Go Short on BPApril 29th, 2010

What we did was to entrust the future of the planet as a place hospitable to humans to a few greedy American and British businessmen, and they’ve opened a passage to hell. What’s pouring into the Gulf of Mexico stands to be dispersed from Cuba to Gibraltar and to all points in between.

People in our government let British Petroleum operate an unsafe rig in the Gulf, and nobody made the company install a proper shutoff. The oil is flowing freely at a rate that can only be estimated, and it’s already created a slick almost the size of Connecticut. The authorities and the company have no idea how to stop the flow and it is likely to continue for weeks.

Media coverage of the event seems to focus on the short-term effects on local fisheries. There’s hardly any discussion of the true consequences. On CBS, the reporter didn’t talk to a single scientist or engineer, except for a BP hack who said about 25 words. If anyone has occasion to review this coverage a few weeks from now, it will be deemed superficial, at best, and, at worst, deliberately misleading, to the advantage of the culpable company–a regular advertiser.

By my elementary reckoning, accepting recent estimates of 5,000 barrels leaking per day, this spill exceeds Exxon Valdez after 50 days. And nobody’s saying the spill gets contained within 50 days. Tell me if I’m wrong on this, but isn’t the water in the Gulf flushing continually into the Atlantic, passing the entire East Coast of the US in its journey to Western Europe?

What we’re looking at is an unfolding catastrophe, not just for local shrimpers and sea birds but for the entire Atlantic. When the world catches on to what our corrupt government has done here, unleashing poison in unprecedented volume into a stream that touches the whole western world, people are going to get mad.

Overlooked by the news reporter from CBS was the probable destination of the oil. If it follows the prevailing currents, as it has so far, and if it leaks for 90 days, it will pass between Cuba and Florida, kiss the North American coast from Miami to Newfoundland and then cross the Atlantic to foul the North Sea and Baltic Sea beaches of our partner in oil, Britain, and its erstwhile mates along the North and West Coast of Europe.

Looking at it from a lawyer’s point of view, I see unprecedented liability, and I see it falling not only on BP and the US government but on each and every one of us. The USA and Britain will be taken into receivership over this, in my opinion, and the reparations will make the penalties inflicted on Weimar Germany look paltry by comparison.

America should know this: if the flow of oil is not stanched within days, there will almost certainly be another collapse of value in the US economy in the near term. People will get out while the getting is good, before the public catches on to what’s ahead. I suspect the short-sellers are on the prowl as I write, with the news-reporters and financiers scrambling to liquidate before anybody starts talking about how bad this really is.