Alabama Governor Bob Riley calls oil spill claims process 'extortion'

Bob Riley is a lame duck Governor who leaves office in January and really doesn’t have to go after the feds with guns a-blazin’. But that’s not stopping the boots-wearing Republican, who has been critical of the Gulf Coast Claims Facility almost since day one:

Bob Riley calls oil spill claims process 'extortion'

---

Riley said he is concerned that underpayments by Feinberg’s Gulf Coast Claims Facility will force businesses to prematurely sign away the right to sue BP PLC.

Area businesses have complained loudly about the size of payments, compared to claims, plus the lack of information about how those amounts were determined.

“If you have the capacity to turn them down with no explanation and make them sign away their right to sue, that’s extortion,” Riley said.

---

Riley is absolutely correct—Feinberg’s process unfairly penalizes businesses, arbitrarily denies legitimate claims filed by businesses, and forces businesses to either sign away their rights to litigation or walk away with nothing.

This comes on the heels of clear evidence that the Obama regime is also playing politics with oil spill study funds under NRDA, and in the wake of indications that Feinberg’s claims facility is nothing more than a White House sanctioned engine for redistributing wealth.

Businesses are getting fractions of well documented claims, while the employees of those businesses are getting multiples of what they’ve filed for. What’s up with that?

Most of the businesses affected are small, mom-and-pop shops that clean cottages and condos, sell sundries and souvenirs, conduct boat tours and rent beach equipment. They’re not fat cats by any stretch of the imagination, and they were devastated by the spill’s impact on tourism. Even with a full reimbursement claim, a lot of these businesses aren’t going to make to the 2011 summer season.

Bob Riley gets major props for taking Feinberg and Obama to task, and the louder he shouts the more light is shed on a politically motivated claims settlement process.

Redistributing wealth with the Gulf Coast Claims Facility

President Barack Hussein Obama famously said, “I do think at a certain point, you’ve made enough money.”  This man, this regime is hell bent on making sure the rich suffer the consequences of rapaciously accumulating all of that wealth.  So much so, that they are apparently attempting to redistribute it even with the Gulf Coast Claims Facility.  The GCCF is the apparatus that distributes the $20 billion slush fund that the regime arm-twisted out of BP.  The GCCF is administered by none other than the former “Pay Czar,” Kenneth Feinberg.  You know, the guy who said he’d be “uncompensated” for that position but got a six-figure salary, anyway.

In a story from yesterday’s Mobile Press-Register:

---

Business owners and public officials in Baldwin County say they are alarmed by reports of employees receiving more money for oil spill claims than owners of the businesses they work for.

It is just another aspect of their biggest problem with Ken Feinberg’s Gulf Coast Claims Facility — that business owners near Baldwin County’s once-lucrative beaches get checks that cover only a fraction of losses suffered after the oil spill began keeping tourists at bay.

David Wright is an extreme example. The owner of an Elberta company that builds high-end homes for people who plan to either retire or vacation on the coast, Wright had to lay off his 15 workers when his customers canceled contracts after the April 20 spill.

Rob Manney, a supervisor on Wright’s crew, said he got checks totaling 80 percent of his personal claim with Feinberg’s operation.

Wright’s business claim was denied.

“How do you pay an employee and not the business?” Wright asked. “It’s anti-business.”

Feinberg did not respond to requests for comment made to his media representative.

---

Feinberg says that the GCCF is not under the direction of BP or the regime.  That, obviously, is a bunch of shit. There is only one reason why Wright’s employees are getting claims checks and business owners like Wright are not—it’s class discrimination.  “Bourgeoisie” business owners like Wright are the people who create the jobs that drive this economy.  But to the Obama regime, men like Wright are guilty of building wealth on the sweat and blood of their employees.  So, when the opportunity arises to “make it right,” they do so.  They deny legitimate claims submitted by business owners while approving the claims of the businesses’ employees.

I am no fan of the $20 billion slush fund.  It’s just another way for the regime to pick winners and losers.  Or, in this case, to pick those who suffer a little and those who suffer a lot. 

The regime’s complete ineptitude in responding to the disaster—as documented in the Deepwater Horizon Incident Timeline on this blog—shows that it is incapable of managing any significant enterprise or effort.  It inevitably allows politics to color its decision-making process, and shamefully allows ideology to pollute what should be a straightforward process of settling claims.

Is the "regime of transparency" getting outflanked for $20 billion?

On June 16, 2010, BP PLC and the United States Government announced plans to establish what amounts to a $20 billion slush fund, ostensibly aimed at compensating residents and business interests along the Gulf coast for economic and financial damage caused by the Deepwater Horizon oil spill. The White House also appointed Pay Czar Kenneth Feinberg as the fund's administrator, and he immediately took his dog and pony show on the road.

Almost from the beginning, the government has been either confused or silent on the fund's status. In fact, Feinberg told a CNN interviewer that the fund would cover claims arising from the government's deepwater drilling moratorium, only to reverse himself and change the story the very next day.

On August 9, BP announced that it made an "early" $3 billion "deposit" into the fund to show that it's committed to fulfilling its obligation. Waiting nearly two months for the first installment doesn't seem like either the government or BP understands the definition of the term "early," but let's play along.

The real problem here, gentle readers, is that none of the details of the negotiations between the government and BP have seen the light of day. We have seen no contract. We have seen no memorandum of understanding between the two parties. We have not seen even the first set of criteria for establishing claims legitimacy. All we've had is the Kenneth Feinberg Carnival Road Show, with the charismatic and seemingly trustworthy administrator reassuring residents, businesses and local government leaders that it's all gonna be Ok. At least one state attorney general--Troy King of Alabama--smells a rat.

Since the executive branch has no power to compel a private entity to fork over the bucks to fund the kitty, it stands to reason that BP will have great power in establishing the rules by which claims legitimacy deteminations are made. If this is the case, then BP is likely outmaneuvering the boy-king. They let him fist-bump his buddies over shaking down the company for $20 extra-large, but then they use his constitutional inability to compel payment to restrict the boundaries of claims legitimacy. The $20 billion slush fund just becomes a BP-controlled $20 billion savings account.  This idea appeals to me in a way--the government doesn't have a stellar track record in preventing fraud when it comes to claims-paying.  The Dept. of Justice is still prosecuting fraud cases from the Katrina relief, five years after the storm.  While BP might come across as stingy, they're much less likely to pay frivolous or fraudulent claims because it's like, their money.

But again, we don't know anything, because "the most transparent administration in history" has released absolutely nothing.

I frankly believe BP is playing Obama like a cheap Texas fiddle. Bob Dudley cut his governmental relations teeth by doing business with Vladimir Putin and the Russian Mafia Federation. He beat them so badly that he made the company billions, increased its petroleum reserves and was forced to flee Moscow for his safety once Putin's thugs realized the level to which they'd been played.  Outflanking this bunch of amateurs in the White House is child's play.

By the way, look at BP's stock performance since mid-June.

Gimme some feedback in the comments.

Chaos and confusion, part deux: the $20 billion slush fund

Just yesterday, we learned about the apparent confusion over who's covered by the $20 billion BP shakedown fund when, during an interview with CNN, the fund administrator told the interviewer that he'd just learned that the moratorium claims would be covered.

But it's a different day today, so it's a different story.

---

Kenneth Feinberg, who is administering the new claims process for victims of the Gulf oil disaster, made crystal clear today that individuals and businesses hurt by the drilling moratorium are not eligible for a piece of the $20 billion escrow fund BP set aside to pay all eligible claims.

"If they send moratorium claims to me what am I supposed to do with them under the $20 billion?" Feinberg said during a break of a hearing of the House Small Business Committee at which he was testifying about his new job. "Those moratorium claims are only going to be paid out of the $100 million."

---

This is not what he said Monday:

---

"Yes, I now have discovered -- I didn't realize this until yesterday -- that the moratorium claims will fall under my jurisdiction," Feinberg said in an interview Monday on CNN.

"That's a huge development, and we didn't know that before?" replied the CNN reporter.

"I didn't either," Feinberg said.

---

There doesn't seem to be any lack of confusion or chaos on the part of the White House or BP, either.  In the second story linked above, a White House spokesman said that the $100 million fund would be administered by BP.  In the story linked yesterday, Feinberg said he believed he'd be administering the fund.  Keep in mind, sports fans, that these two slush funds were established in negotiations between the White House and BP on June 16, two freakin' weeks ago.

So why all the confusion?  Maybe it's because there is no document formalizing the agreement.  At least, there isn't one that's been made public.  As a result, Kenneth Feinberg tells the media one thing on Monday and tells Congress something completely different a few days later.

Who the hell is in charge?  $20 billion here.  $100 million there.  Pretty soon, we're talking about a lot of money, and a tremendous opportunity for waste, fraud and abuse.

Gimme some feedback in the comments.

Confusion, chaos reign with $20 billion BP shakedown fund--what could go wrong?

In a CNN interview on Monday, the administrator of the Obama regime's $20 billion shakedown/slush fund announced that, by Jove, his purview will indeed also include settling claims for individuals and businesses affected by the deepwater drilling moratorium.  That would be the moratorium that a Federal Judge has set aside and is technically no longer in effect.

But here's the kicker--Ken Feinberg didn't know his jurisdiction would include moratorium claims until the weekend:

---

"Yes, I now have discovered -- I didn't realize this until yesterday -- that the moratorium claims will fall under my jurisdiction," Feinberg said in an interview Monday on CNN.

"That's a huge development, and we didn't know that before?" replied the CNN reporter.

"I didn't either," Feinberg said.

---

Just last Thursday, Feinberg was telling reporters that idled workers couldn't submit claims against the $20 billion escrow account BP established following a June 16 meeting at the White House.  Instead, workers were expected to be compensated by a separate $100 million slush fund that was also agreed to at the June 16 meeting.

So, between last Thursday and his interview with CNN yesterday, who told Feinberg that his fund's jurisdiction would cover workers idled by the moratorium?  More interestingly, why is he being told to cover workers idled by a moratorium that cannot be enforced due to a court order?  

It's easy to understand the confusion that reigns over how these funds are to be administered.  If a formal agreement exists, no documentation of it has been made public.  First it was a $20 billion fund that was to be neither a guaranteed minimum nor a guaranteed maximum, nor was the establishment of the fund to mitigate BP's liability from the coming onslaught of civil lawsuits.  That fund was supposed to compensate individuals and businesses who were hurt by the spill's effects on tourism, fishing and other economic activities shut down by the spill.  Then, we learned about a separate $100 million fund that would serve workers idled by moratoria and other regime interference in the oil and gas sector.  Now, apparently, those two funds are to be conflated, co-mingled and completely confused with one another.  Gee, do you think there might be an opportunity for waste, fraud and abuse here, sports fans?

We already have fantastic evidence of how well managed these types of slush funds are.  Remember how well TARP and Porkulus funds were accounted for.  Why, every red cent went right where it was supposed to, didn't it? Remember also that this is the Gulf Coast, and the epicenter of this disaster is Louisiana.  In the five years since Katrina and Rita hit the state in a hurricane double-whammy, the a special task force at the Department of Justice is still indicting, prosecuting and convicting people of defrauding the government with bogus claims.

There's a $20 billion slush fund and its own administrator doesn't know what it covers.  There's supposedly a separate $100 million fund that's supposed to cover workers idled by the moratorium--the moratorium tossed out of court last week. Does Feinberg administer that fund as well, or is someone else in charge of it?  There's absolutely no documentation of the agreements between BP and the federal government, so we don't really know who's in charge of what fund and who can file claims against this one, that one or some other one.  And, there's a state with a legendary history of graft and corruption. 

Gee... What could go wrong?

Gimme some feedback in the comments.