堪培拉論文代寫：A case study of BP oil explosion in G
Business and government in the global context: A case study of BP oil explosion in Gulf of Mexico
堪培拉論文代寫：A case study of BP oil explosion in Gulf of Mexico
With the intensity of globalization of economy, business and government are increasingly connected and cooperated. Studies and researches have been done to discuss the global political economy and theories have been used to support those arguments. However, the BP (British Petroleum) oil explosion in Gulf of Mexico has triggers different debates on the relationship of business and government in the global context. The massive disaster resulted in damages to the wildlife in sea, tourism industries decline and human health. Who should be responsible for this tragedy and why? How the theories of international power economy can give a good explanation to the dos of stakeholders. This essay is going to discuss the business and government relationship in the global context, with the support of case study of BP oil explosion in 2010. It is critically important to understand Strange’s work on power in the international power economy before we start to discuss BP oil explosion case. This essay is divided into three parts: the first part introduces the theory of Susan Strange on the international power economy in the context of globalization; the second part gives a brief description of the BP oil explosion in 2010; the third part is the most important part where the stakeholders involved in the explosion incident will be examined and their responses will be analyzed accordingly. With the support of IPE theory, the third part expresses the role of US government in the BP oil spill crisis. The whole essay is concluded that interests and benefits lead the relations between governments and business in global context, and a calling for solutions is in priority in order to prevent similar tragedy happens again.
Literature review: Susan Strange’s theory
When it comes to international political economy, one can not ignore Susan Strange (1923-1998). Strange played a critical role in creating and developing studies and researches on international relations and structural powers. She has created the notions that structural power has four dimensions: security, production, finance and knowledge, in terms of international political power (IPE). Strange first started her study on international dimension in terms of British financial policy. Then she gradually focused on power structure related to international monetary system. In the late 1960s and early 1970s, Strange became more and more concentrated on business and government issues in the global context especially the economic power distribution (May, 1996). Susan Strange’s work presents three main strands: firstly she analyzed the structural power in IPE. For example, she explained and concentrated on the international financial economics, international monetary system and financial structure. Secondly, Strange expressed the international politics of money and credits in detail. Thirdly, Strange provided a comprehensive view on the international economy rooted in the direct relations with international politics. Strange considered IPE as a key component to understand the world where markets/economy and authority are interacted together. In her 1988 article States and Markets, Strange (1998) argued that power resides in structure, that is to say, if there are two relavent powers in certain context of structure, party A will force party B to do things on the will of party A. Therefore, party A obtains the ability to shape and control the rules of the game in certain context. Strange further stated that state politics (especially US and UK) has exercised its power (security, production, finance, knowledge) in broad structures such as transport, trade, energy, welfare. Therefore, power influences can not be just judged according to the political extensions. At last, Strange put it that the globalization of finance and economy is because it suits the benefits/interests of certain power structure or political authority, in this case, UK and US.
To sum it up, Strange’s contains two strong elements: power politics and economic nationalism (Susan Strange-an unorthodox realist, n.d.). In a global economy, state politics has considerable connections with the exercise of power especially in some emergency management. Strange made it clear that parties that involved in global economy are structuring the economic system and adjusting it to their benefits and interests. The most significant contribution Strange made is her argument on taking account of the growing role of markets, economic powers and corporations where the states have a share of the operations. Strange also pointed out that even the world is changing quickly and the globalization of economy is getting more and more intense, the nature and the very core of the world have not changed. That is hegemony has transformed into state authority (Strange, 1987, 1996). For readers, when consider some cases or international crisis, one should really ask him/herself is that “Who benefits?” in this process. Then one can really understands the power structure and authority play involvement in the incident.
An overview of BP oil explosion in 2010
On 20 April 2010, an explosion in the Gulf of Mexico has shocked the world. The explosions happened in the Macondo Prospect oil field (owned by BP), nearly 40 miles southeast of the American coast line. 11 workers were killed and the other 16 were injured severely in the explosion. The explosions followed by firing, sinking of the drilling units and oil pollution lasting for months in the Gulf of Mexico, which results in massive oil spelling, large scales of wildlife habitats mortality, fishing and tourism industry damages. This explosion was called the Deepwater Horizon drilling rig explosion. Due to it's massive damage to the environment and to the largest accidental explosion, it ranked the most severe environmental tragedy in the US history (Angelov, et al., n.d.).
This Deepwater Horizon explosion starts on the Deepwater Horizon mobile offshore drilling unit (MODU). MODU is semi-submersible drilling equipment owned by Transocean who is operating for BP Company. Halliburton is the company who was in charge of the whole cementing and testing the well drilling process. In addition, the Minerals Management Service (MMS) is also who to blame. Functioned as a supervisor or a regulator, MMS did not act like a government agency but a collaborator of the BP oil, which leads to its lack of control over the BP oil on industry standards. As for BP Oil, the initiator, was accused of lack of responsibility to handle crisis readily and overlooking the key facts which later caused the explosions (Hair & Narvaez, 2011).
Looking back the whole incidents, there are four parties involved and have obligations on the oil explosion crisis: the BP company, Transocean, Halliburton and the US government-Mineral Management Service. The following section will illustrate how different powers operated in this crisis and analyze in detail who should be accountable for the happening, who should be responsible for the oil explosion disaster and who should bear the costs of the disaster.
Power and politics: stakeholders and responsibility in Deepwater Horizon disaster
According to the investigative report of the BP spill accident from the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE, formerly MMS) and the Coast Guard, the main causes of the Deepwater Horizon disaster are stated clearly (2010, 2011). The reports state that the defective cement causes the sequent disasters. Halliburton, BP and Transocean should take the mistake they made in different levels and bear the responsibility for the disaster. The blowouts were the outcomes of a cement barrier failure, which did not stop the flow up of the well. The BP spill and explosion crisis is the result of poor risk management, inappropriate changes to corporate plans, failure to respond quickly to the crisis, inadequate control from the regulation department, insufficient emergency training for personnel. BP, the ultimate principal and operator, should held the responsibility for operations under safe and sound working environment, make sure the protection of equipments and the natural environments. Transocean, a subcontractor and the owner of the Deepwater Horizon, should be in place to safeguard the safety of employees and operations. Halliburton, another subcontractor, should have certain obligations on monitoring the safety of well and cementing.
However, in Cohen et al.’s (2011) defense, there does have inherent conflicts of interests among shareholders and managers of a company, which will lead to the insufficient information to the shareholders. Managers care for the short term interests while the shareholders care about the long term interests. That explains why when the shareholders urge the building of safe environment managers will compromise the willingness, because usually managers are paid by performance bonus. It can be interpreted that even though the BP shareholders intend or show the interest in improve and set up safety foundation for working environment, the contractors may not want raise the bar because they may consider it a waste of money.
Nevertheless, the previous paragraphs focus on the official investigations about the equipments failure. However, the reports choose to neglect the lack of supervision from the US government. The US government was not prepared and responded slowly during the crisis. If we dig further enough from the perspective of IPE, connections between BP oil spill and role playing of US government will present to the surface. As discussed in the first part of the essay, IPE refers to political forces shape the economic systems and interact with structure powers, and conversely structure powers also have influence on the political forces and structures. It is important to first understand the significance of oil in global economy, however it is surprisingly hard to find that studies and researches have rarely extend concerns over the importance of oil to modern geopolitics, especially in terms of international political economy (Colgan, 2010). It is obvious that if there are interests economic-wise, politics will get involved into the process as a “partner”. If there are conflicts or crisis burst out, politics start insert its power as a supervisor and present to the public the actions to make things right, stand for justice and cry out for the truth.
A lawsuit from the Sierra Club and the Gulf Restoration Network has alleged the role of irresponsibility of the MMS in the BP oil disaster (Turner, 2010). It claims that MMS has waived safety regulations on BP’s oil exploration and issued BP the valid exploration documents in the Gulf of Mexico. It is a must have process that oil companies need to outline a worst case scenario when there is a spill happens what the companies would do. However, MMS just ignored and set asides those requirements and approve BP’s validness for offshore drilling exploration (Alexander, 2010). As an administrative agency, the MMS suppose to handle the regulatory responsible for managing offshore drilling operations. However, in the BP oil spill crisis, the MMS is considered to be the complicit with BP (Honigberg, 2011). In violating its own regulations, the MMS permits the deepwater drilling program and even allows the companies to set up regulations that favor their interests. In essence, the MMS is blamed because as an administrative agency, the MMS keeps too close relationship with the industry who is under its supervision. This is maybe because the MMS collects $ 10 billion US dollars a year from BP (Angelov, et al, n.d.). All the above results in the widespread regulatory failure of the MMS and its failure to protect the public and the environment as well. Notwithstanding the regulatory deficiencies, Flournoy et al. (2010) put it that the regulatory deficiencies are mainly because the MMS lacked the resources and personnel who are professional in the oil drilling examinations. In addition, the MMS also do not have experienced professionals and innovative technology for the highly-complicated industry.
Nevertheless, the government has also responded to criticism on the MMS and replaced the MMS with a new agency named the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), in order to restricting the operation system and create independent functions on regulating, safety insurance and environment protection. This does not address the problem that new agency is still connected to the conflicts of interests to the oil and gas industry. The nature of the BOEMRE is still more a revenue collection agency rather than a regulatory supervise agency. In this case, there is still no guarantee that another BP disaster will not happen because the conflicts of interest exist. The truth is the US government benefits from the offshore drilling exploration, not a little, but a lot! This echoes with Strange’s theory on power structure in international political economy that where there is benefits/interest, there is deficiency over regulations. The profits from oil industry have made the MMS give its way to the oil power and let it shape the administrative system in some extent. Governmental administrators will continue to stay close relations with business parties in order to pursue their own interests.
This section first illustrates Susan Strange’s theory on international political economy and points out her main argument is that benefits leads the relations between business and government. Then an overview on the BP oil spill and explosion crisis is described to support with Strange’s theory. BP, Halliburton and Transocean were responsible for the damages and bears the costs for the after-crisis management in the Gulf of Mexico. For example, BP company paid 2.5 billion US dollars to the cleaning-up efforts and 1.1 billion USD for the settlement cost. The administrative agency, the MMS is also responsible for the crisis due to its lack of supervision and regulatory deficiency. Efforts have been made from the US government to correct their administrative mistakes, there is still long way to go before the government can really overcome the attraction from the huge benefits they get from the oil industry and do their job righteously.
In a global economy, state politics has considerable connections with the exercise of power especially in some emergency management. According to Strange, IPE refers to political forces shape the economic systems and interact with structure powers, and conversely structure powers also have influence on the political forces and structures. BP oil crisis is good example of how business and government are related in the global context. Even though the main cause of the crisis is the failure of cement jobs, BP, Halliburton and Transocean are the most guilty one to blame, the Mineral Management Service-US government share the responsibility for the tragedy. It is obvious that conflicts of different parties’ interests have led to the tragedy of the BP oil spill. These conflicts will not eliminate even though actions have been taken and punishment have been implemented to each relevant party. Increasingly, conflicts of interests will raise in different ways and cause another tragedy. As long as there exist interests, any political power can have the potential to make decisions that is favorable to commercial and business where profits are made, despite the potential disaster and future loss for environment and damages to the earth. This essay just points out the problems where political powers are shaped by economic interests without offering the solutions to the puzzle. This can be a topic that leaves for future discussions and researches on how to deal with the nature of interests driven parties and how to make effective yet righteous decision when it comes to international political power.
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堪培拉論文代寫：A case study of BP oil explosion in Gulf of Mexico
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