Money pollution in the Gulf

Money pollution in the Gulf October 21, 2010

The Gulf coast way of life survived the oil spill.  But will it survive all of that money BP has thrown at them?

On a truly normal evening, Acy Cooper Jr. would be out shrimping. Instead, one recent night, he was staying home, as he has done more often these days.

“Why? It don’t pay me to do that when they’re going to pay my claim anyway,” said Cooper, vice president of the state’s shrimpers association.

Today, it is BP’s money, not its oil, that is most visibly altering the Gulf Coast. The company has been trying – on federal orders – to protect not just the water but the way of life there. But BP’s waterfall of cash has changed people’s lives profoundly.

The oil company has already paid out $965 million and set aside $20 billion in a separate compensation fund. The money has been welcomed as a lifeline. But it has made the coast feel like an open-air economic experiment: Some hardworking fishermen think it’s in their best interest to be idle, losing market share they will need next year. And those who haven’t been paid are looking for legal and illegal ways to work the system. . . .

So far, BP has paid $569 million to locals who participated in the Vessels of Opportunity program, helping to spot, sop up and burn the oil.

It also gave out about $396 million to compensate fishermen, hotel owners and others who lost money during the spill, before handing the process over to Feinberg in August.

For those who played their cards right, BP’s money brought a summer of quiet windfall. Ted Melancon, a shrimper from Cut Off, La., worked for BP for 130 days.

“They sure helped us out, you know, they stepped up to the plate and helped us out. . . . It would have been a bad year,” said Melancon (pronounced “meh-lan-sahn”). He said he hasn’t counted his full take, but he made enough to buy new nets and new cable for his shrimp boat, as well as a new Ford F-150 pickup.

“Which I didn’t really need, but I had to buy. Because, you know, tax write-offs,” he said, meaning that the truck and other items could be written off as business expenses. On top of that, he’s expecting to get another BP payout, compensation for the shrimping he couldn’t do this summer while large areas of the gulf were closed.

“I’m done for the season,” Melancon said. “It don’t pay to go back to work.”

via Adrift in oil, then money.

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  • sg

    Let me see if I got this straight. BP is spending a bunch of money because of the accident. That means they likely won’t make a profit, and then won’t pay taxes. Their stock price is also down. So, those who hold their stock and pay taxes will be impacted. Is that right?

  • sg

    Let me see if I got this straight. BP is spending a bunch of money because of the accident. That means they likely won’t make a profit, and then won’t pay taxes. Their stock price is also down. So, those who hold their stock and pay taxes will be impacted. Is that right?

  • It’s called “spreading the wealth around.”

  • It’s called “spreading the wealth around.”