If We Put BP Out of Business They Won't Be Able to Pay For All This Stuff

Gov. Haley Barbour of Mississippi brings up a good point about Obama's BP escrow plan:

Mississippi's governor said Wednesday he's not sure the federal government should have made BP put $20 billion into escrow to compensate victims of the Gulf of Mexico oil spill because the company needs it to drill more wells and make money so it can pay up.

President Barack Obama insisted BP set the money aside, and the company agreed to put $5 billion a year into the fund for the next four years.

"If they take a huge amount of money and put it in an escrow account so they can't use it to drill oil wells and produce revenue, are they going to be able to pay us?" Gov. Haley Barbour told The Associated Press in a telephone interview Wednesday.

Millions of gallons of oil have gushed into the Gulf since a BP well ruptured eight weeks ago off the Louisiana coast.

"We need them to generate revenue to be able to pay us," said Barbour, a Republican. "I worry that this escrow account reduces the chance of that rather than increasing the chances of that."

That's a legitimate concern, but not the only concern when it comes to BP's big bucks:

The crisis engulfing BP plumbed new depths last night as President Obama bullied the company into depositing £13.5billion into a fund to settle compensation claims for the calamitous Gulf of Mexico oil spill.

After a face-to-face showdown with the President at the White House, BP chairman Carl-Henric Svanberg revealed the payment meant the oil giant would be forced to suspend dividends to its shareholders until at least next year.

The news sent BP shares plunging to a 14-year low of £3.37, and is a major blow for Britain's pension funds, which rely on BP's dividend income to provide £1 in every £6 they receive each year.

Since the fatal explosion in April, the value of the company - formerly Britain's biggest - has halved to £63billion.

A damaged BP has ramifications for thousands of employees, both in America and Britain. In fact, there are twice as many American employees as there are Brits.

Another concern about Obama's ham-handed handling of this whole thing - he stated that we won't allow any further Gulf oil exploration until we know what caused this problem. In 1979 the worst Gulf Oil Spill occurred in the Ixtoc platform, many times the size of what's going on now. Thirty-one years later the experts still don't know what caused that one. Are we going to ban oil drilling forever if we can't figure out what happened this time?