What BP gets by putting 20B into an escrow account (or why this in NO way resembles a "shakedown")

[Kber]

BP will put at least 20B into in escrow account to pay for some of the damage they have caused. In addition, they will put other money aside to compensate workers hurt by the moratorium on drilling and for environmental studies. The 20 billion is a start, not a cap and BP will have no influence on how claims are paid or to whom.

We know some of the things we get out of the deal, including a claims process that we can have more faith in, knowledge that money will be set aside to pay claims, even if BP goes belly up, and money to pay for some items (like worker compensation) that BP believes it should not be responsible for.

But BP benefits as well. First and foremost, they get to claim a tiny bit of good PR, which they desperately need. Secondly, by administering the claims through a neutral third party, BP can avoid both the expense and hassle of setting up the infrastructure to process claims. Perhaps most importantly for them, when some claims are inevitably denied for reasons good or bad, BP won’t have to deal with the subsequent news stories about slow or improperly denied claims.

Make no mistake, I believe the fund is a great start on cleaning up the mess BP has created and I don’t trust BP to be either willing or terribly able to pay damages in a fair and effective manner. However, for Gingrich, Barton, or anyone else to suggest that the government “robbed” BP somehow not only seems to suggest that, against all evidence, BP would be more competent and willing to fairly pay for damages, and not only must they believe the taxpayers in their own districts should pick up some or all of the clean up tab, but they are overlooking the very real benefits BP reaps from the deal.

[PBS Poll-435]

1. Easy K&R

:thumbsup:

[vaberella]

2. Well the independent organization dealing with pay outs doesn't benefit them only.

This covers the base of the government as well. It ensures the government that the funds will get paid out, without dealing with unnecessary repercussions from the media and Republican party that BP was fleeced or because of government involvement pay outs weren't done in time.

[Kber]

3. Oh, for sure.

That's a good point too.