Alaska and Oil

Zane informs me of the recent decision by the court system to reduce
Exxon's payments to the state of Alaska:

http://audacityofhops.blogspot.com/2008/06/alaskan-settlement.html

Really, ship owners can't be held responsible for the actions of their
captains, right?

I agree with Señor Kelly's assessment--can the courts really expect that
corporations involved in shipping have no greater control over their
vessels than in the early 19th century? With satellite phones, LORAN,
GPS, shortwave radio, etc., it seems to be a truly bizarre argument.
However, for all of the rhetoric about Joe Hazelwood and his
whiskey-slinging bravado, the real travesty here is the kind of
incentive this produces (or fails to produce) for the owners of Exxon.

I have no historical institutionalism here, but maybe a little rational
choice institutionalism:

If the court system structures a set of incentives around the hazards of
shipping oil that externalizes the costs of accidents and disasters, oil
companies and others involved in the industry will face no incentive to
prevent such disasters. If, on the other hand, the courts force the oil
industry to pay for its accidents, they will create incentives for the
industry to prevent these accidents in the future.

An example--If I understand correctly, the oil industry has, since the
time of the Valdez disaster, instituted a policy of replacing its
single-hull tankers with newer, double-hulled designs. Basically, the
rocks (or reef, or sunken pirate ship or whatever) need to bust through
two hulls before the oil starts to leak, instead of just one (as was the
case in the bad old days).

But if the oil industry doesn't need to pay for these disasters, and
Alaskan fishermen, and Alaskan and US taxpayers bear the costs of oil
spills, why bother to build these types of ships (which are more
expensive)?

And let's face it--$500 mil. is peanuts at any time, let alone in these
times of high profits for oil.

A potentially interesting aside: I understand that the Alaskan
heli-skiing industry was a direct result of the oil spill. Bored oil
spill cleanup workers needed something to do on weekends, and Exxon had
the helicopters...

But I should postscript this with a disclaimer--I am no expert on (a)
the oil industry, (b) the legal field, or (c) backcountry skiing in any
form (though I do have four pairs of skis hanging in my storage shed).