It's not hard to understand why people are mad at BP
, the energy giant whose oil
has been spreading through the Gulf of Mexico for 50 days, despite several failed attempts
to fix the leak, causing a disaster that could take years to clean
The Department of Justice is exploring the possibility of bringing criminal charges
but that may be the least of BP's worries right now. The company's stock
trading at half of its 52-week high. Here's what it has to look forward
- 'Free Fall' for BP Stock Talking Points Memo's David Kurtz writes, "BP share
prices have gone off a cliff today. Earlier this afternoon, they were as
low as they've been since 1997, but they've declined
farther since then." MarketWatch reports, "BP
should suspend dividend payments to shareholders until it stops the
leaking well in the Gulf of Mexico and cleans up the mess from the
disaster, a group of U.S. lawmakers said Wednesday."
- The Dividend Dilemma Reuters' Felix Salmon explains, "The
company has been paying out a steady 84 cents per share per quarter,
and that payment is now in jeopardy. ... BP's coffers are not at all a
safe place to store shareholders' cash: they can be raided by all manner
of legal and regulatory eventualities. But there's another dynamic at
work here: BP and Shell between them account for 50% of the dividends
paid by UK companies every year. It seems quaint, but there really are a
lot of far-from-wealthy people in the UK who live off their dividend
income, and those people constitute a surprisingly large part of BP's
shareholder base. If BP suspends its dividend, the only way they can get
money from their stock is by selling it."
- Cut Off BP's $2B
Defense Contracts The Nation's Jeremy Scahill points out,
"Contrast the Congressional response to ACORN's federal contracts with
its response to BP, which does billions of dollars in business with the
federal government, specifically the Pentagon. BP holds more than $2
billion in annual US defense contracts and continues to be the premiere
provider of fuel to the world's largest consumer of oil and gas: the
Pentagon. ... And yet, there is no real, bi-partisan Congressional march
to de-fund BP."
- Congress Should End All BP Deals E.D. Kain urges, "Pull all of
BP's government contracts and send a clear message to environmental
offenders that the feds will not do business with companies with bad
environmental and safety records. ... Nationalizing BP, as some pundits
have suggested, strikes me as a huge waste of resources and probably a
huge step in the wrong direction, making the oil giant even less
accountable by weaving it even more indelibly into the federal
government. Cutting all government contracts with BP, on the other hand,
is a rational response to this catastrophe."
- Nationalize BP!
The Center for American Progress' Brad
Johnson suggests, "If federal officials believe that BP engineers
should continue to work on the problem, the President has the authority
to have those people working directly for the federal government. In
fact, the president has the authority to nationalize BP America and
seize all of its assets, rendering the question of reliance on BP moot.
If Obama does not believe that the Clean Water Act's 'spill of national
significance' provisions give him sufficient authority, he can rightly
declare a national emergency, or demand that Congress deliver him
necessary legislation. Or there's an easier option: BP is on the hook
for all costs of this apocalyptic disaster. Obama can simply buy BP
America and send the bill to its foreign parent company."
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