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Is It A Shakedown?
Jun 24, 2010
BP CEO Tony Hayward testified before the House Energy and Commerc Committee. It did not go well. Given that the U.S. Attorney General has announced an investigation into possible criminal charges, it seems noteworthy that no one thought to read Hayward his Miranda rights. Indeed, the congressmen rather seemed to expect he should make a wide variety of assertions on the basis of which he and others might later be pilloried, sued, and jailed.
The highlight of the committee session was the assertion by Rep. Joe L. Barton (Republican of Texas) that the $20 billion escrow account BP has agreed to set up under threat from President Obama was “a shakedown.” This is what is known in Washington lingo as a “Kinsley gaffe.” (The term arises from a remark by Michael Kinsley: “A gaffe is when a politician tells the truth.”)
And yet Rep. Barton’s analysis was superficial. Yes, BP handed over money under the threat of force, the classic form of a shakedown or extortion. But the money was not directly for the use and enjoyment of the coercers. It was seen, by them, as an immediate downpayment on the economic damages that BP will undoubtedly end up paying. From this perspective, the act by the U.S. administration is better characterized as Jacobinism, governmental behavior that brushes aside the rule of law in order to achieve its perception of justice. And a rapid crumbling in the rule of law is what we have been seeing now in the United States for some time, especially (but not just) where businessmen are concerned.