Before President Obama appointed him to administer the $20 billion compensation fund for the 2010 BP oil disaster, Kenneth Feinberg ran two other disaster-related funds. One was for Vietnam veterans sickened by exposure to the toxic herbicide Agent Orange. The other was for victims of the 9/11 terrorist attacks, including those made ill by pollution from the collapse and burning of the Twin Towers.
But there's a big difference in how Feinberg, a Washington attorney, ran the two earlier funds compared to the BP fund, and it's detailed in a new report [pdf] by Advocates for Environmental Human Rights (AEHR), a New Orleans nonprofit. In the case of the Agent Orange Settlement Fund and the 9/11 Victims Compensation Fund, Feinberg didn't require medical proof of causation -- that is, that claimants' exposure to the toxins directly caused their illness. Instead, those funds required only that claimants show they were in the vicinity where harmful chemicals were present and had a related medically-diagnosed illness or disability related to the exposure.
Today marks nine months since the BP Deepwater Horizon offshore oil rig exploded, killing 11 workers and sending millions of gallons of crude oil pouring into the Gulf of Mexico.
Though the gushing well was capped last July, oil continues to wash ashore along the Gulf Coast. BP's oil is also washing up in people's bodies, raising concerns about long-term health effects.
The Deepwater Horizon disaster was the result of mistakes that call into question the entire oil industry's safety culture and demand better regulation.
So concludes the final report from the National Commission on the BP Deepwater Horizon Oil Spill released yesterday. The nonpartisan commission found that the initial explosion on the rig -- which killed 11 workers and resulted in the uncontrolled release of millions of gallons of toxic crude into the Gulf of Mexico -- could have been prevented.
Independent testing has turned up oil contamination in Gulf seafood, raising concerns that federal officials prematurely pronounced it OK to eat.
The Lower Mississippi Riverkeeper (LMRK) has released results from seafood sampling trips conducted along a broad area of the Louisiana coast since August. The results show significant levels of petroleum in a number of species -- though the contamination was not apparent by sight or smell.
For examples, levels of total petroleum hydrocarbons in flounder and speckled trout caught in St. Bernard Parish on Aug. 12 were 21,575 milligrams per kilogram, while oysters caught in Plaquemines Parish on Aug. 3 showed levels at 12,500 mg/kg. Petroleum levels found in fiddler crabs and periwinkles harvested from Terrebonne Parish on Aug. 19 were 6,916 mg/kg.
As the 111th Congress of the United States of America draws to a close there is a unique opportunity for assisting the ongoing struggle for full recovery of the Gulf Coast. The region, battered by the 2005 hurricane season, which was led by Hurricane Katrina, the largest and most expensive disaster in the history of country and followed by several smaller hurricanes, was struck by disaster once again this year with the BP oil drilling disaster. The BP disaster set back all recovery efforts by creating massive destruction of environment, livelihoods, culture and health.
A new document uncovered last week might help to clear up some confusion over comments made by the President's Oil Spill Commission earlier this month when its chief counsel, Fred Bartlit Jr., said, "To date we have not seen a single instance where a human being made a conscious decision to favor dollars over safety."
Yesterday the government's oil spill panel released a letter alleging that Halliburton knew of potential flaws in its cement prior to the Deepwater Horizon blowout. That same spill commission, in a little-noticed report by the New Orleans Times-Picayune, had earlier this week criticized government inspectors for their lack of knowledge about how to safely cement an offshore well.
"When we asked about cementing and centralizers, they said very freely, 'We don't know about that stuff; we have to trust the companies,'" the commission's co-chairman, William Reilly, told the Times-Picayune. "All they get is on-the-job training. It really is fairly startling, considering how sophisticated the industry has become."
We've noted such problems within the Minerals Management Service -- the regulatory agency responsible for inspecting offshore drilling rigs -- including its shortage of inspectors, reliance on industry to self-police, and history of ethical violations, some of which occurred as recently as 2008.
Cross posted from an article by Sasha Chavkin of ProPublica on Facing South.
Five weeks after taking over the oil spill damage claims from BP, and after widespread criticism of delays in processing applications, claims czar Kenneth Feinberg said his operation had eliminated the backlog of older claims that had been sitting in the system unpaid.
Cross-posted from an article by Chris Kromm on Facing South
In his speech from New Orleans on the fifth anniversary of Katrina yesterday, President Obama declared that he intended to honor the nation's promise to help rebuild the Gulf Coast:
[W]hile an incredible amount of progress has been made, on this fifth anniversary, I wanted to come here and tell the people of this city directly: My administration is going to stand with you -- and fight alongside you -- until the job is done. Until New Orleans is all the way back, all the way.
Cross-posted from an article by Chris Kromm on Facing South
As we approach the five year anniversary of Hurricane Katrina, today the Institute for Southern Studies is releasing a new report which looks at what has changed -- and what hasn't changed -- since the deadly storm took over 1,800 lives and devastated the Gulf Coast.
Today Congressman and Democratic Challenger to Senator Vitter, Charlie Melancon called on the Senate to finish their work before they leave town.
At issue is the bill that passed in the House but is left inside a huge stack of bills in the Senate.This bill would effectively end the moratorium for those rigs who are meeting or exceeding their responsibilities to operate safely and would provide over $1.2 Billion in penalties against BP that would be directed to Costal Restoration projects.It appears that these bills are caught up in politics and not what is best for Louisiana.
SHOULD THE FEDS MAKE LOUISIANA A PROTECTORATE?
HELL YES!
Roseanne Roseannadanna summed it up pretty well in trying to make sense out of the trials and tribulations of Louisiana. "Well, it just goes to show you, it's always something." Now we are hearing cries that Louisiana is unable to take care of all its problems, and should be treated differently than other states in the U.S. Make it a protectorate of the federal government. And you know what? Maybe that ain't too bad of an idea.
The proposal took legs early this week when nationally syndicated columnist Froma Harrop, who is an editor for the Providence Journal, broached the idea in print. "Louisiana has had more than its share of tragedies in recent years, and some, such as hurricane Katrina, could be deemed an act of nature. But whatever the cause, every calamity that befalls Louisiana is made worse by a corrupt civic nature. A protectorate could provide the structure of government people need."
England, Scotland, and Ireland were all protectorates at one time. There is a major move on in Europe today to take Greece under a European protectorate. In Great Britain, a debate is taking place as to whether the Falkland Islands, presently under the wing of the British, should be cut loose as a protectorate and join up with neighboring Argentina.
But in most of these past and present instances, the so called protectorate was receiving much more in financial aid from their respective overseers than the country or state being protected was contributing. Not so in Louisiana. Yes, you will read about all the federal dollars that has been flowing into the Bayou State, particularly post Katrina. But whatever federal sums have been allocated is a drop in the bucket when you add up the massive mineral resources that have been drained from the state.
When it comes to receiving federal dollars in other areas, Louisiana often gets the short end of the stick. Louisiana taxpayers subsidize numerous programs that proportionately benefit other parts of the country significantly more. Here are a few examples:
Federal highway funds. A federal gas tax is charged on every gallon of gasoline that goes into a national highway fund to build highways. For years, a formula has been used to distribute the money that has worked against Louisiana. For every dollar we send to Washington, Louisiana taxpayers are getting a little more that ninety cents back. California receives $1.30 back for every dollar they send in, as is the same for most of the states along the east coast. Louisiana taxpayers are subsidizing roads and bicycle trails throughout California, New York and many other states. A report released last week pointing out the Louisiana is tremendously underfunded in its effort to improve the quality of our roads. One big reason is that the state is paying substantially more into the federal pot that it is getting out.
Louisiana receives federal reimbursement to nursing homes that take care of the poor under the Medicaid program. But the formula works dramatically against Louisiana nursing homes. Where patients in New York nursing homes receive reimbursement of $175.00 a day, the same patient in Louisiana only receives $79.00 a day. Some states are receiving four times what Louisiana gets. Alaska, for example, receives $317.00 per day for Medicaid patient reimbursement. Louisiana has the lowest reimbursement amount in the country.
So maybe the east coast columnist is right. Louisiana might be much better off if it did become a protectorate. There is ample support throughout the country for states considering the option of becoming independent. Just this week, a national Rasmussen poll found that 28% of Americans believe it is at least somewhat likely that some states will try to leave the United States and form an independent country over the next 25 years or so.
How about this! Louisiana becomes an independent protectorate of the U.S., with Washington providing all the international protection like they do for Canada and Mexico. Sure the U.S. can continue to use the port of New Orleans (largest port in the nation), as well as Baton Rouge (third largest in tonnage) and Lake Charles (5th largest in tonnage), but of course there would be fees similar to those charged in other international ports. The oil and gas would continue to flow to the rest of the country, but with adequate severance and processing fees for the quite reasonable sum of five to seven billion dollars (much less than the importation charges the country is paying OPEC countries now.) No more groveling for a small share of offshore oil payouts.
Mississippi might also want to join in the protectorate effort. The two states might even agree to create a "coastal nation of Louisissippi." The French would be appalled, but who cares.
So who is going to run this new protectorate? The test , knows how to get results? Walking the walk rather than talking the talk. There really are only two candidates for the job. One is former Army General Russell Honore.' He's the "John Wayne dude" who blew into New Orleans post Katrina and took charge of the disastrous recovery efforts. He lives in Baton Rouge and seems to be well rested and ready. And right in contention is New Orleans Saints Head Coach Sean Payton. Now he does know how to get the job done.
The Ambassador to Washington? The "Ragin Cajun," James Carville is the man to demand fair respect for the Bayou State in the nation's capitol. Also an easy choice is the treasury secretary. New Orleans Saints owner Tom Benson is, hands down, the best guy to go after the foreign aid. He is Louisiana's greatest robber baron, having talked the Louisiana Legislature out of over $500 million dollars. Remember that no other NFL team has received a penny from their respective states. He's definitely the man to go after and handle the money.
The state flag would be a combination of black, purple and gold. And of course native born Randy Newman should write the national anthem. Froma Harrop's column called Louisiana the best run state in the Caribbean. Maybe she's right, and we should give it a try. Protect Louisiana's borders and let it keep all its minerals. If you look at the numbers, I have a hunch that any redneck or Cajun would jump at such a deal.
*****
"There is growing sentiment throughout the North in favor of letting the Gulf States go."
The New York Times (March 21, 1861)
Peace and Justice
Jim Brown
Jim Brown's syndicated column appears each week in numerous newspapers and websites throughout the South. You can read all is past columns and see continuing updates at www.jimbrownla.com. You can also hear Jim's nationally syndicated radio show each Sunday morning from 9 am till 11:00 am central time on the Genesis Radio Network, with a live stream at http://www.jimbrownusa.com.
"And if thou stare long enough into an abyss,
The abyss will also gaze into thee."
Nietzsche
Melville's Moby Dick is a popular semblance right now for our unquenchable search for oil, and, like Captain Ahab, the consequences that often lead to self destruction. In days of old, whalers ventured further and further into unchartered waters to become excavators of oceanic whale oil that stroked the furnaces of the Industrial Revolution. The same unchartered path has been followed by oil companies pushing technology to new limits. But are they responsibility assessing the risk involved?
The BP gang has continually told us that such a spill never happened before, and therefore they had not anticipated such bleak scenario. That's the same argument we heard during the financial meltdown from Ben Bernanke and Alan Greenspan when they argued that the housing market would not plummet because "it had never happened before." But stuff happens. Part of the process is to assess the risk. Time and time again, both industry and government have minimized risk and, in a highly irresponsible way, just played the odds. And much too often, it has turned out to be a bad bet.
Lay the blame for BP's irresponsible risk taking right at the feet of the United States Congress. Our representatives in Washington passed a little known 1990 law that capped an oil company's liability, after cleanup costs, at $75 million. For now at least BP has agreed to waive the cap. But who knows for how long? BP stockholders, many of whom have retired on BP dividends, may well feel full justification to challenge disbursement of BP assets when the law says the company is not required to do so.
The federal law limiting BPs liability actually distorts the company's decision making, so they can ignore the potential damage beyond cleanup costs. It is low probability, high cost, and with legal limits that have been put in to place, you and I are the real losers. How ironic that government policy encourages BP and the financial industry to underestimate the odds of a catastrophe.
In the financial sector, no single example better serves to show how the dice are rolled against the public interest than A.I.G. This insurance giant, which happens to be the single largest insurance conglomerate operating in my home state of Louisiana, ran amok forcing taxpayers to come to its rescue at a price of some $185 billion. This massive insurance bailout was fueled by U.S. Treasurer Tim Geithner's testimony that the failure of A.I.G would threaten to bring down the entire financial system.
The company was playing "Wall Street Casino" by insuring financial instruments that were, in the warped opinion of the companies' officers, "sure winners." And as long as state insurance commissioners failed to examine the company's books and turned a blind eye to pervasive faulty accounting, A.I.G had free reign to lend and spend, running up massive financial debt that was significantly beyond its ability to pay in case of defaults. Just last week, a new study released by McClatchy Newspapers found that insurance commissioners had "broken all the rules" by allowing A.I.G to continually defy regulatory oversight and become a "corporate Frankenstein."
Former Louisiana chief insurance examiner W.O. Myrick, who has extensively studied the A.I.G. debacle, criticized state insurance commissioners for allowing companies like A.I.G. to cook their books and "falsify" their balance sheets by continuing to list bonds as assets while they were loaned to banks. Had something been done by insurance regulators at the time of A.I.G.'s shenanigans, according to Myrick: "There would have been people that would have been speaking up to avoid long prison terms, leading to action that could have prevented the massive securities losses."
In each of these cases, neither the regulators, nor those being regulated did anywhere close to an adequate job of estimating the risks involved. Many companies ended up incurring enormous costs both in money, and, in the case of BP, environmental destruction. The odds normally would not justify such a risk. But with the government backing up these calamities with bailouts and laws that gave perpetrators limited liability, why not go for broke? Companies like BP and A.I.G. did just that, and we as tax payers are the real losers.
With BP's financial picture looking more precarious as each day goes by, how can those damaged be assured that losses will be recovered? Waiting around for payment, or possible bankruptcy, raises the possibility that, just like the Exxon Valdez disaster, the reimbursement process could go on for years. So what can be done to assure adequate recompense?
Simply seize the gushing oil well. It will eventually be capped, and there is a projected $70 billion of oil yet to come from this crippled hole in the ocean floor. Remember that BP is only leasing the drilling rights, and they have certainly and repeatedly violated the terms of the lease. The Minerals Management Service has the legal authority to terminate the lease due to the numerous safety and environmental violations incurred by the lessor, BP. Sure litigation will take place. But the value is there, and a number of legal scholars have concluded that the federal government has strong legal standing to take the well back.
Two things lulled BP into ignoring the possibility of a major catastrophic spill. First, these disasters rarely happen. It's the proverbial "black swan" theory. In ancient literature, a black swan was a proverbial phrase for something extremely rare or non-existent. Certainly a good metaphor for the mindset of both BP and federal regulators. But this ignores the basic premise we all know as Murphy's Law. "Anything that can go wrong, will go wrong". Then knowing full well their liabilities were limited by federal law, why not just go for broke?
The envelope has being pushed by Wall Street and now Big Oil. They rolled the dice and lost. But under our dysfunctional federal and state regulatory systems, it's the taxpayers who are the losers.
*****
"Living at risk is jumping off the cliff and building your wings on the way down."
- Ray Bradbury
Peace and Justice
Jim Brown
Jim Brown's syndicated column appears each week in numerous newspapers and websites throughout the South. You can read all is past columns and see continuing updates at www.jimbrownla.com. You can also hear Jim's nationally syndicated radio show each Sunday morning from 9 am till 11:00 am central time on the Genesis Radio Network, with a live stream at http://www.jimbrownusa.com.
It is by now obvious that even after we stop the gentle trickle of oil that's currently expressing itself into the Gulf of Mexico (thank you so much, BP) we are not going to be able to get that oil out of the water for some considerable length of time--and if you think it could take years, I wouldn't bet against you.
While BP is the legally responsible party, out on the water it will be up to the Coast Guard to manage the Federal response, and to determine that BP is running things in a way that gets the work done not only correctly and safely, but, in a world of limited resources, efficiently.
Which brings us to the obvious question: can the Coast Guard manage such a complex undertaking?
While we hope they can, you need to know that the Coast Guard has been trying to manage the replacement of their fleet of ships and aircraft for about a decade now...and the results have been so stunningly bad that you and I are now the proud owners of a small flotilla of ships that can never be used, because if they go to sea, they might literally break into pieces.
It's an awful story, and before we're done you'll understand why Deepwater was already an ugly word around Headquarters, years before that oil rig blew up.
If you destroy British Petroleum, then who is the real loser?
British Petroleum, the overseas oil giant, is under siege from every direction as they struggle to cap the massive Gulf oil spill. The BP stock price has plummeted 25% since the start of the spill, and company officials have been hauled daily before a litany of federal and state regulatory and legislative committees. It's hard to keep track of the numerous daily lawsuits that have been filed all along the Gulf Coast. And in the latest salvo, Attorney General Eric Holder launched a criminal investigation, noting that there is "a wide` range of possible criminal violations." But if BP collapses under the weight of all this cross fire, who are the real losers?
How about quite buying BP gasoline? Ralph Nader's consumer-advocacy group Public Citizen is calling for a national moratorium to boycott BP gas stations. You can go to Facebook where thousands of members swear to bypass any BP retail outlets. But most of the BP service stations are independently owned, so a boycott hurts individual retailers who live in the local community that is doing the boycotting. Does this really hurt the BP corporate entity that operates internationally?
The criminal investigation and more below the jump...
Baton Rouge (FNS)-Facing both a massive oil slick from a sunken offshore drilling platform and a second year of declining tourism revenues along the Louisiana Gulf Coast caused by high gas prices, Louisiana Governor Bobby Jindal today introduced a new tourism promotion that he reports is going to "...make lemons into lemonade".
Jindal, flanked by British Petroleum's Director of Marketing Dick Timoneous and the Executive Director of the Louisiana State Tourism Board, Jenna Talia, announced that the "All The Oil You Can Carry Festival" would officially commence today just east of New Orleans, and last at least through the month of May.
Today Congressman and Democratic Challenger to Senator Vitter, Charlie Melancon called on the Senate to finish their work before they leave town. 
