Tuesday, July 27, 2010

BP shows Hayward the door, when will Massey Energy give Blankenship the boot?

For anyone following the BP Oil Spill Disaster, the news that BP is cutting CEO Tony Hayward loose should begin to bring a small sense of vindication to residence of the Gulf of Mexico.  As Hayward made one PR gaff after another, paving the way for his exit, Hayward's statements and actions began to reveal the massive disconnect between everyday people laboring to make a living and the lifestyles of corporate elites. 

Whether it be Hayward's statement that he understood the anger of Gulf residence and he too "wanted his life back", or his yacht outing as millions of people and small business owners lived the reality of their livelihoods destroyed, it is clear the financial elites of the world have a different mentality when it comes to lives being disrupted and live in a different reality all together. 

As one big corporate CEO exists the stage (with a "Golden Parachute" severance package of $1.6 million per year for causing the largest industrial disaster in American history), another Big Energy tycoon is aggressively defending his company's commitment to safety despite mounting evidence to the contrary. 

Richmond based Massey Energy and its outspoken CEO, Don Blankenship, defiantly continue to claim that they do not put profits over people.  The disaster at the Upper Big Branch Mine on April 5, 2010 that caused the deaths of 29 miners continues to reveal a corporate culture at Massey Energy that can best be summarized as:  mine the coal, disregard MSHA and Federal Safety Regulations, pay the fine(s), ignore fixing safety problems, keep the coal coming. 

Up to this point, the common thread connecting BP and Massey Energy (besides being giants in the energy sector of the world economy) was the corporate culture of profits over people and safety.  In order to provide some context and perspective about corporate culture in the oil industry, NPR's Wendy Kaufman compared the most recent safety records of BP and Exxon: 
"In the last three years, when we look at refineries, 97 percent of the violation considered egregious and willful were given to BP.  So, BP had 760.  Exxon had one," says Pavel Molchanov, and oil and gas analyst at Raymond James.  "That's a colossal difference." 
Exxon's change in corporate culture, resulting from the Exxon Valdez Oil Spill, is reflective in its current safety record.  Since 1989, Exxon began taking safety seriously and realized that if they strictly adhered to safety standards, the profits would be there and the company would survive.  But, this change in Exxon's corporate culture didn't happen overnight.  It took years and as the NPR story points out, many of the fisherman who were directly affected are now dead and were never compensated for the damage the Exxon Valdez caused.  With BP's removal of Tony Hayward and American Robert Dudley taking over effective October 1, 2010, BP is at least letting their actions speak louder than their words regarding changes in its corporate culture. 

So, what does this say for Massey Energy and Don Blankenship?  Let's make a comparison, all-be-it an apples to oranges comparison (Big Oil to Big Coal) between the BP safety violations at its refineries since 2007 and Massey Energy's safety violations at the Upper Big Branch Mine from 2009 to 2010.  PB's violations cover all its refineries and total 760 over a three year period.  Massey Energy's violations at the Upper Big Branch Mine alone total 639 (515 safety violations for 2009 and 124 safety violations for 2010)That's at just ONE MINE.  While being interviewed by Bloomberg Television's "In Business" Don Blankenship states
"The feeling of the industry is that we're regulated too much and not too little.  Tragedies lead to more regulation." 
Well, it seems that all those burdensome regulations didn't make one bit of difference to the 29 miners killed at the Upper Big Branch Mine since Massey Energy ignored them.  Blankenship is right about one thing, events like Sago and Upper Big Branch do lead to increased scrutiny, reviews of safety standards, regulations, and a tightening of those regulations due to non-compliance or blatant disregard of the regulations.  As pointed out by today's Roanoke Times Editorial, the Mine Safety and Health Act passed in response to another mine disaster, "coal mining deaths have declined significantly. There were 260 deaths in 1970. Since 1984, there has not been a year with more than 100 deaths."  Below is a link to a chart on the MSHA web site tracking the number of deaths in coal mines since 1996: 

Coal Fatalities by State 1996 - 2010 

At this point, Massey Energy and Don Blakenship don't seem to be getting the lesson that Exxon learned years ago, and BP seems to understand:  If you put safety first, the profits will follow.  Again, despite evidence to the contrary Don Blankenship (along with business friendly conservatives in Congress) want the Federal Government to leave corporations alone. In their mind, self regulation will magically lead to better safety, decrease the number of job site accidents, and fewer deaths.  So just that I get this clear, too much regulation leads to more accidents, deaths, and most importantly costs people their JOBS? 

Lets see, Big Oil, Big Coal, Big Banking and Finance aggressively lobby Congress and give heavily to the campaigns of business friendly lawmakers to look the other way, deregulate, and cut taxes.  During the Bush Administration, household incomes remain flat or decline while corporate profits skyrocket and the top 1 percent got wealthier.  The economic crisis that starts around 2007 and accelerates in September of 2008 leads to the loss of over 8 million jobs, as well as trillions of dollars in savings, investments, and property values disappearing, in some cases over night.  Sago, Upper Big Branch, and the BP Oil Disaster leads to numerous deaths and erases the way millions of people earn a living. 

As I stated earlier, it is clear the financial elites of the world have a different mentality when it comes to lives being disrupted and live in a different reality all together.  So, the question now becomes how long will it be until Massey Energy shows Don Blankenship the door?  Or will they continue thumb their noses at the American people and stand by "The Don"? 

The American people want justice but they're so mad and frustrated they don't know who to blame.  Americans are worried about keeping the jobs they still have and the unemployed are still trying to find work.  Their anger and angst has shifted from the ones responsible for the mess we're in to the current Presidential Administration and Congress. 

Business friendly conservatives have been so effective in crafting this "Enemy of the State" mentality that's focused on the Obama Administration's legislative agenda and Congressional Democrats, that they very well could take control of the House or Senate or both. 

It remains to be seen if Democrats can refocus the attention and anger on Corporate America before the 2010 Mid-Term Elections, the ones that are really responsible for the majority of the fiscal ills of the nation.  One thing that could go a long way towards a national feeling of vindication is if someone like Don Blankenship went to jail.  That would be justice.

1 comment:

  1. According to the AP Wire, Massey Energy will post a 2nd Quarter loss of $88.7 million.


    Lets see if the losses continue...