Bankruptcy?

Reader comment on: Richard Epstein on the Oil Spill

Submitted by ben (United States), May 11, 2010 08:53

Epstein writes a sensible piece here, but he does not handle the elephant in the room. What happens if an oil company does not have the money to pay for the cleanup? This doesn't seem likely in BP's case, but it is well within the realm of possibility that a company drilling wells will create a spill and not have the resources to compensate the victims. In this case, the public outcry for taxpayer dollars to pay for the cleanup would be enormous, and once again the government will pick up the tab for the problems of private industry. How to avoid this? His suggestion that we limit where well get drilled is a good one, and so too might be a system of industry insurance (which already exists for spills) to be large enough to compensate people for damages as well. Of course, our ultimate goal should be to move away from the burning of fossil fuels in the first place. As best I can tell, solar panels do not have meltdowns, and wind turbines do not leak harmful chemicals (nor do they produce that much energy yet!)

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