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Emerging from a marathon meeting with BP officials, President Obama today announced that the embattled oil company had agreed to establish a $20 billion escrow account to cover damage claims resulting from the worst environmental disaster in the nation's history.
He also said that $20 billion is not a cap, and added that BP would create at $100 million fund to compensate unemployed oil workers affected by the government's six-month moratorium on exploratory drilling in deep water.
"The people of the Gulf have my commitment that BP will meet it obligations to them," Obama said. "BP has publicly pledged to make good on the claims that it owes to the people in the Gulf, so the agreement we reached sets up a financial and legal framework to do it."
Obama called today's meeting -- his first with BP officials -- "constructive" and said the current $75 million cap on oil companies' liability in the case of oil spills under federal law would "obviously be insufficient" and that therefore the escrow account would provide "substantial assurance" that claims would be honored. BP has agreed to contribute $5 billion a year over a four-year period to the account, including this year, according to a White House fact sheet.
Ken Feinberg, who ran the 9/11 victim's fund, will administer the escrow account independently, and a three-person board will handle damage claims that are turned down, the president said.
In addition, Obama stated that the escrow account did not supersede either individuals' rights or states' rights to present claims in court, and said BP would continue to be liable for the environmental disaster it has caused.
The remarks came after a meeting between administration officials and BP executives that lasted several hours. Among those in attendance at the Roosevelt Room discussion were BP CEO Tony Hayward, BP Chairman Carl-Henric Svanberg, BP General Counsel Rupert Bondy, BP Managing Director Robert Dudley, White House adviser Valerie Jarrett, Labor Secretary Hilda Solis, Attorney General Eric Holder, and Homeland Security Secretary Janet Napolitano.
After the meeting, BP's chairman, Carl-Henric Svanberg, told reporters that the company and the administration were "fully aligned," he apologized to the American people, and said the company would not pay out dividends for the rest of the year.
Svanberg also assured the press that the BP cares about "the small people" like the shrimpers, fisherman and small business owners of the Gulf Coast.
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Anna Molly: I agree that there had been some private talks prior to the President's speech. In light of the above comments, it looks like the President can negotiate a tough deal. No cap, right to file charges in court are steps in the right direction.
I'm not a attorney, but I appreciate their logic and training. Is there anything he left out?
Don't know yet, Ron, but he got at least three major pieces, including a claims fund, no cap with the right to sue, and the unemployment set-aside. Although, as the plume of oil spreads out, I'd have to say $100 million sounds like a very low number for unemployment. I presume the $20 billion is intended to cover personal injury claims as well as property damage, and given the potential long-term health effects of this kind of thing, I hope there is some provision to re-ante if necessary and to cover long-term -- or more importantly -- later emerging claims. I read that the claims fund applies to state and local governments, but couldn't tell whether BP plans to reimburse the federal government for the costs it incurs here. I do hope someone is keeping track. But why do I suspect Congress won't be the ones doing that?
Oh, and I hope he mentioned to them that he would REALLY appreciate it if they would cooperate with OSHA, NIOSH, CDC, and other public health organizations when they make suggestions about worker safety during the clean-up, such as wearing haz-mat suits to avoid long-term health risks. No more need for photo-ops and ad campaigns.
Am I the only one who thinks the pundits got caught off guard with the Presidents announcement of the $100 million dollar fund for the unemployed oil workers?
They seem to be eerily silent...
I'm happy to hear BP came to their senses and will NOT be paying dividends this year!
Yes Fiesty, you are right. They dont know everything even though they think they do.
Hey Gingerbread Mama!
Great post earlier btw! I ran out to lunch and had Tamara Hall on - Chuck came across like he got caught with his pants down and as usual switched to 'snarky' mode! :0))
Feist,
You got it. It drives the repugs crazy when President Obama makes a promise and has the nerve to keep it. I am seeing very little from the Republican power brokers other than that nitwit in MN. I wonder how some of the pundints feel today after the hammering they gave Obama yesterday and this AM. I am waiting to see what Keith has to say tonight.
Come on Feisty... You know that Obama should have demanded $500 million. How the hell can you support the President when he is spending all that time and effort trying to help the little people? Screw the unemployed! Help poor Tony Hayward get his life (and his fat bonus checks) back! Poor little BP.
True that! Had he gotten $500 million they would have been whining why didn't he get $1 BILLION!
There's NO pleasing the right wing whacko's!
Right on. Too Little, Too late, Too Much, Not Enough. Maybe they (the brain dead repugs) would feel better if they got paid in Chickens.
You know that fund is for the unemployed related to the moratorium on drilling for six months....right?
and I quote:
and added that BP would create at $100 million fund to compensate unemployed oil workers affected by the government's six-month moratorium on exploratory drilling in deep water.
so how much more do you think they will need for six months unemployment?
This looks like a good job well done by the the President and his administration. In watching the WH press briefing now, Carol Browner doing a great job in explaining how the claims fund will work and the rights of the claimants. Seems to me they have done a great job in nailing BP to the wall.
Now let's see how much howling will come from the pundits and the party of No. The rabid rhetoric needs to be tempered and from some an acknowledgement that the they don't know everything that goes on behind close doors and shouldn't make assumptions based on their own mindsets.
You owe the President an apology that you are so willing to criticize in such harsh tones and that begs the question, is it because he is a Democrat or is it because he is black, or a little of both?
Gingerbread: You are becoming quite the writer!! I could not have said it better myself.
I was initially skeptical, too, Gingerbread, because the speech seemed lackluster, too conciliatory, and almost apologetic. Then after I heard BP's response, I realized that, in all probability, the deal had already been done, and the speech had to be pared back at the last moment. Not only republicans were dissatisfied with the speech, but you're correct that it will be mostly republicans who will be dissatisfied with the deal.
Anna, this deal, on it's face, looks like a good deal for the Gulf States and the cleanup effort. I guess the carrot to keep BP in line is the right to sue. Kudos to President Obama for looking out for our interest(s) for once.
Winner, winner, chicken dinner. This seems like a very reasonable deal all around.
Now all they gotta do is stop the gusher. Can't forget that little detail...
Sound like a copout ... cap to me ....its 20 billion over 3 years ....not all at once...and they said the if you add up the payments they will be making ...i can add its not 20 billion !!!!
Winner, winner, chicken dinner. This seems like a very reasonable deal all around.
Now all that gotta do is stop the gusher. Can't forget that little detail...
Gingerbread,
Good points but I would not hold my breath for any apology from the Repugs, that word is not in their vocab.
They will probally answer with a talking point or another midless rant.
Hi US Navy, thank you for the shoutout. Oh! I'm not holding my breath either. I was so incensed by the pundits last night and especially Keith Olbermann,I emailed him at disappointed and displeased I am, that all he is doing is giving talking points to the opposition. Especially, when I saw that weasel, Eric Cantor, snearingly refer to Keith, remarks as a validation for his point of view.
I enjoy your posts, thanks for being here and most of all thank you for your service. Bless you!
Hiya US Navy, very true, not only have the Repugs totally forgotten what the word Apologize means (As well as ethics, bi-partisanship and humility) they seem to have lost any sort of grip on the REAL Needs of this Nation are...ya know, like jobs, clean water, non-oiled (or otherwise tainted) food, medical care and AUTHENTIC (non-corporate) representation.
Just realized a parallel with the whole Teabag thing...Once the teabag is put into the hot water, where it 'dirties' it up, it is set aside to dry up and is later thrown away...JUST like the Repugs are trying to use them.
As science fiction author Robert A. Heinlein once put it: "The people trying to fix any sort of problem have to deal with an opposition that is profiting from the status quo."
Pres. Obama took office after the very worst (in fact, Worst Case Scenario) of a president that basically told Corporate America to "Go ahead and rape America and the World for everything you can get...I am turning my back and the backs of any and all regulatory agencies to anything you do: Rape Away, just send my my portion of the profits...After I step down of course!"
He intentionally emasculated the abilities of the US Government to hold Corporations accountable in any reasonable way so that his buddies, primarily the Oil and Banking industries, could reap untold wealth. The Right-Wing members of The Supreme Court has been complicit in achieving his goals...
KNOWING what a fiasco they had assembled; the dismantling of the regulatory structures that had been set in place, weak as they were even then, KNOWING that the Housing Bubble would pop and plunge us into a Full Depression; the Republicans did what they Always do: make sure that they lost the presidential vote so that they could then transfer the blame to the Democratic Elected President, whether that was Obama of Clinton, they really did not care, as long as they could point the finger and say "It Was On Their Watch!" Why else do you think that McCain chose someone who was patently unqualified for office?
However, the Banking Crisis happened earlier than they expected it to, some of their cabal could not wait until after the election to start shorting their holdings, which they KNEW to be terribly bad, trying to get out from under the debt of their knowingly fraudulent deals in order to get the jump on the profits that they expected from the fallout. There is No Honor amongst Thieves when they have the gold in their hands.
Likewise, the MMS got busted with their hands in the cookie jar (or in some cases, the cookie) taking money, drugs and sex in exchange for (at the president's behest, to look out for his Buddies) looking the other way. The people in that office who were actually trying to do their jobs were sidelined, transferred or removed from their position for "being obstructionist and difficult." When Obama took office the investigations were still ongoing. Obama's biggest mistake was in believing that the office had been properly reorganized by the Bush Admin, when the Last thing the Bushies wanted was anyone actually doing their jobs. I am rather sure that the bureaucrats left in that office paid lip service to the changes needed while making sure that things continued in the same ol', same ol' fashion.
Obama is smart enough to know that he cannot micro-manage the Government and so HAS to rely on those under him to make sure that he is getting the correct info. He has had to contend with a Party of NO that has blocked most of his attempts to place reasonable individuals into appointed positions, refusing to confirm his choices, using blatantly obstructive methodology to do so. They profit the most from keeping things as they are, not how they Should Be, and refuse to concede the fact that they Lost the General Election in a very big way. The GOP's actions now, as during the Bush Admin, come very very close to sedition and treason.
Luckily, Most of America is actually seeing this for what it is, nevermind the overblown hype given to the teabags and other whacko right-wing nutjobs. The teabags have the ears of the MSM mostly because it is strident, well-heeled, divisive and besides, the Corporate Sponsors (mainly Banking, Insurance, Oil and the M/I complex) have TOLD them to concentrate on these loud, whining anti-governists. Frankly, I think the Corporations are going to be bit in their nether regions very badly when they realize that they spent all that money, scheming and fraud...just to lose again when the People realize how they have been lied to and used by these people. It is happening already; No One Trusts what a Corporation says, about ANYTHING, particularly when the "Banks" that "needed rescuing" are now making obscene profits and STILL not lending to the people that could bring us out of this recession: the small business owners. On top of that, we see exactly how hollow the promises of the oil industry that they "Always operate with safety and the environment as top priorities." Their ONLY priority is to generate obscene levels of profit for themselves and their shareholders (of which they still control the most shares, so they make the "profits" just go back to their own, private, coffers.)
To actually try to hold Pres Obama responsible for all of this is ludicrous, in the absence of proof of wrongdoing by any of these corporations he has no way of stopping "normal business" without entailing massive legal liabilities, since the regulations have been watered down by congress to the point that they protect the Corporations rather than the People or the Environment. After the rig blew up and consequently sank I am sure that Obama felt that since BP had filed response plans and are supposed to be leaders in the field of oil exploration and extraction that they would have the wherewithall to be able to deal with the spill. He did what was normally recognized as the normal approach to disaster management: Make sure that the ones who made the mess are the ones to clean it up. He gave BP the chance to make good on their promises while providing Coast Guard support to the efforts.. It was only after BP PROVED itself incapable, not only of being able to stop the leak quickly but also of being able to be truthful about what was actually happening that Obama felt the need to apply severe pressure to the BP executives.
Why did the Gulf States themselves NOT act more quickly...they are the ones that have been profiting from the oil off their coast, making it easier for Corporations to drill and trying to water down Federal Law to increase their own profits...Why did THEY not have up to date plans and contingencies in place for this sort of accident: Everyone told them that this had to happen sooner or later, yet they buried their heads in the sand and took the Corporate Word along with their Dollars. Now that they are paying for their past actions/inactions they are screaming at the Federal Government to "DO SOMETHING" when for decades these Red States have decried "overzealous" Federal Regulation and "Infringement of State's Rights" Yet NOW, when their beaches are fouled due to their OWN lack of reasonable response, they want to hold Obama and the Federal Govt's feet to the fire, when the know that their own feet should be incinerated by now.
Pres. Obama acted in a "Good Faith" manner towards BP, BP totally blew that trust, along with the rig, out of the water, so to try to blame Obama for ANY of this is just more right-wing rhetoric aimed at trying to delegitimise him politically so that they can continue to protect their Corporate "Sponsors" from anything that "Might" impact their bottom line even if it gives needed protections to the People of this Nation and the Environment.
I foretell a LOT of Republicans losing their jobs in this election cycle, particularly in those Gulf States that have been lied to by those same Republicans(Who have NOT done their jobs properly) for decades.
The teabags are helping the Democrats out very handily, they are removing old time GOP members from contention and placing themselves, with their outlandishly outdated, unconstitutional and disproven theories of law and governance, in the glaring spotlight of the public realm where their own crackpot ideas will make them the laughingstock of this and future generations. Even Palin has to be rethinking the whole "Drill, Baby, Drill" mantra, hopefully with some shame attached to it!
I Am, by-the way, a Disabled Veteran myself, so Yes, I Have done my Duty for my Nation, and will continue to do so, in any way I can!
Very interesting and thorough analysis. I won't take issue with anything you say, except for one thing. McCain picked Palin because HE'S incompetent to be President, and he didn't even know he was deliberately left holding the bag. I genuinely believe that he genuinely believed that he was a legitimate candidate. Just like that guy Greene in South Carolina. And they're not the only ones. And that's how it's done.
LOL, Thanks AnnaMolly, I will buy that argument. He Was, and Is incompetent to be an Elected Official at this point.
They knew they were going to let McCain hang himself with his own rope, or lipsticked pig. The Diebold and Ivotronic vote fraud machines weren't going to be programmed to win the election for those two dunces. They needed to be able to blame the mess, the false prosperity they had made over Bush/Cheney's reign, on the next administration from another party.