Thursday, June 03, 2010

Seize BP While it Still Has an Asset!

by Len Hart, The Existentialist Cowboy

BP is busted. Penalties already assessed BP exceed 60 $billion. The cost of the cleanup will run about $760m but that figure was 'operative' before the last failed attempt to plug up the hole. Damages increase daily, hourly as the hole remains unplugged, as the oil continues to spew!

Associated Press reports that damages have already wiped out some $75 billion in market value. By every definition, BP is bankrupt, finished! Kaput!
Firm's stock sale nearly twice as large as any other institution; Represented 44 percent of total BP investment
The brokerage firm that's faced the most scrutiny from regulators in the past year over the shorting of mortgage related securities seems to have had good timing when it came to something else: the stock of British oil giant BP.
According to regulatory filings, RawStory.com has found that Goldman Sachs sold 4,680,822 shares of BP in the first quarter of 2010. Goldman's sales were the largest of any firm during that time. Goldman would have pocketed slightly more than $266 million if their holdings were sold at the average price of BP's stock during the quarter.
--Goldman Sachs sold $250 million of BP stock before spill
And then --yet to be tallied --the costs of clean up and environmental damages to coast lines, damage that has yet to occur!.
...under US law, BP is liable for $1,100 in civil penalties for each spilt barrel of oil and gas, to be paid to the US federal and affected state governments. If BP is found to have acted with gross negligence – and there is no evidence so far that it has – this fine would rise to $4,300 for each barrel.
The issue of legal liability for the accident is complex, involving US federal and state laws. City analysts’ calculations of the bill faced by BP have ignored the potentially ruinous cost of civil penalties.
--BP Faces Extra $60 Billion Legal Costs As US Loses Patience
I propose that the governments of the United States and Britain act quickly to seize the assets of BP, plan a fair distribution of all assets and put into place a mechanism by which damages to homes and other coastal properties are addressed without additional layers of PR flack, corporate bureaucracy and 'spin'.
On Tuesday alone, the first trading day since BP’s latest attempt at a fix failed, and the day the government announced it had opened a criminal probe into the disaster, its stock took a hit of 15 percent.
The British oil giant is worth $75 billion less on the open market than it was when the Deepwater Horizon rig exploded six weeks ago. Other companies involved in the spill — Transocean, Halliburton and Cameron — have all lost at least 30 percent in value.
And as oil seeps unchecked into the Gulf, nearby states, businesses, environmental regulators and injured workers and cleanup crews are eyeing damages that could total billions more.
--As Gulf Oil Spill Grows, Do Does BP's Liability; $75 Billion in Market Value Already Wiped Out
The Gulf disaster has now eclipsed the 1989 Exxon Valdez spill, which, after two decades of lawsuits, cost Exxon Mobil $4.5 billion. According to analyst Blake Fernandez with the Howard Weil investment firm, that comes to about $654 per gallon today.
ON JUNE 2nd the White House announced that BP, an oil firm, would be subject to a criminal investigation over the oil spilling out of the Deepwater Horizon rig. The company's share price, along with that of Halliburton, an oil-services company that is also implicated in the Gulf of Mexico spill, fell sharply on the news. This contrasts with the price of ExxonMobil's stock in the weeks following the Exxon Valdez spill in 1989 (when the company was plain Exxon). Cleaning up after Exxon Valdez ultimately cost Exxon about $4 billion, much less than had seemed likely at first, because a Supreme Court decision in 2008 allowed punitive damages to be slashed from $2.5 billion to $507.5m.
--The Economist, How the share prices of BP and Exxon have fared after big oil spills
Many are of the opinion that it is time to restore the 'corporate death penalty: seize BP, freeze, confiscate assets, prosecute whatever management is guilty of criminal negligence and/or or malfeasance of any type or terminology. Seizing BP effectively ends that company's existence as a corporation. Any assets remaining after damages are paid are then controllable by the public; the current management is put put out of a job if not prosecuted. Secondly --seizing BP puts an end to its control of information, better termed 'dis-information'. Corporate spin-meisters are literally trained by companies like Ammerman Enterprises of Sugar Land, TX, the Houston suburb whose other disgrace is that it was home to Tom DeLay. Ammerman Enterprises trains executives for huge firms like Exxon, Shell, DuPont et al. It was Ammerman Enterprise which 'trained' EXXON executives with respect to the Exxon Valdez. What we call 'spin' and PR, they call 'bridging' --a fancy, 'corporate' word for 'let's talk about something else' or 'I don't wanna talk about that; let's talk about this!'

This disaster will prove to have been much worse --a catastrophe by any standard, an irrefutable repudiation of the very notion of 'corporate personhood', in fact, 'corporate privilege'. It is time to repudiate the SCOTUS decision, the effect of which is to put corporations above the law even as 'real persons' are held to a higher and often unfair standard. This disaster must be watched carefully! Will corporations get away with destroying the habitats of all living things --including ourselves? Or --will the corporations be held responsible for the irreparable damages that they have inflicted and continue to inflict upon our only habitat: planet Earth?

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