Thousands of gallons of oil have been pouring into the Gulf of Mexico daily since the Deepwater Horizon rig exploded on April 20, killing 11 workers. Most commentators believe public opinion will turn against drilling for oil and towards alternative technologies. New York Times columnist Thomas Friedman opined this week that, “if President Obama wants to seize this moment, it is there for the taking”. But this is a misreading. People realise that stopping drilling in places such as the Gulf of Mexico means consuming less oil. There is no evidence they are willing to take the steps that would be required. The Deepwater incident makes the transition to alternative fuels less likely, not more likely.
Far from seizing the moment, President Barack Obama is almost certainly wishing it would go away. Co-ordinating disaster relief is harder than it looks. Many complex procedures – heart surgery, for example – have an element of repetition. Disasters are one-offs. The only organisation equipped to carry out complex one-off operations is the military. It is necessarily wasteful, with protective resources it will never need. Environmental watchdogs have no such resources. What they have is the bully pulpit. The administration has sought to scapegoat BP, which owns the leaking oil, although it is Transocean that operates the rig and Halliburton that was hired to cement the area that is now leaking. Interior secretary Ken Salazar promised to keep a “boot on the throat” of BP and Robert Gibbs, Mr Obama’s spokesman, repeated the words this week.
George W. Bush, the former US president, ended a two-decade moratorium on offshore drilling in October 2008. Just three weeks before the leak began, the Obama administration announced it would not enforce the moratorium, either. Mr Obama proposed opening up large stretches of US coastal waters for drilling, particularly on the south Atlantic coast and in the Arctic. Deepwater looks like a chance to build a different approach around the more stringent policies Mr Obama’s environmentalist base wants. After all, imagine a rig leak in the Arctic Ocean, thousands of miles from clean-up equipment, with the added complications of ice and 24-hour winter darkness. Imagine a leak in Florida, where beaches anchor a $65bn tourism industry, which in turn anchors the state’s economy.
It ought to be easy for Mr Obama to rule out offshore drilling, as politicians in both parties are urging him to. Arnold Schwarzenegger, the Republican governor of California, for example, asked this week: “Why would we want to take on that kind of risk?”
Well, there is an answer. California’s politicians, like those in many other states, have ordered their state so that it is dependent on cheap gasoline. Before the Federal Highway Act of 1955, Los Angeles was crisscrossed by urban rail networks. Now it is a watchword for clogged highways.
Mr Schwarzenegger and other representatives of gas-guzzling states, such as Robert Menendez of New Jersey, can stay outraged against drilling only as long as gasoline is cheap. When the price of oil rises close to $150 a barrel, as it did two years ago, gasoline hits $4 a gallon – not high by world standards, but enough to convince voters that they have been deprived of a God-given right, and drive them into an incumbent-slaying furore. The polling numbers on drilling are stunning. A poll last November in the St Petersburg Times found that 54 per cent of Floridians support drilling for oil between three and 10 miles from shore. Santa Barbara County in California, which in 1969 was the site of the most damaging oil-rig leak in US history, voted to resume drilling in April 2009.
This is why the leak in the Gulf may make it less likely that Mr Obama will get the environmental legislation he desires. Any bill with the slightest austerity or self-sacrifice has an uphill climb, particularly in this economy. Voters will accept the “new” environmentalism (focused on climate change) only as long as it is free. The temptation has been to pay for the new environmentalism by gutting the old environmentalism (focused on visible pollution).
Here the energy industry in recent decades offers certain parallels to the finance industry. Structured finance on the one hand, a green economy on the other – both innovations involve trade-offs. But the modern voter, like the modern consumer and the modern investor, is unsatisfied with trade-offs. He wants windfalls.
So innovations are presented as pure gains. This is done by rounding risk down, by assuming that hitherto rare events – a housing crash on the one hand, a drilling leak on the other – are impossible. You pay for the new efficiencies by zeroing out protections from old-fashioned risks. The risk of a spill is taken off balance sheet. Until the inevitable screw-up, it looks like a bonanza attained through the brilliance of our leaders.
At a Senate hearing in November, Mary Landrieu, the Democratic senator from Louisiana, said we had to measure the dangers of oil spills against the gains from oil: victory in the second world war, the industrial revolution, the automobile. Ms Landrieu is the largest recipient in Congress of donations from BP and its employees (just as Mr Obama is the largest recipient among all US politicians), so one might take her views with a grain of salt. She has been mocked this week. But her larger point bears listening to. After so many forests have been felled and hillocks dynamited to serve the US addiction to oil and automobiles, it would be unwise to think that the contamination of a few salt marshes is going to alter energy policy in the long term.
The writer is a senior editor at The Weekly Standard
More columns at www.ft.com/caldwell
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