Here is your question, or is that questions, of the day: if the spilled oil from BP’s oil rig never actually reaches the Florida coast, but the state tourist industry suffers anyway because of all the publicity, should BP still be held responsible? Supposing BP is cleared of all charges of bad practice, and that it is found to have gone beyond all reasonable requirements in attempting to deal with the oil spill, will it be entitled to compensation from the US taxpayer?

It appears, or so say the scientists, that the oil floating around in the ocean is evaporating before it reaches the Florida coast. See: What’s that – good news from the Gulf of Mexico?

The damage to Louisiana was awful, but the damage to Florida may be more psychological.

Bloomberg quoted US Florida Representative Kathy Castor as saying: “The oil is hundreds and hundreds of miles away… Yet the word has gone out all across the globe [that] the Florida beaches are damaged.” See BP Oil Leak Avoids Florida, as Do Tourists Who Think Otherwise

According to CNNMoney: “For many businesses in this region of the Gulf, it isn’t the oil that has hurt them the most, it’s tourist anxiety. When vacationers are jittery they book trips elsewhere, even if there’s no oil on the beach.” See 100 days after the spill

 The Florida tourist industry is worth around $66bn a year. Just imagine BP being forced to foot the bill for all the damage to the Florida tourist industry. It is doubtful the company would survive.

Tony Hayward reckons he was vilified and demonised. He is probably right. To many Brits he comes across as a decent bloke who was misunderstood. He was clearly not responsible for the oil leak when it occurred, and it does appear that BP did everything it could to deal with the leak. Those who say it should have done more, or that the US government should have done more, are living in a land that is populated by clouds and cuckoos.

But the backlash against BP in the US is such that little things like facts and truth are irrelevancies. For that matter, one can’t help but wonder whether any US based investigation will be wholly objective.

Once a crowd acts in unison, it takes little short of hell freezing over for the crowd’s constituent parts to change their minds.

Such madness of crowds is not always a bad thing. The spirit of the Blitz won the Second World War for Britain and her allies; the mourning at the time of the death of Diana Princess of Wales may have been quite extreme, but it did no harm, and at least it demonstrated crowds can care. (There could even be an evolutionary explanation for madness of crowds.)

The media is not solely to blame. The media is like a mirror – it reflects back its public’s views. It would be wrong to say the media moulds public views; the process is more subtle than that. It may be better to see madness of crowds as akin to two magnifying mirrors facing each other: a public and a media glass. Each reflects back the image they face, but magnifies it.

Clearly the damage done to the Florida tourist industry thanks to BP’s negative publicity is down to the complexity of crowd behaviour. But it is crowd behaviour that may yet force BP to fork out more money.

But just suppose the inquiry into the oil spill finds that BP’s safety standards were no worse than those employed by other oil companies, and that they adhered to regulatory requirements. Suppose the inquiry finds that the company did all that was possible to fix the oil leak and clean up the mess. Suppose it found that Tony Hayward was put under more stress and pressure than one could realistically have been expected to withstand. Supposing the inquiry finds that Hayward’s £10 million pension was justified as his pension pot was earned over 30 years. What then: would BP and Hayward be able to sue the mad crowd?

This is the snag with crowds. They have enormous power, and no responsibility.

© Investment & Business News 2013