Friday, February 11, 2011

Gulf Recovery

Two years and $20 billion later BP will have paid in full all of its compensation to local businesses. The Gulf Coast Claims Facility, GCCF, determines who is eligible to receive compensation. The GCCF claims a full recovery will be made by the end of 2012 for all local businesses except oyster fisherman.
The recovery rate for oysters in the gulf is unknown. The fund estimates compensation around four times the amount of documented damages. However if the oysters don’t recover by this time many local fishermen will find themselves unemployed. Many locals believe the fund has “short-changed” them.
BP took full advantage of the economic crisis stating if you accept a final payment then you are no longer allowed to sue the company. Many workers affected by the spill have lost income and are reliant on the compensatory payments to feed their families. They are left no choice but to accept the final payments by BP even if they feel they are being under paid. By accepting the payment each individual gives up his or her right to pursue a lawsuit against the oil giant.
The GCCF was able to predict compensation for each industry quickly by categorizing everything together with the exception of fishermen and determining an arbitrary figure. The time constraint was important but lumping everything together to determine payments couldn’t possibly be fair to the local businesses. Unfortunately, many businesses can’t hold out for a lawsuit and must accept the compensation.
Final payments will start going out as soon as February 16. Once a final payment is received no further compensation can be pursued. If the economy or environment fails to recover many businesses will be closed.
I believe that BP should be held more accountable for their actions. Although they have definitely paid for their mistake they have still been taking short cuts to protect themselves. The environment and local economies should be their priority at this point as it was directly BP's fault they are both suffering. In addition, many of the people who did place claims with the GCCF were unaware of the option to sue for what they believed to be a fair settlement. They should have been notified of their options before having to sign over their rights for a final payment.

--Ben Simon

1 comment:

  1. You can't help to think that on a purely business basis, BP was operating in the best interests of their investors, which is what we all want when we invest in a company right? I think it is wrong to look at it as just BP's catastrophic blunder, but rather to review the regulatory framework in which they have been operating. Not to mention, $20 billion is a pretty large amount for a business to dish out. But what would happen if BP paid everyone for all the damages that resulted from the oil spill? can we live without BP?