Sunday, June 6, 2010

The BP oil spill ... A priority should be to get a valuation of impact

Dear Colleagues

A professional listserve asked the question "How to Help with Oil Spill Aftermath". I anticipate that most of the responses will relate to operational matters like handling the wildlife who get ensnared in the oil, and so on ... but I thought it made sense to start to talk about the need for community data so that the payment of compensations gets to be done in a manner that is appropriate and equitable. This is my comment:
The socio-economic impact of the BP oil spill is big ... but how big, nobody knows. The ways things usually work is that a lot of funding will be committed to making things whole ... but almost none of the money will end up actually achieving this. Some of the reasons are legitimate, many are not.

A good start in any disaster mitigation and management program is to mobilize data ... and to use data everywhere to get the best possible outcomes. Somehow, the data needs to stay easily accessible to the interested public so that there is transparency and so that there is accountability ... profiteering in disaster is commonplace ... and it merely serves to remove funding from the payment of legitimate claims.

I would like to see a value accounting database put together ... and I would like to be involved with it to the extent that I can be helpful. My guess is that the total socio-economic damage to the US Gulf Coast is way bigger than the market capitalization of BP ... which shows, I believe, the importance of having very credible data. Combining modern technology and old fashioned accounting may be a way to handle this.
Adbhas Jha and his colleagues at the World Bank have recently published a handbook for reconstructing after natural disasters called Safer Homes, Stronger Communities. In this work the importance of good data is very clear. I would argue that relevant socio-economic data are needed in the case of the current BP oil spill ... and the sooner this is put in place the better.

In most disaster management guides the data starts after the disaster happens ... and this is already too late. The data that are most useful are those that "start" before the disaster. In order to get back to the pre-disaster situation, it helps to have data about the pre-disaster situation. As the disaster progresses ... the baseline remains what the situation was pre-disaster.

In the case of the BP oil spill the complex nature of the damage being done to the socio-economic system and the underlying ecosystem that drives much of the local economy needs to be incorporated into the data. This is exactly what the Community Analytics (CA) methodology aims to do ... not as a academic exercise, but as a pragmatic basis for decision making and the improvement in quality of life. The CA methodology applies in a disaster situation in just the same way it does in ordinary times.

Peter Burgess

No comments:

Post a Comment

Post a Comment