Friday, June 18, 2010

Oil Mess Update: Howard's Tap Dance

In case you missed it, Tony Hayward, the embattled chief executive officer of BP plc, put in a hard seven hours on Capital Hill today, evading questions he had previously received from the congressional committee seeking to sort out responsibility for the mess that persists since the April 20 Gulf of Mexico oil-rig explosion. Hayward was widely expected to choose his words very carefully, to avoid being seen to accept any legal or moral responsibility for the deaths of 11 men who were on that oil platform or the ugly brown oil sludge that continues to coat the Gulf coast. And sure enough, he said next to nothing apart from acknowledging that there was indeed an oil rig mishap and that BP accepts its that it must at least help pay for the cleanup.
BP, as the world’s fourth-largest corporation, takes in huge revenues from its energy and other mineral exploitation worldwide. Even so, $20 billion (assuming the agreed-upon escrow fund is fully spent) is not chump change. So naturally, Howard would not want to be held accountable for any more losses. BP stock has already taken a hit, and this is from the impact of a leak at just one of the deep-water rigs BP owns or holds rights to globally. So, one would think, 60 days into this one particular mess, Howard would have spent at least the previous 59 days of “wanting his life back” in trying to determine what went wrong and whether it might go wrong again, possibly even worse, somewhere else. From his responses in testimony however, that seems not to be the case. He didn’t know this. He wasn’t responsible for that….. Bullshit Tony. You are the CEO. The buck stops with you. You may not have blown up the oil rig, and you probably didn’t know that the pipe on the seabed was going to be so hard to cap off. But you are a trained oil geologist and the executive in charge of all the people at BP who DO have the answers and the responsibility. So it is your bloody job to find out what went wrong and put a cap on that.
Compare, if you will, Howard’s verbal tap dance under oath today with what another CEO said in a globally televised address just a few days before:
“The one approach I will not accept is inaction. The one answer I will not settle for is the idea that this challenge is somehow too big and too difficult to meet. You know, the same thing was said about our ability to produce enough planes and tanks in World War II.” That was from Barack Obama, CEO of the United States, in his first address from the Oval Office since he became president. Obama was just back from another trip to the Gulf states hardest hit by the creeping oil sludge from Howard’s well. Granted, it was an address intended to show the president is in charge and maybe to help bolster sagging popular support. But it was devoid of any attempt to shirk responsibility or show ignorance. Howard and his handlers need to do some serious post-game reviewing of the videos on that one.
At the same time, I give Howard credit for staying focused, despite a surprise blow job from Republican Congressman Joe Barton of Texas, who twice apologized to Howard for what Barton called the “slush fund” BP agreed to post to help pay for the Gulf cleanup and recovery. Barton later retracted his remarks, under strong pressure from his congressional colleagues. But Barton, whose campaign fund includes at least $27,350 in donations from BP (according to Time magazine), really needs to have someone brand STFU in reverse on his forehead so each time he looks in the mirror, he will be reminded to watch his mouth. He certainly didn’t help his Republican colleagues who seemed earnest about a united effort to get to the bottom of the oil spill, so to speak. Perhaps that’s what we have come to expect from politicians in bed with Big Oil, but the spotlight on the Gulf of Mexico now should also help enlighten us all. Meanwhile, we should also hope that BP’s Howard will stand by one statement he made in testimony, that he is “focused on the recovery.” That’s what’s needed most.

Friday, June 11, 2010

Time Out: Yes, I'm Mad as Hell!

Tony Hayward, as the chief executive officer of BP plc, heads the world’s fourth-largest corporation (and the third-largest energy company after Royal Dutch Shell and Exxon Mobil). That puts him squarely in the realm of world leaders, not shoe clerks. Indeed, Hayward has negotiated mineral rights with presidents and potentates all over the world. Not bad for a man who started out at BP as an oil rig geologist. He’s no dummy, despite his stupid-ass comments and stonewalling on the April 20 Gulf of Mexico oil-rig disaster. And he is not likely to be any less disingenuous when he and other energy executives appear in Washington, D.C., June 17 to testify about the mess.
I have interviewed corporate executives in my years as a journalist. I do not believe these people routinely lie. And they are not stupid. Well, when a fifth-grader says the dog ate his homework, I guess that counts as a lie. When a crook is confronted with the evidence of his theft, his natural response is to plead ignorance. So I guess that’s also a lie. Ok, yeah, corporate executives do lie, sometimes famously, but lies are not a natural response executives of publicly held corporations ought to make in unpleasant or uncomfortable situations. One of the smartest answers an executive could give when asked if his company has done something bad should be to say “I don’t know.” Yes, it is a lame-dick answer, but which is worse, being stupid, or being a liar? Hayward has so far chosen against taking the high ground.
Speaking of the ecological and economic disaster the encroaching oil leak is creating, Hayward famously told USA Today, "We're sorry for the massive disruption it's caused to their lives." Now Hayward is a well-educated native speaker of the English language, and even allowing for the British propensity to understatement, referring to this as “massive disruption” is like referring to World War II as a military skirmish. Even worse, however, in the same article, Hayward is quoted as saying, "There's no one who wants this thing over more than I do, I'd like my life back.” I am willing to bet my next Social Security check that the 11 men who died as a result of the rig explosion would like to have their lives back too. I’d bet those who survived but are still traumatized by the blast would like to have their lives back. I’d bet the families and friends of all those folks, as well as the families of Gulf and coastal fishermen and others who depend upon an oil-free environment for their livelihoods would like to get their lives back as well.
As I write this screed, BP says it aims to start burning some of the oil it is able to retrieve from the surface of the Gulf. Oh fine; we already killed off the biosphere of the Gulf region with tar balls and waterborne toxins still surging up from the broken undersea well pipe. Now let’s go ahead and kill off what’s left with airborne toxins from uncontrolled burning. Obviously, whoever comes up with these brilliant notions, while days go by without pursuing even the most fundamental common-sense responses, must be on some kind of methamphetamine IV. I smell “lawyers” in the brilliance of BP’s reactions so far.
Before this gets any more ridiculous, and without waiting for Washington to figure out which asses to kick instead of which to kiss, and in addition to the Henry VI approach of "The first thing we do, let's kill all the lawyers," I have some suggestions on things we can do to end this crap. Keep in mind that BP is not “just” an energy company. And even though BP shares have sunk in value, the real value of BP’s underlying assets – that is the value of BP properties if they were sold today on eBay, for example – is still an awesome amount of money by any standard. So:
1. One of the first responses is already under way on stock markets, where BP shares have lost at least 60 percent of their value since the April 20 explosion. As investors dump their shares, the prospects of long-term credit damage to BP in having to pay for the cleanup and related lawsuits has even spooked the institutions that hedge their investments with credit-default swaps. BP has a first-quarter dividend payout due in a week or so. Chances are good that more than 15 million British pensioners are going to suffer the impact on their payouts as well, as BP holdings are a large part of pension-fund portfolios in the corporation’s home country. Sorry, folks.
2. Accountability has obviously not been a useful tool against BP thus far. Even before the oil-rig blowout, BP was the worst offender of all corporations in the United States in terms of its safety record, according to the Occupational Safety and Health Administration. OSHA had already accused BP of “willful violation” of its rules. Not counting the 11 deaths in the Gulf of Mexico disaster, BP had more work-related fatalities than any other company in the United States over the past decade, OSHA records show. Survivors of the Gulf of Mexico explosion have gone on record about the shoddy safety practices at that specific drilling site. But BP has oil and energy-exploration operations under way all over the world. BP public relations hacks have Hayward telling the world the company always puts safety first and foremost. Bullshit. Governments can, by executive order, have all those operations nationalized and shut down. Do it.
3. One way or another, United States taxpayers will be paying for the aftermath for many years. No matter how much BP may eventually be forced to pay toward the cost, it won’t be enough. Since BP is not, strictly speaking, a U.S. corporation (when taking into account the holdings that are part of the London-based BP corporate empire), let’s start with nationalizing all the U.S. assets of BP. By “all the U.S. assets,” I mean real estate, leaseholdings on exploration and exploitation within the territorial United States, hardware, pipe, storage tanks and vessels, office furnishings, toilet paper – all of it.
There are probably other steps that could be taken, but these three, I think, would be a good start.

Wednesday, June 02, 2010

Dogs & Suds

Over Memorial Day weekend, I satisfied (as best I could) a long-smoldering craving for chili dogs and root beer. The dogs were my own combination of chili, chopped onion and all-beef hot dogs on toasted whole-wheat rolls. The root beer came from a can, but at least I could come up with a frosted mug (Pour boiling water over the mug, then put it in the freezer compartment.)
Where I grew up, we had two A&W root beer stands, one on the north side of town, the other on the south side. Both made great Spanish hot dogs (chili dogs) and pumped that famous A&W root beer. I was happily surprised to find A&W root beer stands in Guam, Okinawa and the Philippines, too. Alas, the franchise has fallen on the same kind of hard times that wiped out other famous chains of the past (Howard Johnson's restaurants, once a Pennsylvania Turnpike treat, for example). Now, there is an A&W outlet beside a KFC (another once-good, now horrible food franchise) at one of the upper bench malls in Boise. But it's not the same.
I appreciate the background on the original A&W (see, and I do think the modern version of A&W root beer is not bad. But it just ain't the same. For one thing, the companies aren't even the same. The drive-in chain has become a "full-service" operation, absorbed by Yum! Brands (which also owns Long John Silver's pseudo-seafood outlets), and the classic root beer beverage is mixed in there with 7-Up and Dr. Pepper (two other beverages that lost their identity long ago too) under the cleverly named Dr. Pepper/7-Up Inc. corporate umbrella. I can come up with a pretty good chili dog on my own, (and I've written previously about how to make a version of Kentucky fried chicken that the Colonel might not think is nearly as bad as what comes out these days under the brand that sullies his name). But I am really not up to trying to make my own root beer. There are other brands (Dad's, Barq's, Nesbitt's and Nehi (both of which made all kinds of other flavored soda pops back in the day), Barrelhead, and Weinhard's (which I think is the best commercial root beer nowadays). But I sure do miss the kind that came out of those big ol' barrels at the A&W drive-inn. The car hops were cute too. But that's another story.