Friday, June 18, 2010

Gulf Oil Spill: BP Cries 'Uncle'

By Ernest Corea
Republished courtesy
IDN-InDepth NewsAnalysis

WASHINGTON DC (IDN) - Less than 24 hours after President Barack Obama delivered an address to the nation on the relentless consequences of the BP (British Petroleum) disaster in the Gulf of Mexico -- a disaster that has already adversely affected four Gulf states -- BP management cried "uncle".

They made a passable show of contrition and went along with Obama's demand for generosity.

(The phrase "to cry uncle" is drawn from childhood playtimes, and implies a giving in or surrender by the party that is about to be vanquished, on the understanding that (s)he will no longer be challenged, chased, tormented, or teased. The phrase was a favourite of President Ronald Reagan who used it to describe Libya's relationship with the U.S.)

Obama spoke on the night of Tuesday, June 16. On Wednesday morning, a bunch of beleaguered BP barons led by BP Chair Carl-Henric Svanberg and including Chief Executive Officer Tony ("I want my life back") Hayward arrived at the White House to discuss the consequences of the oil spill caused by an explosion on the oil rig "Deepwater Horizon" which was operating under BP control.

Discussions, including a private session between Obama and the BP Chair, began at 10 am., lasted several hours and, by all accounts, the results up to now are consistent with the needs of the disaster's victims.

So it is unfortunate that Svanberg, whose first language clearly is not English, referred in a public statement to the victims of the BP Disaster as "small people". The people of Louisiana were outraged. The kindest comment made in street interviews was: "Somebody should train BP executives to keep their mouths shut."


Shortly after 2.30 pm, the BP barons emerged from the White House negotiation, and faced cameras and microphones, where they:

-- apologised to all those affected for the impact of a disaster that should not have happened;

-- announced the establishment by BP of a $10 billion (yes, "b" as in "boy") escrow fund from which victims of BP's incompetence could be compensated for their losses;

-- stated that management of the fund would be independent of both BP and the U.S. Government;

-- pledged that a full investigation of the "Deepwater Horizon" tragedy will be pursued to determine its causes and eliminate a possibility of repetition;

-- announced that BP had decided to suspend the payment of dividends.

Additionally, BP voluntarily agreed to establish a $100 million fund to compensate unemployed oil rig workers affected by the closure of the deepwater rigs.


Obama issued a separate statement that fleshed out details of the White House negotiation.

He had raised two main issues with the BP barons: containment of the oil that is still spewing into the Gulf, and BP's foot dragging response to legitimate claims for compensation. Both issues are critically important to the welfare, peace of mind, culture, and future of families who have for generations made their living in the Gulf area.

The expectation emerging from the talks is that BP will draw on the best available advice, technology, and other resources to capture the rest of the oil that continues to leak until a relief well that will be ready later in the summer stops the leak completely.

As for the claims for compensation made by affected families, two complaints were confronted. The first is the pressing need for processing of claims to be accelerated. The second is the existence of a legally mandated cap of $75 million on how much oil companies could under certain circumstances be required to pay for economic damages caused by a spill such as the BP Disaster.

BP's agreement to set up the $20 billion account to pay claims for damages resolves that issue. Moreover, both sides are said to have agreed that the $20 billion is only a beginning and will reviewed and could be augmented.

The escrow account will be administered by Kenneth Feinberg whose long experience in this specialised area has included managing the fund that compensated victims of the September 11, 2001 attacks. A three-member panel will adjudicate claims that are turned down. Every effort will be made to expedite these claims.

Thus, the negotiations covered the main issues on which Gulf families wanted Obama's leadership and support, and on which he dwelt during Tuesday's address to the nation.


Several presidents have used the setting of the Oval Office – the official office of the President since 1909 – to address the nation on topics of outstanding significance. President John F. Kennedy, for example, delivered a memorable civil rights message from that setting.

Presidential statements from the Oval Office tend to be brief, lasting from five to 10 minutes, but Obama spoke for almost 18 minutes. That did not prevent media pundits from criticising him for delivering too short a speech.

In those parts of the world where the entrenched culture produced the word "pundit" it continues to be used as a description of a person endowed with wisdom; thoughtful, introspective, intellectually inquisitive, and associated with solutions to seemingly intractable problems. Among representatives of the international media, the word merely identifies the commentator or writer with the biggest bawls.

Obama has been under pressure from his critics to "show emotion and be a daddy to Lousiana." Some of his supporters believe this is a deliberate "put down" meant to denigrate his role as president, turning him into a foster parent and not the commander-in-chief.

His handling of the BP Disaster has been castigated by the liberal segment of his base partly because of their opposition to the corporate sector and their desire therefore to see the entire top management of BP frog marched to jail, while their financial resources are strewn across the affected areas.

They have also been venting, because of their anger over his unwillingness to adopt their positions on other issues that have nothing to do with the BP Disaster.

And the "Nobama Obama" crowd except him to act like the little boy in the Dutch story, to go down to where the oil leak exists and personally plug the hole.


Obama chose not to respond to these criticisms but to deal directly with issues that people in the Gulf region had raised with him during his four visits there.

He acknowledged that because there has never been a leak of this size at this depth, stopping it has tested the limits of human technology. This is an accurate description of the problem but cannot be considered as a reason or an excuse for inaction or mis-steps.

Well aware of this, and in the full knowledge that what matters is the fate and fortune of the people directly affected, Obama identified what he described as a battle plan in three stages for fighting back: First, the cleanup. Second, the recovery and restoration of the Gulf Coast. Third, measures to ensure that a similar disaster does not happen again.

There are aspects of the first stage itself that have not been universally acclaimed and, in fact, over 50 percent of the population disapproves of the government's actions/reactions. Images of the continuing destruction wrought by the BP Disaster do not inspire confidence.

Perhaps because of this, a no-nonsense manager, Michael Bromwich, a former federal prosecutor, has been placed in charge of revitalising the government's watchdog agency the Minerals Management Service that some critics say was actually a lap dog of the oil industry. At the same time, Secretary of the Navy Ray Mabus, a former governor of Mississippi and "a son of the Gulf" has been charged with developing a long-term Gulf Coast Restoration Plan.

While these activities go on, the commission referred to in a previous article continues its investigation into the causes of the BP Disaster.

Those whose way of life and livelihoods are at stake will watch for action on the ground demonstrating that the battle plan is real and not just mirrors-and-smoke.
Copyright © 2010 IDN-InDepthNews | Analysis That Matters

The writer has served as Sri Lanka's ambassador to Canada, Cuba, Mexico, and the USA. He was Chairman of the Commonwealth Select Committee on the media and development, Editor of the Ceylon 'Daily News' and the Ceylon 'Observer', and was for a time Features Editor and Foreign Affairs columnist of the Singapore 'Straits Times'. He is on the IDN editorial board.