Thread by @srajagopalan

Today is the 35th anniversary of the Bhopal Gas Tragedy. As 60% of the country was born after the tragedy, a thread to acknowledge the endless suffering of the victims, and recap the state blunders because of which most victims are still waiting for compensation. #Bhopal 1/n

On December 2, 1984, Methyl Iso-cyanate (MIC) and other highly toxic gases leaked from a pesticides plant set up by Union Carbide India Ltd (UCIL) - a subsidiary of Union Carbide Corporation (UCC) - in of Bhopal. At least 10,000 died within 3 days of the leak. 2/n

The govt of India was involved from the beginning. It courted UCC to set up in India, provided all he relevant clearances, relaxed some regulatory requirements, and even owned a 22% of the shares in UCIL. 3/n

Union Carbide was notorious even in the 80s for having different safety standards for developed and developing countries. They were criminally negligent and exploited the weak state capacity and lax enforcement of safety regulation and a very corrupt Indian bureaucracy. 4/n

UCIL and UCC officials fled Bhopal and India in the immediate aftermath of the gas leak. No one from the companies has faced criminal prosecution or punishment for the actions that led to the gas leak. 5/n

After the gas leak, there are at least two more tragedies that led to the continuing suffering of the victims discussed in this podcast hosted by @amitvarma seenunseen.in/episodes/2017/… - based on my paper 'Bhopal gas Tragedy: Paternalism and Filicide' shrutiraj.com/wp-content/upl… 6/n

In the immediate aftermath American lawyers (ambulance chasers) flooded Bhopal and got victims to sign contracts for representation.Everyone feared that American lawyers and ‘ambulance-chasers’ working on contingency fees, sometimes as high as 50%, would exploit the victims. 7/n

To prevent exploitation by american ambulance chasers, the govt. passed the Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985 [BGLDA] which took away the right of victims to have legal representation and only govt could represent the victims in any court. 8/n

Second, BGLDA replaced the adversarial system of litigation with an inquisitorial system. Normally lawyers representing victims would have won damages in an adversarial system. But now the govt would get the damages, and then a bureaucrat would distribute that among victims.9/n

Third, the BGLDA made the ‘Welfare Commissioner’ the principle searcher for valid claims and determine the severity of the injury before distributing the compensation. As we all know, most victims are still waiting for compensation. 10/n

It took many years for the govt of India to move the litigation back to India. District Judge of Bhopal ordered Interim Relief of Rs. 350 Crores (3.5 billion) in Dec 1987. On appeal to the High Court, Judge Deo reduced it to Rs. 250 Crores (2.5 billion) on April 4, 1988. 11/n

The second tragedy was the horrifying final settlement between UCC and the Govt of India (representing all victims) in Feb 1989. Both parties negotiated a settlement approved by the Supreme Court for $470 million or Rs 750 Crores (7.5 billion). 12/n

The most shocking thing about the settlement - one of the conditions absolved UCC and UCIL of all past, present and future liability for the $470 million (Rs.750 crore). This was unheard of in cases where the full effects of the has leak were unknown and unknowable. 13/n

750 crore was based on - 3000 fatalities (3 lakh each). 30,000 with permanent disabilities(50,000-200,000 each). 20,000 with temporary disabilities(25,000 -100,000 each). 2,000 with utmost severe injuries(400,000 each). 25 crore (medical facilities) & 220 crore (property). 14/n

We dont have an accurate headcount but we know its tenfold what the govt estimated. 10,000 died within 3 days of the leak, and 20,000 have died in the last 35 years because of gas leak related diseases. This does not include children who were stillborn, also in the thousands.15/n

Instead of 52,000 estimated by the govt at least 500,000 were partially or severely disabled because of the chemicals. Thousands born post the gas leak are disabled because of the toxic ground water in the area was never cleaned up. Nor were victims moved to a safe location.16/n

The reason for such a miscalculation was that the incentives under BGLDA. In the aftermath of Bhopal there were thousands of fake claims by many exploiting the tragedy. It became difficult for the welfare commissioner to separate the genuine cases from the spurious cases. 17/n

Adversarial systems reduce both Type I and II errors. Type I error - false positive- is paying spurious claims and Type II errors - false negatives - is the failure to pay genuine claims. Bhopal settlement was rife with both Type I and Type II errors. 18/n

The adversarial system - which BGLDA eliminated - is a competitive model of evidence production reducing both Type I and Type II errors. Lawyers for both parties have strong incentives to pursue all evidence relevant to their case resulting in more than one search. 19/n

But the welfare commissioner under the BGLDA only conducts one search, without the aid of self interested lawyers who have an incentive to minimize error for their clients. Even the most hardworking and well intentioned bureaucrats in this system is plagued by error. 20/n

The incentives of the Welfare Commissioners (appointment, compensation, and promotions) were in no way linked to the speedy or accurate settlement of claims. There was little incentive to carry out an extensive search, seek out the genuine claimants, and minimize error. 21/n

Also, “ambulance chasers” have the right incentives. Where lawyers work on a success-fee or contingent fees arrangement, they get paid only if they win the case. While their intentions are distasteful, their incentives are very well aligned with the victims of Bhopal. 22/n

Removing institutions that created the right incentives led to 20,000 undecided claims in 2004 and Rs.1,503 crores (because of interest) was yet to be disbursed, after nearly 570,000 claims had been settled. Current numbers, though unknown, are worse. 23/n

The average compensation to victims was less than Rs.25,000 ($350). While UCCs criminal and fraudulent behavior caused the leak, the lack of compensation is a result of state callousness, hubris, paternalism, and malincentives detailed this paper shrutiraj.com/wp-content/upl… 24/n

The biggest lesson from Bhopal is that we the Indian bar council should allow contingency fee arrangements and the govt should rely more on adversarial litigation instead of inquisitorial searches given current state capacity. And reopen claims using these two systems. 25/n