According to the Department of Natural Resources, “Sampling from one of the wells drilled last summer to test for pollutants in groundwater near Madison Kipp Corporation turned up traces of an industrial solvent at nearly six times the maximum level allowable in drinking water under state and federal standards.” Madison Kipp Corporation is a producer of machine components and controls a substantial portion of the supply chain beginning with the metal alloying to the final production of the machines. Ownership of the entire supply chain results in greater production, which means more chemical and industrial use.
Of course, a fundamental social problem with such a business is the negative externalities that result from its work. In the past, Madison Kipp Corporation has faced complaints over noise as well as air emissions from neighboring houses. This new groundwater and soil contamination issue is just another externality that the company is imposing on the surrounding community.
Madison Kipp Corporation ought to deal with this issue before it even goes to court and costs it more money and the neighbors greater headaches. The corporation might begin by giving a substantial portion of money to surrounding neighbors that have been affected by these negative side effects. This it should do as a good neighborly gesture and include in this a mailing about specific and detailed explanations of how the corporation is going to amend this situation. Then it should figure out how to prevent these externalities from occurring in the first place instead of trying the cleanup method (which obviously is not working very well). I am not an expert in industrial production techniques, but it seems clear that Madison Kipp Corporation’s current approach is failing.
If Madison Kipp Corporation neglects to rectify this issue, it is not only failing in its moral and legal obligations, but is ultimately hurting its own self-interest. Corporations are taking a lot of public heat as it is, and doing business in a liberal-minded community with little respect for the neighbors is going to harm their reputation over the long haul. They not only have to consider the ramifications that not dealing with this will have on their reputation, but also on their bottom line. Going to court is expensive and even more so when harmful substances are being emitted by a large corporation.
Pollution and environmental contamination are things that are being taken far more seriously these days, especially when it endangers people’s safety, as in the case of groundwater contaminants. Thus, the risk of a large expensive lawsuit against Madison Kipp Corporation looks likely. Furthermore, the corporation needs to really consider the long-term cost opposed to the short-term cost. A large initial investment to solve the pollution issues will cost an enormous amount in the short run, but it will save the corporation substantial sums of money, time and effort in the long run. In this case, the investment may very well be worth its short-term cost.
Madison Kipp Corporation has been the target of lawsuits in the past, and there is no reason to expect that it will not be again unless it takes action to both address community concerns and also to modify its current production systems. Sure, it will suffer high initial fixed costs to create cleaner and safer systems, but it is the right thing to do, morally, legally and for the corporation’s own bottom line.
Matt Jeffers ([email protected]) is a senior majoring in philosophy and economics.
