# Why would Republicans object to the $20 billion BP clean-up fund? **URL:** \ **Category:** Great Debates\ **Created:** [June 18, 2010, 1:49am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634 "2010-06-18T01:49:34Z")\ **Posts on this page:** 20\ **Page:** 7
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:08am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/121 "2010-06-22T03:08:38Z")
> [@GIGObuster](#): > > Well, there is that, I was going to say that IMHO many \*\*are \*\*giving credit to BP for the fund, it is a good chunk of Republicans and right wing gasbags that are livid and not giving credit to BP. Not me so much. If they were coerced or forced into it, they really don’t deserve any credit, do they? If this insulates them from a greater liability than it’s actually self-serving and a negative. Thole thing doesn’t make much sense. BP has according to CNN spent 6 billion so far in trying to fix this. That’s in two months. It seems to me that the costs in cleaning this up and fixing it are right now. Why is this being spread out over five or six years? Aren’t the major costs now? Won’t money spent now ameliorate some of the future consequences.? How will giving a billion dollars a quarter for the next five years solve a 3 billion dollar a month current crisis? What’s the fucking point of this thing? ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 22, 2010, 3:15am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/122 "2010-06-22T03:15:38Z")
> [@yorick73](#): > > What is the difference? The only way to mitigate damages is to limit liability. Not true. The damages are being racked up as we speak, and the final amount won’t be determined for a long time. The damages exist, regardless of BP’s ultimate liability for them. Liability simply answers the question of how much of those damages will BP be responsible for. ---
**Author:** ![SenorBeef](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/senorbeef/32/2220_2.png) [@SenorBeef](https://boards.straightdope.com/u/SenorBeef)\ **Post date:** [June 22, 2010, 3:18am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/123 "2010-06-22T03:18:27Z")
> [@Scylla](#): > > Same goes for drilling. As a society we recognize this. We’ve even gone so far as to accept this and limit liability to 75 million because we so value the product. I think we are a bunch of guilty hypocrites. I in no way absolve BP from any of the negligence they may have engaged in that created this particular incident, but I kind of think we’re a bunch of spoiled bitches looking to blame somebody else for the reality that we’ve created. This would be more compelling if the accident didn’t come from the company that had more safety violations than the rest of the industry combined. If some airliner that was in gross violation of the FAA regulations and didn’t have its engines checked or maintained for 3 months blew up in flight, we wouldn’t be saying “oh well, that’s the risky nature of air travel” because the situation could’ve been prevented. BP gambled that they could skirt the cost of safety with a slightly increased profit if nothing happened. Well, something did happen, and now they’re paying for it. It may be true that a certain level of risk is inevitable. However, we spend time and effort and money reducing the likeliness that this will happen. That seems to be skirted here. And it guts the inevitability argument. ---
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:22am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/124 "2010-06-22T03:22:07Z")
> [@MOIDALIZE](#): > > First off, the fund doesn’t exist outside of the legal system. It’s not a slush fund for Obama to re-fund ACORN. The fund gives us a process for paying claims, TODAY, when the money is needed. How does 1.25 billion being paid in 2014 create a process for paying claims “TODAY, when the money is needed.” Since the money won’t actually be available until they pay it in, and they won’t pay the majority of it for many years, how does that help “TODAY, when the money is needed.” It seems to me that such a mechanism **ensures** that it won’t be available “TODAY, when the money is needed.” > [@](#): > > Do you think the fund’s administrators owe no fiduciary duties of any kind to BP? No. I think that was the whole point of an independent third party administrator. If Mr. Feinberg had a fiduciary duty to BP than he wouldn’t be an independent third party, would he? Perhaps I’m wrong and you can show me where, in this agreement (that we haven’t been allowed to see,) that Mr. Feinberg owes a duty back to BP. > [@](#): > > Do you think every dollar spent won’t be accounted for? On paper? sure. > [@](#): > > Do you think BP will have no recourse in litigation if bogus claims are paid out of the fund? Of course not. > [@](#): > > In any case, BP isn’t being forced to do this, threats of criminal prosecution or not. Oh. That’s good to know. Unlike you, I wasn’t there. Seeing as you were and know this for a fact, I’ll just take your word on it. Thanks. > [@](#): > > The rest of your argument is honestly ridiculous. We don’t exist in a system where businesses are excused from the consequences of their negligence or malfeasance just because society benefits generally. Ummmmmmmmm. ---
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:27am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/125 "2010-06-22T03:27:51Z")
> [@SenorBeef](#): > > This would be more compelling if the accident didn’t come from the company that had more safety violations than the rest of the industry combined. If some airliner that was in gross violation of the FAA regulations and didn’t have its engines checked or maintained for 3 months blew up in flight, we wouldn’t be saying “oh well, that’s the risky nature of air travel” because the situation could’ve been prevented. > > BP gambled that they could skirt the cost of safety with a slightly increased profit if nothing happened. Well, something did happen, and now they’re paying for it. > > It may be true that a certain level of risk is inevitable. However, we spend time and effort and money reducing the likeliness that this will happen. That seems to be skirted here. And it guts the inevitability argument. That’s a good point to a degree. If you think it through though you’ll see that the laws of chance would suggest that the inevitable accident is mostly likely to occur from the sloppiest operator. For example. If the safest operator can limit the chances of a spill like this to 1 in 100 years of drilling, and the sloppiest to 1 in 10, the spill is inevitable in either case but more likely to occur from the sloppiest operator. Anyway, we seem to be ignoring our culpability. We encouraged and incented sloppy operators by limiting liability to a mere 75 million, when clearly the costs of an incident would be much higher. We agreed to take on the remaining risk. Now we don’t live up to that, or accept responsibility for the environment that we created. ---
**Author:** ![yorick73](https://avatars.discourse-cdn.com/v4/letter/y/b5a626/32.png) [@yorick73](https://boards.straightdope.com/u/yorick73)\ **Post date:** [June 22, 2010, 3:31am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/126 "2010-06-22T03:31:14Z")
> [@MOIDALIZE](#): > > Not true. The damages are being racked up as we speak, and the final amount won’t be determined for a long time. The damages exist, regardless of BP’s ultimate liability for them. > > Liability simply answers the question of how much of those damages will BP be responsible for. This doesn’t make any sense. How would the fund mitigate any damages. If anything it appears the creation of the fund may cost BP more in the long run. Excluding bogus claims the fund could make payments to individuals or businesses that might not have been allowed in litigation. And, since the creation of the fund does not limit liability, they will still have to pay out in any suit that they lose ---
**Author:** ![GIGObuster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gigobuster/32/421_2.png) [@GIGObuster](https://boards.straightdope.com/u/GIGObuster)\ **Post date:** [June 22, 2010, 3:36am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/127 "2010-06-22T03:36:33Z")
> [@Scylla](#): > > Not me so much. If they were coerced or forced into it, they really don’t deserve any credit, do they? > > If this insulates them from a greater liability than it’s actually self-serving and a negative. > > Thole thing doesn’t make much sense. BP has according to CNN spent 6 billion so far in trying to fix this. That’s in two months. It seems to me that the costs in cleaning this up and fixing it are right now. Why is this being spread out over five or six years? Aren’t the major costs now? Won’t money spent now ameliorate some of the future consequences.? How will giving a billion dollars a quarter for the next five years solve a 3 billion dollar a month current crisis? > > What’s the fucking point of this thing? I would check the news before assuming an argument from ignorance. [http://www.reuters.com/article/idUSTRE65H43E20100618](http://www.reuters.com/article/idUSTRE65H43E20100618) > [@](#): > > Mississippi (Reuters) - A $20 billion fund set up by energy giant BP Plc to compensate financial losses due to a big oil spill in the Gulf of Mexico will pay legitimate claims fast, the fund’s independent administrator said on Friday. > > The fund would use a “transparent methodology” and there will be “prompt payment” of new claims while emergency interim payments will continue, said administrator Kenneth Feinberg, named to run the fund set up this week. The “old rules” already gave us evidence of what it would be expected if there was no prompt compensation: Endless litigation for many that even to this day, have not been able to get compensation for the Exxon Valdez disaster. ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 22, 2010, 3:40am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/128 "2010-06-22T03:40:17Z")
> [@Scylla](#): > > How does 1.25 billion being paid in 2014 create a process for paying claims “TODAY, when the money is needed.” Since the money won’t actually be available until they pay it in, and they won’t pay the majority of it for many years, how does that help “TODAY, when the money is needed.” > > It seems to me that such a mechanism **ensures** that it won’t be available “TODAY, when the money is needed.” It’s not like the people of the Gulf are clamoring for $20 billion to be paid this instant, and nobody is saying BP has to pony up that entire amount right now. But the fund ensures that people are going to be compensated in the short and medium term, and in terms of an inevitable litigation that will likely take years to resolve, there’s nothing ridiculous about making sure people with claims in 2014 have some immediate recourse. > [@](#): > > No. I think that was the whole point of an independent third party administrator. If Mr. Feinberg had a fiduciary duty to BP than he wouldn’t be an independent third party, would he? Perhaps I’m wrong and you can show me where, in this agreement (that we haven’t been allowed to see,) that Mr. Feinberg owes a duty back to BP. Maybe it’s stapled to Obama’s birth certificate. In any case, a fiduciary duty exists any time someone holds the assets of another party. Unless BP were to agree to a disclaimer of such a duty (which they’d be colossal morons if they did), you can be sure Kenneth Feinberg won’t be embezzling the money. ---
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:45am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/129 "2010-06-22T03:45:28Z")
> [@GIGObuster](#): > > I would check the news before assuming an argument from ignorance. > > [http://www.reuters.com/article/idUSTRE65H43E20100618](http://www.reuters.com/article/idUSTRE65H43E20100618) > > The “old rules” already gave us evidence of what it would be expected if there was no prompt compensation: Endless litigation for many that even to this day, have not been able to get compensation for the Exxon Valdez disaster. Oh. So the guy in charge says it will be “prompt” and “transparent.” That’s good enough for you. Were you comfortable when Bush said he knew for sure that Iraq had WMDs or were you concerned about being forced to accept one man’s decision? Me, I might wonder how he is going to make “prompt” payments now from funds that won’t exist for several years. He’ll probably just use his personal Visa now, and pay himself back in 2014 or so, right? ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 22, 2010, 3:50am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/130 "2010-06-22T03:50:57Z")
> [@yorick73](#): > > This doesn’t make any sense. How would the fund mitigate any damages. If anything it appears the creation of the fund may cost BP more in the long run. Excluding bogus claims the fund could make payments to individuals or businesses that might not have been allowed in litigation. And, since the creation of the fund does not limit liability, they will still have to pay out in any suit that they lose Put aside the environmental damage and consider the economic damage. Take a hypothetical fisherman temporarily put out of business by the spill. What if he can’t make his mortgage payment? If BP can kick some money his way until he’s able to work again or otherwise can sort things out, maybe he can avoid losing his home in the interim. That’s the type of “extra” damage that BP can avoid by paying the fisherman now instead of waiting until after litigation. If they play hardball and go to court and end up being liable, they’ll have to pay for not only the fisherman’s lost wages but the costs associated with him losing his home. ---
**Author:** ![GIGObuster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gigobuster/32/421_2.png) [@GIGObuster](https://boards.straightdope.com/u/GIGObuster)\ **Post date:** [June 22, 2010, 3:55am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/131 "2010-06-22T03:55:56Z")
> [@Scylla](#): > > Oh. So the guy in charge says it will be “prompt” and “transparent.” That’s good enough for you. AFAIK the guy in charge was selected by to be independent from BP and the Obama administration, do you have any evidence to the contrary? > [@Scylla](#): > > Were you comfortable when Bush said he knew for sure that Iraq had WMDs or were you concerned about being forced to accept one man’s decision? Bush told us that he was going to go a third party and demand a vote to go to war. It turns out that he lied to the American people. If you do not see any difference I do feel sorry. > [@Scylla](#): > > Me, I might wonder how he is going to make “prompt” payments now from funds that won’t exist for several years. He’ll probably just use his personal Visa now, and pay himself back in 2014 or so, right? As you have demonstrated that you do not now much on how the fund is setup or the particulars of it, this point of yours is just an appeal to ignorance. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [June 22, 2010, 3:56am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/132 "2010-06-22T03:56:34Z")
> [@Scylla](#): > > Thole thing doesn’t make much sense. BP has according to CNN spent 6 billion so far in trying to fix this. That’s in two months. It seems to me that the costs in cleaning this up and fixing it are right now. Why is this being spread out over five or six years? Aren’t the major costs now? Won’t money spent now ameliorate some of the future consequences.? How will giving a billion dollars a quarter for the next five years solve a 3 billion dollar a month current crisis? The escrow fund is not used to stop the leak, which is the bulk of the spending by BP right now. BP has paid only [$105 million in claims over the past 2 months](http://dealbook.blogs.nytimes.com/2010/06/21/feinberg-seeks-faster-payments-of-bp-claims/), so the $1.25 billion per quarter is well under that burn rate so far. ---
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:57am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/133 "2010-06-22T03:57:31Z")
> [@MOIDALIZE](#): > > It’s not like the people of the Gulf are clamoring for $20 billion to be paid this instant, I’ve actually been reading several news stories about people complaining that they need money now, and it’s slow coming. > [@](#): > > In any case, a fiduciary duty exists any time someone holds the assets of another party. Unless BP were to agree to a disclaimer of such a duty (which they’d be colossal morons if they did), you can be sure Kenneth Feinberg won’t be embezzling the money. Once BP puts the money into the trust, it is not their asset any more. Since it is not their asset no fiduciary duty is owed back to them. How can I be so sure? Simple. If you pay money to a creditor, once you do so, it’s not your money. You have no say in what does with it. The US government **is** a creditor of BP in this instance, by definition. Part of the agreement was that BP would post $20 billion in assets as a surety bond against payment of the debt. You are confusing this with the structure of a grantor controlled trust. The actual stucture is that of a simple collateralized debt to a third party. ---
**Author:** ![Scylla](https://avatars.discourse-cdn.com/v4/letter/s/a5b964/32.png) [@Scylla](https://boards.straightdope.com/u/Scylla)\ **Post date:** [June 22, 2010, 3:59am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/134 "2010-06-22T03:59:22Z")
> [@Fear\_Itself](#): > > The escrow fund is not used to stop the leak, which is the bulk of the spending by BP right now. BP has paid only [$105 million in claims over the past 2 months](http://dealbook.blogs.nytimes.com/2010/06/21/feinberg-seeks-faster-payments-of-bp-claims/), so the $1.25 billion per quarter is well under that burn rate so far. That’s a fair point. (You’re a moderator!?!?!?!?!) ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [June 22, 2010, 4:00am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/135 "2010-06-22T04:00:18Z")
> [@Scylla](#): > > (You’re a moderator!?!?!?!?!) No. But if you step out of line, I’ll moperate you. ---
**Author:** ![elucidator](https://avatars.discourse-cdn.com/v4/letter/e/8edcca/32.png) [@elucidator](https://boards.straightdope.com/u/elucidator)\ **Post date:** [June 22, 2010, 4:13am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/136 "2010-06-22T04:13:12Z")
> [@Scylla](#): > > …Were you comfortable when Bush said he knew for sure that Iraq had WMDs or were you concerned about being forced to accept one man’s decision?.. You were here. You know exactly what we were concerned about, because we told you. When we told you, you kept digging up rationalizations for how we were full of beans. But we were right. And you were, spectacularly, wrong. You did for wrong what Wagner does for screaming > [@](#): > > …Me, I might wonder how he is going to make “prompt” payments now from funds that won’t exist for several years. He’ll probably just use his personal Visa now, and pay himself back in 2014 or so, right? You keep hanging these innuendos around like ugly Xmas tree ornaments. What, exactly, are you hoping to insinuate? The executor of the escrow seems to be a pretty straight shooter, took on a task you couldn’t pay me enough to do. Have faith. There are any number of sharp eyed people keeping their eye on the piggy bank, they are highly motivated, got that ol’ time civic virtue. If they could catch Obama fooling with so much as a dime, the collective Republican orgasm would be felt in five adjoining states. Barry knows that. Rahm knows that. They didn’t get there being stupid. That was the other guy. ---
**Author:** ![DanBlather](https://avatars.discourse-cdn.com/v4/letter/d/f4b2a3/32.png) [@DanBlather](https://boards.straightdope.com/u/DanBlather)\ **Post date:** [June 22, 2010, 4:17am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/137 "2010-06-22T04:17:46Z")
> [@GIGObuster](#): > > I would check the news before assuming an argument from ignorance. > > [http://www.reuters.com/article/idUSTRE65H43E20100618](http://www.reuters.com/article/idUSTRE65H43E20100618) > > The “old rules” already gave us evidence of what it would be expected if there was no prompt compensation: Endless litigation for many that even to this day, have not been able to get compensation for the Exxon Valdez disaster. And even if they did, it took decades. The shrimpers and small business owners are barely getting by month to month, they can’t wait years to get their money. Buy then they’ll be out of business. It’s mind boggling how fucked up the right has become: Let’s let GM go tits up and lose a few hundred thousand jobs, let’s not raise the liability ceiling for oil companies, let’s apologize to BP. ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 22, 2010, 4:20am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/138 "2010-06-22T04:20:20Z")
> [@Scylla](#): > > Once BP puts the money into the trust, it is not their asset any more. That would be true if this were a trust. I’m not aware that BP has agreed to structure the fund as a trust. ETA: In fact, nobody knows what the final parameters of the fund will be because that’s still being hashed out. ---
**Author:** ![DanBlather](https://avatars.discourse-cdn.com/v4/letter/d/f4b2a3/32.png) [@DanBlather](https://boards.straightdope.com/u/DanBlather)\ **Post date:** [June 22, 2010, 4:20am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/139 "2010-06-22T04:20:34Z")
> [@MOIDALIZE](#): > > If they play hardball and go to court and end up being liable, they’ll have to pay for not only the fisherman’s lost wages but the costs associated with him losing his home. I do not think that is true. Do you have anything to back up that claim other than your copy of Atlas Shrugged? ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 22, 2010, 4:27am UTC](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634/140 "2010-06-22T04:27:10Z")
I’d also like to add that the $75 million cap some of you are focused on doesn’t apply when a company is found to have violated a federal safety or operational regulation. Remember when everyone was wondering why all the booms and netting that BP was supposed to have ready at all times wasn’t being set up to protect the coastlines? That’s a violation right there. [Previous page](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634.md?page=6) [Next page](https://boards.straightdope.com/t/why-would-republicans-object-to-the-20-billion-bp-clean-up-fund/543634.md?page=8)