Thursday, 10 June 2010

Health warning, politicians seeking re-election

One of the few universal truths in politics is that the only thing politicians really care about is getting re-elected. You can call it staying on the gravy train, keeping your snout in the trough or just plain staying in power. This is the what is driving Obama's and the rest of the US administration's inflammatory rhetoric on BP and Merkel and Sarkozy increasingly shrill pronouncements on short selling, hedge funds, bank regulation etc. In short anything that panders to the general populaces worries and prejudices and which might get these sordid politicians the votes of the gullible.

Obama's faces mid term Congressional elections in November. His administration is in deep trouble domestically so he is doing what tyrants, dictators and incompetent politicians have done throughout history, blame the foreigners who of course have no votes in US elections. This is aided by the media in search of a 'story' their largely moronic customers can understand in 5 seconds, their maximum attention span. Hence the media find a worst case like an oil drenched pelican picture and plaster over their front pages, newscasts etc. This is a universal problem in Western democracies and you end up with actions not as it should be for the great mass of the population but for the extreme vociferous minority for whose grievances the great silent majority have to pay.

Damian Reece points out in today's DT that so far a total of 1356 dead animals have been found across 5 Gulf states the vast majority of whom died of natural causes. Also as there is now much more interest in reporting and keeping a count on these animal corpses any comparison with normal times overestimates the effect of the spill. If however we accept the 1356 figure and divide it into the loss of BP market valuation you come out with a staggering £36.6 million per corpse.

Worse, U.S. Interior Secretary Ken Salazar told a Senate hearing he would ask BP to repay salaries of any workers laid off because of the six-month moratorium on deepwater exploratory drilling imposed by the U.S. government after the spill. So BP is to be made responsible for the effect of Obama's actions. This is Robert Mugabe land law.

As a result of this and other inflammatory statements by administration officials BP shares fell heavily last night under fear that they BP may have to file for bankruptcy. Also, US politicians have absolutely no right to influence BP's dividend policy on which many British and US pension funds depend. The only criticism levelled at BP concerns its CEO's inept PR. No one has seriously criticised their technical or engineering people.

I am sure many US oil companies would like to see BP forced into bankruptcy by Obama's boot on BP's neck so they could then buy up BP assets at a knockdown price. But who has the most money to buy up and the expertise to operate BP's assets and has a huge growing demand for oil? China! Let us see how the US people and Obama react if the results of his anti-British spleen is a Chinese boot on the throat of the oil supplies closest to the US.

That well known anti-American organisation, the EU has been conspicuous for its silence throughout. It is interesting to speculate if this silence would have been so deafening if it had been a Shell well. Shell is 60% Dutch owned. So all the Europhile hot air about giving the UK a bigger voice in the world against the large power blocks has been shown to be, well just more hot air.

Back in Euroland Merkel and Sarkozy continue in their doomed attempts to ban standard financial market practices and so boost the Swiss economy. Merkel has of course just had a kicking in the recent Rhine Westphalia elections and Sarkozy has his eye on getting re-elected. Not only do thy both suffer from the re-election imperative but both are hidebound by out dated Soviet style ideology and dreams of restoring their former military supremacy. Not so the Chinese leaders, pragmatic long term thinkers par excellence!

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