BP and Union Carbide: Shifting Standards of Corporate ‘Responsibility’
In India, with its love of acronyms, BP has always meant something different from British Petroleum. BP is blood pressure, and a rather common middle-class preoccupation is the measurement of BP with home BP kits, not least of all because there are many things, from the oppressive heat to the traffic snarls caused by CPWD’s lazy habit of leaving behind large amounts of debris on every road, that tend to make an average person’s BP shoot up. [CPWD, for the uninitiated, is Central Public Works Department.] It appears that the BP of the unflappable Barack Obama, hitherto renowned (and sometimes criticized) for never exploding with anger, has likewise suddenly registered a rapid increase. The spill from the BP well in the Gulf of Mexico, which has caused anger and consternation among the residents of Louisiana, Mississippi, Alabama, and Florida, has created environmental havoc and there seems to be no end in sight to this crisis. In an interview with NBC News Today on June 8, where Obama was questioned about the Gulf of Mexico BP oil spill, he is reported as saying: “I don’t sit around just talking to experts because this is a college seminar. We talk to these folks because they potentially have the best answer so I know whose ass to kick.”
Obama’s faith in experts is unexceptional, even if he is more prone to expressing his profound respect for expertise knowledge than other recent occupants of the White House. What is exceptional – not, let us be sure, in the annals of American presidential history, but only judged against Obama’s recourse to more elevated speech in comparison with some of his predecessors -- is his casual reference to kicking ass, and more recent reports suggest rather unequivocally that Obama is now prepared to exercise the prerogatives of American power to secure “adequate compensation” for all those who have been adversely affected by the oil spill. The White House and BP have reached an agreement that BP will create a $20 billion fund that will be used to clean up the Gulf and award compensation to those whose lives and livelihoods have been endangered by the oil spill. It is significant that Obama himself has been involved in negotiations with BP’s senior executives and lawyers, and that the agreement, if one wishes to call it that, was struck not with the EPA or the Department of Justice, but rather with the White House. The oil spill has become a matter of state, a matter to be adjudicated by a war cabinet. Agreement seems a rather benign word, since it is all too clear that Obama in effect ordered BP’s chairman, Carl Henric Svanberg, “to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company’s recklessness.”
There is certainly no reason to feel sorry for BP, or indeed any other similar monstrosity, and others can mourn BP’s losses. In Britain there is said to have been concern that Obama has been playing the nationalist card, referring to BP as “British Petroleum” even though BP is a multinational and shed its earlier name some years ago; others note that the fate of millions of pensioners and investors is tied up with BP and neither Obama nor British Prime Minister David Cameron can permit BP to go down under. Some in Britain, mindful of the “special relationship” that is said to exist between the US and the UK, might perhaps take affront at Obama’s provocative admonitions to “British Petroleum”. Nevertheless, the consequences for bilateral US-Britain relationships, of which much has been said, seem trifling in comparison to other considerations. There is no gainsaying the fact that BP has not been on the level: the amount of oil it claimed to be retrieving some two to three weeks ago, around 15,000 barrels a day, is three times the amount it first claimed was leaking from the spill. Indeed, more recent estimates suggest that 60,000 barrels, or the equivalent of 2.5 million gallons of crude, are spilling out every day. BP claimed to have spent by mid-June well over $1 billion in efforts to plug the leak and clean up, and in compensation claims to workers, fishermen, and businesses along the coast.
“Corporate responsibility” has always largely been a fiction, but since Obama has been so strident in denouncing BP’s negligence and culpability and insisting that BP be held fully accountable, the question that arises is whether American corporations will be held to the same standards. But, before turning to that question, it may be instructive to dwell on America’s own culpability, about which the US media has been (true to its reputation to avoid anything that might be remotely interesting) studiously silent, in the matter of the oil spill. In April 2009, the Minerals Management Service (MMS), an arm of the Interior Department charged in part with supervising and policing offshore operations, granted a “categorical exemption” to BP from the National Environmental Policy Act. Some will claim that MMS made a wholly inadequate evaluation of the possibility of a large oil spill and thus erroneously allowed BP an exemption, but this obfuscates the wretched history of the MMS as an organization rife with corruption. In the American context, there are other factors that preclude effective regulation of corporate giants, none perhaps as prominent as the fact that senior officials at corporations, in the US administration, and in regulatory agencies are all part of what is called the revolving door. Thus, to take one example, Obama’s appointee as head of the Department of the Interior, Ken Salazar, has voted against regulation that would require vehicles to be more fuel efficient, and he similarly voted against an amendment that would have repealed tax breaks for major oil companies -- and this man is supposed to be safeguarding the environment! Salazar in turn lured Sylvia B. Vaca from BP, where she spent a stint after holding a position in the Clinton administration, to be the deputy head of the Minerals Management Service. ‘Revolving Door’ may be one way to describe these scandalous migrations, but I am more inclined to think of these relationships as indicative of the place of incest in the history of the American establishment.
In these same weeks that the oil spill has enraged the US, the Indian Supreme Court handed down, after a lapse of twenty-five years, a judgment which sends a handful of former Union Carbide Corporation of India (UCIL) officials to jail for a mere two years. Over 2,000 people died in the immediate aftermath of the leak of a poisonous gas from a Union Carbide plant in Bhopal; since then, at least another 20,000 people have died as a consequence of their exposure to the lethal gas, and half a million have suffered various ailments for the same reason. UCIL was a subsidiary of Union Carbide (now absorbed into Dow Chemical), but Union Carbide, which owned a 50.9% share in UCIL, refused to accept responsibility for the catastrophe and resolved upon a strategy intended to establish that it had a distant relationship with its own subsidiary; indeed, it even suggested that a disgruntled Indian employee had sabotaged the plant. Since, it was reasoned by many in the US, and certainly by Union Carbide’s officials, life in India is cheap, why bother at all with substantive compensation? The paltry amount of $470 million was agreed upon as final compensation for the hundreds of thousands whose livelihoods, hopes, dreams, and futures were snatched from them. The complicity of the Indian government in this crime against common people cannot be denied, but neither should that admission serve as the pretext for exculpating Union Carbide’s responsibility.
The story of Bhopal’s gas leak has been told many times before; and though it need not be rehearsed again at this juncture, the overwhelming question remains: will Obama have the daring to admit Union Carbide’s responsibility in its crimes and order Dow Chemical to pay a just compensation to the victims of the gas leak? And, yet, this is scarcely a question, since the answer has long been foretold. Obama will do no such thing. We should not be surprised that, when Obama finally leaves the White House, we find him part of the ‘revolving door’, moving from one corporate board to another, from one obscenely lucrative speaking engagement on “corporate leadership” to another.
Copyright: Vinay Lal, 2010