Sunday, June 13, 2010

Conservatives Pushing For BP Bailout

...I think it's part of this sort of blame-game society in the sense that it's always got to be somebody's fault instead of the fact that maybe sometimes accidents happen ~ Rand Paul, referring to BP's underwater Gulf of Mexico oil geyser on ABC's Good Morning America (5/21/2010).

As I've alluded to in previous posts, I am no fan of Ayn Rand, Objectivism, or Libertarians. Objectifiers of greed and selfishness, is more like it. Let us pray that Kentuckian voters send this fool packing. The record clearly shows that Randal Paul (his actual name) was dead wrong to suggest that this was an accident.

Gulf Oil Disaster Not An Accident

According to an oil industry whistleblower, "BP had been aware for years that tests of blowout prevention devices were being falsified". During Congressional hearings it was revealed that the blowout preventer attached to the well that the Deepwater Horizon was in the final stages of completing, "had a leak in a crucial hydraulic system and had failed a negative pressure test just hours before the April 20 explosion".

A recent ProPublica investigation revealed that "Years of Internal BP Probes Warned That Neglect Could Lead to Accidents", and that BP had "systemically ignored its own safety policies across its North American operations".

Finally, let's not forget that the CEO of BP, Tony Hayward recently admitted, "We did not have the tools you would want in your toolkit". Which, even though he probably did not realize it at the time, is an admission that BP lied when it stated, in their drilling application to the Minerals Management Service, it could "handle a spill involving as much as 12.6 million gallons of oil per day, a number 60 times higher than its current estimate of the ongoing Gulf disaster".

Criminal Negligence

Legally, when you cut this many corners in complete disregard for even your own safety protocols, you can no longer claim that the resulting disaster is an "accident". This is, without a doubt, a brazen case of criminal negligence. (For the record, BP has yet to be convicted of criminal negligence in the case of the Deepwater Horizon disaster, although AG Eric Holder is investigating).

So when Mr. Paul feigned outrage at Obama administration's declaration to keep its "boot heel on the throat of BP", saying, "I think that sounds really un-American in his criticism of business", I do not believe he was being sincere. This reminds me of Sarah Palin praising the "pro-America" parts of the country during the Presidential campaign. Obviously the "pro-American" parts of the country are were the majority of the voters fall for Conservative chicanery and put the interests of the wealthy and corporations above their own by electing Republicans.

Of course, to a Conservative, saying anything in support of the Average Joe and against the wealthy and corporations would be grounds for being accused of "un-American activities". Strike that, DOING anything in support of the average Joe. Conservatives routinely lie about their policies being good for everyone.

For instance, on the oil spill, Randal Paul also said that, "he had heard nothing from BP indicating it wouldn't pay for the spill". This is a completely ridiculous thing for Mr. Paul to say. Under President Doofus our government routinely let oil companies off the hook in regards to paying for the accidents their reckless disregard for safety caused. (In fact, "Bush's DOJ Killed a Criminal Probe Into BP That Threatened to Net Top Officials".)

Final Price For Disaster Could Be Beyond Astronomical

Apparently BP doesn't even intend on paying for all the immediate costs of the cleanup, which, according to a current estimate will total approximately 12.5 billion. If they were, why would Tony Hayward, in an attempt to reassure the financial industry, say "BP can escape this disaster paying no more than $3 billion in costs and damages"?

But 12.5 Billion for the clean up is just an initial estimate - the final cost may be several hundred billion. Although, as far as economic damages go, Congress capped those at 75 million after the Exxon Valdez oil spill.

In regards to the issue of "liability caps", Senator Patrick Leahy has stated, "It reduce[s] the consequences of [any] misconduct to a discounted cost of doing business. That's almost like saying, 'We're giving you a green light to do whatever you want to do'. I can't imagine why anyone would be surprised that... oil companies cut corners and compromised safety".

The liability cap, however, only applies to economic damages. There is no cap so far as the cleanup costs. There is also no cap on fines that may be imposed. An EPA imposed per-barrel "spilled" fine under the Clean Water Act could amount to as much as $10.7 billion (estimated by Rachel Maddow on her 6/1/2010 broadcast). Rachel went on to say, "That would be $10.7 billion on top of all of the other cleanup costs, all of the economic injury claims from local businessmen, all of the liability to states for tourism lost and whatever criminal charges the Justice Department turns up".

Criminal charges will most certainly result in criminal fines, and BP has a long history of convictions. In 2005 BP was cited for "willful negligence" and paid two of the largest fines in OSHA history. Including these two citations, BP's fines since 2005 total more than $730 million. In regards to this latest disaster, one expert says the case against BP is a "slam dunk".

Also, if the criminal proceedings determine that BP was "grossly negligent or... engaged in willful misconduct or conduct in violation of federal regulations", the $75 million economic liability cap is nullified. So, despite their horrendous track record, Randal Paul thinks we should take BP at their word. Like when we trusted BP employees to fill out their own inspection reports honestly and accurately.

There is also the issue of the 18.75% royality BP agreed to pay when they signed the lease. Although there is a question regarding whether or not this royalty should be applied to the oil "recovered", or all the oil removed from the ground. A 6/4/2010 Politico story reports that the Democratic Representative from West Virginia, Nick Rahall says that "the Minerals Management Service, the agency that oversees offshore drilling, has been unclear whether BP would be required to pay royalties on any oil captured from the Deepwater Horizon spill".

Why only assess royalties on the captured oil? I believe BP should pay royalties on ALL the oil that escapes from the well, whether they capture it or it escapes into the gulf - plus the per-barrel fine.

Finally, NOLA.com reports that the White House has suggested that BP reimburse "offshore oil rig workers who lose wages as a result of the administration's moratorium on deep water oil and gas exploration". This would cost BP an additional $150 million to $300 million a month.

Incredibly Unlikely That BP Will Pay "Every Cent"

I would have guessed that a Libertarian would believe in the old axiom, "trust must be earned". BP has clearly not earned our trust. That, plus the rumor I've heard is that BP may file for bankruptcy protection to avoid paying. An ABC news story states that "respected oil industry analyst Matt Simmons told Fortune Magazine that a bankruptcy filing was likely within a month". According to Mr. Simmons, "They're going to run out of cash from lawsuits, cleanup and other expenses", because "there isn't enough money in the world to clean up the Gulf of Mexico".

By the way, Wikpedia, in discussing "bankruptcy" says that "The principal focus of modern insolvency legislation and business debt restructuring practices no longer rests on the elimination of insolvent entities but on the remodeling of the financial and organizational structure of debtors experiencing financial distress so as to permit the rehabilitation and continuation of their business". In other words bankruptcy would not put BP out of business, leaving it's creditors to divvy up it's assets.

Also according to Wikipedia, "a strategic bankruptcy may occur when an otherwise solvent company makes use of the bankruptcy laws for some specific business purpose" In this case the "specific business purpose" would be to discharge it's obligations to pay a majority of the Gulf oil spill bill.

During a 6/11/2010 interview, Louisiana State Treasurer John Kennedy conjectured, "I know BP said they won't go into bankruptcy. I hope they're telling the truth. They weren't truthful about the extent of the spill". He is urging Governor Bobby Jindal to "devise a plan to deal with the oil spill cleanup and response efforts in the event of a BP bankruptcy".

It is also possible that BP may be deemed "to big to fail" and rescued by an American and/or British bailout. Apparently a lot of British pensioners hold shares of BP, and recent suggestions that BP delay or cancel it's dividend payment have raised the ire of the British politicians who represent them. A Labour Party member by the name of Tom Watson cried foul, stating that, "you attack the dividend and you are attacking millions of British pensioners".

Finally, the U.S. Chamber of Commerce president Tom Donohue threw his support behind a taxpayer funded BP bailout, declaring, "...everybody is going to contribute to this clean up. We are going to have to get the money from the government and from the companies". Obviously money from "the government" is taxpayer money. He also stated his opposition to Senate efforts to raise the cap on economic damages, whining, "It is generally not the practice of this country to change the laws after the game".

And, as a 6/10/2010 Huffington Post article points out, House Minority Leader John Boehner agrees! This is no surprise since the Chamber is an anti-middle class pro-big business organization that solely represents the interests of the wealthy and, in furtherance of that goal, primarily funds Republicans.

Exxon Mobil Did Not Pay "Every Cent" For Valdez Alaska Spill, Nor Were All The Injured Parties "Made Whole"

I believe that what this all indicates, beyond any doubt, is that this was not an accident - and that BP isn't going to pay the full cost of the environmental and economic disaster their reckless greed caused. Even so, at this point, my conclusions are simply speculation. However, what we do know for sure is that Exxon did not pay the full cost of their 1989 spill, instead they fought the punitive damage award levied against them for 20 years.

Damages were eventually reduced from 5 Billion to paltry 500 million by the Right-leaning Supreme Court.

A 2/2/2009 CBS News story reminds, "Back in 1989, Exxon executives promised to take care of everyone affected by the spill". Exxon's manager of Alaska operations promised, "You have my word we will make you whole again". I seriously doubt that the any of the 32,000 original plaintiffs in the Exxon lawsuit feel they have been "made whole" - those that are still alive, that is. "At least 6,000 of the original plaintiffs died" during the 20 years Exxon battled the original judgment in court.

Tony Hayward has made similar statements claiming BP will "stand with Gulf Coast residents until they are made whole". If that is the case, then why, in the lawsuits which are already pending against BP, does it appear as though they intend to fight them in court the same way Exxon did - for decades, filing appeal after appeal until the judgment against them is reduced as much as possible? Or, preferably, get all the cases heard in front of a judge who is friendly to the industry.

Can The Conservative BP Bailout Be Stopped?

Randal Paul, Libertarian running for the Senate in Kentucky is attempting to paint BP's criminal negligence as an "accident" and thinks we should back off and allow BP to do what they think is right. Former Alaskan Republican half-Governor Sarah Palin agrees, proclaiming, "I want our country to be able to trust the oil industry".

Texas' Republican Governor Rick Perry claims the explosion and sinking of the Deepwater Horizon was "just an act of God". Mississippi Republican Haley Barbour thinks the oil washing up on shore is "non-toxic", and, after visiting Petit Bois Island off Mississippi's coast, alleged he did not think it "was hurt one iota".

The Conservative "Blue Dog" Democratic Representative from Mississippi Gene Taylor remarked, "I would remind people that the oil is twenty miles from any marsh. ...That chocolate milk looking spill starts breaking up in smaller pieces ...It is tending to break up naturally". And Conservative propagandist Rush Limbaugh insists "the ocean will take care of this on its own if it was left alone and left out there [because] it's natural. It's as natural as the ocean water is".

Also, don't forget about the Conservatives in Congress who are blocking Democratic efforts to remove the 75 million dollar economic liability cap. The first attempt was blocked by Republican Senator from Alaska Lisa Murkowski, and the second attempt was blocked by the Global Climate Change denier from Oklahoma, Republican Senator James Mountain "Jim" Inhofe. A disappointed President Obama responded with a statement that read, "This maneuver threatens to leave taxpayers, rather than the oil companies, on the hook for future disasters like the BP oil spill".

Why do all these conservatives want us to believe that this disaster is an accident, not that big a deal, or (if it does turn out to be serious) the fault of the Federal Government and that we should leave the liability cap in place? Because they think the taxpayers should pay. Who the hell else is going to pay if not BP? And, as I pointed out earlier, U.S. Chamber of Commerce president Tom Donohue and House Minority Leader John Boehner have come right out and suggested the US taxpayer should be on the hook.

Boehner later "clarified" his statement, insisting he's always said BP should pay, even though the person asking the question specifically inquired as to whether or not Boehner thought "taxpayers should pitch in to clean up the oil spill". Boehner clearly indicated that he thought they should. Silly Boehner, you are supposed to keep pro-bailout thoughts on the down low by using language which does not directly support a bailout, but can lead to nowhere but a bailout... like your fellow Conservatives are doing.

So, can this bailout be stopped? I doubt it. Despite the fact that oil companies are among the most profitable corporations in the world the US government still grants them subsidies of 2.7 billion a year.

In my opinion, the only way we could guarantee that BP pay the maximum amount it is able would be to follow Robert Reich's advice and place BP under temporary receivership. In a 5/31/2010 blog post Mr. Reich wrote, "it's time for the federal government to put BP under temporary receivership, which gives the government authority to take over BP's operations in the Gulf of Mexico until the gusher is stopped".

Taking Mr. Reich's idea one step further, the ANSWER Coalition's "Sieze BP" website advocates the Federal Government seize BP's assets (or as many of their assets that it can, seeing as BP is a British Corporation). I urge you to consider signing the petition, even though it is most likely pointless. The influence of corporate money on our political system is such that what we have, in essence, is two conservative parties.

The Republican Party which is 100 percent Conservative, and the Democratic Party which, in addition to the so-called "blue dogs", consists of quite a few DLC "New Democrats" (whose sellout "Third Way" means they aggressively pursue corporate money to win elections). Liberals are a minority, with only 82 out of 312 Congressional Democrats belonging to the Progressive Caucus.

On the 6/10/2010 episode of the "Daily Show", Minnesota Governor Tim Pawlenty, in response to a question by Jon Stewart, explained, "I'm a Republican, so of course I'm conservative". You'll never hear a Democrat assert, "I'm a Democrat, so of course I'm liberal". Much to my disappointment, Barack Obama has shown himself to be a Bill Clinton Third Way Democrat. One of his first appointments was Third Way DLC Clintonite Rham Emmanuel to White House Chief of Staff. This is the guy who thinks that Liberals are "retarded".

Not to mention the other Clinton era advisers President Obama has surrounded himself with. Which is why Republican Politicians and Commentators calling him a "Socialist" are such liars. Their brainwashed minions may be buying this nonsense, but they know better. Crying "Communism" or "Socialism" is simply a diversionary tactic they use to push us further towards corporatism. The BP bailout is a done deal. Unfortunately, just like the Gulf of Mexico ecosystem and Gulf State economies, the American taxpayer never stood a chance.

Seize BP

SWTD #41

1 comment:

Unfortunately comment moderation is necessary in order to screen out insanity from an idiot calling himself "Luke" of the "Words And Music" blog (a liar who has made bogus accusations that many others are stealing his posts) as well as homophobic hate from TOM of the blog "Stay A While" (actually the same person).