Category: Business

A Hole in the World: The BP Oil Hemorrhage

It’s not an oil spill. There is no mere spill in the Gulf of Mexico.

There is a hole in the world. The floor of the Gulf of Mexico is hemorrhaging oil, and no one has a clue how to stop it. When they finally do plug the hold, the damage will likely be with us for decades.

From The Nation:

How long will it take for an ecosystem this ravaged to be "restored and made whole," as Obama’s interior secretary pledged it would be? It’s not at all clear that such a thing is even possible, at least not in a time frame we can easily wrap our heads around. The Alaskan fisheries have yet to recover fully from the 1989 Exxon Valdez spill, and some species of fish never returned. Government scientists estimate that as much as a Valdez-worth of oil may be entering the Gulf Coast waters every four days. An even worse prognosis emerges from the 1991 Gulf War spill, when an estimated 11 million barrels of oil were dumped into the Persian Gulf—the largest spill ever. It’s not a perfect comparison, since so little cleanup was done, but according to a study conducted twelve years after the disaster in the Persian Gulf, nearly 90 percent of the impacted muddy salt marshes and mangroves were still profoundly damaged.

We do know this: far from being "made whole," the Gulf Coast, more than likely, will be diminished. Its rich waters and crowded skies will be less alive than they are today. The physical space many communities occupy on the map will also shrink, thanks to erosion. And the coast’s legendary culture will contract and wither. The fishing families up and down the coast do not just gather food, after all. They hold up an intricate network that includes family tradition, cuisine, music, art and endangered languages—much like the roots of grass holding up the land in the marsh. Without fishing, these unique cultures lose their root system, the very ground on which they stand. (BP, for its part, is well aware of the limits of recovery. The company’s "Gulf of Mexico Regional Oil Spill Response Plan" specifically instructs officials not to make "promises that property, ecology, or anything else will be restored to normal." Which is no doubt why its officials consistently favor folksy terms like "make it right.")

If Katrina pulled back the curtain on racism, the BP disaster pulls back the curtain on something far more hidden: how little control even the most ingenious among us have over the awesome, intricately interconnected natural forces with which we so casually meddle. BP cannot plug the hole in the Earth that it made. Obama cannot order brown pelicans not to go extinct (no matter whose ass he kicks). No amount of money—not BP’s recently pledged $20 billion, not $100 billion—can replace a culture that has lost its roots. And while our politicians and corporate leaders have yet to come to terms with these humbling truths, the people whose air, water and livelihoods have been contaminated are losing their illusions fast.

"Everything is dying," a woman said as the town hall meeting was coming to a close. "How can you honestly tell us that our gulf is resilient and will bounce back? Because not one of you up here has a hint as to what is going to happen to our gulf. You sit up here with a straight face and act like you know, when you don’t know."

"Everything is dying."


Hold Those Poll Numbers – Obama Produces Results, Not Theater

President Barack Obama

First, word from the latest CBS poll:

Most Americans do not believe President Obama has a clear plan to deal with the oil spill in the Gulf, according to a new CBS News/New York Times poll.

Just 32 percent say Mr. Obama has a clear plan to deal with the oil leak, while 59 percent (including 64 percent of Gulf coast residents) say he does not.

The numbers are not much better among those who watched the president’s Oval Office speech on the spill last week, with 35 percent of that group saying he has a clear plan and 56 percent saying he does not.

The spill isn’t the only issue on which the president is seen as lacking a plan of action: Just 41 percent say Mr. Obama has a clear plan for developing new sources of energy, while 45 percent say he has no clear plan. And when it comes to creating jobs, just 34 percent say he has a clear plan; 54 percent say he does not.

A majority of Americans – 61 percent – says the president’s response to the oil spill was too slow. Just 31 percent say they have “a lot” of confidence in his ability to handle a crisis, though a majority has at least some confidence that he can do so. Since January, the percentage who says Mr. Obama has strong qualities of leadership has fallen from 70 percent to 62 percent.

Overall, 43 percent approve of Mr. Obama’s handling of the oil spill, while 47 percent disapprove.

I remember listening to Cokie Roberts speak at a luncheon of the Inland Press Association a few years ago. I was actually looking forward to her presentation. The 2008 Presidential Election was still before us, and I was hoping for some insider wisdom from one of America’s most popular journalists.

When she opened her mouth, she graced us with poll numbers, the absolute “latest ABC poll results.” She presented us a good 20 minutes of meaningless drivel, letting us in on which way the winds had most recently blown.

It was rather sad. Cokie tried to prognosticate, didn’t even try to elucidate.

I was critical of President Obama after his speech last Tuesday evening. I wrote that I did not feel reassured by what the President said. I thought he sounded weak, and concluded with higher expectations for the morrow:

At any rate, I hope the President shows more spark tomorrow when he meets with BP execs. behind closed doors. If BP’s royalty don’t emerge from their meeting with POTUS looking like they just had a “Come-to-Jesus” moment, well, shame on President Obama.

The next day came the big announcement:

President Barack Obama wrested a $20 billion compensation guarantee and an apology to the nation from British oil giant BP Wednesday, announcing the company would set up a major claims fund for shrimpers, restaurateurs and others whose lives and livelihoods are being wrecked by the oil flooding into the Gulf of Mexico.

Applause broke out during a community meeting in Orange Beach, Ala., on the news.

“We asked for that two weeks ago and they laughed at us,” Mayor Tony Kennon said. “Thank you, President Obama, for taking a bunch of rednecks’ suggestion and making it happen.”

That floored me. Yes, $20 billion might be pocket change for BP in the long run, but it’s quite a bit for the people suffering loss – financial and otherwise – from the oil spill. Some members of the GOBP, like good old Joe Barton, criticized the agreement, calling it a “shakedown” and worse. Yes, Barton later apologized for that “misconstrued misconstruction,” or whatever. Members of the far right shuddered that there was no “due process,” as if every wrong can only be made right in this country by lengthy and extremely costly litigation.

President Obama simply cut through the red tape. If BP wanted to, they could certainly, even now, seek remedy in the courts — but that isn’t likely.

The President has resisted doing theater as Commander in Chief. Those moments are for campaigns, perhaps. A $20 billion (so far) agreement between a private corporation responsible for the worst environmental disaster ever in the Unted States and the highest elected official representing the people of this country — that’s incredible.

Put away the poll numbers. The media wants theater at every turn.

“No-Drama Obama” gets results.


Mark Kirk Makes Like Bunny, Flees From Press

Illinois politics takes us down the rabbit hole once again.

From Greg Hinz at Crain’s Chicago Business:

The Democratic and Republican nominees for the U.S. Senate, Alexi Giannoulias and Mark Kirk, gave their views on planning and environmental issues at a Metropolitan Planning Council lunch on Monday.

But the news was what happened afterward: Mr. Kirk literally ran out the hotel door rather than answer questions about a host of recent reports that he repeatedly has exaggerated his experience and credentials.

The Peter Cottontail moment happened at the downtown Hyatt Regency, where about 1,000 folks were on hand for MPC’s annual big do.

Mr. Giannoulias, on the way in, stopped for a couple of minutes to chat with reporters. He left quickly after speaking but had a good reason: a fundraiser with Vice-president Joe Biden. Lunch then was served.

Mr. Kirk arrived after lunch, coming in via a side door.

He spoke for about 20 minutes, than walked down from the dais to have his picture taken with MPC President MarySue Barrett.

As soon as that was done — with a swarm of TV cameras and reporters moving toward the front of the ballroom — Mr. Kirk bolted for a back door.

With media in hot pursuit, he raced through a Hyatt kitchen and into the back seat of a black SUV — I believe it was a Cadillac Escalade — which instantly peeled out.

I know what you’re thinking.  Crain’s Chicago Business is the fountain of liberalism in Chicago, much more so than Boy’s Town.

Not quite.

Running away like Peter Cottontail won’t cut it with liberals, moderates, or conservatives in Illinois.

More here.


Red Tape Chronicles Uncovers Business-Killer Credit Card Swipe Fees

Bob Sullivan covers Internet scams and consumer fraud for MSNBC.com. He is the winner of multiple journalism awards for his coverage of online crime and author of Gotcha Capitalism:
How Hidden Fees Rip You Off Every Day and What You Can Do About It.
and Your Evil Twin:
Behind the Identity Theft Epidemic.

Bob was recently in Pittsburgh, where he spent some time with a small business getting taken to the bank with credit card swipe fees.

From Bob’s blog, The Red Tape Chronicles:

You probably swipe a credit or debit card through a magnetic stripe reader dozens of times each month. It’s a simple act, but it’s it at the core of a battle between titans with billions of dollars at stake. On one side are big banks, which take a cut every time a card is swiped. On the other are retailers like Mike McArdle, who are tired of paying Visa, MasterCard and their member banks $1 or $2 every time a customer makes a purchase.

McArdle runs McArdle’s Pub on Pittsburgh’s South Side, the very definition of a family business. It opened in 1939, and the sign above the front door doesn’t look like it’s been changed since. It once held a prime spot near two of the Steel City’s largest steel plants. Both of them have long since been converted to shopping malls, but McArdle’s plugs away, thanks to its position just off the main entertainment strip in Pittsburgh’s hippest neighborhood.

For years, banks have held the upper hand in the fight with the McArdles of the world, but no more. Last week, the U.S. Senate approved legislation that could drastically change the way banks are compensated for card swipes, and that could impact what happens every time you pull out your wallet. In fact, the legislation could provide incentives — that means money — for Americans to leave the plastic in their wallet and pull out old-fashioned cash instead.

As part of its omnibus financial reform bill, Congress is taking on what are called interchange fees — the price that merchants pay for banks to process their credit card transactions. Formulas vary, but generally stores pay a flat 50 cents or $1 per transaction fee, plus 1 to 2 percent of the purchase price.  Retailers have screamed for years that the fees are too high and that the card associations impose anti-competitive restrictions on them – given the limited choices among standards like Visa, MasterCard, American Express, and Discover.

Read more here.