A week ago I criticised the US media for childishly demanding that President Barack Obama "just do something" about the oil spill in the Gulf of Mexico, observing there was much to be said for a leader who stayed calm in a crisis. Next day, no doubt as a result, Obama became pointedly less calm.
He dialled up the invective against BP — which he likes to call by its old name, British Petroleum, to underline the company's alien perfidy.
The US outcry against the company is still building, and the administration, intent on deflecting its critics, has put itself in the vanguard. Criminal investigations and efforts to remove a statutory cap on the company's liability are under way. It is ominous lawyers are working hard, with the administration's blessing, to enlarge the very concept of civil liability.
Given the extraordinary importance of BP for the UK stock market, the stakes are huge, and the row might easily open a rift between Obama and the new government in London. But if a serious falling out is to be avoided, it is the Brits more than the Americans who need to be careful.
A US media frenzy is a disgusting thing to watch. Even so, in all this I have no sympathy for either BP or for those in Britain who are complaining about a surge in anti-British rhetoric. That kind of whining does not play well in the US.
Imagine that Exxon Mobil had spent weeks dumping 30,000 barrels of oil a day (the newest estimate, double the previous one: seven Exxon Valdez spills so far and counting) on the British shoreline, with no end yet in sight. This does not do justice to the gravity of the emergency in the US, by the way, since the coastline in question is especially sensitive both in environmental and in economic terms.
Dominant position
Imagine that the company had dithered, dissembled and obfuscated from the outset. Imagine its chief executive had said the environmental impact would be small, and that he and his company, they are American, they know what they are doing, would take care of it. Might there be just a little anti-Exxon, and anti-American, feeling? Well, the idea is unthinkable.
The British press points out that BP has a dominant position in the stock market and that pensioners depend on its dividends. What is one to conclude? The bigger the company, the smaller its obligation to make good the damage it has done? Those pensioners own a company that has caused the biggest environmental disaster the US has ever experienced. Someone must bear the costs of this calamity. Is it the innocent victims who should pay rather than the company's owners — who, being pensioners, should be excused? The notion is not just indefensible, it is laughable.
The proper extent of BP's liability is, admittedly, unclear. The issue will be before the courts for years, if not decades. Under US law, BP must pay all the clean-up costs. Congress and the administration are going through the motions of removing a $75 million (Dh275 million) cap on some other damages — but this does not apply to state-law tort actions and is void anyway if a company has been negligent or has broken rules. It is inconceivable that any US court would rule otherwise in this case. BP says it will pay up. Its damages may in the end run into the tens of billions of dollars.
Since that crippling blow is going to fall, you could argue there is no need for the administration to push the liability envelope. It has decided to push it anyway. Ken Salazar, the interior secretary, has told Congress BP must pay the wages of oil-service workers laid off as a result of the drilling moratorium imposed when the spill began.
The administration is saying that liability extends beyond direct victims of the accident to victims of the regulatory consequences of the accident. Suppose deepwater drilling in the Gulf were henceforth banned. Would BP be liable in perpetuity for jobs lost as a result?
Politically foolish
The question of whether even this company's mighty resources are adequate to meet these demands cannot be dismissed. In such circumstances, I cannot see why BP has hesitated to suspend its dividend. The idea that it can take this calamity in its stride and proceed on the basis of business as usual is absurd, and politically foolish too, since it is a provocation to critics intent on vengeance.
The Gulf disaster will have far-reaching economic and energy-policy implications. But British complaints that BP is being "scapegoated" will not help reason to prevail. Let us not add insult to injury.
