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By Jim Efstathiou Jr. and Jeff Plungis
June 17 (Bloomberg) -- Representative Joe Barton, a Texas Republican, said a fund BP Plc agreed to establish after meeting with President Barack Obama yesterday amounted to “a $20 billion shakedown.”
“I’m ashamed of what happened in the White House,” Barton said today as a House Energy Committee panel began a hearing on BP’s Gulf of Mexico oil spill. The Obama administration called Barton’s comments “shameful.”
The London-based oil company agreed yesterday to Obama’s request to establish a fund to pay damages from the spill, and to temporarily suspend dividends as Gulf residents and businesses begin filing claims. BP said it will commit $20 billion to the fund.
Barton spoke in opening statements before testimony to the committee by BP Chief Executive Officer Tony Hayward, in his first appearance before Congress since its oil well exploded.
“It is a tragedy of the first proportion that a private corporation can be subjected to what I would characterize as a shakedown, in this case, a $20 billion shakedown,” Barton said.
White House press secretary Robert Gibbs called in a statement for lawmakers from both parties to “repudiate his comments.”
‘Big Corporations’
“What is shameful is that Joe Barton seems to have more concern for big corporations that caused this disaster than the fishermen, small business owners and communities whose lives have been devastated by the destruction,” Gibbs said.
Representative Edward Markey, a Massachusetts Democrat, rebuked Barton at the hearing, saying he disagreed “in the strongest possible terms.”
“It was the government of the United States working to protect the most vulnerable citizens that we have in our country right now, the residents of the Gulf,” Markey said.
Hayward said in his opening remarks that the company will pay “all necessary cleanup costs” of the spill.
“Right now, it’s simply too early to say what caused the incident,” Hayward said. “A full answer must await the outcome of multiple investigations.”
The CEO drew criticism from the panel for allegedly ignoring dangers at the Macondo well that exploded, creating the biggest U.S. oil spill.
“We could find no evidence that you paid any attention to the tremendous risk BP was taking,” Representative Henry Waxman, a California Democrat, said. “There is not a single e- mail or document that shows you paid the slightest attention to the dangers at this well.”
Cracks in February
Hayward, 53, who told the lawmakers he is “personally devastated” by the spill and the death of 11 workers in the explosion, was warned through a list of advance questions to expect a rough reception from lawmakers. Before today’s hearing, lawmakers described five “questionable decisions” by BP that they said the CEO should be prepared to discuss.
--Editors: Larry Liebert, Steve Geimann
To contact the reporters on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net; Jeff Plungis in Washington at jplungis@bloomberg.net.
To contact the editor responsible for this story: Larry Liebert at LLiebert@bloomberg.net.
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