As the BP-Halliburton oil disaster in the Gulf of Mexico grows, President Barack Obama vowed to change the “cozy relationship” between government and the oil and gas industry. The Minerals Management Service (MMS), a 1700-person bureau in the Department of the Interior that manages $13.7 billion per year in revenues from drilling leases, will be restructured, though in ways that fail to solve essential problems.
In an exclusive interview with the Wonk Room, top offshore drilling lobbyist Allen J. Verret raised concerns that this “chaotic situation” in the Gulf of Mexico could lead to the “opportunity for draconian measures to be taken against the oil and gas industry that fit the adminstration’s plans.” Verret worries greatly that the Obama administration’s response to this “watershed moment” will fit the pattern he sees of government taking over private commerce:
Recently the government is running automotive companies, running financial companies, running banks. They’re getting more in the business of running commerce, much to the dismay of the business owners. . . . You’re going to have a Communist Party member sitting on everything.
Verret is the executive director of the Offshore Operators Committee (OOC), a coalition of Gulf of Mexico offshore drillers that negotiates with the federal agencies that oversee the industry. With the American Petroleum Institute, the OOC helps write the rules for the industry that the MMS enforces. BP officials Marshall Maestri, Scherie Douglas and Randy Josacek chair OOC’s legal, drilling and pipeline subcommittees.
Verret believes that the objections that API and his organization raised to mandatory safety and environmental rules proposed last year are “twisted” by the “liberal” media. “We have no problems with good regulations,” he told the Wonk Room in the telephone interview, but “none of these agencies have the expertise to do the things they’re given the authority to look over.” Despite his fears of creeping socialism, Verret recognized that “you can over-regulate and you can under-regulate an industry.”