A Business Climate

2006-09-20_21

I’ve been thinking about business practices and regulations.  A war is going on between groups that favor more regulations and groups that favor less.  It happens in every area of human endeavor, from what we see on TV to offshore oil drilling.  It seems like the balance between them shifts on tragedy.  When BP calculated the risks of drilling at a deeper depth in the Gulf, they didn’t consider a complete failure as a risk.  It is the role of regulations to envision the worst case.  That’s why they seem so ridiculous sometimes.  I worked on a disaster recovery/ business continuity study last year.  Thinking about disasters at work was a little disconcerting.  CSV has had wrecks that closed 25 square miles in our area before.  There’s a railroad within a mile of the office.  There’s a railroad crossing within 3 miles of my house, too.

2006-09-20_07 2006-09-20_08

Too much regulation is bad, though.  I’m watching 1984 while I type.  That’s a world of nothing but regulation, where every aspect of life is controlled.  North Korea has always fascinated me because it’s an attempt to bring Orwell’s vision to life.  So where is the balance between business practices and regulation?  We have an adversarial system, like our judiciary.  Regulators and the regulated push back against each other until some tipping point is reached either way.  In the case of BP’s drilling operations, they flag their oil rigs in a such a way that they can avoid US inspection and regulations.  That’s the inherent irony of the regulation wars.  Taken as individuals, I think that BP would have agreed that the maintenance and operation of Blow Out Preventers is essential to the way they do business.  The same way we all agree that tailgating on the road is dangerous.  Give those individuals a sense of anonymity, like a car or a corporation, and they can do all kinds irresponsible things.   So, how’s your driving been lately?

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