GOP rep apologizes to BP for Obama ‘shakedown’

WASHINGTON (AP) - Rep. Joe Barton's criticism of the White House isn't likely to provide solace to BP's Tony Hayward...

Jun 17, 2010

WASHINGTON (AP) — BP’s CEO was symbolically flogged by a congressional committee on Thursday, but one member, a Texas Republican, accused the White House of a ”$20 billion shakedown” for demanding the oil giant set up a huge fund to pay damages for the Gulf of Mexico calamity.

Rep. Joe Barton’s criticism of the White House at the beginning of the hearing was not likely, however, to provide solace to BP CEO Tony Hayward who was appearing before Congress for the first time.

In fact, Barton’s remarks in an otherwise silent congressional chamber were stark evidence of the brutal partisanship confronting President Barak Obama. The statement could also divert attention from the growing impression among Americans that Obama has handled the blowout poorly.

The White House responded rapidly, saying 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.”

In a statement, White House press secretary Robert Gibbs said members of Congress “from both parties should repudiate his (Barton’s) comments.”

WATCH VIDEO OF REP. BARTON AT THE HEARINGS HERE:
[MSNBCMSN video=”http://www.msnbc.msn.com/id/32545640″ w=”420″ h=”245″ launch_id=”37758028″ id=”msnbcb285d”]

Visit msnbc.com for breaking news, world news, and news about the economy

Facing Hayward at the witness table, Barton said, “I’m ashamed of what happened in the White House” on Wednesday. Barton was referring to the agreement that Obama won from BP for establishment of a $20 billion relief fund to individuals and business harmed by the blown out well. The broken well still is gushing as much as 60,000 barrels of oil each day eight weeks after the April 20 explosion.

Rep. Ed Markey had already sharply disagreed with his Texas colleague.

The Massachusetts Democrat said the compensation fund was “not a slush fund, not a shakedown. … 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.”

Shortly before Hayward read a prepared statement to the House panel, a woman, identified as Diane Wilson, shouted to Hayward from the back of the room: “You need to be charged with a crime.” She was grabbed by Capitol police and taken from the room.

Hayward said the explosion and sinking of the BP-operated rig “never should have happened — and I am deeply sorry that they did.”

Democratic Rep. Henry Waxman told the BP executive that in his committee’s review of 30,000 items, there was “not a single e-mail or document that you paid even the slightest attention to the dangers at this well.”

A day after agreeing to a $20 billion victims’ compensation fund, Hayward was to tell Congress in prepared testimony that he was “personally devastated” by the April explosion of the Deepwater Horizon oil rig that triggered the giant spill — and that he understands the anger that Americans feel toward him and his company.

Creation of the $20 billion fund — to be run by an administrator with a proven track record — is the first big success Obama has been able to give to Gulf residents and Americans in the eight weeks since the explosion, a period during which the spill has taken ever more of the public’s attention, threatening anything else the president hoped to focus on or accomplish.

A new AP-GFK poll showed that a majority of Americans think the president has not handled the crisis well, a significant outcome in the countdown to November congressional elections that could cost Obama his Democratic majority in one or both houses of Congress.

“To be sure, neither I nor the company is perfect,” Hayward said in his remarks. “But we are unwavering in our commitment to fulfill all our responsibilities.” He said the company has spent nearly $1.5 billion so far, and will not stop spending “until the job is done.”

He called the blowout “a complex accident, caused by an unprecedented combination of failures.”

A day before meeting BP officials and extracting their pledge to set up the $20 billion fund, Obama had accused the company of “recklessness.”

Board chairman Carl-Henric Svanberg, after the Obama meeting, also announced the company would not pay dividends to shareholders for the rest of the year, including one scheduled for June 21 totaling about $2.6 billion. The company will make initial payments into the escrow fund of $3 billion this summer and $2 billion in the fall, followed by $1.25 billion per quarter until the $20 billion figure is reached.

The use of the BP escrow fund is intended to avoid a repeat of the painful aftermath of 1989 Exxon Valdez oil disaster in Alaska, when the fight over money dragged out in courts over roughly two decades.

The company’s potential liabilities, including cleanup costs, victims’ compensation and civil fines, are breathtaking to consider — stretching far beyond the $20 billion fund.

Resolving one particularly thorny dispute between BP and the government, the company also agreed to establish a separate $100 million fund to support oil rig workers idled by Obama’s post-spill six-month moratorium on new deep-sea oil drilling. The administration also was to ask Congress for special unemployment insurance for the workers.

___

Associated Press writers Frederic J. Frommer and Matthew Daly contributed to this report.