On Wednesday, President Obama sat down with the chairman and the CEO of BP and emerged from that meeting with a pledge that the company would establish a $20 billion fund to help pay for losses experienced by residents during the recent Gulf Coast oil spill.
The president also announced that he had obtained a further commitment that BP would make an additional $100 million available to compensate unemployed oil-rig workers affected by the stoppage in deepwater drilling.
Here’s where all of this starts to get interesting: Under U.S. Federal law, total corporate liability related to oil-spill losses is limited to $75 million.
It seems to me that what the U.S. expects in the way of corporate responsibility from BP, a notorious, bottom-line-oriented, public-be-damned industrial bully, is very much akin to expecting a leopard to “change its spots.”
In the year 2000, for example, British Petroleum, as part of an embarrassingly transparent, “lipstick-on-a-pig” image campaign, changed its official name to BP (Beyond Petroleum) to imply that it was going to be, in the future, no longer wedded to fossil fuel development and would work to become a leading participant in the development of clean, more ecologically friendly energy sources, including “solar.” The image campaign came complete with a spanking new green-and-yellow sunburst logo color scheme and an investment, from 2000 to 2002, of $600 million in new signage, stationery and a global multi-media advertising campaign.
One of my old communications professors was fond of saying that “good PR is not what you say, it’s what you do."
Someone should have mentioned that to BP. They probably could have saved themselves several hundreds of millions of dollars.
It turns out, of course, that the company’s problem was not limited, at all, to the color of its signs or the appeal of its TV commercials. The real issue was that BP had amassed a long, uninterrupted history of being grossly insensitive to people, wherever it happened to do its business – all over the globe – and that it simply never has seemed to care very much about what the public thought about any of that.
In fact, BP’s corporate style has been to say anything that might be expedient to move past an uncomfortable situation, or to temporarily divert responsibility. We’ve seen evidence of that dozens of times already, just since April. That’s probably why the company’s CEO, Tony Hayward, seems to contradict himself so much, to otherwise misspeak, and to have a problem looking straight into a camera.
It’s clear, now, given what we’ve seen of its “half-stepping" reaction to the damage being done every second of every minute, every hour of every day, for the past two months, in the Gulf Coast, that the “new BP" is still very much the same organization that has acted so irresponsibly toward its neighbors and to the global ecology since the London-based company discovered its first oil reserves in Iran, in 1908, and began to operate, in 1909, as the Anglo-Persian Oil Company.
Though most Americans had been only vaguely familiar with BP, other than through seeing its brightly lit gas stations along the highway, the company has $130 billion in assets, and happens to be the world’s third-largest energy company, behind only Exxon-Mobil and Royal Dutch Shell.
Establishing its rapacious business model early on, the company, which drew absolutely all of its revenue from those early Iranian wells, returned only 16 percent of that money to the people of Iran. In 1935, after Persia changed its name to Iran, the company renamed itself, becoming the Anglo-Iranian Oil Company, but still maintained total and absolute control over every drop of oil that flowed from Iran.
In 1951, Iranian Prime Minister Mossadeq nationalized the country’s oil industry and forced BP out of his country’s oil-producing operations. Shortly thereafter, in 1953, perhaps not coincidentally, Mossadeq was overthrown in a coup and replaced by a man who happened to be exceptionally supportive of the U.S. and British, Shah Pahlavi, known to most Americans, simply, as the Shah of Iran.
The next year, the company changed its name again, this time to "British Petroleum."
Shortly after the Shah assumed power, the British began to share their oil revenues with the Americans, and BP began to expand its oil drilling operations beyond Iran and into Alaska and to the North Sea. It also assumed control of the old, U.S.-based, Atlantic Richfield (ARCO) Energy Company.
The company eventually expanded its drilling operations into Colombia, where it has long been accused of human rights violations.
In case you didn’t know, BP also maintained extensive business relationships with the apartheid South African government, prior to that country’s “democratization,” in 1994, which saw Nelson Mandela elected president. Because the company had continued to refine crude oil in pre-1994 South Africa, despite an international oil embargo, it was high on the global “anti-apartheid” movement’s list of “corporate enemies.”
BP also ignored a U.N. oil embargo against pre-Mugabe Zimbabwe, then known as Rhodesia. In that capacity, the company supplied the oppressive, white-minority-controlled government with oil that was illegally shipped in through South Africa.
Not surprisingly, the company's record of insensitivity has extended far beyond geo-political and human rights issues.
As far back as 1991, nearly 20 years ago, the Washington DC-based Citizens Action organization named BP among the top ten environmental polluters in the United States. In Ohio, the Public Interest Campaign, in 1988, said the company’s two plants in Lima, Ohio, were far and away the “biggest polluters" in the state. The company’s chemical plant and refinery, the group found, “produced 60 million pounds of toxic pollution” in the year before the report was written, including 8.2 million pounds released into the air, 58.2 million pounds injected under ground, 380,000 pounds dumped into the Ottawa River and one million pounds disposed on the land.
When you look at the company’s shameful record, it’s hard to imagine that it could have any, real, corporate-level concern for the residents of the Gulf Coast--what may become of the them, their families, their homes or their very way of life.
In that regard, I'm especially concerned about the well-being of the region’s black fishermen. Up until two months ago, they had been able to earn a self-sufficient living in the Gulf, dating back, at least, to the early part of the 20th Century. Now that the spill has decimated their industry, will they and others really receive the support they need from BP to make themselves whole?
It is clear, however, that such a principled response is entirely inconsistent with the company’s 101-year track record.
While we wonder about that, we should also remember that the Gulf oil spill, as horrible as it continues to be, is not the largest such spill on record – not yet anyway. At an estimated 2.7 million barrels spilled to date, it still ranks behind the 3.3 million-barrel Ixtoc I spill in Mexico in 1979, the 5.5 million-barrel Gulf War oil spill in Iraq, in 1991, and the 9 million-barrel Lake View Gusher spill, in Kern County, California, in 1910. Give it time, though. With 40,000 gallons a day being pumped into the Gulf of Mexico, this one still may very well top them all.
But while you’re waiting for BP and the U.S. Government to “plug the hole,” don’t hold your breath about the company actually stepping up to the plate and doing anything substantially more for Gulf residents and wildlife than the law absolutely requires it to do.
As welcome as that kind of corporate cooperation would be, such behavior would be entirely out of character for the company which now calls itself BP.
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