OPINION: Red Tape Never Was What It’s Cracked Up To Be

The Pencil Warrior

By Dave Wheelock

Hidden beneath the drama of media accounts detailing efforts to halt the massive oil leak in the Gulf of Mexico are the glimmerings of more essential questions: how did this unnatural disaster happen, and how can we prevent anything like it from reoccurring? The answer to these questions depends, if you will pardon the pun, on how deep beneath the surface you wish to drill. What if we tunnel beneath the blowout preventers, acoustic switches, and frantic finger-pointing between BP and its subcontractors, all the way down to the origins of the first federal regulatory agency in 1887?
Corporate hucksters, of course, have long decried the wave of “over-regulation” that needs to be peeled “off industry’s back.” As if it was sudden. As if it was a problem for them. As if it was happening.
As reported by the New York Times on May 7: “Federal regulators (from the Mineral Management Service, or MMS) warned offshore rig operators more than a decade ago that they needed to install backup systems to control the giant undersea valves known as blowout preventers . . . The warnings were repeated in 2004 and 2009. Yet the . . . Service . . . never took steps to comprehensively address the issue, relying instead on industry assurances that they were on top of the problem, a review of documents shows.”
The MMS, which is tasked with both “regulating” extractive industries and collecting royalties from companies plying those trades (the government’s second revenue-producer after the Internal Revenue Service), has a history that falls somewhat short of the watchdog image. You may remember revelations a few years back that agency officials took bribes and engaged in drug use and sex with oil industry types in the Western U.S. The agency’s own scientists have accused senior agency officials of revising staff reports to eliminate environmental concerns surrounding oil drilling applications for offshore sites near Alaska.
Space prohibits a directional drill to Vice Resident Dick Cheney’s 2001 top-secret Energy Task Force, graced with cameos by such rightwing darlings as Grover Norquist, founder of something called the Council of Republicans for Environmental Advocacy. Suffice to say the Task Force gang had their own ideas about environmental concerns. But anyway, that’s why you have Google (hint: Washington Post, 7/18/2007; Pencil Warrior 8/24/2006 and 11/10/2005).
Instead, let’s recall the origins of the regulatory system the drill, baby, drill crowd are so desperate to get off their backs. The first U.S. regulatory agency, the Interstate Commerce Commission, owes its birth in 1887 not to the farmers and workers of the U.S. Populist movement, but rather to the notorious railroad barons who attracted so much of their ire. The transport of passengers and especially freight was the nineteenth century’s equivalent of the automobile or the computer in terms of revolutionizing business. The vast potentials for profit attracted fierce competition among railroad companies, and the biggest outfits started looking for ways to protect “their” turf by buying political leaders, artificially fixing prices, and other nefarious means.
But citizens did their homework in those days. Due to their natural wariness of early right wingers atop mounds of cash, most states had laws preventing one corporation from owning stock in another, thus closing off the strategy of corporations simply merging to squeeze entrepreneurs out. In 1890 the Sherman Anti-trust Act outlawed monopolies by denying the formation of business trusts.
Worst of all for the corporations, people were organizing to push their government to abolish the methods railroads, mines, banks, and factories were using to cheat and exploit them. A tense period of strikes ensued, bringing vicious counterattacks by owners often backed by the public’s own law enforcement forces. Yet the resistance continued.
And so the railroads and their cronies in office decided to settle for a new government creation that would pacify the public while paying the costs of organizing an industry they themselves would otherwise have to pay (quality control, safety inspections, enforcement of standards). The Interstate Commerce Commission even provided a mechanism to legally fix prices by mandating minimum costs emerging companies could charge. Thus was set, from the beginning, the pattern of "captured agencies".
Richard Olney, a lawyer for the Boston and Maine Railroad who later became President Cleveland’s Attorney General, gave comfort to troubled railroad tycoons. “The [Interstate Commerce] commission, as its functions have now been limited by the courts is, or can be made, of great use to the railroads. It satisfies the public clamor for a government supervision of railroads, at the same time that that supervision is almost entirely nominal.”
No doubt in public Olney put it another way. For all we know he may even deserve credit for “the wealth-producing engine of this country is being strangled by regulatory red tape.”
In a system of captured regulatory agencies, citizens can only wonder where to expect the next manmade disaster.

Dave Wheelock, a member of the Oneida Nation, lives and works in Socorro. Contact him at davewheelock@yahoo.com. Mr. Wheelock’s views are not necessarily those of the Mountain Mail.

OPINION: Red Tape Never Was What It’s Cracked Up To Be