President Barack Obama, shown visiting the Louisiana coast in late May, will make his fourth trip to the Gulf Coast on Monday and Tuesday, returning to Washington in time to report to the nation Tuesday night.
President Barack Obama finally might be digging in his executive heels over the Gulf oil blowout. The White House has announced the president will address the nation Tuesday night about the spill and is expected to outline a plan that would force BP to create a multibillion-dollar escrow account to compensate those affected. —JCL
The New York Times:
President Obama for the first time will address the nation about the ongoing oil disaster in the Gulf of Mexico on Tuesday night and outline his plans to legally force BP executives to create an escrow account reserving billions of dollars to compensate businesses and individuals if the company does not do so on its own, a senior administration official said on Sunday.
“The president will use his legal authority to compel them,” said Robert Gibbs, the White House spokesman.
Mr. Gibbs did not elaborate on the legal basis for such a move but said that White House lawyers have been researching the matter for days. The president is seizing the initiative after reports on Friday from London that BP would voluntarily establish an escrow account — either for compensating victims or for delaying a planned dividend for BP shareholders — turned out to be less certain than the White House initially thought.
The escrow account that the White House envisions would be roughly modeled after the fund established for victims of the terrorist attacks on Sept. 11, 2001, and it would be administered by a third party to provide greater independence and transparency and to guard against the company too narrowly defining who is entitled to payments and how much.
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This is not unreasonable. In fact, this should have been done the day that BP decided to self-insure. Insurance companies are required to have capital reserves, so should private businesses that self insure.
There’s also the issue of clean-up workers not getting paid on time. I don’t want to make excuses for BP, but let’s not forget, they are in the process of drilling two relief wells that were not planned. That has to be taking up a lot of company resources, other than just capital. Perhaps they could just cut Jindal a check, and let his people issue the checks to the workers. It can all be settled up at a later date. Paying clean-up workers, and settling liability lawsuits are two different things.
By Mike, June 13, 2010 at 10:15 am Link to this comment
(Unregistered commenter)
I’ll believe it when I see it. The president has a knack for saying one thing and working behind the scenes to do the opposite, like he did with the public option.
It looks like the fund would need at least tens of billions of dollars to compensate those affected from Louisiana to Florida and probably up the east coast as the spill is nowhere near contained.
Obama could actually be doing BP a favor by “demanding” for far less than what is needed. BP could claim that they paid into the fund and would not pay any more as the cost of the spill rises, and take a hardline approach to future settlements which they will probably do anyway.
Obama needs to make sure that BP’s contribution to the fund is not a one shot deal, that is if this isn’t a scam to save BP and its shareholders
money and pass the expense on to the American taxpayer.
I shouldn’t be so cynical but this administration and BP don’t inspire my confidence.
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By Fat Freddy, June 14, 2010 at 3:03 am Link to this comment
This is not unreasonable. In fact, this should have been done the day that BP decided to self-insure. Insurance companies are required to have capital reserves, so should private businesses that self insure.
There’s also the issue of clean-up workers not getting paid on time. I don’t want to make excuses for BP, but let’s not forget, they are in the process of drilling two relief wells that were not planned. That has to be taking up a lot of company resources, other than just capital. Perhaps they could just cut Jindal a check, and let his people issue the checks to the workers. It can all be settled up at a later date. Paying clean-up workers, and settling liability lawsuits are two different things.
Report thisBy Mike, June 13, 2010 at 10:15 am Link to this comment
(Unregistered commenter)
I’ll believe it when I see it. The president has a knack for saying one thing and working behind the scenes to do the opposite, like he did with the public option.
It looks like the fund would need at least tens of billions of dollars to compensate those affected from Louisiana to Florida and probably up the east coast as the spill is nowhere near contained.
Obama could actually be doing BP a favor by “demanding” for far less than what is needed. BP could claim that they paid into the fund and would not pay any more as the cost of the spill rises, and take a hardline approach to future settlements which they will probably do anyway.
Obama needs to make sure that BP’s contribution to the fund is not a one shot deal, that is if this isn’t a scam to save BP and its shareholders
money and pass the expense on to the American taxpayer.
I shouldn’t be so cynical but this administration and BP don’t inspire my confidence.
Report this