6-Month Moratorium in the Gulf: Commentary

My hunch is that the administration now realizes the knee-jerk reaction to mandate a six-month moratorium on new drilling in the gulf was exactly the wrong thing to do. Someone likened this to a moratorium on all flying for six months if a commercial jet crashed.

Now more than ever, the long-term outcome of events in the gulf rests on the administration, even more so than on BP. The spill may have devastated the coast beyond repair for decades but sometimes doing nothing is better than doing something. Doing nothing might have been politically unpalatable but doing something that makes things even worse is political suicide.

As the number of jobs lost in Louisiana starts to sink in, the administration is in a lose-lose situation. If it does not lift the six-month moratorium, job losses in Louisiana will be devastating to the state. Everything in the state is tied to oil, except tourism and after Hurricane Katrina even tourism has yet to pick up. I wonder how much Louisiana's economic activity contributes to the nation's GDP (probably not all that much) and how much its employment numbers contribute to the national numbers (probably quite a bit).

If the administration decides to lift the moratorium, which it almost has to do, at best, it flip-flops. At worse, the end of the moratorium will come just as the hurricane season reaches its zenith, and if there's another oil leak due to a hurricane, it will fall squarely on the president's shoulder because he alone made the decision to lift the moratorium. (The hurricane season extends into November so it is impossible to tie an early cessation of the moratorium with the end of the hurricane season; both are scheduled to end about the same time as it stands now.)

The administration's decision to lawyer-up against "British petroleum" and to "keep a foot on its throat" has created irreparable damage to America's relationship with its number one ally. This folly makes it less likely that the British government will be all that willing to put pressure on BP in support of America's effort to get BP to pony up with more financial concessions. The Brits are livid about the effect this has had on their retirement accounts and the British government is not about to pile on more on BP when it's down. Related or unrelated to this turn of events, the British government has since announced no more troops in support of America's war in Afghanistan. (An aside: the situation in Afghanistan has gotten worse in just the past week, according to the administration's biggest supporter, the New York Times. It continues to look like a lost cause. Even Congress is starting to get nervous.)

The president first visited the gulf coast on May 2, about two weeks after the initial event, the rig explosion.

All in all, a) the late response to the crisis; b) the lawyering-up; and, c) the knee-jerk reaction to implement a six-month moratorium all remind us of the concern Hillary Clinton had when she talked about the 3:00 a.m. phone call. Ironically that 3:00 a.m. phone call had nothing to do with an international event.

The explosion occurred at 11:00 p.m. EST, and so it's possible, the call to the White House came at 3:00 a.m.

The explosion occurred April 20, the eve of Earth Day.