The Delta Grassroots Caucus (DGC) is a broad coalition of grassroots leaders in the eight-state Delta region. DGC is also a founding partner of the Economic Equality Caucus,
which advocates for economic equality across the USA.

Louisiana Responses to Obama & Congressional Actions on the Oil Disaster

Posted on June 18, 2010 at 05:22 PM

SOUTHERN LOUISIANA: Local assessments of the Obama administration’s responses to the oil disaster improved somewhat after the agreement for BP to create a $20 billion escrow account was announced. President Obama’s decision to choose Secretary of the Navy and former Governor of Mississippi Ray Mabus to head the Gulf economic recovery plan was also well received, due to his being a son of the region and his involvement in Delta regional issues since he and then Gov. Bill Clinton were key leaders of the Lower Mississippi Delta Development Commission.

There were still reservations, though, largely because of bitter memories of the inept federal response from FEMA to Hurricane Katrina. We spoke with aides to Plaquemines Parish President Billy Nungesser who told us that “the creation of the escrow account is good, but it has to be handled fairly and efficiently. If it’s handled in the typical Washington, DC bureaucratic way it’ll be another flop.” Nungesser has been among the most vocal local critics of both BP and the Coast Guard and other federal activities.

The suspicion of the federal government here due to the abysmal experience during and after Katrina is understandable. There is also some hope that this process will be different. The selection of Kenneth Feinberg to oversee the BP claims process has generally gotten good reviews. Most, though certainly not all, observers felt he did a good job of administering the funds for victims compensated by the 9/11 Victims Compensation Fund.

Congressman Charlie Melancon, who participates every year at the Delta Caucus Washington, DC conference and represents the southern Louisiana district most directly harmed by the spill thus far, said Feinberg’s selection by Obama might be the step forward that is needed to “shake things up.”

Not all the responses were so favorable, however. While $20 billion is certainly a large amount and a step forward, the consequences are likely to be so expensive that the amount needed may be much larger. The administration indicated that the $20 billion for paying damage claims to individuals and businesses was “neither a ceiling nor a floor,” but BP has publicly pledged to make good on the claims it owes people in the Gulf.

The $20 billion fund is generally perceived positively here, but the $100 million fund for oil rig workers who lose their jobs as a result of the administration’s six-month moratorium on deepwater drilling is inadequate. Rep. Melancon wrote to BP CEO Tony Hayward that the oil giant should pay the full salary of every rig worker laid off because of the moratorium, which he calculated at $330 million per month. Melancon described the $100 million “a drop in the bucket of what is needed to make these workers whole.”

Another major problem with the $100 million fund is that it does not apply to support crews. Each rig job supports three jobs on shore or on supply vessels, so while the number of rig workers who stand to lose their work is 6,000 to 8,000 people, thare are between 18,000 and 24,000 jobs across the Gulf created by the 30 shuttered rigs.

If the response to the Obama administration’s heightened involvement in the spill received better reviews than it had before the recent Coast Guard criticisms of BP, the escrow account creation, and the choice of Mabus to develop the recovery plan, the negative reaction to Members of Congress who apologized to BP’s Hayward for the Obama administration’s “shakedown” of them was volcanic. The reference to a “shakedown” was not only used by Rep. Joe Barton but also by Rep. Tom Price of Georgia and a report by the Republican Study Committee, a group of staunchly conservative Republicans.

The most publicity was devoted to Rep. Joe Barton’s apology to Hayward at a Congressional hearing, but a similar criticism of Obama’s alleged “shakedown” was made by Rep. Tom Price of Georgia, who used similar language in a report issued by the Republican Study Committee, which wrote on Wednesday that “BP’s reported willingness to go along with the White House’s new fund suggests that the Obama administration is hard at work exerting its brand of Chicago-style shakedown politics.”

The Obama administration may not have had the legal authority to force BP to create the fund, although obviously pressure from the administration was the main reason they agreed to it. The criminal investigation of BP being conducted by Attorney General Eric Holder is an entirely separate matter. The political and moral pressure exerted by the administration clearly carries weight with BP, and many people understand that along with the justified condemnation for BP causing the disaster, they should be given credit if they begin to compensate victims properly and improve their cleanup operations.

A typical response to Reps. Barton and Price was that of Dr. Kevin Stephens, a distinguished medical doctor in New Orleans and formerly high-level Louisiana health department official. Dr. Stephens said that far from being a shakedown, “Obama’s action was just a realization that the economic effect is huge and is snowballing, and BP needs to step up to the plate and handle the mess that they created.”

Tim Smith, president of the Louisiana Housing and Community Development Corp., which operates statewide but is based in New Orleans, agreed that in the last couple of weeks “Obama is doing better and is more on top of it now than he was earlier perceived to be.” he said “I see the Coast Guard heavily involved on a day-to-day basis now.”

Smith said “Terrebonne and Jefferson Parishes also have a lot of exposure to this, and they are quickly spending local government dollars to help pay for fishermen to help with the work with the booms and other clean-up activities.” They are being more pro-active because they are suspicious of relying on federal government aid after the bad experience from Hurricane Katrina.

Even though it’s positive that the local governments are trying to make their contributions, the costs of the spill are so massive that only BP and the federal government have the resources to deal with it. The Plaquemines Parish government led by Billy Nungesser argues for allowing local governments to get involved in the decision-making process to avoid another Katrina-type mess.

This disaster has important differences from Katrina, because the main source of funding in this case is BP rather than the federal government. The roles of well-respected people like Feinberg in the compensations process and Ray Mabus on the overall recovery plan are pluses. The experience of Katrina still casts a long shadow over the compensation process, and the Obama administration still has a lot of work to do to get high marks from southern Louisiana.

Even though BP is employing many of the people still working in places like Grand Isle, the hostility against them is not surprisingly rampant. There were big signs all along Louisiana Highway One, the main road in Grand Isle, saying things like “Hey, Tony, don’t whine about getting your life back. Give us our beach back!”–a reference to his public comment that the spill had taken his normal life-style away. A big sign over a house near the beach said “For sale or long-term lease. Gee thanks, BP.”

Hayward’s testimony before Congress was dismissed here. One fisherman told us “That’s just typical TonyBaloney,” which is one of the derisive nicknames (other typical language referring to him can’t be printed) he has earned among many in Grand Isle and elsewhere along the coast.

The Plaquemines Parish government is closely monitoring the health effects, especially on the workers who work closely with it. They are most concerned with the dispersants, which are especially “caustic,” Nungesser’s staff told us, although the effects of such a massive amount of oil and the noxious fumes is also a concern.

We are getting a great deal of interest in setting up Community Health House Network facilities in the parishes on the coast as well as New Orleans, for both oil spill victims and long-term recovery after Katrina. Apart from the direct impact of the fumes, the oil and the dispersants, the economic impact on many low-income or recently unemployed people will make it more difficult for them to buy health insurance. Mental health care experts predict a major increase in mental health problems due to the oil disaster.

I will be participating at a Department of Health and Human Services meeting at the Monteleone Hotel in New Orleans on Monday and Tuesday, June 21-22 about the health impact of the oil spill. Dr. Aaron Shirley, the noted pediatrician with the Jackson Medical Mall Foundation in Mississippi, will be among the participants at that conference.

We still do not know how bad the impact will be but there will be many experts in the field at these meetings and I will give you a report about it next week. I also plan to give an update on the Community Health House Network initiative next week.

Please RSVP for the Delta Caucus conference in Washington, DC on Sept. 21-23. Among our issues we will certainly focus considerably on the impact of the oil spill. One session will include a fundraiser for victims of the oil spill and Katrina, to be held Thursday morning, Sept. 23, at the main sanctuary of the Lutheran Church of the Reformation on Capitol Hill near the Supreme Court, 8:30 a.m. to 12:30.

You register for the Sept. 21-23 Delta initiative in DC by paying the $85 early registration fee. Please make out the check to Delta Grassroots Caucus and mail to:

Delta Grassroots Caucus

(Attention: Lee Powell)

5030 Purslane Place

Waldorf, MD 20601

The proceeds of the Sept. 23 fundraiser will go to nonprofits aiding those suffering in southern Louisiana. Thanks–Lee Powell, MDGC (202) 360-6347