Capitalism Floats in the Gulf Coast
There is something to be said about the factors surrounding the circumstances of the BP catastrophe.
News reports are claiming that regulators and big oil companies maintain relationships that produce conflicts of interest.
While finger pointing among the parties involved aren't exactly conducive to favorable public relations, it does draw attention to some underlying mechanisms that nurtured this disaster.
Capitalism has both advantages and disadvantages and it would be a disservice if I downplayed the success it has brought the United States as a whole.
It has propelled this country forward and made it the global superpower it is today.
In fact, capitalism is the reason why so many foreigners from undeveloped countries are so eager to settle here.
Even by today's standards, there are few countries that can manifest the promise of financial stability and wealth the way in which America can.
However, astute and forward thinking business people know that future success cannot always be had by outdated strategy.
For instance, Blockbuster was among the first to offer movie rentals to the masses, bringing the experience of going to the movies, to the comforts of home.
For years, Blockbuster mostly thrived in the marketplace unchallenged.
With the advent of widespread internet access, competitors such as Netflix and Redbox entered the market, offering the same product utilizing slightly different logistical methods at a cheaper price point.
Even as Blockbuster's competitive landscape began to change, the company clung to its outdated brick-and-mortar business model.
As a result, store closings and revenue declines plagued Blockbuster as they scrambled to react to their changing business landscape.
Capitalism has been a tried-and-true model for the United States economy, but the global landscape is changing.
In conjunction with a conservative checks and balances approach to capitalism, the United States should also alter its strategy to reflect the changes.
So how does this relate to BP? While capitalism has proven to be the best fuel for national economic activity, it can be detrimental.
In an environment where individuals can theoretically earn an uncapped amount of income, it can draw some unintended consequences.
One of the most treacherous side-effects of capitalism is blinding greed.
Every year, companies are looking for ways to boost their bottom lines, whether it is saving money or bringing in new business.
Both would be ideal, but in the process of determining the best method of achieving such a feat, companies can veer off track at the detriment of the community in which it operates.
In BP's case, the damage has become extensive and unlike any other documented disaster.
So how has blind greed contributed to BP's woes? During congressional hearings, a BP official was asked about the type of containment methods the company had in place to deal specifically with these circumstances.
Oddly enough, BP nor has any other oil company (at least as of this writing) developed any sort emergency containment methods for spills at such deep depths.
BP is essentially utilizing containment methods for oil spills of lesser severity.
In addition (and by BP's own admission), it appears that deployment technology has advanced faster than containment and clean-up technology.
It does nothing for BP's balance sheet to spend more on containment technologies than it does to develop a method to get to the oil faster and at greater depths.
Logically speaking, it would then make sense to have an emergency response in place to handle a worse-case scenario at deeper depths as well.
In other words, both deployment and containment/clean-up technologies should be given equal merit.
However, capitalism and more often than not shareholders frown on social responsibility because it is perceived as an added expenditure.
Unless there is a mandate or if doing otherwise negatively impacts brand imagery, social responsibility almost always takes a backseat to increasing profit margins.
The issue is not the oil spill, rather it is the political, economical and lax regulatory parameters that BP operates within.
Capitalism rewards only those participants who engage directly in "for-profit" activity.
Activity outside of those limits come solely at the expense of the company or individual.
As a result, BP as well as most other organizations are influenced to concentrate on earning more with as little monetary effort as possible.
Shareholders no doubt played a role in restricting budget dollars toward containment and clean-up measures in an effort to save money.
But after all is said and done, it may end up costing them more than money.
News reports are claiming that regulators and big oil companies maintain relationships that produce conflicts of interest.
While finger pointing among the parties involved aren't exactly conducive to favorable public relations, it does draw attention to some underlying mechanisms that nurtured this disaster.
Capitalism has both advantages and disadvantages and it would be a disservice if I downplayed the success it has brought the United States as a whole.
It has propelled this country forward and made it the global superpower it is today.
In fact, capitalism is the reason why so many foreigners from undeveloped countries are so eager to settle here.
Even by today's standards, there are few countries that can manifest the promise of financial stability and wealth the way in which America can.
However, astute and forward thinking business people know that future success cannot always be had by outdated strategy.
For instance, Blockbuster was among the first to offer movie rentals to the masses, bringing the experience of going to the movies, to the comforts of home.
For years, Blockbuster mostly thrived in the marketplace unchallenged.
With the advent of widespread internet access, competitors such as Netflix and Redbox entered the market, offering the same product utilizing slightly different logistical methods at a cheaper price point.
Even as Blockbuster's competitive landscape began to change, the company clung to its outdated brick-and-mortar business model.
As a result, store closings and revenue declines plagued Blockbuster as they scrambled to react to their changing business landscape.
Capitalism has been a tried-and-true model for the United States economy, but the global landscape is changing.
In conjunction with a conservative checks and balances approach to capitalism, the United States should also alter its strategy to reflect the changes.
So how does this relate to BP? While capitalism has proven to be the best fuel for national economic activity, it can be detrimental.
In an environment where individuals can theoretically earn an uncapped amount of income, it can draw some unintended consequences.
One of the most treacherous side-effects of capitalism is blinding greed.
Every year, companies are looking for ways to boost their bottom lines, whether it is saving money or bringing in new business.
Both would be ideal, but in the process of determining the best method of achieving such a feat, companies can veer off track at the detriment of the community in which it operates.
In BP's case, the damage has become extensive and unlike any other documented disaster.
So how has blind greed contributed to BP's woes? During congressional hearings, a BP official was asked about the type of containment methods the company had in place to deal specifically with these circumstances.
Oddly enough, BP nor has any other oil company (at least as of this writing) developed any sort emergency containment methods for spills at such deep depths.
BP is essentially utilizing containment methods for oil spills of lesser severity.
In addition (and by BP's own admission), it appears that deployment technology has advanced faster than containment and clean-up technology.
It does nothing for BP's balance sheet to spend more on containment technologies than it does to develop a method to get to the oil faster and at greater depths.
Logically speaking, it would then make sense to have an emergency response in place to handle a worse-case scenario at deeper depths as well.
In other words, both deployment and containment/clean-up technologies should be given equal merit.
However, capitalism and more often than not shareholders frown on social responsibility because it is perceived as an added expenditure.
Unless there is a mandate or if doing otherwise negatively impacts brand imagery, social responsibility almost always takes a backseat to increasing profit margins.
The issue is not the oil spill, rather it is the political, economical and lax regulatory parameters that BP operates within.
Capitalism rewards only those participants who engage directly in "for-profit" activity.
Activity outside of those limits come solely at the expense of the company or individual.
As a result, BP as well as most other organizations are influenced to concentrate on earning more with as little monetary effort as possible.
Shareholders no doubt played a role in restricting budget dollars toward containment and clean-up measures in an effort to save money.
But after all is said and done, it may end up costing them more than money.
