Various stories and columns bandy about the disaster recovery plans of oil companies reference to walruses, which have not existed in the Gulf of Mexico for 3 million years.
The Atlantic: companies' plans for a similar disaster were basically 'cookie cutter' copies of BP's spill plan, all prepared by the same group, the Response Group. The plans include an assessment of the impact of a possible spill on walruses (which don't live in the Gulf) and the phone number of an expert who died in 2005 (well before the plans were submitted). 'ExxonMobil, Chevron, ConocoPhillips, and Shell are as unprepared as BP,' said Rep. Henry Waxman (D-Calif.). 'The only technology you seem to be relying on is the Xerox machine,' echoed Rep. Ed Markey (D-Mass.)."
Gail Collins: At the ritual Congressional lashing of C.E.O.’s this week, we learned that none of the major oil companies have any idea how to control a spill like this, and that their faux plans for handling one in the gulf were made up of boilerplate so undigested that several had sections on protecting walruses — mammals that have not been seen in the area since the Ice Age. “It’s unfortunate that walruses were included,” admitted Exxon Mobil’s chief.
ABC News (Australia): ExxonMobil ridiculed for walrus oil spill plan. ExxonMobil in particular was ridiculed for including plans to deal with walruses - an animal whose range is confined to the Arctic - in its plans for a Gulf of Mexico oil spill.
Thursday, June 17, 2010
I know what to buy, or short
Lawmakers Bet on Firms They Oversaw
In 2009, amid the federal government's most aggressive intervention in the U.S. economy in decades, some members of key congressional committees placed bets with their own money on the stocks of companies they helped oversee, according to a preliminary analysis by The Wall Street Journal of public disclosure filings made public Wednesday.
The Journal has reported that some members of Congress or their spouses made bets during 2008 that U.S. stocks and bonds would fall in value. There isn't evidence that any of the 2009 trades identified by the Journal involved nonpublic information or broke any laws. Members of both parties and both chambers traded regularly, although in some cases the trades were made by spouses rather than by the legislators themselves. Whereas many government officials are prohibited from making certain types of investments in which they might have a conflict of interest, members of Congress face relatively few restrictions.
Under the codes of ethics set by the House and Senate, members are generally free to trade stocks or other securities—and to "sell short," or bet that investments will fall in price—even in the case of companies whose fortunes may be directly influenced by legislative actions.
Nice way to make a living.
In 2009, amid the federal government's most aggressive intervention in the U.S. economy in decades, some members of key congressional committees placed bets with their own money on the stocks of companies they helped oversee, according to a preliminary analysis by The Wall Street Journal of public disclosure filings made public Wednesday.
The Journal has reported that some members of Congress or their spouses made bets during 2008 that U.S. stocks and bonds would fall in value. There isn't evidence that any of the 2009 trades identified by the Journal involved nonpublic information or broke any laws. Members of both parties and both chambers traded regularly, although in some cases the trades were made by spouses rather than by the legislators themselves. Whereas many government officials are prohibited from making certain types of investments in which they might have a conflict of interest, members of Congress face relatively few restrictions.
Under the codes of ethics set by the House and Senate, members are generally free to trade stocks or other securities—and to "sell short," or bet that investments will fall in price—even in the case of companies whose fortunes may be directly influenced by legislative actions.
Nice way to make a living.
Unbalanced and opinionated
Typical Wall Street Journal slant on the news.
BP PLC, under intense legal and political pressure from President Barack Obama, agreed Wednesday to put $20 billion into a fund to compensate victims of the Gulf oil spill, and said it would cancel shareholder dividends for the first three quarters of this year to offset that cost. BP said it would pay another $100 million to a separate fund to help oil-industry workers sidelined by the Obama administration's moratorium on deepwater drilling.
The payments far exceed the letter of U.S. law, which caps economic liabilities in oil spills at just $75 million. BP agreed to waive that limit. In a pact hammered out in a four-hour White House bargaining session, BP agreed to "set aside" $20 billion in U.S. assets as a guarantee that it would make good on the promised $20 billion in cash by 2013.
The deal is the latest in a series of interventions by the Obama administration in the operations of private businesses in crisis. Mr. Obama sent an emissary to demand that the then-head of General Motors Corp., Rick Wagoner, resign prior to the government-led rescue of GM. The administration has pressed Wall Street banks in the aftermath of the financial crisis, calling for sharp cuts in executive pay.
If GM was to receive taxpayer funds, the government had a legitimate right to write conditions on disbursing said funds. It is more than the Administration that has pressed for cuts in executive pay; Congress and the public have, too.
BP PLC, under intense legal and political pressure from President Barack Obama, agreed Wednesday to put $20 billion into a fund to compensate victims of the Gulf oil spill, and said it would cancel shareholder dividends for the first three quarters of this year to offset that cost. BP said it would pay another $100 million to a separate fund to help oil-industry workers sidelined by the Obama administration's moratorium on deepwater drilling.
The payments far exceed the letter of U.S. law, which caps economic liabilities in oil spills at just $75 million. BP agreed to waive that limit. In a pact hammered out in a four-hour White House bargaining session, BP agreed to "set aside" $20 billion in U.S. assets as a guarantee that it would make good on the promised $20 billion in cash by 2013.
The deal is the latest in a series of interventions by the Obama administration in the operations of private businesses in crisis. Mr. Obama sent an emissary to demand that the then-head of General Motors Corp., Rick Wagoner, resign prior to the government-led rescue of GM. The administration has pressed Wall Street banks in the aftermath of the financial crisis, calling for sharp cuts in executive pay.
If GM was to receive taxpayer funds, the government had a legitimate right to write conditions on disbursing said funds. It is more than the Administration that has pressed for cuts in executive pay; Congress and the public have, too.
Wednesday, June 16, 2010
Obama Goes Small
Quick impression: the president went a good way toward reasserting that he is in charge and BP is trouble. The no-nonsense tone, martial imagery ("battle plan"), the three-part plan, the identification of a bad guy (BP's CEO) who is going to be dealt with sternly, who was scolded for "recklessness," and whose company will be paying for the cleanup and damage--not asked, but told to pay, evidently--all of this was good theatrics, and moderately reassuring. But the address struck me as notably defensive in places, such as when the president tried to explain away why he so confidently, and rather arrogantly, proposed to expand offshore drilling while waving away concerns just three weeks before the explosion. Obama said he was "under the assurance that it would be absolutely safe," which seems like buck-passing to whatever experts were whispering in his ear. I'm all in favor of the moratorium on drilling, a national commission to understand the causes of this disaster, and the idea that we need to move toward developing sources of clean energy. But I thought Obama reached for some pretty cheap platitudes on the latter point. "Seizing the moment," invoking World War II vets and the moon landing are all well and good, but it rang pretty hollow to me. What stood out was that for all his praise of the House climate bill and talk about the "consequences of inaction" and so forth, not once did he utter the phrase, "It's time to put a price on carbon." And that suggests to me that this speech was primarily about containing the damage to his administration, and was not the pivot point in the energy debate that many people were hoping for.
Joshua Green in The Atlantic.
The president says he was assured? Goodness, me, even the president is covering his ass; but, he can't, he's in charge.
Joshua Green in The Atlantic.
The president says he was assured? Goodness, me, even the president is covering his ass; but, he can't, he's in charge.
Tuesday, June 15, 2010
UAW Fund: $45 Billion For Investing
"... a newly independent fund born out of the remaking of the Detroit auto business three years ago is busy figuring out where to place its roughly $45 billion in assets. That doesn't include ownership stakes in two of the three U.S. auto makers. The new pool is sure to tantalize money managers across the country, some of which, like BlackRock Inc., have already gotten business from the fund, called the UAW Retiree Medical Benefits Trust. The trust has put out requests for proposals to manage parts of its global stocks and fixed-income portfolios.
In contrast, Calpers had assets of $193 billion as of 9 June 2010.
Known as a VEBA, for voluntary employee beneficiary association, in January the trust became one of the world's largest such funds after accepting large stakes in General Motors Co., Ford Motor Co. and Chrysler Group LLC as part of a cost-cutting deal with the auto makers. The VEBA relieves the car companies of responsibility of lifelong health-care benefits for 800,000 retired auto workers and their spouses.
The fund trust still owns 68% of Chrysler common stock and 17.5% of GM common stock plus warrants for an additional 2.5%. Because of its holdings, the VEBA has a seat on each company's board, giving the union a voice in the running of the companies through the trust.
To create the UAW VEBA, GM transferred $23.6 billion while Ford contributed $15 billion and Chrysler handed over $6.8 billion. Those payments are in addition to the common stock and warrants awarded at each of the car companies to the trust.
In his retirement speech at Cobo Hall in downtown Detroit on Monday, UAW President Ron Gettelfinger credited the creation of the VEBA with helping the auto makers survive the sharp downturn in auto sales in 2008 and emerge from the bankruptcies at Chrysler and GM last year.
He said that the union was able to preserve most of the health-care benefits for retirees, concluding that "this was unprecedented" during a time of bankruptcy reorganization.
Mr. Henry declined to say whether the current level of benefits could be sustained in the decades to come.
"The UAW Retiree Medical Benefits Trust has sufficient assets to provide medical benefits to all covered retirees for the foreseeable future," Mr. Henry wrote in the email exchange. "Our operation commenced just over five months ago and we are still gathering data on our short history of benefit payments."
In contrast, Calpers had assets of $193 billion as of 9 June 2010.
Known as a VEBA, for voluntary employee beneficiary association, in January the trust became one of the world's largest such funds after accepting large stakes in General Motors Co., Ford Motor Co. and Chrysler Group LLC as part of a cost-cutting deal with the auto makers. The VEBA relieves the car companies of responsibility of lifelong health-care benefits for 800,000 retired auto workers and their spouses.
The fund trust still owns 68% of Chrysler common stock and 17.5% of GM common stock plus warrants for an additional 2.5%. Because of its holdings, the VEBA has a seat on each company's board, giving the union a voice in the running of the companies through the trust.
To create the UAW VEBA, GM transferred $23.6 billion while Ford contributed $15 billion and Chrysler handed over $6.8 billion. Those payments are in addition to the common stock and warrants awarded at each of the car companies to the trust.
In his retirement speech at Cobo Hall in downtown Detroit on Monday, UAW President Ron Gettelfinger credited the creation of the VEBA with helping the auto makers survive the sharp downturn in auto sales in 2008 and emerge from the bankruptcies at Chrysler and GM last year.
He said that the union was able to preserve most of the health-care benefits for retirees, concluding that "this was unprecedented" during a time of bankruptcy reorganization.
Mr. Henry declined to say whether the current level of benefits could be sustained in the decades to come.
"The UAW Retiree Medical Benefits Trust has sufficient assets to provide medical benefits to all covered retirees for the foreseeable future," Mr. Henry wrote in the email exchange. "Our operation commenced just over five months ago and we are still gathering data on our short history of benefit payments."
Saturday, June 12, 2010
The Courage to Leave, by Bob Herbert
There is no good news coming out of the depressing and endless war in Afghanistan. There once was merit to our incursion there, but that was long ago. Now we’re just going through the tragic motions, flailing at this and that, with no real strategy or decent end in sight.
The U.S. doesn’t win wars anymore. We just funnel the stressed and underpaid troops in and out of the combat zones, while all the while showering taxpayer billions on the contractors and giant corporations that view the horrors of war as a heaven-sent bonanza. BP, as we’ve been told repeatedly recently, is one of the largest suppliers of fuel to the wartime U.S. military.
What’s happening in Afghanistan is not only tragic, it’s embarrassing. The American troops will fight, but the Afghan troops who are supposed to be their allies are a lost cause. The government of President Hamid Karzai is breathtakingly corrupt and incompetent — and widely unpopular to boot. And now, as The Times’s Dexter Filkins is reporting, the erratic Mr. Karzai seems to be giving up hope that the U.S. can prevail in the war and is making nice with the Taliban.
There is no overall game plan, no real strategy or coherent goals, to guide the fighting of U.S. forces. It’s just a mind-numbing, soul-chilling, body-destroying slog, month after month, year after pointless year.The truth is that top American officials do not believe the war can be won but do not know how to end it. So we get gibberish about empowering the unempowerable Afghan forces and rebuilding a hopelessly corrupt and incompetent civil society.
Ultimately, the public is at fault for this catastrophe in Afghanistan, where more than 1,000 G.I.’s have now lost their lives. If we don’t have the courage as a people to fight and share in the sacrifices when our nation is at war, if we’re unwilling to seriously think about the war and hold our leaders accountable for the way it is conducted, if we’re not even willing to pay for it, then we should at least have the courage to pull our valiant forces out of it.
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