Wednesday - August 04, 2010

Suckas

From Carol, an email that also made it as a blog post, but started out as a letter to the editor. Is it true? I don’t know. Maybe it is. Maybe it’s only true for certain definitions of “truth”. But I love the closing line.

It seems a miracle that our beloved leader was able to convince BP to establish a $20 billion slush (oops, escrow) fund to compensate those hurt by the ongoing oil plume in the Gulf of Mexico. After all, he had no constitutional power to force them to do so; so had to resort to Chicago-style negotiating.

But, let us take a closer look at the effect on BP’s finances:

1. BP will establish a $20 billion fund, but will pay only $7 billion into it during 2010.

2. BP is a British corporation, but has a very large operating entity in the U.S.

3. By generally accepted accounting principles, BP must book the entire $20 billion expense in the year accrued. Therefore, they will book a $20 billion expense in 2010, reducing their U.S. tax liability by $7 billion.

4. Our dear leader also convinced this massive corporation to show their concern for the “small people” by withholding dividends to their shareholders for the last three quarters of 2010. This reduces their outward cash flow by about $7.5 billion, including approximately 40 percent of that amount to U.S. citizens. Assuming the Bush tax cuts will survive through 2010, the U.S. Treasury will lose another $450 million in taxes on that amount. We won’t even discuss the effect on the U.S. economy.

Let us review the results:

BP Cash Flow:

Escrow funding ($7 billion)

Dividend saving $7.5 billion

Tax savings $7 billion

Net favorable cash flow : $7.5 billion

US Treasury Tax Receipts:

BP Corporate income tax ($7.5 billion)

BP Shareholders ($0.45 billion)

Net unfavorable tax receipts ($7.95 billion)

I guess we really should expect this. After all, our dear leader is the most inexperienced man in any room he walks into.



DICK MILLER
Savannah

So, after all this mess, BP comes out $7 billion ahead? Awesome. But that’s only for this year. Next year they’ll still have to drop that much or nearly twice that into the escrow fund. But, it may not be needed! Because the End Of The World oil spill, the Worst Disaster Evah Evah Evah Evah!!!! seems to be mostly cleaned up already. That 75% of the oil that was spilled seems to have dissipated, degraded, or been sucked up. Go figure. Who knew? Well, Rush Limbaugh for one. And anyone who saw how rapidly Saddam’s mess in the Gulf in ‘91 was cleaned up. Or that IxToc oil spill in the Gulf that Mexico did some years back ... but the environmentally conscious seem upset that their doom and gloom 50 years of problems forecast might not last 1 entire year.

But don’t worry, Opersonalcleansingwipe will take full credit for everything.

Battle to halt BP oil spill is nearing its end, says Barack Obama

BP claims it has reached ‘significant milestone’ in efforts to permanently seal Deepwater Horizon well

Barack Obama today declared the US’s largest and most politically embarrassing oil spill near an end as BP said it had reached a “significant milestone” in its efforts to permanently seal the Deepwater Horizon well.

“The long battle is finally close to coming to an end, and we are very pleased with that,” said the president, who was strongly criticised for what was initially seen as a slow and weak response as millions of barrels of oil poured into the Gulf of Mexico.

BP said it had completed a process known as static kill, in which heavy mud was pumped in to plug the stricken well, producing a “textbook” result.

Obama described the static kill operation, and a report by government scientists that about 75% of the nearly 5m barrels of spilled oil has been dealt with by the clean-up effort or nature, as “very welcome news”.

The White House tried to ensure the administration would gain credit for leading what it called a “robust” response to the disaster by saying that the clean-up would not have been as successful if it had not pushed BP “every step of the way”.

Right, because playing golf, going to rock concerts, putting half of Louisiana out of work, hiring thousands of layabouts to put sand in bags while only working a third of a day for full day’s pay at a higher hourly rate than they’ve ever seen, and taking multiple vacations is what we all call a “robust response”. Plus letting all the various government departments have a festival of stepping on their own dicks and generally slowing things down and making them worse. Dimwit.

Leftists Displeased, Surprised by Disappearing, Dispersing Gulf Oil

RUSH: The New York Times, the Washington Post, it’s everywhere.  “On the Surface, Gulf Oil Spill Is Vanishing Fast; Concerns Stay—The oil slick in the Gulf of Mexico appears to be dissolving far more rapidly than anyone expected --” No.  There were a lot of us that expected this to happen.  “-- a piece of good news that raises tricky new questions about how fast the government should scale back its response to the Deepwater Horizon disaster.” Come on, New York Times, scale back?  Does the federal government scale back in anything?  It’s response?  The moratorium goes on, jobs shut down, drilling shut down, 135,000 jobs kaput, $20 billion shaken down from British Petroleum. 

Speaking of that: “BP said Tuesday that it plans to cut its U.S. tax bill by $9.9 billion, or about half the amount pledged to aid victims of the disaster, by deducting costs related to the oil spill.  A portion of that could be refunded from taxes BP paid in earlier years.  The company disclosed its intentions as part of its second-quarter earnings report, in which it said it would record a $32.2 billion charge to reflect the costs of the spill.  Under U.S. corporate tax law, companies can take credits on up to 35 percent of their losses.  The credit for BP could mean, however, that taxpayers will indirectly foot part of the bill for the $20 billion” shakedown that BP was forced to pay by Obama “to compensate people and businesses harmed by the disaster.” It doesn’t read that way in the Washington Post.  I used my own words to make the story accurate, calling it a shakedown.  Gonna cut their tax bill by $10 billion.  This is said to be the taxpayer indirectly footing the bill.

That seems to at least partially support the above numbers.

And this is the Washington Post: “Oil from the BP blowout is degrading rapidly in the warm waters of the Gulf of Mexico and becoming increasingly difficult to find on the water surface, the head of the National Oceanic and Atmospheric Administration said Tuesday.  ‘The light crude oil is biodegrading quickly,’ NOAA director Jane Lubchenco said during the response team daily briefing. ‘Significant oil has been dispersed and broken down by bacteria.’

“A significantly more optimistic assessment of the environmental effects of the oil well blowout came Tuesday from Edward Owens, who worked with Exxon for four years on the Valdez spill in Alaska and who has been hired as a consultant to BP. Owens was quoted as saying the fragile Louisiana marshes would be close to pre-blowout condition within months and that the environmental impact on the gulf as a whole would be ‘quite small.’” Whoa.  Something’s going to have to happen to this guy.  Doesn’t he realize the permanent destruction of the Gulf is now settled science?

Read the rest if you want, it’s a Rush. And it only got better today.

from the NY Times article discussed by Rush:

The immense patches of surface oil that covered thousands of square miles of the gulf after the April 20 oil rig explosion are largely gone, though sightings of tar balls and emulsified oil continue here and there.

Reporters flying over the area Sunday spotted only a few patches of sheen and an occasional streak of thicker oil, and radar images taken since then suggest that these few remaining patches are quickly breaking down in the warm surface waters of the gulf.

Hmmm, no wonder the government wouldn’t let anybody fly over this. That kind of news goes completely against the approved story. And Cap & Trade had to move forward. Let no crisis go to waste ... even if you have to manufacture one? Or at least digitally enhance it?

Posted by Drew458     on 08/04/2010 at 07:27 PM   
Filed Under: • Environment • Oil, Alternative Energy, and Gas Prices •  
• Comments (3) • Trackbacks(0)  Permalink •  

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