Oil and Water, Economics and Ecology in the Gulf of Mexico

Abstract

Some economists and ecologists predict that the Deepwater Horizon oil disaster will sharpen the tools of ecosystem damage valuation in much the same way that war advances emergency medicine. Others fault both the methods and the premises of attempts to price nature. Generally agreed: avoiding future “spills” always beats trying to calculate the losses afterward, and that industrial societies have to rerig the incentives that fail to prevent appalling carelessness. The federal Natural Resource Damage Assessment (NRDA) process for the Gulf of Mexico may absorb federal scientists and economists, as well as dozens of collaborators in academia, for years. “Every damage assessment is different, and this one is really different. I couldn’t put a timeline on it,” says Tom Brosnan, a NOAA (National Oceanic and Atmospheric Administration) environmental scientist and a veteran of several earlier oil spill audits. NOAA and the US Fish and Wildlife Service are the lead agencies for the NRDA. Economic techniques used to calculate direct losses to fishers, boaters, tourists, sunbathers, or scuba divers and the businesses that serve them are complex but comparatively well settled. Trying to tally ecosystem Assessment and restoration Dollars can become the focus if there is litigation, or if the perpetrators want to settle. But the federal NRDA process is intended to look past the difficult question of dollar valuation of nature, at least initially, to calculate the costs of restoration instead. “Our job is to damage that doesn’t immediately affect what humans buy, consume, or earn from directly, however, sends economists and ecologists down a labyrinth. What’s the price tag for a brown pelican, sea turtle, reef, marsh, or mangrove, or for the ecological resilience of the Gulf as a whole?