Monday, May 10, 2010

Possible payoff from the Gulf Coast oil spill?

Business Times - 11 May 2010

Possible payoff from the Gulf Coast oil spill?

Obama could press for an energy bill and its cap-and-trade provisions more strongly now


FIVE years ago when Hurricane Katrina hit New Orleans, then president George W Bush was criticised for waiting much too long to act. The Bush administration had failed to provide the kind of decisive leadership required for dealing effectively with an emergency, said Democratic lawmakers and media commentators.

That negative assessment was magnified by media images of Mr Bush presenting a birthday cake to Republican Senator John McCain of Arizona in Phoenix on exactly the same day the hurricane hit.

Indeed, Mr Bush's handling of the 2005 disaster - which resulted in the death of 1,800 people and caused close to US$100 billion in damage - turned out to be the lowest point in the history of his administration.

The debacle of Katrina helped erode much of the remaining support for Mr Bush and his Republican allies on Capitol Hill - who had already come under a lot of criticism for the handling of the Iraq War. And the debacle provided political ammunition to the Democrats, who campaigned successfully against the Republican administration's management of the Katrina mess, regaining eventually control of the Senate in the 2006 congressional elections and achieving their huge electoral win in the 2008 elections.

So no one was really shocked that, five years later, with the oil spill catastrophe in the Gulf Coast of the United States now close to three weeks old, Republican lawmakers and conservative pundits are accusing President Barack Obama of gross mismanagement of the effects of the oil leak and are describing the catastrophe as - surprise! surprise! - 'Obama's Katrina'.

President Obama's response to the oil explosion was so slow and unsuccessful that he actually made Mr Bush's response to Hurricane Katrina seem timely and effective, according to the House of Representatives' Republican Conference chairman Mike Pence, who insisted that 'people in the Gulf of Mexico deserve better'.

The American people 'want answers', he told reporters, arguing that Mr Obama left the containment of the oil spill to British Petroleum (BP). The president did not fully respond until late on April 28, Mr Pence said, adding that 'the American people know this was a slow response'.

Conservative columnists, bloggers and radio talk-show hosts have also been aggressively promoting the 'Obama's Katrina' spin.

And in what could be described as a scene from the theatre of the absurd, playing the role of one of Mr Obama's leading critics is none other than Michael Brown, the former director of the Federal Emergency Management Agency (FEMA) under Mr Bush. It was he who, while much of New Orleans was underwater, was being complimented by his boss for his performance. 'Brownie, you're doing one heck of a job,' was the way Mr Bush rated his FEMA director's response to Katrina.

'You're now nine days into the storm, into the disaster, and actually now, only now is the president appearing to be engaged,' Mr Brown told Fox News as he assessed President Obama's response to the oil spill.

Moreover, Mr Brown seemed to be advancing a political conspiracy theory to explain Mr Obama's conduct, accusing the president of a delayed response to the Louisiana oil spill as part of a strategy to stop offshore drilling.

It was 'pure politics', Mr Brown said. 'This president has never supported big oil. He has never supported offshore drilling, Mr Brown told Fox News. 'And now he has an excuse to shut it back down.'

Interestingly enough, in contrast to the American public's reaction to Mr Bush's handling of Katrina, most Americans seem to have rejected the Republicans' spin and have given President Obama good grades for his management of the Gulf oil spill disaster.

According to a Rasmussen opinion poll, the majority rate it as 'excellent' (20 per cent), 'good' (23 per cent) or 'fair' (28 per cent) - which doesn't sound like the American public has concluded that the Gulf oil spill is turning into 'Obama's Katrina'. Only 25 per cent consider his performance 'poor'.

But officials in the White House recognise that public perceptions can change. While no one expects the oil spill to produce the human and economic costs that resulted from Katrina, the disaster in the Gulf of Mexico has tested President Obama's ability to manage major crises and their political consequences.

And it seems that Mr Obama and his aides have learned quite a lot from Mr Bush's disastrous response to Katrina. Hence, while in theory Mr Obama could have managed the current crisis from the White House via teleconferencing, he decided to make a presidential trip to the Gulf in order to ensure that - unlike Mr Bush, who is recalled for flying over the parts of Louisiana ravaged by the hurricane - he would be seen as a commander-in-chief who was fully engaged in leading the rescue and recovery operations.

And unlike during Katrina, when television viewers were following the misery inflicted on thousands of Louisianans crying for help, the images of the oil spill from the Gulf were less graphic and were associated in the minds of most Americans with the failure on the part of oil giant BP.

Indeed, while the responsibility for the collapse of the levees in Louisiana was with the government and the US Army Corps of Engineers that had built them, it was a private company - not the government - that was responsible for the oil leak.

Mr Obama would have been in a better position to criticise BP and to launch an attack on the Republicans who have been urging even more domestic oil drilling operations if the oil leak had not happened just a few weeks after the president made a speech in support of allowing offshore drilling.

But Mr Obama had agreed to a compromise on the oil drilling issue as part of an effort to reach a deal with the Republicans over the passage of comprehensive energy legislation by Congress. Now that the oil spill has clearly eroded public support for the Republicans' pro-oil-business position, Mr Obama may have gained new political leverage over the opposition party and could be in a stronger position to press for an energy bill and its cap-and-trade provisions.

So perhaps something good could come out of the oil spill disaster, after all.

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