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What’s A B Corporation?
There’s a handwritten list on my refrigerator. It’s hanging there from a magnet right next to the monthly family calendar and the report cards. My wife keeps a roster of corporations like Costco and Starbucks that follow ethical practices. These are the places we’re supposed to patronize. There’s also another list, over on the side, headlined by companies like Monsanto and Koch Industries that represent a different kind of corporation. Woe to the wayward family member who might drop a dollar or two on one of their products. I haven’t set foot in a Wal Mart in over 5 years and my wife would rather see me walking down the shoulder of an interstate with a gas can in my hand than fill up at an Exxon or BP station. It’s one way of making a statement about corporate practices.
There is a different way to assess corporate behavior. The “B” Corporation is a relatively new development in business management practices. The B stands for benefit. A corporation chartered as a Benefit Corporation has the ability to include activities designed to achieve social or environmental benefits as part of its core business operations. Don’t get me wrong, Benefit Corporations are still in existence to turn a profit. The difference is that the Benefit Corporation establishes societal benefits as one of its founding principles. The company exists, in part, to do good things. Additionally, by the rules of its establishment, the corporation is also bound to follow policies and practices ensuring accountability, transparency in its actions, standardized accounting methods and procedures for governance that are very different from the traditional corporate structure. A Benefit Corporation pledges to work towards its stated goals for the public good as a part of its basic operations and can be called to task by its shareholders should it fail to pursue that mission. 23 states and the District of Columbia currently authorize the creation of Benefit Corporations. Legislation is currently pending in an additional 14 states. Illinois has also introduced legislation that would permit the creation of a Benefit LLC for businesses where incorporation may not be appropriate.
Every time you spend money, you’re casting a vote for the kind of world you want.-Anna Lappe
Related to the creation of Benefit Corporations is a non-profit that has been established to evaluate corporate operations of these entities. B Lab provides an independent certification of Benefit Corporations that assesses their practices and methods and confers the status of “Certified B Corporation” on businesses that meet their requirements. Currently there are 1,040 certified B Corporations in 34 countries around the world representing 60 different industries. A Benefit Corporation does not need to be certified by B Lab, but the certification process provides a measurement tool that can provide a consumer with a presumably objective method of evaluating the standards and practices of a company. Much like LEED Certification, where a building doesn’t need to be certified to be energy-efficient, a Benefit Corporation need not be certified to be engaged in a public purpose. In both instances the certification process provides both the business and the public with a standardized method of evaluating performance. You can find out more about the certification process by visiting the B Lab website.
A New Way Of Doing Business?
The traditional corporation exists for one purpose-to make money. In fact, beyond that, a traditional corporation is committed to pursuing the maximum possible profits possible as part of its fiduciary duty to its shareholders. This corporate “greed” has resulted in all sorts of mayhem for the environment. Corporations in pursuit of maximum profits have engaged in a myriad of practices that have resulted in the destruction or degradation of natural resources. Corporations have a long and sordid history of environmental destruction in the U.S. and a resume’ that includes polluting the air and water, improper disposal of waste, evading regulation and influencing legislation to permit destructive practices all in pursuit of maximizing profits. The Benefit Corporation diverges from this model of corporate governance and creates the opportunity to utilize the methods usually used to create corporate wealth to accomplish goals, especially in the realm of environmental protection, that were heretofore difficult or impossible to achieve because of a lack of resources.
The traditional corporation is “constrained” by its fiduciary duties to shareholders to pursue profit and its own interests above all else. Social entrepreneurs and people looking for an outlet for socially conscious investing are hard pressed to match their goals with the established corporate structure. In fact, in a Benefit Corporation the directors have a fiduciary duty to pursue the established non-financial socially beneficial purposes of the corporation. The creation of Benefit Corporations allows access to all of the advantages of incorporation, or the investment in corporate stock, without the limitation of the obligation to pursue profit above all other goals. It is an interesting, and potentially powerful, hybrid of the role of non-profits and the capability of the for-profit business world focused on achieving social good. The possibility of bringing investment capital to the world of environmental protection has a great deal of promise.
Does It Matter?
There has been some debate regarding whether or not the creation of the Benefit Corporation form was necessary. The freedom to use the corporate form of doing business with its structure and protections, attract investors and pursue socially beneficial goals is reason enough. The possibility of unleashing the financial power of business to address major issues facing our society only emphasizes the advantages of enabling this form of incorporation. The fact that in addition to start-up social entrepreneurs, substantial businesses like Patagonia, Seventh Generation and Cabot Creamery have chosen to conduct their operations in accordance with the standards and practices required of a Benefit Corporation highlights both the possibilities and the efficacy of this way of doing business and the importance of growing the B Corporation community.
According to B Labs, certified B Corporations are more likely to not just be better corporate citizens, but engage in better employment practices. The certification process offers consumers the chance to make informed decisions on where they may want to spend their money. Perhaps most importantly, it offers a different approach to accepted methods and practices of commerce that has the potential to change the accepted norms of capitalism. For environmental advocates the possibilities are endless.
You’re welcome to stop by my house and pursue the lists of good and bad corporations on my refrigerator. They were carefully compiled after extensive research into the corporate practices of the companies that are on them. It’s probably a better idea to consult the folks at B Labs. Their objective standards not only provide a good measuring stick for companies, but they offer encouragement and reinforcement to companies that choose to include public good as part of their business mission. While the idea may be novel today, 10 years from now the benefit corporation may very well be a common way for investors, social entrepreneurs and consumers to use the power of capitalism to change the world.- Ben Spinelli
National Treasure For Sale
The New Jersey Palisades are a unique geologic formation along the New Jersey side of the Hudson River across from New York City. Sheer basalt cliffs that rise between 300 and 550 feet above the river, they stretch for nearly 20 miles. In 1983, the Palisades were listed as a National Natural Landmark, a designation that includes iconic places like Mount Shasta in California and Franconia Notch in New Hampshire. The natural beauty and the ecological value of the Palisades are protected by an interstate park that was created cooperatively by New York and New Jersey in 1900 pursuant to an agreement between the governor of New Jersey and the governor of New York-Theodore Roosevelt. Protection of the Palisades was visionary and a gift to future generations from people who understood the value of protecting a resource from degradation.
The Palisades Interstate Park was created to protect the cliffs from quarrying operations. Now the Palisades face a different threat. LG Electronics-the “Life is Good” people who manufacture cell phones and flat screen T.V.s wants to put its new North American headquarters in a 143 foot high office campus in Englewood Cliffs, NJ. The project will undoubtedly bring jobs and economic investment to New Jersey (as well as significant property tax revenue to Englewood Cliffs). The problem is that this proposed building will rise above the tree line and intrude upon the vista that has been protected since the creation of the park and acknowledged as a valuable resource with the designation of the Palisades as a National Landmark. The magnitude of the intrusion into a scenic view is, I suppose, in the eye of the beholder. The import of enabling a governing ethic that embraces squandering protected resources in exchange for questionable short-term gains is not debatable. It is a dangerous and ominous precedent.
Answering The Wrong Questions
There is a great scene in My Cousin Vinny where Vinny is discussing with his girlfriend just what he should wear to go deer hunting. The answer was both priceless and obvious as well as extremely relevant to answering the questions surrounding LG’s proposal. The people in Englewood Cliff are busy discussing how high the new LG headquarters should be or how it should be designed. The correct answer is, who cares! It does not belong there. The arguments over how this building should look or how high it should be are seriously misplaced. It highlights how the battle for local tax revenue leads local officials to become deranged. Instead of asking the basic question-is this the right place for this building-the conversation centers on rationalization and justification to find a way to accommodate a project that was ill-conceived from the start. Most alarmingly, this debate is over how to convey benefits to a small group of people at the expense of compromising something of acknowledged national significance.
It seems to me that the General has his headquarters where his hindquarters ought to be-Abraham Lincoln
There are real questions that need to be asked here. Are there no alternatives? Is the tax revenue to one town more valuable than the integrity of a national landmark? Has anyone involved in the project heard the news that suburban office campuses are a dying non-sustainable model of development? Do we have the political will to insist that economic development take place in an environmentally sustainable manner? Are we capable of viewing investment and development in a more regional fashion and end the destructive competition between communities? Why bring these jobs to a site that is not served by mass transit? Isn’t there a better way to meet LG’s needs, provide jobs and encourage investment in New Jersey without the environmental destruction?
The answer to the last question is easy. While the effort to pound a square peg into a round hole goes on in Englewood Cliffs, 18 miles away Newark, the state’s largest city, sits looking for economic investment. The City has all of the necessary infrastructure in place to support a large corporate headquarters. Its located at the hub of a network of highways. Newark is served by commuter and regional railroads, an international airport, an international seaport and is home to the acclaimed New Jersey Institute of Technology. NJIT’s high-tech campus attracts students and research professors from all over the world. Midtown Manhattan is a 15 minute train ride away. These are all assets that a technology company like LG just might be interested in. They could build their building however high they need it to be-without the need to compromise a national landmark. Yet, for whatever reason, locating this building in a far more appropriate place has never entered the conversation. Municipal and state officials are doing contortions to find a way to enable construction of a new building with absolutely no access to mass transit and that will duplicate countless existing empty corporate campuses that dot (or plague) the suburban landscape. Instead the debate centers on just how much the new headquarters will affect a national treasure. It’s an insane conversation driven by municipal finances. It’s hard to understand why.
If I Ask You To Jump….
Towns will sell their souls for the short buck. Englewood Cliffs is willing to hand the keys to the city to LG to keep them in town along with their tax revenues. They are willing to make a decision that will impact millions of people, affect multiple generations and unravel over a century of conservation policy to protect their parochial interests. Faced with push back, the mayor of Englewood Cliffs stated, “Time is of the essence! I fear if a fair compromise is not reached, LG will leave the state.” This line of reasoning would be laughable if it weren’t so destructive and ridiculous. LG will no doubt complain that the state is unfriendly to business and cite the obstacles to their plans-as if an ill-planned poorly located project was not itself an obstacle-as evidence of a hostile regulatory scheme. Never mind that there are perfectly reasonable and preferable alternatives that would meet their needs. Corporations have only one goal-maximizing their profits-and if they can co-opt a community into assisting with that effort; all the better. Meanwhile local governments will continue to perform tricks in an effort to out compete their neighbors and to please corporations with their promises of dubious rewards.
Protection of the environment and economic development are not mutually exclusive goals. Jobs and economic growth are laudable and necessary aims. However, they do not trump protecting the environment. Finding ways to accommodate and enable investment in a manner, and in places, that minimize environmental impact and encourage sustainable outcomes is achievable. The saga of LG and Englewood Cliffs has a great deal of significance that goes beyond just this incident. Hydraulic fracturing, offshore oil drilling, and real estate deals all over the country pit the public interest against the quests of private and corporate interests to garner benefits, concessions and incentives on a daily basis. The ability of corporations to manipulate outcomes because local officials are susceptible to spurious arguments of economic gain and a reliance on the old rateable chase continues to lead us down an unsustainable path. Maybe it won’t be all that obvious today, but when the time comes that LG cuts a better deal somewhere else and the people of Englewood Cliffs are stuck with an empty office building in a bad location, it might just sink in.
So to the folks fighting the LG project-keep it up! If the mayor is talking compromise and LG is threatening to go elsewhere you must be making some headway. The issues in play here are important beyond Englewood Cliffs or the Palisades. Somewhere there’s a town offering a tax break or a state waiving an environmental regulation for a Super Wal-Mart at the highway exit or a new football stadium for a team that’s threatening to leave town. Somewhere somebody is willing to trade public trust assets for short-term gain. Every time it happens public officials need to be called out. Your efforts might stop the LG project, but more importantly, they might serve as an example to people elsewhere that the fight is worthwhile. Somewhere along the line this way of doing business has to stop and right now is as good a time as any. – Ben Spinelli
It Wasn’t My Fault!
With so much going on right now it seems a bit much to have to stick to New Jersey, but two days after I wrote Your Tax Dollars At Work….or Not, New Jersey Governor Chris Christie held the first town hall meeting of his second term to discuss Hurricane Sandy recovery with the hard hit people of the Raritan Bayshore. In a performance reminiscent of Jake Blues plea for mercy in the Blues Brothers, the governor managed to lay the blame for the state’s poor performance in administering Sandy recovery on the Federal Government and the old stalking horse, red tape. “What happens when you deal with the federal government is the red tape is immeasurable,” he said. Christie went on to blame the National Flood Insurance Program (NFIP), anti-fraud regulations, President Obama and Congress. As a show stopper, he referred to the new “F” word- FEMA. Interesting words from a man who was preaching personal responsibility at a Republican Governor’s Association event just a few days before.
His denials of responsibility were tantamount to an admission that the recovery process was not going smoothly. However, finding fault with everybody else does little to make things better. Even worse, the lack of any self-critical analysis portends only continued failure as the core issues will never be addressed as long the focus is on blaming somebody outside of New Jersey for the poor performance. It wasn’t the Federal government that steered recovery money to housing projects in Belleville and New Brunswick that were unrelated to Sandy. The Federal government didn’t hire and spend tens of millions of recovery dollars on politically connected contractors to administer the homeowner’s aid programs that Christie complains are inefficient. One contractor, HGI, was fired for unspecified reasons and given an additional $10 million as a parting gift. The governor, who styles himself as a “straight shooter” dodged questions about the reasons for HGI’s firing at the town hall meeting. It is the NJ Department of Community Affairs that is responsible for distributing the various Federal aid dollars and where the most of the frustration for individuals originates. There was no mention of anything the state needs to do better. It’s all somebody else’s fault!
Failure to Plan…..
The problems with Sandy recovery didn’t just crop up overnight. First, the rules and regulations governing both the NFIP and the various homeowner’s assistance programs were in place at the outset of the recovery process. The inept handling of claims by the outside contractor certainly wasn’t in any way related to the Federal government. Complaining about measures to combat fraud or abuse is almost comical-particularly in light of the stories coming out of Hoboken and Belleville. The state’s problems originate with the state and its failure to put a rational and measured plan for recovery in place. As they say, the failure to plan is a plan for failure. We are now seeing the results of that failure.
We must remember not to judge any public servant by any one act, and especially should we beware of attacking the men who are merely the occasions and not the cause of disaster.-Theodore Roosevelt
If this were unforeseeable or a singular mistake these missteps could be excused. However, when this is viewed for what it is-a part of a greater pattern of behavior-its time for some accountability from the Christie administration. Trying to lay blame at the feet of everyone else is not only unseemly, it virtually guarantees that nothing will get fixed. Recovery from a disaster of the magnitude of Sandy is an enormous and incredibly complex undertaking. Governor Christie was obsessed with the opportunity for power and the chance to burnish his image as a strong leader that Sandy, and its billions in disaster aid, represented. However, he has proven that he and his administration were not up to the challenges posed in this recovery, either intellectually or morally. That may be a tough charge, but it has been earned.
Like any large complex undertaking, this job required vision and planning. Two essential elements that have been completely missing from New Jersey’s recovery efforts. The sin of it is that in anticipation of the enormous and monumental challenges our region was facing, the Federal government brought extraordinarily valuable resources to the area in addition to pledging billions of dollars. Smart, experienced and resourceful people dropped everything they were doing to come to our state to assist in the recovery efforts. They brought years spent assisting in the recovery from disasters all across the country as well as specialized expertise in the various disciplines necessary to effect a comprehensive and successful restoration of our devastated state. They came and worked tirelessly to help New Jersey in its darkest hour. Many of these people represented the agency that Governor Christie derogatorily referred to as the new “F” word. Because of their positions, most of these individuals are people who can’t respond. Perfect targets for a bully looking to deflect blame from his own failings.
Not A Gratuitous Charge
This is not idle criticism. The Christie administration resisted all efforts to guide or assist with recovery efforts. They fought to remove all mentions of climate change from the recovery strategy documents. They forbid recovery planners from working with any towns where the administration did not give prior permission. They failed completely in creating a unified and comprehensive vision for either how to recover or what the state should look like in the future. They ignored recommendations contained in the report from the Hurricane Sandy Task Force. Disturbingly, they allowed politics to creep into every aspect of the state’s recovery efforts.
Rebuilding from Sandy is about more than just cleaning up debris and re-constructing demolished homes. Its more than just photo opportunities in a fleece. Proper planning for infrastructure-how it is designed and where it should go-is a basic step. Identification of places that are appropriate for re-building , appropriate for re-building in a modified manner or where we just shouldn’t rebuild at all are essential elements of any intelligent recovery strategy. Identifying innovative measures that include better building codes, the use of natural systems to complement engineered solutions for protection from future storms and the effects of sea-level rise are just common sense approaches that have largely been ignored. Understanding that a coastal state with substantial development in vulnerable areas needs to fundamentally rethink its footprint in places exposed to storm surge and flooding isn’t a radical idea, it’s a foundational building block of responsible government policy. Is it any wonder that an administration that has ignored these essential elements for recovery has also been mishandling the immediate tasks of rebuilding.
It’s Not You-It’s Me
This isn’t about the details of what is missing from New Jersey’s recovery strategy, or more accurately the missing recovery strategy. This is about the failure to take responsibility for the proper administration of the complex and difficult task of disaster recovery. You also can’t address shortcomings if you don’t recognize they exist, or worse, try to lay blame for those shortcomings on others. It may make for good politics but it has the effect of visiting yet another disaster on a state that still suffering from the effects of Sandy. This one of man-made origins. Nothing will improve as long as long as the greatest effort goes into trying to show the blame for failure lies somewhere else.
The governor’s efforts to save face would have been better spent facing up to the tasks at hand and getting on with the hard work of recovery. The failure, and there is no other word that quite fits the bill, to rationally and intelligently approach the rebuilding of New Jersey after Sandy goes directly back to the governor’s office. The governor wanted control of the process and that’s what he got. Having taken control, when things go awry, there is no honor in ducking responsibility. It may be a way to divert attention from millions of wasted aid, aid spent on projects for the politically favored and mismanagement of the administration of vital recovery programs. However, it doesn’t solve one problem for one person still suffering after the storm. It may make good political theater or play well with the governor’s donor base, but it’s no way to lead. The governor needs to stop concentrating on his image and his political future and start concentrating on the lives of his affected constituents and the future of the state. Along the way he owes an apology to the people who gave their best efforts to help him do that job the best that he could-even if it didn’t fit in with his personal agenda.- Ben Spinelli
I Didn’t Want To Have To Write This
This is an article that I wish I didn’t have to write. I’m an optimist and I want to believe that given the opportunity, people in positions of authority will do their best. I want to believe that even when I disagree with someone and their approach to a problem, that they are acting in good faith and just see a different path to a solution than I do. I always keep open the possibility that I’m wrong. After all, I’m not the first person in the history of the world to never make a mistake or come to an incorrect conclusion. Nobody in public life ever takes a particular action convinced that its wrong. I’ve also been in positions of authority, so I have some empathy for public officials charged with difficult or complex jobs. I tend to be tolerant of differing points of view because intelligent discourse usually leads to better policies. I say all of this because I want to give the benefit of the doubt to the folks guiding New Jersey’s recovery from Hurricane Sandy-but I can’t.
I would like to be be discussing the progressive and forward thinking approach to rebuilding that New Jersey has taken in the aftermath of Sandy. But I can’t. I would like to describe the intelligent and measured plan to spend the billions of dollars in federal Sandy aid that has poured into the state. But I can’t. I would like to list the dozens of coordinated programs designed to re-shape the future of New Jersey as a place where vulnerability to future storms and the effects of climate change on a coastal state are being adequately addressed. But I can’t. I would like to say that in response to Sandy’s destruction New Jersey is fundamentally re-assessing how and where we occupy vulnerable areas of the coast. But I can’t. What I can say is that something has gone wrong, very wrong, with the state’s handling of Sandy recovery.
Keep Your Eye On The Ball
While the byzantine details of the George Washington Bridge lane closures capture the attention of the public and the media, the state faces issues that have the potential to negatively effect New Jersey residents for generations to come. The failure to adequately plan New Jersey’s recovery from Sandy and the inability to properly allocate the billions in recovery aid will be the real scandal. 16 months after Sandy, the state has managed to spend money on housing projects in Belleville and New Brunswick that were on the books before the storm and pay millions to outside, politically connected, contractors to help administer and distribute homeowner assistance. This includes a $10 million settlement to fired contractor HGI and $5 million more for a Christie family beach movie. Think about what that money alone could have done. There is no sign of a transparent coordinated plan that addresses the breadth of issues that the state is facing.
What New Jersey needs is a common sense approach to recovery that goes beyond the distribution of individual assistance that helps people rebuild homes damaged by Sandy’s flooding. An integrated and comprehensive plan that recognizes the threats of climate change and sea level rise in a densely populated coastal state should, at a minimum, provide the guiding principals for recovery. What it appears that we have gotten is a muddled and highly political system for distribution of Sandy money without a clear vision or discernible long-term goals. More disturbingly, it appears that aid may have been distributed (or not) based in part upon political considerations. There is nothing more corrupt than squandering the state’s long-term future in exchange for short-term political advantage.
It didn’t have to be this way. The Federal Hurricane Sandy Task Force set out a series of recommendations to guide recovery efforts. The report laid out principals for rebuilding in the wake of Sandy that included requirements for addressing resiliency, vulnerability and responses to future threats posed by climate change, including sea level rise. Properly undertaking recovery would necessitate addressing infrastructure, housing, the environment and every other issue area that climate change effects. However, the Christie administration apparently knows better and is following their own path. The amount of damage done by Sandy was so enormous and the task of reshaping New Jersey is so vital that every available penny in aid needed to be spent accomplishing as much as possible. The Chrisitie administration’s failure to keep that fact as their guiding principal is a far bigger breech of the public trust, and far more damaging (albeit less entertaining), than whatever was going on at the George Washington Bridge.
Be Careful What You Wish For…
Another New Jersey governor who got himself in too deep was General George B. McClellan. When he was tapped to replace Winfield Scott at the outset of the Civil War and concerns were expressed about his ability to be both an army commander and the general-in-chief he famously stated,”I can do it all!”. McClellan’s hubris eventually proved his undoing. The Christie administration wanted total control over the billions in Hurricane Sandy aid coming to the state. Never mind the accounting challenge that distribution of that much money would present, the policy challenges of spending the money appropriately or the incredibly complex issues that require innovative and thoughtful solutions-they could “do it all!” The temptation of controlling that much money along with the political power it brings and the sheer hubris that his administration needed no assistance or guidance was a toxic combination. They got what they wanted and it has led us to where we are now. New Jersey will be paying for this failure for a long time.
Across the river in New York, an innovative program called New York Rising was created to respond to the damages caused by Sandy and the flooding of Hurricane Irene the year before. Formulating sensible and targeted spending strategies for disaster aid, implementation of intelligent and effective policies, regional planning solutions for threats that have a regional basis and most importantly, a clear and cogent approach to recovery are all integral to the operation of this program. These are all approaches that were suggested to the people at the Governor’s Office of Rebuilding and Recovery (GORR) in New Jersey. The folks at the GORR are smart and earnest, but they are also apparently not calling the shots. That responsibility rests somewhere else in the administration where the difficult work of actual disaster recovery is secondary to using Sandy recovery to burnish the governor’s political image . The logical and measured approach taken by New York was seemingly not palatable, or useful enough, for Christie’s inner circle.
What has this obsession with control of the funding and politics gotten us? A number of things-and none of them good. First and foremost the refusal to plan for and implement recovery measures on a regional basis insures that there will never be regional solutions. That puts each town in competition with one another for limited funding, creates a series of winners and losers and results in a fragmented and ultimately ineffectual approach to threats that have a regional basis. It results in funding not being spent wisely or efficiently. It insures that politics, not careful calculation, guides how and where the funding is directed. It’s deprived the state of a unified vision for recovery, resilience and reduction of vulnerability that meets the diverse conditions in a state that needs to implement solutions that are appropriate from the urbanized New York Harbor area to the rural shores of Delaware Bay. These are all colossal failures with generational consequences.
Is It Too Late?
There were many members of Congress who were reticent to allocate billions in aid to our state after Sandy. Fears that the money would be squandered stood in the way of what seemingly should have been an easy and non-partisan vote to help our region recover from the storm’s devastation. Sadly, it seems that we have lived down to those expectations. Because of the approach that New Jersey has taken, especially in stark contrast to the approach taken in New York, the specter of ugly politics casts a shadow over all recovery efforts. Money given to projects unrelated to Sandy but championed by a political ally? Sandy money contingent on support for a project put forward by a close adviser? Aid flowing to towns with mayors who supported the governor and denied to those who didn’t? These questions have all arisen. They would be easily answered and dismissed (and probably wouldn’t have come up in the first place) if the state had taken a different tact. Instead, they all seem ominously credible.
There is still an awful lot of money that will come pouring into New Jersey. No matter where you live, you have a stake in this. Ensuring that tax dollars are appropriately and efficiently spent is important in its own right. However, making sure that recovery takes place in a manner that addresses the threats of climate change, that implements innovative solutions and takes the bold policy measures that are befitting forward thinking intelligent people has benefits that go beyond the borders of New Jersey. Getting politics out of the recovery process may be wishful thinking but providing intelligent guidance is not. Its a necessity. Perhaps now that the governor’s national political ambitions have taken a hit, attention can be directed towards visionary and effective rebuilding and political favoritism left behind. It doesn’t look too good right now, but as I started out, I am eternally an optimist.- Ben Spinelli
A Quick Follow Up
While doing some research for my next post, I came across an interesting item from the great state of Louisiana. As a post-script to That’s Not My Job I’d like to add another example of the government forgetting whose interests they need to serve. Actually, some people did remember. It just prompted a more powerful politician, the state’s governor, to step in and reveal who is really in control of policy in the “Sportsman’s Paradise”.
The National Oceanic and Atmospheric Administration (NOAA) is in the midst of re-mapping the U.S. Gulf Coast. They are removing over 40 (and still counting) place names from their maps-because they no longer exist. In fact, since the 1930’s, over 1,800 square miles of the Louisiana coast has disappeared beneath the Gulf of Mexico. So many of the islands, inlets, wetlands and other features that used to be a part of the coastal landscape have been wiped away. A large contributor to this re-shaping of the coast has been the carving of transport canals by the oil and gas industry.
The loss of such a large swath of coastline has exposed southern Louisiana to increased risk of flooding from storms. The people who are charged with making policy and taking steps to combat coastal flooding, the state’s flood control boards, have taken steps to hold the oil and gas industry accountable for the consequences of their activities by making them contribute financially to coastal restoration projects. Their diligence has resulted in their removal from their seats on the boards.
…a New Orleans area flood control board filed a lawsuit last year against 97 oil and gas companies, claiming they should fund billions of dollars in coastal restoration projects for their role in wetlands loss. Similar lawsuits by Plaquemines and Jefferson parishes followed. Only a fraction of a $50 billion, 50-year state plan to restore the coast has been funded. The move to make oil and gas companies liable has been fought by Louisiana Gov. Bobby Jindal, a Republican, who refused to re-appoint members of the flood control board involved in the suit.
Sea level rise and the continued loss of coastline will only exacerbate the current flooding threats, so there is some urgency to taking action. To their credit, the flood control boards recognized the necessity for action.
However, in Louisiana, your responsibilities as a public official are apparently not what they may appear to be. Do your job to protect the people and resources of your state and you get fired. How could they have gotten it so wrong? It’s always encouraging to see that when regulators try to fulfill their responsibilities to the people they are obligated to protect, there will always be a politician beholden to a powerful special interest around to set things straight. At least we know the Governor is there to look out for the poor abused oil and gas industry.
A tip of the hat to the folks at the flood control boards who tried to do their jobs and for remembering why they were put in their public positions. Flood control, its right in the title! I guess Governor Jindal didn’t appreciate your dedication. Nobody ever said doing the right thing is easy. Oil and gas money is better spent on catchy stylish commercials and political campaigns than environmental restoration anyway. If you would like to learn a little more about the disappearing Louisiana coastline, you can visit the USGS site here. -Ben Spinelli
Who’s Watching The Store
Corporations exist to make money. That’s the way it is. Getting mad at a corporation engaged in pursuit of profit is like getting mad at a lion for eating a gazelle. It’s just what they do.We would like corporations to behave as better players in our society but I would also like people to be more courteous while they drive or more caring and polite. There are certain things we need to learn to live with. Corporate behavior is one of them. How we conduct the affairs of society in the face of what we know we can expect from business interests can make all the difference in the world.
Now corporate activity provides a lot of benefits. Manufacture of goods, jobs and economic activity are all vital to a functioning society. However, when the pursuit of corporate profit goes unfettered, all sorts of mayhem will ensue. Finding an appropriate balance between allowing economic growth and the greater interests of society has always been a challenge. The history of the United States is filled with the ebb and flow of corporations exerting their power and eventually having to be reigned in. We count on government as the arbiter of this give and take to provide a firewall against corporate excess. Unfortunately our history is also rife with examples of undue corporate influence over the mechanisms of government to tip the balance in their favor. Wherever and whenever this has occurred, the results have inevitably been bad.
Protecting the environment is not the job or the goal of the corporation. We rely on the government to insure that the corporate pursuit of profit has limits. We trust that someone is standing guard to make sure that those whose only interest is making money don’t trample on anyone or anything that stands in their way. When the people whose job it is to protect our resources or public health lose sight of that obligation or fail to fulfill that responsibility the results are predictable. When our elected officials owe their allegiance to special interests, the people’s interests get lost. We must demand that those charged with keeping watch on our behalf remember what their job actually is.
Who Knew Something Like This Would Happen
Sadly, we have several immediate examples of what will occur when we subvert the public good to the interests of corporations. The consequences have been dire. On January 9, 2014 , approximately 7,500 gallons of 4-methylcyclohexylmethanol (MCHM) leaked from a storage tank on the banks of West Virginia’s Elk River. MCMH is a chemical used in processing coal to ready it for combustion. Very little is known about its health effects on humans, although studies of the family of chemicals it belongs to, naphthenic acids, have demonstrated both acute and chronic toxicity to fish and other organisms. The site of the spill was about 1 mile above the intake of the West Virginia American Water Company. This resulted in the contamination of the drinking water supply for over 300,000 people in the 9 county region surrounding the state capital of Charleston. One month later, the water still isn’t safe to drink or bathe in. Freedom Industries, the owner of the facility that stored the chemical has filed for bankruptcy.
Meanwhile, in Eden NC, a broken pipe beneath a coal ash storage pond released around 80,000 tons of toxic coal ash into the Dan River. The pond was maintained (or not) by Duke Energy, the nation’s largest energy utility. The ash, which can contain a mixture of toxic chemicals including lead, arsenic, mercury and radioactive uranium, has fouled a 6-mile long stretch of the river. The City of Danville, Virginia, which draws its drinking water from the waterway, has determined that it’s drinking water system can safely filter out the contaminants. However, miles of the Dan River have been fouled by the spill with long-term ecological damage being likely. Environmentalists and regulators had been warning for years that the 31 ash ponds maintained at Duke’s power plants in North Carolina were environmental disasters in the making.
Both incidents were the result of a failure to maintain the facilities involved-facilities that posed a serious threat to the public.Both Freedom Industries and Duke Energy waited a substantial period of time before reporting their respective accidents. Their interests weren’t public health or safety, they were self-protection. Another common denominator was that the regulators, who were in charge of protecting public health and safety, were notably absent in holding these corporations responsible for meeting their obligations to protect the environment prior to the incidents. The power and influence of the coal industry was a far bigger factor than safeguarding the public.
A Close Call
At the same time, in NJ, a state not usually associated with the coal industry, an interesting power play (no pun intended) unfolded. New Jersey utility, South Jersey Gas, sought to construct a gas transmission pipeline that would bring natural gas (derived from fracking in Pennsylvania) to an aging coal fired power plant known as the B.L.England Generating station. It was owned by a private equity group with ties to the Koch Brothers, Rockland Capital Energy Investments. Bringing gas to the plant would allow Rockland to convert the plant from coal to gas and presumably make a better return off of their investment in the power station. In fact, without the conversion, there is the distinct possibility that plant will have to be shut down. However, the pipeline would have to be routed through the environmentally sensitive Pinelands of southern New Jersey.
The Pinelands are protected by some of the nation’s strongest environmental regulations. A dedicated public body, the Pinelands Commission, is charged with planning and protecting the region. The path to approval of the pipeline went right through the Commission. The administration of Governor Chris Christie put tremendous pressure on the Commission to approve the pipeline. The ties between Christie and the project ran from having the Koch Brothers as the top donors to the Republican Governor’s Association and strong boosters of Christie as a presidential candidate, to close Christie ally David Samson’s law firm representing the power plant’s owners to a member of Christie’s senior staff being married to a top executive for South Jersey Gas. Rockland and South Jersey Gas are interested in making money. Protection of the state and national environmental treasure of the Pinelands rests with the Commission and the state government. Despite strong-arm tactics from the administration and even the support of the Commission’s staff, the proposal failed-barely. In the end, the Pinelands Commission’s responsibility was to protect the Pinelands, not corporate profits.
Reader, suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself- Mark Twain
Remembering who has the job of protecting the public and protecting the environment is important. Corporations are quite capable of looking out for themselves. The people who are placed in positions that give them the responsibility of protection of valuable public trust resources should never forget that solemn charge. If they fail to fulfill that duty, nobody else is there to do it for them, or for us. The twin fallacies that corporations can’t make a profit in a regulated world and that corporations can be trusted to “do the right thing” lead to a great deal of bad policy decisions. Poisoning the drinking water of a city in West Virginia, destroying a river in North Carolina or disrupting a sensitive eco-system in New Jersey, all because government priorities have been flipped upside down should be alarming outcomes to any thinking person. When it comes to our elected officials and the environment, we need to make certain that “not my job” is not in their vocabulary. – Ben Spinelli
The Danger of Isolation
Immediately prior to the signing of the Declaration of Independence in 1776, Benjamin Franklin famously told the delegates to the Continental Congress, “We must, indeed, all hang together, or most assuredly we shall all hang separately”. The notion of us all being in a situation together has many applications in the realm of environmental policy, not the least of which are policies governing coastal areas in an era of climate change and sea level rise. The acknowledgement of that fact could be our collective salvation as surely as the failure to recognize that our fates are all tied together will eventually lead to our individual demise. Not only do we have a common interest in addressing environmental threats, there is also a need for a concerted course of action to meet them.
Similarly, the story of the blind men and the elephant brings a related lesson to our approach to policy making. Making decisions based only on a limited perspective can lead to miscalculation and misunderstanding of the nature and scope of the problems or circumstances that we face resulting in a failure to appropriately address the threats that exist. After all, describing an elephant as a snake or a rope may be accurate based upon your limited view of the world, but it is hardly an appropriate description of what you’re facing. This proverb provides no more apt a lesson than for coastal communities that face hazards with systems-based origins but respond with solutions that are only focused on what is right in front of them.
The dangers that coastal communities are facing from the combination of a gradually increasing sea level and flooding and damage from strengthening storms requires a response that looks at the bigger picture. The problem is, that in many areas, our policies and actions are controlled at the local level. This leads to measures being taken that fail to look at real root causes of the hazards. Putting aside, for a moment, the global scale of climate change, the failure to address the expected effects on a regional or systems basis leads to ineffective or inappropriate response measure that continue to put people, property and infrastructure investments at risk. The inability (or unwillingness) to see that what we may be facing at any particular place or point in time is just part of a much larger picture and use that perspective to drive our response is a serious and dangerous shortcoming.
The Need To Act On A Regional Basis
In 1972, Congress passed the Coastal Zone Management Act in an effort to manage the nation’s coastal resources and provide a balance between economic development and environmental protection. Section 307 of the Act encouraged coastal states to implement their own management programs by providing for integrated federal and state permitting in coastal areas for states that were deemed consistent with the CZMA. This led to the adoption of coastal management programs in every coastal state along the Atlantic, Gulf and Pacific coasts as well as in the Great Lakes states. The theory was good. The practice-not so much.
States took different approaches to managing their coastal resources and the definition of what was deemed consistent with the Federal Coastal Zone Management Act had a fairly liberal interpretation. Some states, like California and North Carolina were very aggressive in managing growth in coastal areas and created powerful commissions with both regulatory authority and the technical capacity to support land use decision making. Other states, like New York and New Jersey, passed regulations, but left left much of the decision-making power in the hands of local government. Additionally, New Jersey’s regulations were written in a manner that saw the bulk of typical “Jersey Shore” development fall outside the purview of the restrictions. It’s interesting to note that when North Carolina’s governor signed that state’s coastal management regulations into law he made a statement to the effect that it was to prevent coastal North Carolina from becoming the New Jersey shore.
We have to remember that what we observe is not nature in itself, but nature exposed to our method of questioning – Werner Heisenberg
The politics of regional authority and stronger land use regulations can be very difficult to navigate. However, we can no longer afford to approach coastal land use in the same manner, nor can we continue to manage land use in a piecemeal fashion. Whether its Dauphin Island, AL or Duck, NC or Ortley Beach, NJ, how we recover from the last weather event or prepare for the next storm must have some level of consistency. I’ll leave the methodologies that need to be applied for another day, but the underlying principals need to be based on reduction of vulnerability and hazard reduction and avoidance. Responses cannot be based solely on the interests of any single community or particular interest in isolation. A fragmented approach to a regional problem will never work.
A sea wall that protects one community at the expense of another, an expensive beach replenishment project for the benefit of a small number of people, or an infrastructure investment that supports an unsustainable or vulnerable community are just some examples of the results that a fragmented approach to coastal management can bring. It will not get any easier going forward as difficult decisions will need to be made. Just looking at Sandy recovery, it becomes obvious that there are places that can be re-built, there are places that can be re-built with modifications, but most importantly, there are places where we cannot or should not rebuild. Yet, I can almost guarantee that we will rebuild things right where they were before the storm, that we will favor one community over another, that we will use public funds for infrastructure that is unsustainable and that we will continue to make decisions on a local ad hoc basis. It doesn’t make Sandy recovery any different than Alabama after Frederic in 1979 or Louisiana after Katrina in 2005, but that’s the point; you’d think we would learn by now.
Before the next storm, and there will be a next one, coastal states need to assess their land use management and infrastructure investment practices. Dunes, wetlands, floodways and no-build or buy-out zones have to be a part of the equation and you will not achieve this on a town-by-town basis. The evaluation of vulnerability and resource protection needs to be done regionally. Engineered solutions like jetties, dikes or sea walls all have impacts beyond the project areas that must be assessed. If you don’t look at the big picture, it becomes the old arcade game whack-a-mole. Solve a problem here, it creates another someplace else, and the problems just keep coming. This doesn’t even touch on the resource limitations that individual towns face having to take on a tremendous effort to re-think their footprint without adequate support. Political will, resources and the right perspective are the elements necessary to succeed. Unfortunately, these seemingly simple ingredients are all in short supply. However, not taking the political risk or making the proper investments now will only result in real risk and unaffordable expenses in the future.-Ben Spinelli