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Fast times at the Minerals Management Service (or how Big Oil screwed us in more ways than one)

If you’ve already had breakfast this morning, I’d advise that you skip Juliet Eilperin’s and Scott Higham’s piece in today’s WaPo on “How the Minerals Management Service’s partnership with industry led to failure.” It really will make you sick to your stomach.

Before the BP disaster in the Gulf of Mexico, you probably never heard of the obscure Minerals Management Services, the former federal agency that until recently was charged with regulating offshore drilling leases. Now we know that  during its sordid 28-year history the agency was more facilitator than regulator. From the WaPo:

Top officials and front-line workers routinely referred to the companies under their watch as “clients,” “customers” and especially “partners.” As the relationship became more intertwined, regulatory intensity subsided. MMS officials waived hundreds of environmental reviews and did not aggressively pursue companies for equipment failures. They also participated in studies financed and dominated by industry, more as collaborator than regulator. In the face of industry opposition, MMS abandoned proposals that would have increased costs but might have improved safety.

Here’s one thing I didn’t know about the MMS, though it now makes perfect sense: the agency was created in 1982 by James Watt, who holds the distinction of being the worst and most evil secretary of the interior in the history of these United States. Another thing that Eilperin and Higham reveal is that administrations from Reagan to Obama turned a blind eye to MMS shenanigans because the agency was a cash cow, responsible for more federal revenue than any other agency except for the Internal Revenue Service.

Bruce Babbitt, Bill Clinton’s secretary of the interior, admits that it might not have been such a great idea to trust the oil industry to practically regulate itself.

Babbitt describes how a relentless drive to reduce the federal bureaucracy in the 1990s solidified the partnership between Washington and the offshore industry. The Interior Department began to emphasize “performance-based regulation” on the assumption that industry was better positioned than the government to determine what practices worked.

“That is a mistake for which I shoulder part of the blame,” he says. “It was not a good decision. My belief, with considerable hindsight, is there is no place for performance-based regulation because of the high risk.”

Joe Newman is deputy director of communications at Public Citizen. Follow him on twitter @cosmicsmudge.
Flickr photo by vphill.