Astounding. Really, I knew it would take a while to get actual regulators back in the regulatory agencies after BushCo, but isn't this something someone should have known about -- and notified the public?
TEXAS CITY, TEXAS -- Two weeks before the blowout in the Gulf of Mexico, the huge, trouble-plagued BP refinery in this coastal town spewed tens of thousands of pounds of toxic chemicals into the skies.
The release from the BP facility here began April 6 and lasted 40 days. It stemmed from the company's decision to keep producing and selling gasoline while it attempted repairs on a key piece of equipment, according to BP officials and Texas regulators.
BP says it failed to detect the extent of the emissions for several weeks. It discovered the scope of the problem only after analyzing data from a monitor that measures emissions from a flare 300 feet above the ground that was supposed to incinerate the toxic chemicals.
The company now estimates that 538,000 pounds of chemicals escaped from the refinery while it was replacing the equipment. These included 17,000 pounds of benzene, a known carcinogen; 36,000 pounds of nitrogen oxides, which contribute to respiratory problems; and 189,000 pounds of carbon monoxide.
It is unclear whether the pollutants harmed the health of Texas City residents, but the amount of chemicals far exceeds the limits set by Texas and other states.
Think about that. It exceeded the limits set by Texas, which translates to a public health emergency.
The Bush Administration sure had a knack for letting criminals get away with it, didn't they? They failed to stop 9/11, never caught bin Laden, and now we're learning about the total incompetence of the SEC in responding to Bernie Madoff's Ponzi scheme.
The U.S. Securities and Exchange Commission repeatedly missed chances to catch Bernard Madoff’s $65 billion fraud over 16 years by assigning inexperienced investigators and accepting “implausible” explanations after catching him in lies, the agency’s internal watchdog said.
At least six warnings from sources including a money manager, a “respected hedge-fund manager” and a firm that studied Madoff’s business failed to spur a “thorough and competent” probe, Inspector General H. David Kotz wrote in a summary of a report released today. Madoff, in an interview with Kotz, said even he “was astonished” when investigators failed to check trading records that would have exposed his scam.
“Despite numerous credible and detailed complaints, the SEC never properly examined or investigated Madoff’s trading and never took the necessary, but basic, steps to determine if Madoff was operating a Ponzi scheme,” Kotz wrote.
This is not only an incredible report, it plays into a larger truth about the conservative conception of regulation as a needless bother rather than a diligent effort to protect the consumer. One incredible moment, referenced above but covered in detail by Zachary Roth, shows that Madoff basically thought he was caught and the scheme had been discovered by federal regulators, only to find himself safe once again.
The agency's biggest screw up, says the summary, was the fact that examiners never verified Madoff's trading through an independent third party.
The details of that failure are more astonishing still. Madoff at one point told examiners that all his trades were cleared through his account at the Depository Trust Company (DTC), a clearing agency -- and he gave the examiners his DTC account number. At that point, Madoff told Kotz in an interview, "I thought it was the end game, over. Monday morning they'll call DTC and this will be over." Amazingly, the SEC never followed up with DTC. Madoff said he was "astonished."
The summary almost makes clear that the SEC's right hand didn't know what the left was doing. It notes with astonishment that at one point, two Madoff examinations were going on at the same time within the agency, without either being aware of the other. It was Madoff himself who informed one team of the other's existence [...]
The final, failed Madoff investigation of 2006 -- triggered by a detailed Markopolos complaint -- was perhaps the most egregious. According to the summary, most of the investigative work was done by a staff attorney "who recently graduated from law school and only joined the SEC nineteen months before she was given the Madoff investigation. She had never previously been the lead staff attorney on any investigation, and had been involved in very few investigations overall. The Madoff assignment was also her first real exposure to broker-dealer issues."
According to the summary, that inexperience helps explain why, when Madoff told the examiners that he got such unprecedentedly good return simply because he had a good "feel" for the market, they took that nonsensical explanation at face value.
Bush's SEC didn't bother to check up on Madoff's dealings, and they took his explanations as good enough for them, because their attitude toward regulation was "don't mess with a good thing." Indeed, the entire stock market during the Bush years was kind of operating under a false reality in its own right. Madoff was a crook, but at least an honest crook. And even he couldn't get caught.
This is not just the story of one agency's embarrassing failure. The failure lied in the theory of government, existing to make profits for cronies and lay off the connected and the powerful. The failure to catch Madoff and the failure of conservatism are essentially the same stories.
Hard, Cutting: Interesting that the position that serves to communicate most with the American public--White House press secretary--remains vacant. Patricia has some thoughts on this matter and the rest of the Bolton "rescue" plan.
DARE Generation Diary: The ridiculous lengths to which many of our elected officials are going in order to push their own brand of morality are getting quite scary. Get ready for Sex Toy Prohibition.
