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February 17, 2011

Comments

john b

Not sure why "our role in the Megrahi affair" is all relevant here.

We shafted Megrahi when the Americans told us to, we unshafted him again in exchange for an oil deal once the Americans no longer needed Libya shafted - and then we took the blame after various blowhard US politicians, having learned that blaming BP for America's failings in the Gulf of Mexico went down well with the xenophobic rabble, decided to double-up that strategy (I imagine some terrifyingly high proportion of Americans still believe Libya was involved in Lockerbie...)

Now, if the British government were sensible, the lesson would be "Americans are duplicitous bastards and certainly not our best friends, so let's stop pretending they are". As it is, the lesson seems to be absolutely nothing.

But I don't see how any of this makes the UK's position towards Qaddafi different from anyone else's - he's a bastard who we don't like and who doesn't like us, but who currently controls lots of oil he needs to sell and we'd like to buy. We'd just as much rather he was swinging from the lamp-posts as everyone else, surely?

Myles

and then we took the blame after various blowhard US politicians, having learned that blaming BP for America's failings in the Gulf of Mexico went down well with the xenophobic rabble, decided to double-up that strategy

I always thought David Cameron's response on BP was disturbingly weak, given that BP pays out one-eighth of the dividends on LSE, after all.

Atlanta Roofing

It took a while, but Obama and Hillary spoke up meekly for the right of Egyptians to protest. Will they comment on the violence from the governments of Bahrain and Saudi Arabia?

ajay

That's actually the most cogent and relevant bit of spam I've ever seen. Atlanta Roofing has passed the Turing Test!

dsquared

If I'm ever in Atlanta and in need of a bit of roofing, I'll certainly check them out!

CharlieMcMenamin

Mason offers an intersting, if entirely speculative, take on the meaning of the current situation: he thinks it may be America's 'Suez Moment'.

ejh

Sorry, is anybody claiming that BP weren't substantially to blame for the Gulf of Mexico disaster, or are we just supposed to cheer them on because they're British?

ajay

ejh: the latter, I think. Myles (and Boris Johnson IIRC) took the view that the Americans were being nasty about BP out of xenophobia rather than out of a distaste for having the entire Redneck Riviera covered in an even layer of toxic sludge. Therefore, because they represent 12.5% of LSE dividend yield - and thus represent one-eighth of everything that is good and pure and righteous about England - we should have rallied round them.

john b

The point is more that BP was no worse in safety practices than its US rivals (or, indeed, the US companies that designed and operated its rig), were victims of the kind of bad luck that occurs sometimes when safety rules are dodgy, and were treated far more harshly than a domestic company would have been in the same situation.

ejh

Poor BP.

gastro george

Quite, it reminds me that Bob Diamond is the luckiest (and most sanguine) person alive for have avoided buying ABN-AMRO by the the skin of his teeth. A slightly better bid and he would have sunk Barclays instead of "earning" his millions.

ajay

were treated far more harshly than a domestic company would have been in the same situation.

[citation needed], I think. Exxon didn't exactly get away scot free after the Valdez oil spill, which was considerably smaller than the Deepwater Horizon spill. The only spill in recent history of similar size to Deepwater was the 1991 oil spills in the Gulf.


ejh

When I read - when I can bear to read - of the ruination of BP and its executives, I am often put in mind of the suffering of the Carthaginians.

ajay

You think there's some BP intern whose boss has sworn him to vengeance and who, in twenty years' time, will be marching on Washington, elephants and all?

Myles

Myles (and Boris Johnson IIRC) took the view that the Americans were being nasty about BP out of xenophobia rather than out of a distaste for having the entire Redneck Riviera covered in an even layer of toxic sludge.

I am not quite silly enough to believe that, actually. BP wasn't treated in a beastly way or anything; the Americans were, with the exception of the usually loony Congressmen, generally fair. They probably did treat BP a bit harsher than they would have a domestic company, but Tony Hayward's bumbling has a lot of the blame for that, and Congressional grandstanding takes the rest.

Therefore, because they represent 12.5% of LSE dividend yield - and thus represent one-eighth of everything that is good and pure and righteous about England - we should have rallied round them.

My problem wasn't that BP dividends were getting ruined, it's that David Cameron didn't even get a promise out of Obama that BP would under no circumstance be bankrupted. Practically speaking it made no difference this time, but if Congress had been bloody-minded it would entirely have been within the realm of possibility (I heard people seriously suggesting the seizing of BP's American assets). It would have been absolutely disastrous for the British economy and Britain at large, and wouldn't have done the Americans much good either.

There's a distinct difference between suspending dividends for a few years, and knocking out that big a chunk from the British markets. And David Cameron seemed not to have grasped that difference.

Myles

Sorry, should rephrase that last bit. It's not so much David Cameron didn't know the difference, it's that he's basically oblivious to the kind of tail-end risks emanating from the American political and legal systems, which could easily spin out of control.

ejh

David Cameron didn't even get a promise out of Obama that BP would under no circumstance be bankrupted.

1. How could he have done so? Sent a gunboat up the Potomac?

2. How would the US have bankrupted BP, given their absence of control over BP's non-US assets?

3. How many local people were bankrupted, do you think, as a consequence of BP's greed and negligence?

ajay

My problem wasn't that BP dividends were getting ruined, it's that David Cameron didn't even get a promise out of Obama that BP would under no circumstance be bankrupted.

And was BP in fact bankrupted? No. By ownership, it is almost as much a US company (39%) as a UK one (40%). Bankrupting BP would have meant US investors losing tens of billions of dollars - safe to say Obama wouldn't have wanted to do that.

You also seem a bit hazy on Obama's powers vis-a-vis the American legal system. If, say, a Louisiana court had ruled that all BP's assets in LA were forfeit as damages, what do you think Obama could have done about it?

Myles

1. How could he have done so? Sent a gunboat up the Potomac?

Appeal to Obama's common sense? Look, Cameron's the PM, and it's his job to make sure every contingency gets looked after. And the thing is, if you want to prevent things from possibly getting out of control, you want to douse the flames before they even get started.

2. How would the US have bankrupted BP, given their absence of control over BP's non-US assets?

Congressional action and (somewhat related) mass torts depending how how much Congress fiddles with the laws, and also depends on what part of BP's assets exactly were under US jurisdiction in one way or another.

3. How many local people were bankrupted, do you think, as a consequence of BP's greed and negligence?

Well they jolly well aren't getting compensated if BP goes under, are they?

ejh

Shorter Myles:

1. Waffle.

2. Waffle.

3. Who cares?

Myles

You also seem a bit hazy on Obama's powers vis-a-vis the American legal system. If, say, a Louisiana court had ruled that all BP's assets in LA were forfeit as damages, what do you think Obama could have done about it?

The Louisiana court is not, under then-existing laws, empowered to do such a thing, but Congress changed the laws immediately after the disaster, and the laws could have been changed in a way as to make such a seizure possible (and given the American court system, it was bound to happen somewhere). Cameron's job was to make American political actors (the biggest of which include Obama) understand that such a course would be inadvisable.

Myles

safe to say Obama wouldn't have wanted to do that.

Ah, but you are falling into the trap of the British mindset ("surely Americans wouldn't want to hurt themselves") about the American system again. Americans don't care as much; entire companies have been bankrupted by torts. They do have more room to assert the relevant legal and political principles than Britain does, and they assert them quite well. In the American mind, a company like BP going bust because of mistakes is just a part of life. Not to say I don't admire the mindset (I do), but it's simply much more viable given the size of the U.S. economy and investor base than in the British context.

After all, many Americans thought Detroit should have been fully liquidated. Imagine the comparable British response.

Chris Williams

Memo to self - DC's job includes the task of asking foreign governments to bullet-proof UK assets. Myles - you ever heard of the China River Judgement (China Navigation Company 1930)? This is the kind of shit that never happened even when the UK was a superpower.

Myles

Myles - you ever heard of the China River Judgement (China Navigation Company 1930)?

I tried googling it and can't find anything. Link?

Cian

For fuck's sake. The Obama administration has bent over backwards to protect BP. They've lied for them, muzzled experts, done their best to cap damages, limit the political damage, done their best to limit access from activists/locals/journalists to the damage.

chris williams

CHINA NAVIGATION COMPANY, LIMITED v. ATTORNEY-GENERAL. [1930. C. 2497.]

There is no legal duty on the Crown to afford by its military forces protection to British subjects in foreign parts. If, in the exercise of its discretion, the Crown decides to afford such protection, it may lawfully stipulate that it will do so only on the condition that the cost shall be borne by those asking for it.

Myles

There is no legal duty on the Crown to afford by its military forces protection to British subjects in foreign parts.

Fair enough. This was an extremely tangential issue, given that the American government acted extremely reasonably toward BP, so I am not about to sob about injustices at the hand of Obama or any such nonsense.

I am just slightly annoyed with Cameron, who seems to have a thing for vacuity.

john b

Myles is absolutely right about the capacity of the US judicial system to engage in monumentally stupid, value-destroying and capricious acts for no discernible reason.

3. How many local people were bankrupted, do you think, as a consequence of BP's greed and negligence?

Easy: none. Everyone's going to be (and was always going to be be) generously compensated for the disaster's impact.

They've lied for them, muzzled experts, done their best to cap damages, limit the political damage, done their best to limit access from activists/locals/journalists to the damage

[citation needed]

ejh

Easy: none. Everyone's going to be (and was always going to be be) generously compensated for the disaster's impact.

[citation needed]

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