I was in Mumbai on that December night in 1984 when tragedy struck in Bhopal. I was head of an American multinational’s Indian subsidiary, a company not unlike Union Carbide, whose managing director also happened to be my friend. We were among a few foreign companies that had stayed on and had toughened under the punishing conditions of the ‘license-quota-permit raj’. I was in shock over the horrific human tragedy but my sadness came from another thought, ‘what if it had been me’? I placed myself in his shoes and wondered if I would have acted differently? Probably not, and I thought about human vulnerability and how unbelievable lucky I was.
The epic, Mahabharata, reminds us that life is uncertain. Just as Yudhishthira is consecrated ‘universal sovereign’, he gets trapped in a rigged game of dice and loses everything, including his kingdom and his wife. The loaded dice is a metaphor for the fragile human condition. Imagine, if life is a game of dice governed by rules known to be deceptive, in which the least competent player is forced to stake everything, knowing full well that he will lose? Imagine too that death is the only outcome of the game. ‘In such a world one mostly fights for time,’ says David Shulman, the great Sanskrit scholar.
Clouds of poisonous gas rose in the night sky of December 3 from the Union Carbide factory, killing some 2,250 people and affecting 578,000 others. Of that number, it is estimated that between 15,000 and 25,000 people died subsequently, and tens of thousands of others remain sick to this day. No one in India seemed to know how to cope with the greatest disaster in industrial history and I could feel frustration rising in the nation as the days rolled on. Our national frustration then was not unlike America’s growing aggravation today as each new drop of BP oil that leaks into the Gulf of Mexico.
Twenty five years later, a court has awarded a two year sentence of rigorous imprisonment to seven persons, including my friend, in the Bhopal case. There has been national outrage both at the delay and the lightness of the sentence. Indignation at the sentence is understandable for so horrific a disaster--the human psyche seeks equally gruesome punishment to maintain moral equilibrium. The dawdling pace of justice in India is, of course, a national disgrace which diminishes us daily, but the fact is that crime and punishment in an industrial disaster is a difficult and complex issue.
In order to establish a higher level of crime would require showing criminal intent or prior knowledge of the disaster. For a higher sentence, the prosecutor would have to link the leaking of gas by an unbreakable chain of events to failure of individuals. It is difficult to imagine that directors or employees could have known that negligence on their part would lead to catastrophe of such proportions, and if they had known of the consequences, would they have ignored it? In the absence of intent, the only crime is of ‘rashness and negligence’ and for which the managers have been punished. But I am not sure if even that sentence will be sustained in appeal. The managers at Union Carbide knew they were dealing with a hazardous chemical but had no inkling that either the plant design or their operation was flawed. The 1982 audit report had pointed out few infirmities but they had reportedly rectified them.
The ‘evidentiary link’ was also missing in Andersen’s case, and this explains why India has failed to extradite him. The same logic applies to criminality in the recent, disastrous oil spill in the Gulf of Mexico. Nevertheless, Carbide got away by paying a paltry penalty for the worst industrial disaster in history. It is especially galling when you compare with what BP has paid and will end up paying. The tiny payment has fanned anti-multinational sentiment in India and reinforced a belief that multinationals have double standards. The truth is that multinational operations throughout the developing world are run to much higher technical and managerial standards than local companies. Look, for example, at the safety standards of the Indian railways. When did we last try to jail a railways minister or employee for negligence?
I compliment the Group of Ministers for their balanced and determined approach in recent weeks. It has restored sanity in our society whose discourse had been overtaken by a lynch-mob mentality. They have rightly recognized that the first and foremost duty is to the victims of the disaster and their survivors. Dow Chemicals, although it has no legal responsibility, should share in the financial burden as an act of magnanimity. If only the government had shown this sanity and determination twenty-five years ago so much suffering and tragedy could have been averted.
The lesson from Bhopal and from BP’s oil spill is that we need tort remedies to address the risk of future disasters. The legal system should not allow private individuals to keep the gains from dangerous activity and pass off losses to the public. We require liability to be fixed in advance on companies. Once these remedies are in place we can relax our ever-present licence-permit mentality. Solid insurance underwriting is likely to do a better job in pricing risk than any program of direct government oversight. This logic also suggests that America needs to rethink the Price Anderson Act's $375 million cap on damages to cover nuclear power disasters.
All this has reinforced my belief in the ancient Greek idea of moral luck. It could have been me sleeping innocently on December 3rd under the poisonous cloud. It could have been me working for Union Carbide? The Greeks knew that human life is fragile, but their lyric poet, Pindar, felt that its peculiar beauty also lay in human fragility. He compares a human being to a fragile vine ever in need of fostering weather. It needs gentle dew and rain and the absence of sudden frosts--and it needs caring keepers. So do human beings need fostering, but we also need to keep clear of catastrophe. Greek philosophers hoped to banish contingency by living a life of reason. Ancient Indians, on the other hand, believed that righteous action according to dharma would reduce their vulnerability.
India is becoming a venturesome, entrepreneurial society like America. Humans have a tendency to procrastinate. We don’t take advance measures because disaster is distant and unlikely. Prevention is costly and tedious, and frankly there is so much to do in the here and now. Since the consequences could be ominous, the low risk of occurring should not be a reason to ignore it. So, we need regulation. Regulation should be strong enough to reduce risk, yet not so strong as to stifle our new found entrepreneurial energy. We want regulators to work cooperatively with companies but not to be captured by them--‘crony capitalism’ is an ever present danger in our young capitalist democracy. In the end, no amount of regulation will prevent catastrophe. Humans are prone to err. What is needed is dharma or good faith among both companies and officials to limit harm. Regulators should also remember that costs forced on companies become higher costs for consumers.