You are browsing the archive for BP oil disaster.

Japan Nuclear Ocean Watch: Radioactive Water, Dolphins and Plastic Bottles

5:25 am in Uncategorized by Scarecrow

What is it about our species that sees the earth and its oceans not as our shared home to be cherished and guarded as though our existence depended on it, but as our unlimited garbage dump? We should be ashamed. Our governments should be ashamed. Our corporations and their dishonest executives should be ashamed. All of us.

From the New York Times reporting on Japan:

Tokyo Electric Power Company said on Monday that it will release almost 11,500 tons of water contaminated with low levels of radiation from the Fukushima Daiichi nuclear plant into the Pacific Ocean as workers struggle to contain the increasing amounts of dangerous runoff resulting from efforts to cool the plant’s damaged reactors. . . .

To free up space, about 10,000 tons of less seriously contaminated water will soon be released into the sea from the facility, said Yukio Edano, the chief cabinet secretary.

An additional 1,500 tons of radioactive water will also be released from the No. 5 and No. 6 reactors, after runoff was found flooding parts of their turbine buildings. There are concerns that the water could damage the backup diesel generators powering the reactors’ cooling systems, he said.

“Unfortunately, the water contains a certain amount of radiation,” Mr. Edano said. “This is an unavoidable measure to prevent even higher amounts of radiation from reaching the sea.”

During the BP’s Gulf oil mega-disaster, or should we say, the BP-Halliburton-Transocean disaster, the Bush-Obama Interior Department-Gulf States complicity and coverup and the public denial, we heard repeated warnings about how the destroyed oil well was not merely gushing oil to the surface but forming a massive hidden plume that could threaten life in the Gulf for extended periods. But of course, BP and NOAA’s Jane Lubchenko dismissed as premature the reports from independent scientists, then ordered them to shut up. But as more evidence surfaced, it became obvious the scientists were telling the truth.

Now, many months later, as higher numbers of dead turtles and baby dolphins continue to wash up on Gulf shores, the feds who tried to diminish the risks and silence the researchers then are now telling independent scientists they can’t have samples to test independently because it all has to be kept secret for the federal criminal investigation. That would be the same federal government notorious for not prosecuting senior government or corporate executives for major crimes, the same forward looking Administration that prefers to reach a “settlement” with fraudulent banksters and polluters who pay a modest fine and agree not to do again what they don’t admit they did in the first place.

Now, the exact same people who brought you that life-killing assault on the Gulf and the people whose lives depend on it, and the same state and federal officials who assured us it was safe the first time, want to resume their drilling activities as though nothing had happened. And for them, nothing meaningful has. They’ll give themselves awards for safety and then use the same flawed equipment that failed several times before and that will, sooner or later, fail again.

I don’t diminish for a moment the real dilemmas, the awful choices facing the Japanese. Because we are where we are, those choices range from godawful to truly horrific. I suspect their officials believe they’re doing the best they can, and there’s no doubt of the courage of the Japanese workers struggling to contain the monster their and our corporations and governments have released on the planet.

What’s happening at the Fukushima Daiichi Nuclear plant is not just about them or just about nuclear. And it’s time for an accounting, a moment when a lot more people, including Americans, wake up and start asking some hard questions about how we live and what we eat and what we’re doing to our home planet. The species needs a lot of water bottle wakeup moments, and soon.

But all we’re getting out of the Administration and Congress are non-credible blather and the usual assurances that we don’t need to change a thing about our high-tech, low-safety, zero-accountability oil, gas, coal, and nuclear energy dependence. That attitude will destroy life on the home planet.

And the mindless Tea-GOP bullies running Congress are denying science, defunding health/safety regulation, crippling research and warning systems, and attacking workers’ incomes and their very right to fight back in state after state. They’re not merely morally dishonest in ignoring inconvenient truths, as Krugman notes; they’re a menace.

NN10: Van Jones on Hope, Despair, Change, and the Orcs

12:45 pm in Uncategorized by Scarecrow

Van Jones speaking at Netroots Nation 10. There’s a few minutes intro by Howard Dean, followed by Jones’ speech. This runs about an hour, including Jones’ interview with Ari Melber.

Thanks to the folks at Get Energy Smart NOW! for the video.

Bush OMB Guy Blames Congress for Lax Oil Drilling Oversight That Bush OMB Approved

10:33 am in Uncategorized by Scarecrow

The New York Times turns over valuable op-ed page space to a former Bush OMB official who uses it to obscure it was his and OMB’s job to oversee how effective Interior and Minerals Management Service (MMS) were in regulating and promoting offshore oil drilling.

In A Disaster Congress Voted For, former Bush OMB official David Abraham argues we should blame Congress and environmentalists for the lax regulatory climate that led to the BP oil disaster. The Times helpfully informs us that Mr. Abraham "oversaw offshore programs at the White House Office of Management and Budget from 2003 to 2005." What does that mean?

I think it means Mr. Abraham and OMB had influence over the regulatory plans and budgets of the Interior Department and MMS, the agencies responsible for issuing deepwater drilling permits and ensuring compliance with the nation’s environmental, public health and safety laws.

Moreover, at least since the Reagan era, OMB has assumed responsibility for making sure the nation’s regulations do not impose unwanted restrictions on corporate actions. Because as we all know, health and safety regulations and enforcement should end where they unduly impinge on the bottom line.

A major OMB function is thus to screen existing and proposed regulations to make sure economic burdens on industry are fully considered during and after agency rulemaking. So, if an overly conscientious regulatory agency took its environmental, health and safety responsibilities too strongly, OMB would bring them back into ideological conformity by vetoing proposed regulations and, if needed, by controlling the wayward agency’s budgets. In the era of corporate governance, OMB helps enforce an Administration’s ideologically preferences for or against government interventions in the economy.

Now perhaps Mr. Abraham was alarmed during his tenure and pressed OMB for larger and more effective MMS regulatory budgets. But his op-ed doesn’t say that nor hint at his own and OMB’s likely complicity nor mention the era’s dominant pro-corporate ideology. Instead, he says that Congress was mostly responsible for the lax regulation when offshore drilling literally exploded in the Gulf.

For more than a decade, legislators have allowed themselves to be lulled by industry assurances that drilling in deep water posed little danger. One could say that Congress, just like the companies it has attacked, was obsessed with oil. . . .

At the same time that Congress called for new drilling incentives, it also gutted oversight. From 2002 to 2008, legislators approved budgets reducing regulatory staffing levels by more than 15 percent — despite more complex deep-water operations and Interior Department concerns, voiced in 2000, that industry’s extensive use of contractors and inexperienced offshore workers posed new risks in deep water.

He does not mention that during most of this period after 2000, a Republican President and/or Republican-controlled House or Senate were in charge. So Republican, pro-industry Congresses and Administrations were the ones "obsessed by oil" who "gutted oversight."

Nor does he mention the almost unanimous ideological embrace of regulatory dismantlement by Republicans and conservative Democrats. It was the same guiding ideology expressed by his OMB bosses and President George Bush, not to mention the era’s energy czar Dick Cheney — whose names Abraham neglects to mention to protect the guilty. (Later, however, he does mention that Barack Obama is now President, and as we all know, Democrats control Congress, though I’m sure Mr. Abraham meant to cast blame only in the most bipartisan way.)

Next, Abraham joins Sarah Palin in blaming environmental groups. Palin blamed the enviros for opposing "safe drilling" and thus, in her logic, forcing the industry to engage in "unsafe" offshore drilling, which, uh, she hastens to add, is still safe. Abraham blames the enviros for (1) telling Congress and regulators that offshore drilling was unsafe but (2) failing to tell regulators how to do it safely.

Environmental groups have seized on the spill to continue their push to ban offshore drilling. Although doing so would reduce the potential for spills in the United States, it would effectively send offshore drilling operations to countries with far weaker environmental standards and require shipping more oil, increasing the likelihood of spills globally.

So, we should permit unsafe drilling here, because if we don’t, there will be unsafe drilling in Nigeria. Apparently, there are no other choices. So what should we do?

Instead, a more nuanced approach is needed. A good first step would be for environmental groups to hire experts with the relevant private-sector experience to comment on regulatory changes to ensure that they are in the best public interest.

In other words, Greenpeace and NRDC are partly to blame for the BP oil disaster and lax MMS regulation, because these environmental groups failed to hire drilling safety experts. And without their comments, regulators never thought to require safe drilling techniques, rigorously tested safety equipment, or credible recovery plans.

Bad enviros. Bad, bad.

It would be interesting to know why the New York Times editors selected this op ed.

ClimateProgress, Bush Administration energy policy history: BP oil disaster is Cheney’s Katrina
CAP, Cheney’s culture of deregulation and corruption

Update: NYT Archives, Bush Directive increases Sway on Regulations h/t Froomkin, White House mulling business group’s regulatory hit list

NYT’s Nocera Repeats Oil Industry Propaganda Against Drilling Moratorium

12:11 pm in Uncategorized by Scarecrow

The New York Times’ business columnist, Joe Nocera, writes an astonishing industry shilling piece on why the US Government should not impose a deepwater drilling moratorium. Nocera’s arguments, which swallow the pro-industry federal court ruling whole, are either irrelevant or so deeply dishonest that they warrant a strong retraction from the Times’ editors.

In this post, I listed a few of what I believe are compelling arguments why a deepwater drilling ban in the Gulf is fully justified, at least until we figure out how to drill safely, how to minimize the risks of another deepwater blowout catastrophe and develop far better techniques to contain and quickly recover the spillage from a blow out when it occurs. None of those problems has been solved, notwithstanding the argument that existing drilling rigs have been reinspected under current rules. It’s the rules and solutions we don’t have that are the problem. Thus, a strong case, if properly pleaded, should leave a reviewing court with more than enough support to uphold a conditioned moratorium.

That case would lay out the substantial health, environmental, and safety risks posed by the continued deepwater drilling, based on what we’ve learned from the BP oil disaster and its mostly unsuccessful control and recovery efforts. But it would also need to address the counter-arguments and the likely economic harm a moratorium would impose on affected companies and workers who rely on further drilling. A reviewing court would then determine whether the government had acted reasonably — or arbitrarily and capriciously — in striking that balance of interests.

Joe Nocera’s Saturday column, Moratorium Won’t Cut Risks of Deepwater Drilling, doesn’t even acknowledge the powerful arguments that should compel a moratorium. His editors should have demanded a balanced rewrite there, but they didn’t. Instead, Nocera accepts and repeats oil industry talking points, some of which are irrelevant to the case, some misleading or dishonest, and some so inimical to the public interest they should be summarily dismissed by a disinterested, fair-minded court.

Nocera begins with an intellectual slight of hand, mentioning the size of world oil production and the scope of Gulf oil production with the much smaller scope of new drilling, whose tiny proportion he neglects to mention:

As a percentage of the world’s oil production — some 84.5 million barrels a day — the 1.75 million barrels a day that is extracted from the Gulf of Mexico is not a huge number. (That’s why oil prices haven’t risen as a result of the Deepwater Horizon disaster.) . . .

Uh, no; oil prices remain unaffected because nothing about an incomplete well or a moratorium on new drilling that may not affect production for years affects current supplies or likely production in the near future. He continues:

. . . But in terms of the country’s domestic production, it is extremely important. According to Gibson Consulting, a third of all United States oil production comes from the Gulf of Mexico.

This argument is completely irrelevant. No one is proposing to disrupt any portion of the world’s current oil production, nor even stop any current or near-term production in the Gulf. US supplies aren’t affected yet. The moratorium is aimed at new drilling, not existing production at well’s already drilled. As Rachel Maddow, whom Nocera disparages, reminds us, there are over 36,000 operating production wells in the Gulf, none of them affected by the moratorium, which affects only 33 new drilling efforts.
Nocera next adds this irrelevant point:

What’s more, virtually every new well being drilled in the gulf is a deepwater well — because, after all, that’s where the oil is. . . . And . . . 80 percent of the reserves that remain in the gulf are either in deep or ultra deepwater.

So? His next argument is that we can’t shut down Gulf drilling because we absolutely have to have the oil, even though we don’t.

So the first point is: Until that glorious day comes that our cars are fueled by batteries and our homes are heated by solar power, we need as much domestic oil as we can get our hands on, oil that exists in the deep waters of the Gulf of Mexico. Shutting down drilling in the gulf — even temporarily — means we’ll be importing even more oil from other countries than we already do.

Never mind that Americans have shown repeatedly they can reduce their demand in response to prices. It’s true that if the world stopped drilling new wells, eventually supplies would dwindle. But new wells rarely go into production immediately, so whatever effects there might be in theory from a six-month moratorium are likely years away if ever.

But suppose, as Nocera warns, the moratorium lasted longer than a few months. What that would mean is that the US Government had determined that after a six-month moratorium, it still had no assurance that the industry could conduct deepwater drilling safely, had adequate recovery measures to stop another deepwater blowout quickly before it caused massive damage, and/or still had inadequate resources and techniques to contain and cleanup damages of the magnitude we’re now witnessing. He’s suggesting we should have more unsafe drilling anyway.

Nocera’s argument thus amounts to: "That’s too bad, America. You have to risk that now plausible damage to the Gulf because the industry has convinced me I don’t want to change anything I’m doing."

In fact, if the industry failed to devise safe enough drilling and/or containment/clean-up methods, the long-run effect could be to reduce world supplies and raise prices. Why, prices might even rise to levels we’ve seen in the past, which encouraged people to drive less. Of course, if all of the health/safety/environmental costs of oil dependency (only some of which have been exposed by the BP oil disaster) were included in oil prices, the same effect would occur. So Nocera is essentially arguing that we should continue to drill without limits and consume without paying the costs, because . . . well, because we just have to consume oil as though it didn’t have these costs.

Next, Nocera says that if we hold up drilling here for a few months, the drillers will go elsewhere:

Meanwhile, there are only so many floating rigs in the world, and Brazil, for instance, has just embarked on a $200 billion drilling program. (You read that right: $200 billion.) It takes a month to move an idle rig from the Gulf of Mexico to Brazil, where it will likely stay for years. So a six-month moratorium would quite likely have far greater effect on American oil production that it would seem at first glance.

Yes, that probably would happen, assuming every other country ignored lessons from the BP disaster and did nothing to improve their own safety/environmental oversight. Nocera assumes other nations would do nothing to change their regulations.

We are not lessening the chance of a spill; we’re just transferring that risk to Nigeria and Brazil. We are not helping the world. We are just saying, ‘Brazil, we prefer to despoil your beaches, but not ours.’ ”

No, no one is saying that. Nocera just made that up. What the BP disaster is telling the world — not just the US — is that no deepwater drilling should continue anywhere unless and until the industy’s now obvious laxity and deficient safety procedures are fixed, not just here, but in Brazil and the North Sea, and Nigeria. This is an industry-wide problem.

Finally, Nocera repeats the cynical industry talking point that since they’ve already decimated the Gulf fishing industry, they should be allowed to keep drilling more wells because those are the only jobs left. That’s an argument for even more actions that put other jobs and businesses at risk, instead of forcing the industry that caused the economic damages to fix it’s problems before starting more risks.

The logic of Nocera’s column doesn’t end with a six-month drilling moratorium. It’s really an argument against almost any government regulation of any industry, not just deepwater oil drilling. In essence, he’s arguing that government should never impose additional health, safety or environmental costs on industry, because that might drive them to other places, reduce supplies of their products, or affect employment by that industry. Those are the same arguments unsafe industries have been using for more than 100 years.

All those effects are possible, but Nocera’s argument that we should not balance industry costs against any of the massive costs to the public of under-regulated industry actions is an argument for massive corporate looting and unfettered destruction of the planet. Some of us think there’s already too much of that.

John Chandley

Financial Times, Norway enacts own moratorium on new deepwater drilling
Deutsche Welle, on Nigera, The Oil Disaster the World Would Prefer to Ignore

How Many Clean-Up Workers Could the Gulf Use? Why Aren’t We Sending Them?

5:53 pm in Uncategorized by Scarecrow

Clumps of oil have begun washing up on the beaches in Pensacola, Florida. Take a look at these sickening photos. And these photos showing the effects across the Gulf.

Notice that when the Pensacola locals dug down through the sand, they discovered layers of oil that came in earlier and got covered as more sand washed in. If the oil washes in at night, it might be covered by morning, but it’s still there, doing its damage.

This could happen any/every day and any/every night for months. They could use thousands of people out there, 24/7, working to clean it up as it comes in, and even thousands might not be able to keep up.

Americans across the nation are going to be watching this on television and reading about it and talking about it for months to come. How much damage will occur in that period? What message will people draw from it? Whom will they blame? And what will they do about that?

The Gulf coast is under siege from a sickening, often lethal killing force, and it’s attacking across a thousand mile front. The Gulf Coast is under attack. So leaving the response mostly to BP, even with Coast Guard oversight, is ludicrous, and expecting the states and affected local communities to be able to handle this alone is not enough.

The Federal Government needs to treat this as the equivalent of an invasion and ralley the nation to meet it. Yet the Obama Administration seems to be missing a great opportunity for mobilizing hundreds of thousands or a million workers to do whatever they can to help contain and clean this up until it stops washing ashore and threatening the Gulf.

Thousands of Gulf residents whose jobs are being destroyed by this catastrophe have already been deployed. But that’s not enough. America has 15 million people without jobs and thousands of students without summer jobs. They want to help; they need the work; the nation needs a jobs program. Why isn’t this answer obvious to the people in the White House?

As MSNBC’s Rachel Maddow has been pointing out, night after night, there are jobs that need doing, booms that aren’t being attended, beaches not sufficiently monitored, and oil being left to soak in. Meanwhile we have small politicians arguing about whether the National Guard has been deployed, when even more resources are needed.

Issue an Executive Order creating a Gulf Conservation Corp and put someone in charge in every state, on every shoreline, and use whatever emergency powers the Executive has to start mobilizing them. Then offer a bill in Congress to sanction/pay for it, with recovery from the BP escrow, and let’s see if there are any patriots. Let’s see how Americans respond to a real crisis that puts its real security at risk. I think we might be pleasantly surprised.

John Chandley


Seminal, Chris Matthews: Whom could we get to clean beaches, man oil booms this summer

McClatchy, No skimmers in sight, as oil floods into Mississippi waters

Captured Government: How a Federal Court Can Claim Deepwater Drilling Is Safe

5:46 pm in Uncategorized by Scarecrow

I’m sure more competent counsel are going over the Federal District Judge’s ruling that the US Government did not make a sufficient case for imposing a temporary moratorium on new deepwater drilling permits. After listening to Dylan Ratigan Tuesday agree with Mary Landrieu that the moratorium was just so unfair to the industry, you’d think it was a foregone conclusion.

As I write this Tuesday night, MSNBC just reported that Secretary Salazar will issue an order reinstating the moratorium and provide the court with additional justifications. So it may be that the Government simply didn’t put it’s best case forward initially.

Judging from his reasoning (see Savage’s piece in NYT), which buys without question the industry’s arguments, this particular judge probably wasn’t ideologically inclined to accept the government’s arguments in any case. And there’s the little matter of his reportedly having an apparent financial conflict in the industry stocks he owned.

But when a judge argues that we would never ground all airplanes just because a wing fell off one plane, you have to wonder. It’s a known fact that the US airline regulator has grounded entire fleets of similar aircraft when one of them suffered a serious safety failure. And the Nuclear Regulatory Commission has, in the past, required all nuclear plants built by the same manufacturer to shut down for inspections, when one of that manufacturer’s plants suffered a common mode safety failure. Government-ordered massive recalls of tens of thousands of cars and trucks happen all the time when a few are found to have dangerous defects. This judge just made it up that government doesn’t routinely do these things when the conditions warrant. It does, and industry always goes through denial and a lot of squealing, but the public expects its government to do this.

So in the absence of any evidence of hasty, poor lawyering by the Government’s attorneys, you have to wonder how any competent court could conclude that there isn’t a compelling case for stopping all offshore drilling until serious safety issues common to all of them are resolved. After all, they use essentially the same technologies, the same procedures, the same materials, the same contractors, the same safety rules and the same motives driving the same activities. This is as close to a no-brainer as you get.

Consider what the industry itself has told us and what we’ve learned in recent weeks watching BP stumble from one failed attempt to another but still unable to cap at best a small fraction of the thousands of barrels of oil gushing from its uncontrolled well.

We know that the industry does not have a reliable method to stop a massive deepwater gusher in the event the blowout protector fails. We now know that BOPs have failed on dozens of occasions and when they did, they often caused major blowouts, a few of them castastrophic.

We heard the CEOs from other major oil companies confess to a House Committee that when this happens, they do not have an effective technology for stopping the gushing short of spending months drilling relief wells that may require multiple efforts before they’re successful. The irrelevant "we’re ahead of schedule" announcements forget to mention this.

So we know that a relief well may take many months before it manages, we hope, to bring this rogue well under control. In the meantime, millions of barrels of oil will gush uncontrolled into the ocean and cause irreparable harm.

We know that the environmental damage likely from such a gusher can be catastrophic to an entire region, and the economic costs can be in the tens of billions. We know we don’t know all the pathways or consequences or adverse effects, we don’t know how to predict or measure them, and we don’t know how to contain them.

We know that there are not sufficient resources — equipment or people — or plans, or coordination skills to capture/contain all of the oil rising to the surface or to prevent it from spoiling hundreds of miles of beaches, marshes, wetlands, etc. We know we won’t save even a tiny fraction of the wildlife this affects.

We know that federal regulators have proven to be notoriously incompetent and compromised; we know they didn’t do adequate environmental reviews for permits at other rigs subject to the moratorium; we know the industry has knowingly and deliberately corrupted the regulators; we know that safety regulations and enforcement have become hopelessly compromised in theory and in practice. We know we don’t know whether these other wells are safe or can be made so.

We know that an uncontrolled gusher is not merely possible, but a logical outcome from a plausible chain of equipment failures and human negligence. We know these things happen, even though the industry assured us they never do. We know all the oil companies used the same filings to give us virtually identical contingency plans and tell us these same lies.

We know that the high costs of deepwater drilling create strong pressures on the drillers to cut corners that put safety and environmental damage at risk.

And we know that every one of these findings could apply to any one of the dozens of drilling operations that would otherwise go forward without the moratorium. And because that’s true, we know that other nations are also imposing moratoria on similar operations.

On PBS News Hour, a spokeswoman for the American Petroleum Institute, which won this round, assured us that everything is fine, that all the rigs had been inspected and found safe. She was lying right in our faces. The fact is, we don’t even know yet what to inspect for, and no one can unconditionally vouch for the adequacy of the BOPs and mudding/cementing/sealing procedures and contingency plans they all rely on to prevent another blowout.

Given everything we know about the massive risks of further deepwater drilling as long as these issues are not resolved, only a judge completely oblivious to the public interest and predisposed to credit only the industry’s economic interests could rule that the US Government is not justified, even required by reason and its public responsibilities to stop all such drilling until there are assurances of safety and adequate mitigation.

Judge Feldman was appointed by Ronald Reagan. He’s just like half of the federal judges along the Gulf region who often have to recuse themselves because of ties to the industry. These are "federal judges," but how different are they from MMS with robes? Oil is our opium, and Afghanistan’s corruption has nothing on us.

As the Gipper would say, "government is not the solution, government is the problem." When government is captured by industry thinking, I’d say he had a point.

John Chandley
(edits and updates with video Wednesday a.m.)

So Long, Tony Hayward, and Thanks for All the [Dead] Fish

10:27 am in Uncategorized by Scarecrow

After Tony’s abysmal performance yesterday before the House Subcommittee on investigations, is anyone surprised that BP’s Chairman just announced Tony "I want my life back" Hayward may get his wish?

Via Reuters (and on CNN):

CEO Tony Hayward will hand over daily oversight of the oil giant’s response to the massive spill in the Gulf of Mexico, Sky TV reported on Friday, citing an interview with BP Chairman Carl-Henric Svanberg. (Reporting by Kristin Roberts, Editing by Stacey Joyce)

Update: Link to SkyNews interview with BP Chairman.

Update 2: per CNN, BP says it was already done.

BP spokesman Andrew Gowers tells CNN that Svanberg was just reflecting a June 4 announcement about BP Managing Director Bob Dudley taking over the long-term disaster response. He said Hayward’s current role has not changed.

May they should watch this again:

So long, Tony, and thanks for all the [dead] fish . . . and turtles, whales, shrimp, crab, oysters, wetlands, . . .

CNN has this morning’s video from Admiral Allen

Republican Joe Barton Apologizes to BP for US Making Them Pay for Damages

7:44 am in Uncategorized by Scarecrow

BP’s CEO, Tony (I want my life back!) Hayward is testifying today before a House Committee, and he just received a heartfelt apology from one of his most loyal subjects. Joe Barton (R. Texas) just apologized to BP.

The Republican Party’s quintessential oil Congressman, Barton told Hayward how shameful it was that the Obama Administration would "shake down" BP by demanding that it give up dividends to shareholders and instead set aside a small fraction of their net revenues to the greedy Gulf folks who’ve been only slightly inconvenienced by losing their jobs, their livelihoods, and their environment. Never mind that BP agreed to this on its own, because it knows or fears it’s legal liability may eventually become worse.

I’m so glad Barton, like fellow Republicans Haley Barbour, John Boehner and Michelle Bachmann before him, did that, because I’ve been worried Americans might be giving BP and the oil industry the wrong impression by telling them we expect them to pay for the damages they cause when they’re criminally negligent, kill people, ruin the Gulf and then lie to us about it. This ancient principle of responsibility has run its course and just isn’t American anymore.

Now that the oil industry knows how much we appreciate how they’ve transformed the Gulf into a place safe for unrestricted drilling, it’s now time for Congressional Republicans to apologize, on behalf of a distraught and repentant American people, to Wall Street bankers too. We all deeply regret that their profits took a temporary hit before we came to our senses and made them all fabulously wealthy again. And everyone chipped in to make it up to them — like $14 trillion in lost wealth — especially the 15 million who are unemployed or about to be layed off because Congress thinks firing teachers is the way to increase budget revenues.

And thank the goddess that someone finally showed Obama how to show proper respect to people who don’t have our interests at heart. All that bowing is nothing compared to the on-your-knees performance by Republican Joe Barton.

God Bless BP! And God Bless the Congressmen they bought and paid for! Ain’t American something?


Update: My apologies to Barton! Apparently he was only trying to protect the retirements of small people, like BP shareholder John Boehner:

House Republican Leader John Boehner bought between $15,000 and $50,000 in stock in BP, the company responsible for the spill that has spurred an environmental disaster. Boehner, of West Chester, purchased the stock on Dec. 10, four months before the April 20 explosion that set off the spill.

Rep. Mike Turner of Centerville owns between $1,000 and $15,000 in stock in Transocean Ltd., the company that owned the drilling rig Deepwater Horizon, which was leased by BP and sunk after the explosion, killing 11 workers.

The White House Press Office has a different view:

“What is shameful is that Joe Barton seems to have more concern for big corporations that caused this disaster than the fishermen, small business owners and communities whose lives have been devastated by the destruction. Congressman Barton may think that a fund to compensate these Americans is a ‘tragedy’, but most Americans know that the real tragedy is what the men and women of the Gulf Coast are going through right now. Members from both parties should repudiate his comments.”

Update II: The Hill: Florida Republican calls for Barton to step down:

Rep. Jeff Miller (R-Fla.), whose Pensacola district is among the most-impacted areas in the Gulf by the oil spill, condemned Barton for apologizing to BP CEO Tony Hayward during a committee meeting on Thursday.

"I condemn Mr. Barton’s statement. Mr. Barton’s remarks are out of touch with this tragedy and I feel his comments call into question his judgment and ability to serve in a leadership on the Energy and Commerce Committee," Miller said in a statement. "He should step down as Ranking Member of the Committee.”

Even John Boehner is running away. And David Dayen picks up the story from there: Republicans are in full, modified, limited retreat, sort of, based on a "misconstrued misconstruction."

Open Secrets: Where does Joe Barton’s money come from?
Nancy Pelosi, How come Republicans vote "no" on everything?

Credit Is Due: Obama Gets BP to Suspend Dividends, Commit $20+ Billion for “Small People”

4:28 pm in Uncategorized by Scarecrow

Credit where credit is due. The Obama Administration managed to get BP to commit at least $20 billion to an independently administered escrow fund to pay economic damages arising from the BP oil disaster.

The few details released so far suggest some worthwhile features.

– BP’s commitment of $20 billion will be funded in installments of at least $5 billion this year and each of the next three years. That provides a continuing fund of money for damages that are likely to last over several years.

– With the expectation that total damages could exceed that amount, he President emphasized that the $20 billion is not a cap. He assured Gulf residents that all their claims will be covered.

– Given pressure from the Administration and Congress, BP will suspend dividends for the rest of 2010; with annual dividends at about $10 billion, that’s a major signal to markets that BP is serious about meeting this commitment.

– The escrow fund will be have credible independent oversight from Kenneth Feinberg, who oversaw the 9/11 victims compensation fund. If the fund is truly independently administered, it negates a major frustration claimants would have in facing BP stalling tactics.

– BP will also commit $100 million to compensate oil workers affected by the moratorium on new deepwater permits. The Administration has demanded this against doubts about its legal basis. But in the context of a $20 billion commitment, allocating another $100 million for something the Administration wanted was not a big deal. That $100 million essentially buys the Administration a partial defense against the Gulf Coast Congressmen who wanted the moratorium lifted, because, they argued, it was hurting Gulf jobs.

– And BP’s Chairman emerged from his meeting with Obama to apologize to the American people, promising to meet the terms of the agreement. From the New York Times:

After the president’s remarks, the chairman of BP, Carl-Henric Svanberg, announced the dividend suspension. Mr. Svanberg apologized “to the American people” for the disaster and said that BP would “look after the people affected, and we will repair the damage to this region and the economy.”

The White House was probably exchanging high fives while watching that.

It’s been frustrating to watch the Administration ducking governmental responsibility while leaving critical public health, safety and environmental decisions in BP’s hands. But there was also a tug of war to ensure BP remained financial liable for all damages. But nailing down a basic agreement on how damages get paid, the Administration is better positioned to assert more operational control over cleanup and restoration efforts. At least that’s my hope.

Oh, the "small people" comment? On PBS News Hour, BP executive Bob Dudley explained that for BP’s non-English Chair, Mr. Svanberg, "English is a second language." So "small people" wasn’t a reference to a scene from Wizard of Oz but instead probably meant "small businesses." Uh huh. So apparently we won’t need additional agreements for medium and large people.

John Chandley

Naked Capitalism passes on more skeptical views: basically, the concern is the immediate damages will be much larger than $5 billion/year; so this accommodates BP’s cash concerns, but not the Gulf’s, assuming the $5 billion/year is limiting in the short run.
UK Guardian, BP to pay out $20bn over oil spill after Obama meeting

Republicans Barbour, Bachmann Explain Principles for Holding BP Accountable

10:52 am in Uncategorized by Scarecrow

Please, God/goddess, if you’re upset and striking down false idols, could you check this out?

The White House and BP are telling the media there is a tentative agreement to have BP contribute "about $20 billion" over time to an escrow account to pay economic damages claims for BP’s oil disaster. I still think that’s a good concept but as always, the details matter.

But the leading lights (aka dim bulbs) of the Republican Party can’t seem to give up entirely on John Boehner’s initial view that taxpayers should bail out BP, one of the world’s largest TBTF corporations. Since the Obama Administration proposed the escrow mechanism, it’s important for Republicans to uncover the evil purposes and consequences of the scheme to maintain their view that civilization as we know it is under siege from White House socialists, or fascists, or government takeover zealots.

First, via Pat Caldwell at Minnesota Independent, Michelle Bachmann warns us about the implications of requiring corporations that cause harm to pay for their damages:

The president just called for creating a fund that would be administered by outsiders, which would be more of a redistribution-of-wealth fund. And now it appears like we’ll be looking at one more gateway for more government control, more money to government. If there is a disaster, why is it that government is the one who always seems to benefit after a disaster, and that’s of course what cap-and-trade would be.

We’re fortunate Ms. Bachmann has explained that holding negligent/reckless parties responsible for paying damages is really a socialist scheme to redistribute wealth. I had no idea how pernicious that centuries old Common Law tort concept is. I’m also grateful she slipped in that hit on cap-and-trade, because I never would have seen that a well established damage-claim process was related to schemes for slowing global climate change, though I guess in the grand scheme of things, it probably is.

Next, we have Mississippi’s Governor Haley Barbour, who explains the principles that should apply when corporations engage in inherently dangerous activities that kill workers and cause massive economic damage. Via ThinkProgress, here’s Barbour explaining it to Fox News:

BARBOUR: If BP is the responsible party under the law, they’re to pay for everything. I do worry that this idea of making them make a huge escrow fund is going to make it less likely that they’ll pay for everything. They need their capital to drill wells. They need their capital to produce income. … But this escrow bothers me that it’s going to make them less able to pay us what they owe us. And that concerns me. … [I]t bothers me to talk about causing an escrow to be made, which will — which makes it less likely that they’ll make the income that they need to pay us.

It’s reassuring Barbour is worried about BP’s ability to meet it’s promise to pay all legitimate claims, but it seems his concern is more to maintain BP’s profitability than ensure payments.

If I understand where Haley Barbour’s logic leads, the principle becomes: we shouldn’t require oil companies to comply with costly safety requirements, because that would cut into the profits they’ll need to pay for the damages they cause when they don’t comply with safety requirements. Therefore, damages liability should, a priori, always be limited by a corporation’s profit/earnings ability and never put its assets at risk. Now there’s a moral hazard for you.

I think that’s modern corporate capitalism. Behold the Republican Party, but watch out for the lightning.