Let’s assume that, like most UK workers, you have a pension fund with a substantial part of its investment in FTSE companies, usually weighted by value.
What should you care more about:
1) the fact that the US government is attempting to steal a sizeable proportion of your money?
2) some fucking cormorants?
Clue: if you picked 2, you’re an idiot.
So could British people perhaps stop ragging on BP, or pretending the Gulf of Mexico spill is some kind of serious environmental disaster that’ll actually harm people (rather than making beaches look untidy for a bit and topping some fish and birds)?
The spill will cost about $20-30bn to clear up, including compensation for those directly affected, which is a sum that BP should have no problem in paying, and which would be the fair price for them to pay.
The fact that BP’s share price is below levels reflecting that cost, and that BP bond yields have increased to junk levels partly reflects market panic – but also partly reflects genuine fears that the US will do something truly vindictive, using its demonisation of BP as an excuse to steal its (i.e. ‘your’) assets beyond the cost of cleaning the spill in some form of punitive damages.
And everyone who brings out the whole ‘ooh, BP is so evil and unsafe’ saw (it is not; it is as evil and unsafe as the rest of the oil industry, whose levels of evilness and unsafety are set by national governments in oily countries. BP’s safety culture in its US operations is no different from ExxonMobil’s, Shell’s or Chevron’s – it was just the unlucky one this time round) is enabling that demonisation campaign.
The oil industry should be reformed. It won’t get reformed, because we’re too dependent on cheap oil, and the occasional disaster is collectively viewed as a fair price to pay for the ability to pay under $3 a gallon for petrol. Especially when the disaster in question doesn’t happen to Americans: how many people are even aware of Shell’s operations in Nigeria?
But the US’s anti-BP crusade has nothing to do with any efforts to reform the industry – it’s an attempt to distract Americans from the fact that the disaster is primarily their own fault (and that nothing will be done about it in the long term because the American people won’t stand for expensive petrol), and to steal some foreign assets into the bargain.
So unless you’re a stars-and-stripes-waving redneck, don’t join the anti-BP campaign just because you think the world would be a nicer place if companies were nicer…
Update: Turbo-LOL.
pretending the Gulf of Mexico spill is some kind of serious environmental disaster that’ll actually harm people (rather than making beaches look untidy for a bit and topping some fish and birds (for example)
This is an uncharacteristically stupid and ill-informed piece.
And that was an uncharacteristically un-argued and ill-informed comment, which I suppose makes us even.
So how *are* people going to be harmed by this disaster, other than in economic ways that BP can and will compensate them for? How does that compare to countless other oil-extraction disasters that have, actually, led to the deaths of hundreds or thousands of people?
Do you deny that there's a PR campaign led by the US government to blame BP for the incident, and to pretend that its response was technically flawed? Do you really believe the main cause of the incident is BP's evilness, rather than the regulatory regime in which BP was operating?
(you may want to bear in mind the fact that the rig was designed and operated by US companies, the fact that there is no evidence BP's safety standards or regulatory dealings fall short of the other oilcos, and the fact that nobody has proposed a credible alternative strategy post-blowout that would have dealt with the spill more quickly.)
Yes, the tone of this piece is partly trolling; that's often how my writing rolls – but it's a hell of a lot more moderate than a lot of supposedly mainstream commentary taking the other angle. And I genuinely, 100% believe the core premise that the US government is scapegoating filthy furriners to avoid having to confront the fact that the main cause of the disaster is Americans' thirst for oil.
I'm not sure that "actually harming people" rather than "topping some fish and birds" is a good definition of a "serious environmental disaster". The New Scientist article is interesting though.
Is the problem really "Americans' thirst for oil" or is it really "Americans' thirst for lax safety standards in hazardous industries" in this case?
I think any penal US action that is unwarranted should be opposed strongly by the UK government but I'd make a few counter points:
1) "like most UK workers, you have a pension fund with a substantial part of its investment in FTSE companies" – I'm not sure 'most' is right, the figures are all over the place and would take a whole day just to interpret but I think about 40-45% would be more accurate. [http://www.statistics.gov.uk/downloads/theme_compendia/pensiontrends/Pension_Trends_ch07.pdf]
2) Temporary falls in the share price aren't going to make any difference on a net basis. For people yet to retire its good news, about to retire bad news.
2) The amounts aren't going to be that large. I saw a figure of 2.5% of big pension funds invested in BP. If the US government does expropiate a fifth of that, that's 0.5% of the average pension fund.
3) And pension funds aren't the be-and-and-end-all of UK wealth, and obviously the drop in value affects other assets and so on, so a wider measure would be UK wealth is estimated at £7 trillion end 2009, so let's assume it fell to £6.5 trillion at end 2009. If the drop in BP's value attributable to US government penal action (as opposed to management mistakes etc) comes out at something like £20bn, and we assume it's all UK owned then that is a loss of 1/350th.
4) There have been other, similar, losses in the last few years caused by companies only meeting regulatory standards and when they were caused by the banking crisis you noted that it was only money and money doesn't really matter. I'm not fully in agreement with this view (!), but I'm not a great fan of 'ooh look how it affects our pensions' arguments. That way lies trouhle.
Yes, I've wondered a lot about this … all the coverage I've seen has been as if BP is especially irresponsible, but I've not yet seen anything to suggest they are any more than an oil company like any other, who experienced an big accident. What are the best arguments that BP is specially culpable?
P.S. have you seen this Dilbert investing-in-evil column?
So everyone knows 40% of shares are held by UK-based institutions and individuals, and 39% by US ones, with RoW obviously holding 21%.
Ta, I'd thought it was more like 50-40-10. You'd expect much more of the UK's share of that to be made up of ordinary investors and ordinary pension funds rather than HNWIs, though, given BP's origins.
Correct, although much might be a little strong, 33% UK institutions, 25% US institutions, 14% US individuals, and 7% UK individuals.
The Chinese and Norwegian (oil fund, a bit weird) government own reasonably large stakes.
Quality diversification by the Norwegian oil fund there…
Still, I suppose if the Chinese government already owns a reasonably large stake, that'll help the mooted PetroChina takeover.
@John B
there is no evidence BP’s safety standards or regulatory dealings fall short of the other oilcos
This is false. BP is worse than its peers. http://blog.riskmetrics.com/esg/2010/04/bp-spill-… http://abcnews.go.com/WN/bps-dismal-safety-record…
"According to the Center for Public Integrity, in the last three years, BP refineries in Ohio and Texas have accounted for 97 percent of the "egregious, willful" violations handed out by the Occupational Safety and Health Administration (OSHA)."
BP was also unprepared for a spill – its filed disaster recovery plan was inadequate, and included, famously, measures intended to protect the local walrus population. http://news.yahoo.com/s/ap/20100609/ap_on_bi_ge/u…
pretending the Gulf of Mexico spill is some kind of serious environmental disaster that’ll actually harm people
Eleven people have been killed and many more injured so far.
I'm not sure I agree with the "other oilcos do it too" argument. They probably are just as slapdash and negligent when it comes to risk assessment/management – but that doesn't make it OK for BP to e.g. prepare a contingency plan that lists a dead man as a key contact and is otherwise so riddled with errors as to strongly suggest they didn't give a shit. Without excusing the lax regulations, "No one made us do our job properly so of course we just dicked around" doesn't really cut it as a defense.
BP does have form: they had a refinery blow up in 2005 (whoops!), due to poor safety standards, and they were fined $87m in 2009 for still having major violations on the same site. In fact, <a>this does suggest that they are in fact worse than other oilcos.
Now, if BP can pay the full costs of clean up and compensation (including any long-term health problems that may result) and still make a profit, then it's there's to do with as they will. But I'm quite sceptical about "BP can and will compensate" – can yes, but if they find a way not to, they won't. (For example, there are various accounts of survivors from the rig being held on board ship for days until they signed statements that they were uninjured). What's needed is for their feet to be held to the fire – by, for example, threatening to steal their dividend if they don't play ball.
Ajay:
1) I simply don't believe that ABC piece, having had a brief play with the OSHA website: compare BP with Chevron with the oil & gas extraction industry overall.
2) The fact that the IVA score is 'below average' is meaningless unless we get the distribution. If it's within 5% of the median adjusted by company revenues, then that's irrelevant. If it's in the bottom 5%, then obviously that's a serious cause for concern.
3) The 11 worker fatalities are irrelevant (for these purposes) – the thing that BP are getting keelhauled for is not their share of responsibility for a major industrial accident to workers in a high-risk industry, it's the impact of the oil spill. I'm not sure what work your 'so far' is doing, either.
Andrew:
This is partly my response to Ajay: that I'm unconvinced that the fact that tabloid outlets are rushing to bash BP after the fact using apparently ropey statistics proves much, and that coming in 45/100 among your peers isn't much different from coming in 55/100.
The rest depends on your attitude to corporate ethics, I guess: my view is that companies are obliged to do the absolute minimum to ensure they're in compliance with the law; that the onus on what level of responsibility that involves rests solely with lawmakers (acting as proxies for the public); and "the law" in context needs to be the law *as it is enforced*, not *as it is written but never enforced*.
If a company thinks there's a branding advantage from doing more than the enforced-legal-minimum – say, John Lewis – then that's all gravy, but that this is bloody unlikely in markets like extractive industries where just by continuing to function, you will without a shadow of a doubt end up poisoning, incinerating, drowning, choking or otherwise killing large amounts of people, even if it's slightly fewer than your rival would have done if they'd done the work more cheaply.
But *the fact that all this is the case* means that governments shouldn't be disingenous about extractive projects that they have approved, "well, if the company hadn't cocked it up, we wouldn't have this problem". Rather, they should assume that the company *will* cock it up and burn people alive, and that the CO2 will drown people, and that the CO will choke people, and so on, and run the cost-benefit analysis on that basis. Which would mean we ended up with less oil extracted, and fewer dead cormorants, and no implausible efforts to require profit-maximising corporations to behave like saints.
Let's hope and pray for Bechtel to cause some catastrophic fuck-up on the underground…
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John B :
The rest depends on your attitude to corporate ethics, I guess: my view is that companies are obliged to do the absolute minimum to ensure they’re in compliance with the law; that the onus on what level of responsibility that involves rests solely with lawmakers (acting as proxies for the public); and “the law” in context needs to be the law *as it is enforced*, not *as it is written but never enforced*.
I agree with this up to the "law as enforced" point. The whole essence of the rule of law is that the law is respected – obedience isn't predicated on constant state enforcement but on the understanding that everyone has an obligation to obey it at all times. Otherwise we get into a situation where Oilco can commit 1000 safety violations and if the government inspectors find 999, shrug its shoulders and say "Well, you should have looked harder" when the 1000th blows up. Companies are obliged to obey the law full stop, and the fact that they can make bigger profits by not doing so where they won't get caught is not any kind of exception. This doesn't require them to act like saints – just reasonable human beings. Which everyday life shows is a difficult enough standard to reach, but not an impossible one.
I simply don’t believe that ABC piece, having had a brief play with the OSHA website: compare BP with Chevron with the oil & gas extraction industry overall.
Here's the CPI report that ABC drew on.
http://www.publicintegrity.org/articles/entry/208…
Refinery inspection data obtained by the Center under the Freedom of Information Act for OSHA’s nationwide program and for the parallel Texas City inspection show that BP received a total of 862 citations between June 2007 and February 2010 for alleged violations at its refineries in Texas City and Toledo, Ohio.
Of those, 760 were classified as “egregious willful” and 69 were classified as “willful.” Thirty of the BP citations were deemed “serious” and three were unclassified. Virtually all of the citations were for alleged violations of OSHA’s process safety management standard, a sweeping rule governing everything from storage of flammable liquids to emergency shutdown systems. BP accounted for 829 of the 851 willful violations among all refiners cited by OSHA during the period analyzed by the Center.
Your search on osha.gov seems to have pulled up the number of enforcement inspections rather than the number of violations. I would imagine that it's possible one enforcement inspection could result in no, one, or several citations. It's not surprising that BP gets inspected about the same amount as other similar companies.
Your "law as enforced" point is rather dodgy in light of the fact that one of the relevant enforcement bodies, the MMS, was systematically gutted over the 2001-8 period and seems to have spent most of its time doing coke and shagging around. (Not hyperbole)
I'm with Ajay on this one.
"I simply don’t believe that ABC piece…"
You should not just dismiss the reporting done by ABC, TruthOut, and many others that clearly show BP to be the worst of the worst oil companies. If you can invalidate their argument and/or the data supplied, then by all means do so. But you can't just ignore it because you don't want to believe it's true… I mean, you can. It just makes you look like a twit.
How does this fact square up with your argument? Even if you adjust for company revenues…
"From ABC News – OSHA statistics show BP ran up 760 "egregious, willful" safety violations, while Sunoco and Conoco-Phillips each had eight, Citgo had two and Exxon had one comparable citation." http://bit.ly/a97UsC
It's also rather heartless to tell people to stop "pretending" that the spill will harm people, when the blast did in fact KILL eleven people. I know you call this fact irrelevant to the point you're trying to make, but it is still a very crass statement on your part. And if you want to talk about harming people, you should probably talk to the people who (used to) make a living by fishing in the gulf.
Also, The NewScientist article to which you linked provided flimsy support (if any) to your argument. Relying mostly on cautious optimism to downplay the impact of the disaster. Notice all of the qualifiers in just these few sentences:
"Gulf leak: biggest spill MAY not be biggest disaster.. its ecological impact NEED not be the worst.. IF they can be protected, the region COULD bounce back in just a few years."
And finally, your last two paragraphs are especially disappointing from an American perspective. First you spout off some kooky, right-wing conspiracy theory as if it is common knowledge… and then you go on to imply that the only people who would sign on to such a boycott would be some sort of misinformed, nationalist redneck. What the hell?
Ajay:
No, I was looking at the "violations" column and counting the violations – however, I now see that:
a) my industry data link was looking at 'extraction & exploration', whereas the CPI report was looking at 'refining', which isn't directly relevant to Deepwater Horizon BP's refining and extraction operations are managed as separate divisions globally. AIUI US refining is run by former Amoco people, on the grounds that it's theoretically easy, and US exploration is run by international experts on the grounds that it's one of the most technically challenging industries there is. BP appears to be less safe at refining than other companies, but not less safe at extraction.
b) the reason for the difference in the 'refining' report is that BP Refining's serious violations were classed as 'egregious wilful', whereas other refiners' serious violations were classed as 'serious'. This reflects the authorities' perception of intent, not the actual nature of the violation. Which is why the ABC report was poor – it implied that BP Refining was guilty of most of the serious violations that took place, rather than the truth that because of the authorities' perception of BP Refining's attitude, its violations were classed in a separate category despite being at the same level of seriousness.
Levi:
See my response to Ajay on the violations.
On the "right-wing conspiracy" front, as far as I can see, right-wing commentators and Fox have been among the most vociferous detractors I've seen of BP, and I've not seen them suggesting anything along the lines of this piece (it'd be unpatriotic, for starters). If they are following this line then it doesn't reflect very well on them, as Bush's destruction of the regulatory environment is the most immediate reason why a disaster like this was inevitable.
As far as I'm aware I came up with this argument independently – I've been developing my thoughts (and mentioning a few of them on Twitter) over a few days, having looked at the quality of the regulators and the regulations, pre-existing knowledge about how American politicians fare when they tell the electorate things they don't want to hear (e.g. "you must pay more for oil if you want it to be more safely extracted", "regulation is necessary"), estimates of the actual cost of the clean-up and compensation versus market estimates of how much they think the administration will make BP pay, previous examples of foreign companies who've ended up on the wrong end of damages suits in US courts, and so on.
The one piece of evidence which makes me most certain there's a deliberate attempt to stir up nationalistic feeling going on is that, universally, Obama's speeches are some of the best-written, most carefully crafted political pieces I've ever read – and if his writers get something significant wrong, it'll be for a good reason, rather than just lack of research. So if he isn't trying to stir up nationalist feeling against BP, why the *fuck* does he keep on calling it "British Petroleum" when that hasn't been its name for 22 years? And why is his bashing focused on BP, rather than either the US company that operated the rig or the US company that designed the bits that went wrong? (the latter company is, in fairness, Halliburton; insert left-wing conspiracy theories here to your heart's delight…)
The UK government didn't start scapegoating America, or even Occidental Petroleum, when the US-owned deep-drilling company's dodgy safety practices led to the deaths of 167 British oil contractors in 1987 – rather, they reviewed their safety rules and toughened their safety procedures, on the grounds that that was clearly the problem; the UK offshore industry is now considered one of the safest globally. An operation with Deepwater Horizon's apparent flaws would not have been allowed in the UK, either by the official rules or by the actual state of enforcement.
This kind of proactive safety regulation is a good example of what the US government should be doing at this point – and I'm rather sceptical that any putative right-wing conspiracy theorists are advocating it.
"As far as I’m aware I came up with this argument independently…"
Right. I said you had spouted off a kooky, right-wing conspiracy theory as if it were common knowledge, not that you had simply parroted an existing theory. You may deserve points for originality, but the validity of your assertion is still questionable.
I'm also perplexed as to how "the US government scapegoats foreigners in an attempt to protect domestic companies, placate public anger that would rightly be directed at the previous (primarily) and current (to a far lesser extent, but they hadn't done much to change the situation they inherited) administrations, and put off having to make tough decisions about the country's unsustainable oil consumption" counts as 'right-wing', although I know political compasses can be complicated.
BP appears to be less safe at refining than other companies, but not less safe at extraction.
Actually, BP "appears" to have had more huge, catastrophic failures of safety in its extraction business than any other oil company in the US so far this year. BP is, manifestly, _significantly less safe_ at extraction than its peers, because it's the only one that's killed 11 people, lost an oil rig, and caused a massive oil spill.
It also "appears" to have had roughly the same number of citations for safety issues in its extraction business.
I think the point about the disproportionately high number of "egregious willful" violations was to implicate BP's overall safety record. I wouldn't be surprised if that data was cherry-picked by researchers, but you have yet to provide adequate data to support your assertion that, "BP appears to be less safe at refining than other companies, but not less safe at extraction."
You'd have to come up with a similar data sheet comparing the number (and severity) of violations for all major oil companies, but this time restrict that data to include only extraction & exploration violations.
..and of course this assuming that a worst offender can be determined only by looking at violations. Perhaps an equally good indicator would be the number and frequency of major environmental disasters. If only all of this data were easily compiled for us already!
"So if [Obama] isn’t trying to stir up nationalist feeling against BP, why the *fuck* does he keep on calling it “British Petroleum” when that hasn’t been its name for 22 years?"
Last I heard, the name change officially happen until 1998. That would be just 12 years ago… recent enough for most everyone to assume that BP is little more than a friendly acronym for "British Petroleum." http://bit.ly/94N6bd
From what I have heard of Obama's comments on the subject so far, they have been very calm and measured. He has been reluctant to point fingers at any one company or organization. In fact, I just saw this series of quotes from a Rolling Stone article today:
[paste]
Now, however, the president was suddenly standing up to take command of the cleanup effort. "In case you were wondering who's responsible," Obama told the nation, "I take responsibility." Sounding chastened, he acknowledged that his administration had failed to adequately reform the Minerals Management Service, the scandal-ridden federal agency that for years had essentially allowed the oil industry to self-regulate. "There wasn't sufficient urgency," the president said. "Absolutely I take responsibility for that." He also admitted that he had been too credulous of the oil giants: "I was wrong in my belief that the oil companies had their act together when it came to worst-case scenarios." He unveiled a presidential commission to investigate the disaster, discussed the resignation of the head of MMS, and extended a moratorium on new deepwater drilling. "The buck," he reiterated the next day on the sullied Louisiana coastline, "stops with me." [end paste] http://bit.ly/aFMn2p
"This kind of proactive safety regulation is a good example of what the US government should be doing at this point.."
I wholeheartedly agree with you on that one!
Ajay:
Yes, and Concorde was a very safe aeroplane until 25 July 2000, at which point it magically became a very unsafe aeroplane. And most seconds in London are murder-free, apart from a few seconds a week during which the annualised murder rate works out as 32 million a year. Or "generalising from very rare events to explain said very rare events isn't a very good analytical tool".
I'm not sure what your last sentence means, as the comparator you're using isn't clear: as far as I can see, BP's extraction business appears to have had roughly the same number of safety violations as its peers, which have been fewer and less severe than those in its mining business. This is from eyeballing the data not from rigorous analysis (although I'd note that eyeballing was useful in demonstrating that the ABC interpretation of the CPA report was bullshit); if you've come to different conclusions then share them and I'll change my view.
Levi:
Yes, I was wrong on the name change – I thought the change in corporate branding in 1989 to reflect their increased US focus was also a change of legal name, whereas "British" wasn't dropped from the legal name until the Amoco merger in 1998. Still, 12 years is a fair amount of water under the bridge, and it's something I'd expect the Obama team to get right.
See also the administration's decision to freeze drilling by all companies in the Gulf of Mexico (which is probably right, given what we know about the regulatory failures that led up to the incident) and then make BP pay compensation to the workers that other oil companies are laying off during the freeze. So because this incident has highlighted safety concerns affecting the whole industry, BP has to pay compensation to people who've only ever worked for its rivals…
And yes, Obama's a very measured man (another reason beyond good writing why he makes such a good public speaker – his persona is basically the opposite of 'stereotypical angry nutter / Hitlery type', and so hard not to warm to), but the underlying meaning in the speech you quote is a classic "this is my fault, because I let these idiots get on with it instead of sorting it out myself" denial of actual responsibility.
Relevant point: 25 per cent of BP stock is held by US pension funds, while 14 per cent is held by individual US investors. http://ftalphaville.ft.com/blog/2010/06/10/257621…
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John B :
I’m also perplexed as to how [my argument] counts as ‘right-wing’, although I know political compasses can be complicated.
Perhaps your theory wasn't exactly "right-wing." Sorry if that offended you. I was just going by the modern American brand of right-wing politics which has, at its core, a knee-jerk defense of huge corporations and an irrational distrust of the US federal government.
@ajay Yes: see Matthew at #10.
@Levi Hmm. I sort of see what you mean – but my view is that large corporations inherently can't be trusted, need strong regulators to keep them in place, in the absence of strong regulators will all tend to revert to being disastrously bad, that the main bad thing about the US Federal Government is that it doesn't do anything like enough (across all areas, but especially industry regulation), and that the absolutely worst way to deal with safety failures is to hit the unlucky firms with vast fines and let the lucky ones keep on getting away with it.
<blockquote cite="#commentbody-134072">
John B :
…and then make BP pay compensation to the workers that other oil companies are laying off during the freeze.
Um… Do you have any citation that BP is being told to pay for other companies workers, or is that just another assumption?
As far as your interpretation of the Obama speech, I can only say that it is obviously biased by your attempt to demonize his administration. I'm not saying that they're completely innocent either, I just don't think you will hear any politician EVER take more responsibility for such a huge disaster than he did in that speech. To go a step further would be to start the first lines of a resignation speech.
<blockquote cite="#commentbody-134078">
@Levi Hmm. I sort of see what you mean – but my view is that large corporations inherently can’t be trusted, need strong regulators to keep them in place, in the absence of strong regulators will all tend to revert to being disastrously bad, that the main bad thing about the US Federal Government is that it doesn’t do anything like enough (across all areas, but especially industry regulation), and that the absolutely worst way to deal with safety failures is to hit the unlucky firms with vast fines and let the lucky ones keep on getting away with it.
I agree with all of that, except that BP should be fined because they were more than just unlucky in this case. Every company who drills offshore for oil understands that they adopt all of the risks associated with their endeavors. They are responsible for the damage done and the clean-up efforts. Period.
What the Obama administration does going forward remains to be seen…
From the White House:
We know that the moratorium has hit oil companies other than BP and its suppliers, and has led to them laying off contractors – so I can't see how there's any other way to interpret Gibbs's statement.
On the Obama speech, I'm not trying to demonise his administration – I think it's a massive bloody step up from the last one. I also recognise that he faces massive pressure from, well, everybody, on this issue, and maybe domestic pressures mean that the only approach he can take is the one he's taking.
There may also be a peculiarly US thing in play here under which it's bad form to criticise your predecessor, even when they're primarily responsible for the whole mess.
An 18-month-served British or Australian PM faced with this crisis would say something like "This incident is due to the appalling underregulation and underspending under the previous government. I'm convening a public enquiry right now, and we'll revise our safety restrictions as necessary to ensure they're the best in the world". But I don't think I've ever really heard a US President follow that line on anything.
If there's an unwritten convention that you're not supposed to do that even when it's true, then blaming BP is pretty much his only option other than blaming himself, which as you say could be a bit of a suicide note if taken too far…
Yes, agreed completely.
They should pay compensation for the damage done, and they should pay for the clean-up efforts (and attempt to recover whatever they can from Transocean and Halliburton if it turns out, which I'd be amazed if it didn't, that both firms are also partially liable). Pretty much everyone, including BP, accepts that.
The question is now over whether they end up having to pay punitive damages on top, whether they end up having to pay ridiculous extras like people laid off from other oil companies, whether they end up having their operations expropriated – in short, whether the deal is 'you broke it, you pay for it, sorted', or whether the deal is 'you broke it, you paid for it, but we're also going to utterly screw you over as well'.
And we know there's a real belief that the latter is a possibility, because BP's bond yields imply a real threat of bankruptcy, which simply could not happen based on any sensible estimate of the damage caused by the spill, given how much cash the company is able to generate. This is pricing in a perceive political risk that the final settlement will be brutal rather than restorative.
The blog seems to have failed to generate a pingback for some reason – here's a follow-up.
@John B
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John B :
We know that the moratorium has hit oil companies other than BP and its suppliers, and has led to them laying off contractors – so I can’t see how there’s any other way to interpret Gibbs’s statement.
Actually, it's evident that the details of the proposed legislation are still very ambiguous at this point. There is another way to interpret Gibbs' statement, but you're ignoring that for the sake of your America vs BP rant. I think the Obama admin is purposely leaving the details out because it sounds like a more severe punishment that way.. and that goes a long way toward winning them brownie points with the pissed off coastal populace. (not to mention environmentalists everywhere)
There is actually an unwritten tradition about bashing previous admins in America. The Bush/Cheney supporters are mostly mindless drones, so there's a notion that bashing them really just enrages a good 30+% of likely voters, and mobilizes the FauxNews crowd to attack Obama even more than it is already.
Sure his administration is probably seizing this moment as a chance to unite against a common villain, but that doesn't mean that they have any intention of "stealing" your pensions or bringing BP to its knees. I think all of this talk of bankruptcy is a little silly. Admittedly, I'm no financial guru, but at least one journalist from Forbes.com seems to agree with me – Bankruptcy Not On BP's Agenda.
I just think it's interesting to note that not a single analyst around the world (financial or political) is even hinting at the kind of state-sponsored, capitalist eco-terrorism of which you speak – as far as I know. So, you're either brilliantly prescient or just talking out your ass. ..and there's a real belief that the latter is most likely. ;)