Regulatory Non-Enforcement by Design: Earthworks Shows How the Game is Played

Regulatory Non-Enforcement by Design: Earthworks Shows How the Game is Played by Steve Horn, September 27, 2012, Desmogblog
Earthworks Oil and Gas Accountability Project published a scathing 124-page report this week, “Breaking All the Rules: the Crisis in Oil & Gas Regulatory Enforcement.” The content of the report is exactly as it sounds. That is, state-level regulatory agencies and officials often aren’t doing the jobs taxpayers currently pay them to do and aren’t enforcing regulations on active oil and gas wells even when required to under the law. This is both out of neglect and also because they’re vastly understaffed and underfunded, meaning they literally don’t have the time and/or resources to do proper inspections.

And on those rare instances when regulatory agencies and the regulators that work for them do enforce regulations on active oil and gas wells, Earthworks demonstrated that the penalties for breaking the rules are currently so weak that it’s merely been deemed a tiny “cost of doing business” by the oil and gas industry. It’s certainly not a report to read for the optimists of the world. The Executive Summary sums things up nicely: The U.S. faces a crisis in the enforcement of rules governing the oil and gas industry. … One of the most shocking findings of the study is the fact that 51-91% of the active wells studied in the six states (Colorado, New Mexico, New York, Ohio, Pennsylvania, Texas) have operated with zero inspections to date since the beginning of the ongoing shale oil and gas boom in about 2008. Translation: over half of all wells go uninspected each year in these six states and hundreds of thousands of active oil and gas wells across the country are never inspected. … As we explained in analyzing Bloomberg Markets Magazine’s November 2011 cover story about the “Koch Brothers Secret Sins,” the “haves” almost always come out ahead in the U.S. legal system. That’s not our analysis, but the age-old analysis of one of the founders of the study of sociology of law, University of Wisconsin Law School professor Marc Galanter, author of the seminal paper “Why the ‘Haves’ Come Out Ahead: Speculations on the Limits of Legal Change.” As we wrote, the Bloomberg “article is highly applicable not only to the Koch Brothers, but to all corporate criminals of their ilk.” We proceeded to write, Galanter’s thesis, which he presented in his meticulously researched 60-page essay, is now common knowledge — in the American legal system, the “haves,” or the “Repeat Players,” as he puts it, nearly always come out ahead. The converse, the “one-shotters,” as he calls them, nearly always lose. Why do the “Repeat Players” never really lose? Because they have attorneys who are constantly working the legal system, fighting big-money lawsuits, and developing the techniques necessary to “come out ahead,” including the ability to gain rapport with judges and juries. … “This report shows that rules and regs aren’t worth the paper they’re written on if they’re not enforced.”

But perhaps it’s more sinister than that: the rules and regs written by and for the oil and gas industry are worth the paper written on precisely because they’re not enforced. … Sharon Wilson, author of the well-read blog Texas Sharon and Earthworks’ Gulf Regional Organizer told DeSmogBlog that she chocks it up to not only a crisis in regulatory enforcement, but something far more grave: a crisis in democracy as we know it. “There should be no new drilling until our government fixes the problem and the public can trust the well-being of families and communities in America will come before industry’s bottom line,” she said. [Emphasis added]

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