Posted on 06/23/2010 9:19:12 AM PDT by Kaslin
When eight British soldiers were indicted in Boston for murder in 1770 after five people were shot to death in a rioting crowd that was pelting the soldiers with projectiles, a young lawyer named John Adams took up the soldiers' case because he had a point to prove: Americans believed in -- and lived by -- the rule of law.
"The law, in all vicissitudes of government, fluctuations of the passions or flights of enthusiasm, will preserve a steady undeviating course; it will not bend to the uncertain wishes, imaginations and wanton tempers of men," Adams said in his summation to the jury in the trial of the soldiers.
America did not disappoint Adams. Six of the eight soldiers he defended were acquitted, and two were convicted of manslaughter, not murder. The jury listened to the evidence and returned a fair verdict based on the facts. (For a good summary of the case, see the "Famous Trials" website maintained by professor Douglas O. Linder at the University of Missouri-Kansas City Law School.)
When President Barack Obama was coming under increasing political heat for his response to the oil spill in the Gulf of Mexico, he decided to give his first-ever nationally televised speech from the Oval Office. But Obama is no John Adams, and preserving due process of law was not on his mind.
Many Americans were understandably angry at both BP and Obama, and Obama wanted to deflect the anger from himself by capitalizing on the resentment of BP. He would show, once again, he was the bully in chief.
"Tomorrow," said Obama, "I will meet with the chairman of BP and inform him that he is to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company's recklessness. And this fund will not be controlled by BP. In order to ensure that all legitimate claims are paid out in a fair and timely manner, the account must and will be administered by an independent third party."
Now, the key words in this statement were "inform him." This was not a request. Indeed, the day before, The Washington Post said Obama would "demand" that BP turn over the money he wanted set up in this fund.
When considering Obama's action, it worth remembering that BP was not trying to disclaim responsibility for damage done by the oil spill, nor was it refusing to pay legitimate claims. As of this past Saturday, The New York Times reported, BP had already distributed 25,000 checks worth $63 million to people claiming damage from the spill. Company official had repeatedly insisted they would pay all legitimate claims.
But at his meeting with BP executives, with criminal and civil federal investigations looking into the gulf spill, Obama convinced the BP executives to surrender to an "escrow account" $20 billion of BP shareholders' money.
This "escrow account" will be managed by a Washington lawyer, who will oversee the distribution of funds to claimants. But Obama personally guaranteed that claims will be paid. "The people of the gulf have my commitment that BP will meet its obligations to them," Obama said. His political goal was to position himself as a champion of the little guy against big oil.
The owners of BP are ordinary people. You might be one yourself. According to The Washington Post, 40 percent of BP's stock is held in the United States. In Great Britain, according to the Post, one of every seven pounds -- or 14 percent -- paid in dividends to pension funds is paid by BP.
After the company's executives met with Obama, BP said it would suspend its dividend payments for three quarters -- meaning $7.8 billion would not be paid to pension funds, to retirees who invested in BP and to other shareholders.
The Fifth Amendment of our Constitution says: "No person shall be ... deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation."
In this case, BP's executives caved to Obama, preferring to cut their own political and public-relations losses rather than insist that due process of law be observed through the normal channels of American justice as they moved forward with their stated commitment to make restitution to those injured by the oil spill. But this sets a bad precedent for people who value property rights.
America will soon face a great financial crisis. The unprecedented federal deficits coming as a result of the welfare state that liberals have build up over the past 75 years will require the government to either dramatically diminish the entitlement benefits they have promised or dramatically increase government revenues. When that crisis comes, liberal politicians just might see the modest wealth accumulated by those middle-class Americans who actually saved -- by investing in such things as, say, BP stock -- as an attractive source of revenue to keep the dole flowing.
A president who has established a pattern of using executive power to unilaterally bully and intimidate corporate executives into surrendering their stockholders' property will be a happy precedent for them -- and a dangerous one for private property rights and the rule of law.
I dunno. Did Chrysler shareholders still have rights? GM shareholders? Republican Chrysler dealers? Evidently not.
Yes, the BP shareholders have rights. They can call a shareholder meeting and vote to remove the current leadership if they don’t like their decisions. The new leadership could then go to court claiming the old leadership failed their fiduciary duty in turning over money to an independent body without any legal benefit.
Certainly the people of The Gulf Coast deserve just compensation for lost wages, business, etc., but the amount should be determined by law, not by 0bamao. Also, if BP wishes to declare a dividend, it is not for 0bamao or his regime to say they cannot.
Pretty much the same tactics as Acorn uses... and organized labor as well. Cooperate or else.
Reminds me of when Paulson (under Bush) demanded that banks take TARP funds to hide the failing ones from investors. Did shareholders in those banks have any rights then?
Did Republicans even care about Paulson doing this?? Many here were upset about this but many others here to this day say it was OK for Paulson to force the banks because it saved the economy.
TARP was a curse. Now in Washington we have emergencies everyday of the year.
Good point - not to mention the bondholders. Obama’s actions on those bankruptcies are certainly leading other potential lenders to be less willing to invest.
There very well should be a shareholders lawsuit come of this. IMO, management has not upheld their fiduciary responsibility. Not saying the victims should not be compensated, but just writing checks is not the way to do it. There will be no end to that line.
I hope some BP shareholders file a suit against Hayward and the directors of BP for breach of fiduciary duty.
Corporate assets may properly be used to pay people with bona fide claims against the corporation.
But handing over a huge sum of corporate assets to Obama and his political apparatus, outside of the legal system, with no control or accounting by BP to ascertain that only bona fide claims are paid, in essence providing a giant slush fund for Obama, could well be found to be a breach of the fiduciary duty owed by the officers and directors of BP to their shareholders.
So, BP could argue that it believed that to give in to Obama's illegal actions was necessary to save the company more money and grief from the US government, and perhaps for PR reasons, and if it does, its actions would come under the business judgment rule.
What needs to happen is for the new supposed conservative Prime Minister of Britain to step in and say that this extra-judicial punishment of BP cannot stand, and fight it diplomatically and economically. He has enough power to stand up to Obama for BP, and he can threaten punitive actions against American companies, perhaps in the North Sea or elsewhere. He could say that he has no problem with BP being subject to US laws, but he will not stand idly by while BP is subjected to dictatorial action. In that way, he would be protecting all those British pensioners who are seeing their life savings go down the drain.
Will he do it? I doubt it. The British are probably still too concerned with following the US lead. They have not shifted, yet, to the realization that Obama is not their ally. We still are, but the US under Obama is not.
“Americans believed in — and lived by — the rule of law.”
Adams was right. Americans do believe in the rule of law. This is what comes of electing a president who is not a natural born citizen (and who has been so cagey about his past that it’s reasonable to wonder whether he is even a citizen).
One of the best tests of Legislation or the actions of our own team, is whether we could support it if Obama or other Democrats were pushing the effort.
The second great test is how would we like it if the worst of the Democrats were going to be able to use this legislation to their own ends later on.
But then our leaders don’t even bother to read the legislation they vote for these days.
I wish you were correct, but he did the same with Chrysler bondholders at the very beginning. He took away their money and gave it to the unions.
Regardless of how much I may like a car, I will not buy it from the Detroit unions that now own it --- the very source of Detroit's demise even prior to Obama's action --- for as long as I live.
“Do BP Shareholders Have Rights?”
No.
The precedent was established when Bam-Bam took away GM and Chrysler stockholders’ rights.
BP could have said, “No. See you in court,” but they didn’t. They agreed to pony up the funds and if anything Obama did them a favor. They’re on the hook for billions in damages anyway. They know that. By setting up an escrow fund and letting Obama’s hand-picked designee run it then BP is off the hook. Any delay in payments, any shortage of help, any bottleneck in the claims being processed is the fault of the Obama administration. BP can say, rightly, “We did the responsible thing and made the money available. It’s the other guys who screwed up getting the money to those who need it.”
In Fall 2008 during the debate it was obvious to me as well as liberals like Maxine Waters that Obama would get to spend the TARP money in 2009.
But many fools here believed Bush that TARP would save the economy and McCain would win the election as a result of saving TARP. Of course when that didnt happen they changed their dictionaries from ‘saving the country’ to ‘destroying the country’ trying to fit the MSNBC model of Republicans.
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