opened up both coasts to oil drilling.

This, despite Exxon’s successful legal action culminating earlier this year to reduce its payments on the Exxon Valdez disaster from its original $5 billion. (If you don’t remember the Exxon Valdez oil spill, you can be forgiven; it might have happened before you were born; the ship went aground back in 1989.) So, despite the most open-and-shut culpability imaginable, Exxon successfully managed to socialize the risks of oil production in Alaska, using their privatized profit to fund a 19-year delay and, eventually, bailout. We all ended up paying for the Exxon Valdez; can we really expect anything better when oil rigs start appearing off our beaches and in our fisheries? The risks are great, which is why the coasts were put off limits in the first place, and now they are yours and mine. Photo by ingridtaylar via Flickr.