BP continues to pay a full price for the Deepwater Horizon disaster — deservedly so, you might say, given that 11 rig workers died in the April 2010 explosion that caused ‘the world’s worst oil spillage’ in the Gulf of Mexico. The contractor Halliburton and the rig operator Trans-ocean were also implicated, but blame has been heaped by all parties upon BP, which last month agreed a settlement with the Department of Justice that included pleading guilty to felonies and paying a $4.5 billion fine — to add to tens of billions paid in compensation to businesses along the Louisiana coast, manslaughter charges pending against BP executives, and the possibility of further huge fines for water pollution.
The Environmental Protection Agency (EPA) has also temporarily banned the company from new federal contracts — blocking the renewal of up to $2 billion worth of orders from the US military to which BP is the biggest fuel supplier, and creating a gap which American companies such as Chevron are naturally eager to fill. Finally, it is reported that Tony Hayward, the former BP boss who bore the brunt of Barack Obama’s attacks on ‘British Petroleum’, has been divorced by his wife for ‘unreasonable behaviour’ — so the wish he expressed shortly after the spill, ‘I’d like my life back’, seems not in the end to have been fulfilled.
That was, of course, a wretched remark for Hayward to make when 11 other lives had just been lost, possibly as a result of management negligence; this aspect of the Deepwater Horizon story cannot be downplayed, even in an oil and gas sector with an accident rate (at around 100 fatalities per year) seven times higher than US industry as a whole. What can be questioned is whether the punitive costs meted on BP for its alleged environmental misdeeds are proportionate. Five million barrels of oil spewed into the ocean before the well was capped, but the spill did far less harm than the American public was prompted to fear by instant pictures of oiled-up pelicans — which, shame on me, I suggested at the time might have been kidnapped from a zoo by White House agents and sprayed with gumbo.
A report for the US Coastguard in December 2010 found ‘no exceedances of EPA’s Human Health benchmark’; residual ‘exceedances of Aquatic Life benchmarks’ were found only within three kilometres of the offshore rig site, and 98 per cent of previously closed fisheries had been reopened. When I was in Louisiana last month discussing the resurgence of New Orleans, the spill received a single passing mention — from a city official who said casually, ‘The oil dispersed real fast, there wasn’t a whole lot of long-term damage.’ I sense the campaign to wring the last dollar out of BP has as much to do with political grandstanding, greedy lawyers and hostility to foreign competition as it does with sad pelicans.
No skeletons
Our still-free press leapt exuberantly to the task of finding something negative to report about Bank of England governor designate Mark Carney, but no luck so far. For a moment it looked as though the Canadian’s ‘eco-blogging’ English wife Diana might turn out to be the new Sally Bercow — or at least the new Gretta Duisenberg, the outspoken leftist wife of the first president of the European Central Bank. But then Mrs Carney was discovered to be a sister-in-law of plutocratic Oxfordshire landowner Lord Rotherwick, safe in the establishment fold. Canadian pundits contributed the suggestion that Carney’s low-interest-rate policy — combined with well-capitalised Canadian banks’ continuing willingness to lend — has created at least the possibility that he will leave behind a looming real-estate bubble, and that his reputation might one day go the way of Alan Greenspan’s: godlike while he was at the Federal Reserve, now judged to have been fatally wrong all along.
But this is pretty thin stuff so far. We might have to accept that Carney really is the clean and competent central-banking professional he appears to be. So come on, gutter press, seven months to go till he arrives and the reputation at stake is not his but yours. There must be a skeleton in his cupboards somewhere.
Flying dinner ladies
I’m intrigued to see Delta Air Lines named as a likely bidder for Singapore Airlines’ 49 per cent stake in Virgin Atlantic. A friend in the travel trade tells me that no discerning traveller flies with any US carrier for choice these days, only for Air Miles. If you want luxury, pick a sheikh-funded Gulf airline; for charm, Singapore, Thai or Cathay Pacific; for sheer style, Virgin; for all-round service, British Airways. Having flown with both this autumn, I’d say Delta and Virgin are peculiarly ill-matched. How can I put this without sounding sexist? If a Virgin flight crew, male as well as female, looks like the cast of The Only Way is Essex, Delta’s — selected, no doubt, under fierce anti-discrimination rules — looks like a US version of Dinner Ladies. I’ll be fascinated to see how that culture clash plays out.
Mega Monday
Ahead of his grim Autumn Statement, it was smart of the Chancellor to use ‘Mega Monday’, the day when Britain’s online shopping bill was expected to set new records, to launch a stunt spotlighting tax avoidance by multinationals. It’s easy enough to embarrass the likes of Starbucks: when I declared loudly outside its Kings Cross outlet last week, ‘We won’t go in there, they don’t pay enough tax’, passers-by nodded approvingly. But Amazon, an even worse sinner, is so cyber-remote and so damned convenient to use that protest won’t touch it. Yet its market power is daily destroying real shops in real high streets, making it a politically potent tax target. So here’s my simple suggestion: deem every online transaction in which goods are dispatched from a UK warehouse to reside in a UK company for the purpose of calculating corporation tax, full stop.
Comments