2010 - %3, June

Crisis PR Expert: BP Disaster is "Unspinnable"

—By

| Thu Jun. 3, 2010 6:34 AM PDT

The ecological catastrophe that BP has wrought upon the Gulf of Mexico has been a profound teaching moment, and not just for environmentalists. Corporate America's trusty public relations officials, and their hard-working elite, the crisis communications experts, are eagerly taking note of BP's every word and deed. Mostly, it seems, to remember what not to do when the shit hits the fan.

Chris Lehane is a crisis communication expert whom Newsweek named a "Master of Disaster" for his role in the "rapid response" team that the Clinton Administration assembled to deal with scandals such as Whitewater and the Monica Lewinsky affair. His consulting firm, Fabiani & Lehane, has represented California Edison during the California Energy Crisis, Goldman Sachs during the the financial crisis, and Cisco Systems when the Internet bubble burst. Yesterday Mother Jones spoke with Lehane about the BP crisis.

Mother Jones: From a crisis communications standpoint, what has BP done well?

Chris Lehane: Making the video [of the ruptured oil well] available so that people could see the live feed. One of the rules of thumb of crisis management is that you can never put the genie back in the bottle in terms of what the underlying issue is. People evaluate you in terms of how you handle things going forward. And obviously doing everything to be open, transparent, accessible is the type of thing that the public does look for from a corporate entity in this type of situation.

The video, at a tactical level, is the type of thing that makes sense because you are obviously giving people the capacity to go online and look at this stuff and evaluate it themselves. The challenge for them was that they weren’t necessarily open, transparent, and accessible with everything else, so I’m not sure how much of a benefit they got from that.

MJ: What has BP done poorly?

CL: This is just from a professional perspective: They set up a series of expectations in terms of what they were going to do to resolve the issue, and time after time after time they have not worked out. If you tell people what you are going to do, and you suggest it’s going to be successful, you need to be successful. Because once you create those expectations and you don’t fulfill them, when you already have a significant credibility problem, it just further degrades your credibility.

[Read more]

Advertise on MotherJones.com

Palin Blames Spill on "Extreme Enviros" and More News From the Gulf

—By

| Thu Jun. 3, 2010 6:28 AM PDT

On Tuesday, Sarah Palin posted a new screed on Facebook bashing environmentalists for being the cause of the Gulf oil spill. No, really. Meanwhile, back on Earth, MoJo reporters Mac McClelland and Julia Whitty continue to blog and tweet live from the Gulf beaches, while Kate Sheppard keeps tabs on the politics of the spill. And if you haven't checked out Mac's and Julia's photos yet, they're worth a gander. Trust me. Mac's are here, and Julia's shots of birds battling oil are here.  Some sample tweets and links to our recent coverage of BP and the spill that's shaping up to be the environmental disaster of the century:

@JuliaWhitty: The oil in the seawater is as tacky as wax. I'd like to give the BP bigwigs fully-body Brazilian waxes #bp #oilspill

@MacMcClelland: A big lake of concentrated #BP crude has just been spotted coming toward the coast of Grand Isle.

For more up-to-the-minute updates on the spill, check out our BP coverage and the Blue Marble blog. You can also follow Mac McClelland, Julia Whitty, Kate Sheppard, The Climate Desk, and the Blue Marble on Twitter. 

John Kasich "Takes On" "Special Interests"

—By

| Thu Jun. 3, 2010 6:28 AM PDT

Pledging to "take on special interests" is a time-honored tradition in American politics. It's easy because everyone hates "special interests" and safe because "special interest" can refer to just about anything. John Kasich, the former GOP congressman and Lehman Brothers banker who's running against Ohio Gov. Ted Strickland, knows all this. That's presumably why he's promoting his latest ad with this text:

Ted Strickland's most reliable special interest allies—the labor unions—came to his defense last week with almost $1 million in negative attack ads against me. It’s further proof that Ted Strickland’s complete lack of accomplishment leaves him no other option but to attack and smear.

So, while Ted Strickland’s campaign is benefiting from almost $1 million in negative attacks paid for by special interests, you might be interested to hear what I have to say about special interests by clicking here.

The message is clear: Ted Strickland's union allies are special interests, and John Kasich is going to stand up to them. But if unions are Ohio Gov. Ted Strickland's "most reliable special interest allies," who's backing Kasich? Well, we do know that when he was a congressman, big financial firms and pharmaceutical companies dominated the list of his largest donors. You can review Kasich's current contributors here—it's more of the same. (Strickland's are here.) But I want to focus on one donor in Kasich's congressional career and how a single vote Kasich took affected that donor and the state of Ohio.

National City Corp (a.k.a. NatCity), was a giant subprime lender and Kasich's third largest donor during his second final term in Congress (1999-2000). As the Cleveland-based company imploded in 2008, it announced plans to cut 15 percent of its workforce (about 4,000 jobs) before being bought by PNC Bank with the help of several billion dollars in taxpayer assistance.

The PNC acquisition led to more cuts, as the Pittsburgh-based bank didn't need another headquarters in Cleveland. Kasich blames Strickland for those lost jobs, but the truth is more complicated. While in Congress, Kasich voted for "Foreclosure" Phil Gramm's Commodity Futures Modernization Act, a bill that helped make possible the explosion of "synthetic CDOs," credit default swaps, and the subprime mortgage market in general. (UBS, the giant Swiss bank that later hired Gramm, was Kasich's number-one donor in 2000.) Big banks like NatCity and UBS supported the CFMA because it allowed them to get more involved with the then-lucrative subprime mortgage market. By 2006, NatCity was almost entirely focused on subprime lending. By late 2008, one of Cleveland's oldest institutions was no more.

The point is that all this talk about "taking on special interests" is silly. In his ad, Kasich says "you can't be in a position where somebody's your buddy so that you give them something special." But unless campaigns are publicly funded (or funded by very small contributions from individuals), you can never know for sure that a donation isn't influencing a politician's decisions. If NatCity and UBS hadn't given Kasich all that money, he might still have voted for the CFMA. Or maybe he wouldn't have. We don't really know. What we do know is that donors aren't stupid. Unions give Strickland money because they think he'll do right by them and their members. And bankers and pharmaceutical companies give Kasich money because they believe he'll deliver for them. And if you believe otherwise, well, I have some old NatCity subprime loans to sell you.

UPDATE: Anonymous makes some good points in the comments. Yes, Strickland voted for CFMA, too. But the point of the post isn't that Kasich is responsible for the collapse of NatCity. He's not, and I didn't say he was. That would be ridiculous. The point is that one man's "special interest" is another man's key supporter, and that the "special interest" attack is a meaningless cheap shot. The side point about NatCity is that Kasich's blaming Strickland for all the lost jobs in Ohio is silly—the financial crisis was a huge event with many, interconnected causes. As I said, things are "more complicated" than Kasich claims.

I also corrected the error about 1999-2000 being Kasich's "second" term in Congress, which was really stupid. Sorry—don't know how that happened.

Will the BP Spill Sink Charlie Crist?

—By

| Thu Jun. 3, 2010 6:28 AM PDT

This week, oil from BP's Deepwater Horizon rig in the Gulf of Mexico is expected to hit the shores of Florida's northwest panhandle, greasing the Sunshine State's pristine white-sand beaches in time for the summer tourist season. Already, hotels and restaurants are losing bookings for the coming weeks, though the extent of the BP disaster on Florida's economy—not to mention its coastlines and the water off its shores—is still unclear.

Leading the charge to assure Floridians and potential tourists that the state is open for business is Republican Gov. Charlie Crist. Crist is a candidate for the state's open US Senate seat, and he sent ripples throughout the country with his decision in late April to ditch the GOP and run as an independent. Right now, Crist holds a small lead in the polls, edging out Republican (and Tea Party golden boy) Marco Rubio, a former state legislator, and Democrat Kendrick Meek, a US congressman from South Florida. But will the BP oil spill, expected to last until August, sink Crist's Senate dreams?

Democrats and Republicans alike have lambasted Crist for what they say is his delayed reaction to the spill's impact on Florida. State chief financial officer Alex Sink, a Democrat, pointed out that it took 32 days for Crist to arrange for TV ads to calm fears about the spill's toll on Florida businesses. When Crist did obtain $25 million for commercials touting Florida's untainted vacation spots in the Panhandle, Sink, a 2010 gubernatorial candidate, told the Miami Herald, "I am very disappointed in the lack of sense of urgency about getting this problem solved and getting it solved now." Republican state senator Don Gaetz echoed Sink’s sharp criticisms, lamenting, "It's in days like this that I miss Jeb Bush."

[Read more]

We're Still at War: Photo of the Day for June 3, 2010

Thu Jun. 3, 2010 5:27 AM PDT

 

An AH-64D Apache with Company C, 1st Attack Reconnaissance Battalion, 1st Aviation Regiment, Task Force 12, glides effortlessly over Memorial Hall during the Memorial Day ceremony held at Contingency Operating Base Adder, Iraq, on May 31. Photo via the US Army by Sgt. 1st Class Christopher Dehart.

New Life for the Volcker Rule?

—By

| Wed Jun. 2, 2010 10:23 PM PDT

The conference committee for financial reform legislation won't start meeting until next week, but the Financial Times reports that one provision in the bill is already on target to get tightened up:

Congressional negotiators are moving to toughen financial reform legislation, raising the chances that banks will face a strict ban on proprietary trading and a new conflict of interest rule, people involved in the deliberations say....The provision, sponsored by Jeff Merkley and Carl Levin, two Democratic senators, would toughen the “Volcker rule”, which bans banks from trading for their own account or owning hedge funds and private equity firms, but gives regulators time to study the rule and modify it. “That is a very wishy-washy way to approach the issue,” Mr Merkley said.

Mr Levin said even though the Treasury would “probably...want as much power as they can get to...modify [the bill]”, he thought Congress should write a strong final version.

The Wall Street Journal reports that traders are genuinely unnerved:

Since political momentum began building earlier this year to limit trading for profit at Wall Street firms, traders have been exploring their options, and some have already left. Outside the banks, private investment funds looking for skilled traders have been gearing up for a hot talent market.

...."With Volcker, you've got everyone shaking in their boots, so these traders all have an ear to the ground," says John Pierson, a Manhattan-based headhunter for financial firms.

I guess I can live with this. I'd rather have trading being done in hedge funds, where it belongs, than in banks, where it risks blowing up the plumbing of the financial system. One caveat, though: that trading income should be taxed as ordinary income, not capital gains, as it is now. Other people's money, you know. The House has already done its part to change this, and now it's the Senate's turn.

Advertise on MotherJones.com

The Dead Wildlife We'll Never Know About

—By

| Wed Jun. 2, 2010 7:29 PM PDT

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Louisiana spill zone. All up and down this shoreline angry and scared people told me some scary and infuriating stories in the past few days. I heard about the the dead and dying wildlife we're never going to see because the victims are being carted away to early responder ships and to inaccessible buildings onshore.
 
Out of sight, out of mind, I guess. It all seems like a bad Hollywood script. Except it isn't. I've seen some of those photographs which can't be shown (according to BP's new orders) of dolphins swimming through thick gunky oil, struggling sperm whales trailing wakes a mile long in thick gunky oil, dead jellyfish in gunky oil.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The Louisiana locals are really angry about the lying, threats, and bullying they all complain is coming their way from BP and their contractors. The dead wildlife they've seen, which then miraculously disappears, doesn't actually disappear from their memories. Some of the people I've talked with have signed non-disclosures. Whether they have or not, all agree, the people here are furious and desperate. It's a powder keg, ready to blow. This is Louisiana, they say, we don't do quiet and obedient. 
  

The One Thing BP Got Right (and Other Oil Blurbs)

—By

| Wed Jun. 2, 2010 5:48 PM PDT

While, uh, drilling for angles on the BP spill, I stumbled across the following ad in PetroMin, an oil industry trade magazine.
 

An ad from PetroMin magazine
This seemed somehow fitting. Just yesterday the Obama administration—desperate to cap the pipe spewing oil into the Gulf at a rate of up to 798,000 gallons per day—met with Avatar director James Cameron, whose Titanic experience made him an expert on doing stuff underwater. Shadarian, an Iranian company that makes pipeline-repair products, apparently preferred a more Avatar-esque theme. The weirdest thing, though, is the slogan: "Challenging The Perfection."

Now what the hell is that supposed to mean?

BP, for its part, has challenged the perfection that was offshore drilling's near-term prospects. Said prospects are exactly what PetroMin associate editor Vishnu Pillai gushes about in the trade rag's April-June issue, which clearly hit the presses before "blowout preventer" became a household phrase. He writes:

The search for oil and gas has, over many decades, moved from great plains of land to coastal areas and now even into deepwater areas. Yet the industry still believes that there will be no crisis in the foreseeable future. The industry faces the challenges of environmentalists who claim that the planet is being pillaged to assuage the greed of oil companies on a constant basis, faces the challenge of finding new sources of hydrocarbons and faces the challenge of being economically and operationally viable at the same time. Despite such pressing challenges there is that undeflatable air of optimism that is proudly hung across the industry like badge of defiance.

Pillai then explains why the optimism is warranted:

[Read more]

WikiLeaks' Sketchy Origins

—By

| Wed Jun. 2, 2010 3:56 PM PDT

The New Yorker has a fascinating new profile of Julian Assange, the mastermind behind WikiLeaks. Raffi Khatchadourian's piece is full of revelations about the enigmatic hacker-turned-"open-government activist", from details of his peripatetic childhood to an exclusive glimpse of Assange at work on the "Collateral Murder" video of an American Army helicopter shooting journalists and civilians in Baghdad.

Check it out—but also check out MoJo's controversial profile of Assange by David Kushner, which has just been updated and expanded. Like Kushner, Khatchadourian concludes that Assange's attempts to shine light on evildoers while lurking in the shadows is deeply contradictory: "The thing that he seems to detest most—power with accountability—is encoded in the site's DNA, and will only become more pronounced as WikiLeaks evolves into a real institution."

Perhaps the most interesting tidbit in the New Yorker story is its discussion of how WikiLeaks got its start. When WikiLeaks was in the planning stages in 2006, Assange said that he had more than 1 million documents; a claim that convinced Cryptome founder Jon Young that Assange was either exaggerating or up to no good. But now it seems that Assange did have his hands on a large, questionably obtained, cache of material. Khatchadourian reports that one WikiLeaks activist had access to a "tranche" of secret government documents obtained by Chinese hackers. The documents had been pulled off of Tor, the anonymizing network that WikiLeaks now encourages its leakers to use to stymie "internet spies." According to the New Yorker, WikiLeaks posted only a few of those swiped documents. If it's accurate, this anecdote raises some serious ethical and technical questions about how WikiLeaks operates. Does WikiLeaks condone this kind of online snooping? Has it relied upon it since its launch? Just how many of the senstive documents it's posted were genuinely leaked and how many were hacked?   

[Read more]

Spill Workers Get Sick, Chemicals Get a Pass

—By

| Wed Jun. 2, 2010 2:53 PM PDT

Last week, seven oil-spill clean-up workers were hospitalized after reporting nausea, headaches, dizziness, and chest pains. Doctors said the symptoms could have been caused by airborne chemical exposure while cleaning up oil slicks. The workers' families have blamed chemicals in the dispersants being used to break up the oil. However, BP has said that air quality tests done at the clean-up sites before the workers fell ill found nothing unusual; it first blamed the workers' condition on fatigue and sun exposure. BP CEO Tony Hayward has since chalked up the workers’ conditions to food poisoning: "I am sure they were genuinely ill, but whether it was anything to do with dispersants and oil, whether it was food poisoning or some other reason for them being ill, you know, there's a—food poisoning is surely a big issue when you've got a concentration of this number of people in temporary camps, temporary accommodations."

The possibility that the clean-up workers’ were suffering from chemical exposure is a reminder of just how weak our chemical regulations are. Last month, the President’s Cancer Panel reported that more than 80,000 industrial chemicals are used in the United States and about 700 new ones are introduced annually—yet very few are tested for potential health or environmental impacts before they hit the market. The panel found that those most vulnerable to chemical exposure are migrant workers, children, and blue collar workers—like those cleaning up BP’s mess in the Gulf.

The panel suggested that the US adopt a precautionary approach similar to the one employed by the European Union, which tries to screen out dangerous chemicals before they hit the market. Under our current system, chemicals are considered innocent until proven guilty. Laws protecting trade secrets prevent access to important information that might determine if a chemical is harmful. And if a chemical does appear to pose a risk, the burden of proof is on the EPA, which often has its hands tied. In April, Senator Frank Lautenberg (D-N.J.) introduced a bill that would amend the archaic Toxic Substance Control Act of 1976 to be more precautionary than reactionary. "America's system for regulating industrial chemicals is broken," he said. The bill is hanging out in the Committee on Environment and Public Works, awaiting further action.