BP Must Remain Too Big to Fail

We cannot afford to cancel contracts with BP or take other steps to reduce their income if we are going to provide payment for all those who have suffered damages from the oil spill.
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I rarely find myself in disagreement with Rachel Maddow, but this is such an instance. She compared the rush and ruthless defunding and cancellation of contracts with Acorn by Congress following some isolated and partisan videotaped charade with the failure to do the same to BP following much more serious charges. Not that they don't deserve it, but we cannot afford to cancel contracts with BP or take other steps to reduce their income if we are going to provide payment for all those who have suffered damages from the oil spill.

BP employs thousands of people in the U.S. Many, here and abroad, rely upon its dividends and pensions for their livelihood. Millions will be damaged and adversely affected by the oil spill. No matter how much we may despise them or their cavalier and negligent conduct, their economic failure is not in anyone's best interest. However, there are steps that can and should be taken to protect the dissipation of income and/or assets to the detriment of claimants.

Either by agreement or court order, BP should be enjoined from giving raises, bonuses or dividends, selling or conveying assets or making any payments other than in the regular course of business without permission of a court or someone or entity appointed to conserve assets and protect the rights of claimants. Instead of BP doling out money to claimants, (making those decisions undoubtedly motivated by its own best interests), an immediate fund should be established by BP. That fund should be administered locally by one or more persons familiar with the areas and industries affected, not some bureaucrat sitting in Washington and certainly not a representative of BP.

The request for such an agreement will test BP's public commitment to pay all damages and the costs of clean-up. I know BP has been criticized for limiting its obligation to all "legitimate" claims, but frankly I see nothing wrong with that. Without impugning those who suffer from the spill, to worry that fraudulent claims might be submitted is just facing reality. Failing an agreement, the Justice Department should seek such relief from the courts. Unless BP is in a position to assure that there are sufficient assets and income to meet all present and future claims, I believe a court would be justified in imposing the relief mentioned above and securing it in some way. A promise to pay in full may be good PR, but it doesn't pay the bills.

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