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That represents a total drop of $23 billion in BP's market value.  So, while I'm not lifting a finger to defend BP, I do want to point out that the company truly does have every interest in fixing this problem.  That includes the fiduciary obligations to its shareholders.  The failure to solve this problem reflects on them, as it should.  Or more to the point, it reflects on their bottom line, as it should.

BP is going to get their clocks cleaned over this and it's one hell of an object lesson for others in the business.  I'm very fond of saying "just because you can do something, doesn't mean you should" and BP's spectacle of fail is a perfect example of it. Yes; the regulatory environment made it possible for them to do what they did, but they very clearly shouldn't have.

They've been penny-wise and pound-idiotic.  Thankfully, they're paying the price and will be for quite a while.

The shares have lost more than a third of their value, or about 46 billion pounds ($67 billion), since the leak started six weeks ago. The cost of dealing with the crisis now totals $990 million.

...The leak is a financial and public relations nightmare for BP.

As it should be.  At least they've begun another attempt at capping the well.  I really can't recommend keeping up on all the liveblog coverage enough.  Lots of people report back from a variety of news sources and it's really great discussion to boot.  So let's all take a minute to pray it works.

Rest assured, though, that no one is praying for it to work more than BP and its shareholders.  Yes; BP is rather focused on its image and is spinning like a record.  In other news, the sun is hot.  But I think it is this dynamic behind what some perceive as an aloofness, or worse, on the part of the Obama administration:  this HAS to be BP's fuck-up first and foremost.

If the government "steps in" or "takes over" more than they already are, the failure to cap the well does become theirs.  Right now, it's still BP's and whaddaya know - the free market is actually kicking someone's ass for once.  I guess laissez-faire ideology just had a "broken clock" moment.  But it's about to get its ass kicked too.

There's to be a commission similar to investigations that looked into the explosion of the Challenger shuttle and Three Mile Island.  They will make policy recommendations for avoiding this in the future. Of much more interest, however, is this from the article:

In evidence of the slew of litigation the slick will likely generate, U.S. Attorney General Eric Holder will meet with federal prosecutors and state attorneys general in New Orleans.

It will be Holder's first trip to survey the damage before what legal experts believe will be a criminal investigation into the disaster.

Guess what criminal charges mean?  The liability cap goes out the window!  Oh yeah.  

McClatchy quotes the former head of environmental crimes at the Justice Department, David M. Uhlmann: "There is no question there'll be an enforcement action, and it's very likely that there will be at least some criminal charges brought."

...Prosecutors in criminal cases can seek twice the cost of environmental and economic damages resulting from the spill, according to McClatchy.

What, precisely, are these criminal violations?  My money's on good old-fashioned negligence as the front-runner; apparently, they didn't even make sure batteries on equipment were properly charged! Add that to the long litany of ignoring this problem and skipping that test or the other:

       BP made choices over the course of the project that rendered this well more vulnerable to the blowout, which unleashed a spew of crude oil that engineers are struggling to stanch.

   ...BP also skipped a quality test of the cement around the pipe—another buffer against gas—despite what BP now says were signs of problems with the cement job and despite a warning from cement contractor Halliburton Co.

   ...In an April 18 report to BP, Halliburton warned that if BP didn't use more centering devices, the well would likely have "a SEVERE gas flow problem." Still, BP decided to install fewer of the devices than Halliburton recommended—six instead of 21.

And that's just a sample of what can really only be described as criminal negligence indulged by BP. But that was all before the spill; the oilcano itself has placed BP in the position of having committed direct crimes, namely releasing oil into a navigable waterway and messing with migratory birds

   "I think the question really is not whether criminal charges are going to be brought, but when and what type of charges," said Loyola Law Professor Dane Ciolino.

   Ciolino also says strict liability crimes clearly apply in this case.

   "Because of the fact that some migratory birds have been harmed and that oil has been released into a navigable waterway, that alone, irrespective of fault can lead to a misdemeanor criminal prosecution," said Ciolino.

I look forward to the day when BP looks back wistfully on a mere $23 billion hit.  How about you?

Originally posted to Cedwyn on Tue Jun 01, 2010 at 08:39 AM PDT.

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