Ratufa

There are a few components involved in this disaster:

1) The "system" which, in the article, refers to the standard procedures and best practices one should follow when monitoring and running an oil well of this type. From what the author said, it appears that if the people at the well had followed these procedures the blowout wouldn't have happened.

2) Human error -- people being careless, rushed, drunk, tired, not understanding procedures, etc. This is the "people aren't immune to screw-ups" factor. It's not clear how much this applies to this particular incident.

3) There's another sort of "system" that 1) and 2) are embedded in, and that is the system of incentives in which people operate. This includes things like your manager pressuring you to "do it anyway", or knowing that your promotion depends on cutting corners and being under budget. I suspect that this is the root of the problem, in this case.

One reason these incentives are the way they are is because they often work --- the company saves money (or the individual gets his promotion) and even when things go wrong the cost of the failure may be less than the money saved (though, that likely won't be true in the case of BP). Other reasons may involve not fully understanding the risks, or principal/agent issues.

It's strange how people don't notice problems when making huge amounts of money depends on things remaining the way they are. When it hits the fan, let the finger pointing begin.

The villain in this piece doesn't seem to be the overbearing, but somewhat clueless boss, but the Wall Street banks, in particular Goldman Sachs. It reminds me of Matt Taibbi's recent Rolling Stone article on "The Great American Bubble Machine", though without the screaming.

The author lost me with his silly retirement argument on the first page. Note that the college grad starts out making so much more than the high school grad (by the author's figures) that s/he could start adding to that index fund at the time of graduation, while still paying off his student loans and having a higher standard of living than the high school grad. The college grad also could invest sufficient money in the fund each year to quickly surpass the amount of equity the high school grad has and still have a higher standard of living.

The author would have been better off skipping the pseudo-finance.