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For
anyone who thinks BP got its "ass kicked", to use Obama's lingo,
consider the following facts. |
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This
tale demonstrates Obama's so-called skill. |
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It seems like a miracle that our beloved
leader was able to convince BP to establish a $20 billion slush
(euphemistically referred to as an escrow) fund to compensate those
hurt by the ongoing oil plume in the
Gulf of Mexico. After
all, he had no constitutional power to force them to do so; so had
to resort to Chicago-style negotiating. |
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| But,
consider the realities of the effect on BP's finances: |
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1. BP will establish a $20 billion fund,
but will pay only $7 billion into it during 2010. |
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2. BP is a British corporation, but has
a very large operating entity in the US but only about 30% of it's
income is derived from the
US. |
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3. By Generally Accepted Accounting
Principles (GAAP), BP must book the entire $20 billion expense in the
year accrued. Therefore, they will book a $20 billion expense in
2010, reducing their
US tax liability by $7 billion. |
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4. Our dear leader also convinced this
massive corporation to show their concern for the "small people" by
withholding dividends to their shareholders for the last 3 quarters
of 2010. This reduces their outward cash flow by about $7.5
billion, including approximately 40% of that amount to US citizens.
Assuming that the Bush tax cuts will
survive through 2010, the US Treasury
will lose another $450 million in taxes on that amount. We won't
even discuss the effect on the
US economy. |
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Americans really should expect this. After all, our dear leader is the most inexperienced man in ANY room
he enters. |
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Did the enlightened one "Kick Ass", or
did he get "Sucker Punched"? |
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This is just one more reason why a "community
organizer" should NOT be negotiating anything dealing with
money and finances! |
|
| The
bottom line is: |
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The $20 Billion BP is putting up will
create a $7.5 Billion positive cash for BP flow this year. But,
Obama actually "thinks" he really did something special and "kicked
ass' (to use his own words). |
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In reality, BP executives are laughing
at him and "kicked his ass". |
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This president is in way over his head
when he starts dealing with business people. He succeeds no
more when he deals in international affairs, domestic affairs,
economics, or inter-personal relations. |