Buckeye RINO

I know that there is a growing chorus for eliminating oil drilling, particularly offshore, but I’m still on board with the “all of the above” approach to meeting our nation’s energy needs.

Failing to obtain fossil fuels domestically will only add to our procurement of fossil fuels from abroad, no matter how optimistic we are about the emergence of the renewable energy industry. It will be decades before the renewable energy industry can produce at a large enough scale to replace the need for fossil fuel. So if we must extract fossil fuels from somewhere, why not here, where much is consumed? Are we somehow more special than other nations that we can’t get our hands dirty by extracting the energy we need? If so, then why not just export our garbage to other countries instead of doing the dirty work of managing the waste ourselves, because we’re too special and they’re not?

Staying on course with the “all of the above” approach does not necessarily mean that we will experience natural gas explosion after natural gas explosion, mine disaster after mine disaster, and oil spill after oil spill. Corporate responsibility could nip such events in the bud.

The oil spill in the Gulf of Mexico is not the result of some freak accident, and it’s not as if continuing offshore operations will necessarily lead to more disasters. This was totally preventable, and I hope that the business world, not just oil companies, learn a lesson from this. The lesson is: Cutting corners on safety, quality, and fail-safe measures just to shave some costs here and there can come back to bite your business in the butt, and can ultimately destroy your company. An ounce of prevention is still worth a pound of cure (that maxim has no expiration date).

If irresponsibility within each company were eliminated, then, in the energy industry, for example, we would not need to fear more deaths in coal mines, more explosions at natural gas refineries, and, of course, more oil spills. If a company can’t purge itself of personnel and practices that cause the company to fail to measure up, then I certainly hope that the marketplace and legal penalties purge the entire company from an industry.

I have no sympathy for BP when it whines that sales of their gasoline have plummeted by 20%. I hope sales plummet by 90%. And as for Transocean, I hope they are liquidated and they fold, with more responsible companies taking ownership of Transocean’s former assets. Only if the outcomes for these corporations are absolutely disastrous can the implications reverberate around the corporate world.

Lately, though, it seems as though governments, such as our own, have done more to absolve companies of responsibility. Just look at the Wall Street bailouts. In my mind, there’s no such thing as “too big to fail.” Instead, I believe a company should reap what it sows. The phrase “too big to fail” was coined by the politicians and the most politically connected firms to save their own butts. The powers in Washington and New York conjured up a total fiction of the end of the world as we knew it, hoping the American people would swallow the bait, hook, line, and sinker, as they tried to put a positive spin on the bailouts. If the bailouts hadn’t occurred, sure, New York might have been destroyed as a financial capital, and, sure, the tremors would have shaken the Main Street economy, but the free market would have led to the emergence of a new financial capital, whether it be Houston, or Chicago, or San Francisco, or Atlanta, and market corrections could have occurred quickly and we’d already be seeing the light at the end of the tunnel. Instead, New York was preserved, which is a reward for bad behavior. There is no light at the end of the tunnel of this economic malaise we are experiencing, even after the politicians and Wall Street assured us this was the better path. It wasn’t a better path, except for the culpable, and the market has been artificially prevented from making corrections, meaning more bad economic news is in store. We haven’t hit bottom yet, folks. We may not have averted seeing the end of the world as we know it.

Perhaps the oil spill could signal a turning point where companies will no longer be coddled by Washington, and have to bear the full brunt of the punishment meted out by the marketplace and legal penalties. I certainly hope Washington changes it’s M.O.

In any industry that poses potential hazards, it seems that there are entities that cause a disproportionate share of the infractions within the industry. Why wouldn’t infractions be proportionate? It’s clearly evident that some companies put a premium on safeguards, while others have a short-sighted, bean-counting, devil-may-care, cavalier approach toward operational compliance. How else can it be explained? If everyone in the industry were on the same page, then infractions would be proportionate, on average.

Clearly there is a corporate culture among the companies that play fast and loose that the CEO sets the tone for, and it percolates downward through the rest of the company.

I guarantee the grunt workers, if they were making the company’s decisions, would always err on the side of compliance.  They have a lot on the line when things go horribly wrong at the work site.

The ones who have less, personally, at stake should the company go under, are the ones most prone to take unacceptable risks. Corporate executives will always go home after work each night, even if a facility explodes. Only the grunts on-site face that danger. Corporate executives will have the golden parachute to exit a company jeopardized by the risks they took. Corporate executives have the professional references and the good credit rating so that they are able to find a position at another company. When the company fails, the grunts will be out of work with no parachute, with no supervisor at the now non-existent company to respond to reference checks conducted by other potential employers, and the lack of income may certainly cause the grunt to fall behind on paying bills, thus wrecking his credit score, which, of course, HR departments use among the criteria for hiring decisions.  I suppose HR departments use credit scores as hiring criteria on the basis that it’s an indicator of ethical behavior.  I see potential flaws in that line of thought.

There was a time that I worked in heavy industry. I worked at a manufacturer of automotive parts for Ford. I was represented by a labor union, UAW. When the UAW negotiates contracts, it knows full well that management may be prone to take unacceptable risks. So the union negotiates rules for job classifications to ensure that jobs are performed only by those who know what they are doing. The union negotiates to ensure that quality inspection of the auto parts is conducted by the union workers, not the management. The union has full-time safety representatives to blow the whistle when potential hazards are unacceptable, and bring production to a halt, if necessary. As a result, man-hours lost due to on-the-job injuries were exceedingly rare. We grunt workers wanted to be able to go home after work at night, and we wanted a job to return to the next morning.

I’ve already catalogued several of the missteps that labor unions have taken, particularly in the political arena.  But in no way would I advocate union-busting.  I wouldn’t even advocate for Ohio to become a so-called “right-to-work” state.  Labor unions still provide a vital role in the companies where they are organized.  Besides the swings of the marketplace and the fear of liability and legal penalties, labor unions also play a role in holding company management accountable.  If the corporate culture within a company demanded fail-safe measures and operational compliance, then the accountability function that a labor union performs is probably not necessary, but in companies that take unacceptable risks, a labor union can definitely be a blessing to its membership.

If corporate America learns these lessons of precaution and prevention presented by this oil spill, then I do not fear the future as we follow an “all of the above” approach toward energy independence.