MR. DAVID GREGORY: This Sunday, disaster in the Gulf with no end in sight and a looming summer of oil. Was this the defining week in the Gulf Coast crisis? The issues: containment of the oil and cleanup, holding BP accountable, the impact on the Obama presidency, the future of offshore drilling, and will Washington think big about finding other sources of energy? This morning, our special discussion. With us, Kenneth Feinberg, the independent administrator of the BP oil spill victim compensation fund; Mississippi's governor, Republican Haley Barbour; Louisiana senator, Democrat Mary Landrieu; the chairman of the House Select Committee on Energy Independence and Global Warming, Democrat Ed Markey of Massachusetts; the former president of the Shell Oil Company, John Hofmeister; and "BBC World News America"'s Katty Kay.
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Announcer: From NBC News in Washington, MEET THE PRESS, with David
MR. GREGORY: Good morning.
MR. DAVID GREGORY: After BP's Tony Hayward turned in a poor performance on Capitol Hill this week, he appears to have made matters worse by attending a yacht race over the weekend, drawing yet more criticism from many on the Gulf Coast and beyond who feel that the oil company's chief executive has been sorely out of touch since this disaster began 62 days
ago. This as officials project that 90 percent of the oil will be contained by the end of the month.
Here are the latest government predictions showing where the surface oil will be by noon today. The blue on this chart represents the trajectory of the spill. The darker shades are the heavier pockets of oil.
We go now live to Venice, Louisiana, where NBC News chief environmental affairs correspondent Anne Thompson is standing by.
And, Anne, I want to ask you, through all your reporting down there, to give us a sense of that level of frustration with Tony Hayward, with BP at this juncture in terms of what they're doing, what they're not doing, and how they're conducting themselves.
ANNE THOMPSON reporting: David, the frustration is immense down here, and it's on several levels. First of all, the people who live here along the southern coast of Louisiana, they know these waters better than anyone else. They have made their living off these marshes and these waters for generations, and they feel frustrated that in order to defend their coast they have to go to the company that has fouled their coast, BP, and they have to go through the federal government. And there's all this red tape, and it has existed throughout the response from the amount of boom that they have requested to getting those sand berms, those new barrier islands built--they had a plan in front of the federal government for weeks before they got approval--to just this week, those vacuum barges that Governor Jindal and the Plaquemines Parish Billy Nungesser have been promoting. They were actually shut down by the Coast Guard for the--for safety inspections to see if they had life jackets. And then the Coast Guard never did the inspections. And it's that kind of frustration that has people here just so angry. And, and it's now--we're going into the ninth week, it'll be the ninth week starting Tuesday, and they still have this huge problem and very little impact in stopping the oil.
MR. GREGORY: Anne, what is the latest on Tony Hayward's position at the company? Because there was some confusion about this as to whether he's still on the job.
THOMPSON: Mm-hmm. And I think this just, you know, points to all the confusion, and it, and it comes from the very highest levels of the world's third largest oil company, David. Earlier this week, the chairman of BP did an interview with a British television service and said that Tony Hayward was going to move off from the day-to-day operations. And he cited some of the problems that Tony Hayward has had in dealing with this issue, some of the comments he has made, most famously that he wanted his "life back." And so the impression was that Tony Hayward was being removed from the spill response team. And then on Saturday the BP London office had to issue a clarification, saying no, that Tony Hayward would continue to oversee the response, that Bob Dudley, who's the managing director, he would head a separate organization to deal with the long-term response because this isn't a problem that's going to go away anytime soon.
MR. GREGORY: Anne Thompson, thank you for all your reporting down there throughout this crisis.
MR. DAVID GREGORY: Joining us now from Jackson, Mississippi, Governor Haley Barbour. And with us here in Washington, Louisiana Senator Mary Landrieu; Congressman Ed Markey of the Energy Committee; the former president of Shell Oil, John Hofmeister; and Katty Kay of the BBC. We will also bring in shortly Ken Feinberg, who is, of course, heading up the administration of that BP compensation fund, $20 billion worth. We'll speak to him exclusively about that important task, that mammoth task that lies ahead of him, and we'll do that in just a couple of moments.
I want to go to Governor Barbour first of all in this disaster zone.
Governor, welcome. You met with the president he's been down there visiting here in the past week and a half. What is your assessment of how well-coordinated the federal, state and local officials are, not only in your state but also in Louisiana and Florida?
GOV. HALEY BARBOUR (R-MS): Well, of course, there's nothing satisfactory until the well's shut in. It's when the well's capped and then clean up the oil and then BP pay the bills. Until, until all of that is done, nothing is satisfactory. But as I've said before, and said to the president, I think the federal government's done more right than wrong. I thought appointing Ken Feinberg, who's got a great reputation that's well-deserved, is good for BP and good for the government. Get BP out of that. But BP's got to pay, and everybody has to understand it. BP's the responsible party, we expect them to pay for everything.
MR. GREGORY: Senator, from Louisiana, there's been a lot of frustration in your state, the governor's frustrated, and as I talk to people and if you follow the press down there, there is just complaints about the assets that are being brought to bear, the coordination between folks. I know there's even people who are in the federal government saying there's
a lack of strategic communications as this oil moves toward Florida in the early part of next week. Do you agree with Governor Barbour, more right than wrong?
SEN. MARY LANDRIEU (D-LA): Well, it's not been satisfactory, as the governor said, but the president and his team are getting their legs underneath them. I think the president was a little slow off the block. His Cabinet was there from day one. The Coast Guard was there from day
one. This is unprecedented in the amount of oil and, and the situation about this gushing geyser under the ocean. So the command and control needs to be improved, the claims process needs to be accelerated. But I've really seen, David, in the last several weeks much more of the team coming together, organizing themselves in a way to tackle this challenge
and to meet the challenge as this presents.
MR. GREGORY: Congressman Markey, we've got this live image on the, the, the seafloor that shows the belching oil into the Gulf. In many ways, this could become an iconic image of this presidency politically. But, substantively, there's a question of the oil flow. And here is a
breakdown of what the projections of the flow have actually been that have been so frustrating to people. You go back to April 24th, they said no, it's 1,000 barrels per day; April 28th, oh, no, it's 5,000 per day; May 27th, no, 12,000 to 19,000; June 10th, 20,000 to 40,000; we find out June 15th 35,000 to 60,000. Now the president's out there saying 90 percent contained by the end of the month. Do you actually think that that flow, that rate of oil goes up before it goes down?
REP. ED MARKEY (D-MA): Right now, again, we're dependent upon BP and the execution of their capacity to be able to put a cap over this well. I actually have a document that shows that BP actually believes it could go upwards of 100,000 barrels per day, which would be about four million barrels a day. So again, right from the beginning, BP was either lying or grossly incompetent. First they said it was only 1,000 barrels, then they said it was 5,000 barrels, now we're up to 100,000 barrels. It was their technology, it was their spill camp, they're the ones that should have known right from the beginning; and either to limit their liability or because they were grossly incompetent, they delayed a full response to the magnitude of this disaster.
MR. GREGORY: John Hofmeister, you--you've been in the industry. I've talked to people in the oil industry this week who are not very impressed with BP. They said that they--there were about five different stop signs that they ran through when they drilled this well. What is your
assessment, though, in this narrow space of how well things are operating right now toward the goal of plugging the leak?
MR. JOHN HOFMEISTER: I think we obviously have to find out what happened to cause the blowout. That sounds like gross incompetence or negligence or, or just pure mismanagement. But with respect to what was done at the bottom of the sea to try to stop the blowout in the first few weeks, I don't think any company could have done it better because they had people
from all over the world, people from every major oil company advising, and they are competent in what they're doing at that level. With respect to the cleanup, I think it's been ham-handed. It's been just awful. To use booms and, and mops and dispersants and burning and so forth, skimming with shrimp boats, where's the imagination and the scale? One of the things that the oil industry does best is it knows how to scale things, to do the big jobs very well. And scaling to me means bring hundreds of barges and block the marshes with hundreds of barges with big suction pumps. Take supertankers and cruise them back and forth and back
and forth on the surface of the ocean, depositing the oily water in refineries on the coast.
MR. GREGORY: You know, to that point I'll bring Katty Kay in on this. Gene Robinson with The Washington Post wrote an op-ed piece this week that kind of went to that point. Again, how's the government doing in the immediate task of stopping the leak? And this is what Gene wrote: "Why haven't skimmers been brought in from around the world to scoop up more of the oil? Why isn't the defense of the coastline being run like a military campaign, with failure not an option? ... Every available piece of equipment in the world that can vacuum, skim, scoop or sop up oil ought to be in the Gulf by now, deployed under a central--probably military--command structure. The beaches should be defended as if from a threatened enemy invasion. This is the time for overkill, for the Powell Doctrine, for `decisive force.'"
Has there been decisive force, Katty?
MS. KATTY KAY: No, there clearly hasn't been decisive force. And what we saw the president do this week in his Oval Office address to the nation was at least use the language of decisive force. He started talking about a battle plan. He compared this to 9/11. But the risk of that is that once you start using warlike language, you have to win. And the truth is the president can't win capping this one, that is dependent on BP. So you have an inherent tension with the president wanting to fix this problem and, frankly, not being able to fix this problem at the
MR. GREGORY: But is there, is there a problem here of a learning curve, Senator? I mean, is, is the federal government equipped to--obviously, we know the federal government's not equipped to stop the, the spill or plug the leak. You've got to have that level of expertise. But it does seem, and Thad Allen even referred to that in The Wall Street Journal this week, as if there is a learning curve because nobody's got the experience to deal with a large-scale spill like this.
SEN. LANDRIEU: We are, we are, we are in a learning curve. But I want to say something in response to what Ed Markey said, that we're just not relying on BP. As John said, there are almost every industry at every level--the secretary of Energy, Secretary Salazar, are working in that operation center with BP. We're not just relying on BP to plug this, to plug this well and to get this job done. We're relying on them to pay every bill, and we want to make sure that they do. But we're all on a learning curve.
I learned this week that Canada and--as one country, for instance--does spills into their water to practice in the event that this would happen. That is not allowed in the United States. Maybe we should think about that. So this is like going through something where we've never had a fire drill. Now, there should have been more things in place. We can get more things in place. But I want to make it clear, in defense of this administration, they're just not relying on BP. Shell's been at the table, Exxon's been at the table, experts from around...
MR. GREGORY: But that's been a criticism. I mean, it...
SEN. LANDRIEU: No, it has.
MR. GREGORY: ...whether they're really relying on industry enough.
SEN. LANDRIEU: They are--I can promise you that they are relying on industries across the board, plus they're relying on their internal scientists and expertise.
MR. GREGORY: What have they asked the oil industry writ large to do to help?
SEN. LANDRIEU: I think that they've brought their engineers in. I don't think, I know. I mean, Ken Salazar's been in the operations room. But, you know, nothing has been satisfactory. But, you know, in defense of the administration, because they've gotten beat up pretty badly, they have had expertise. Now, John is correct. I think there's a lot more scale that could be brought, you know, to the situation, and I'm hoping that we can do that.
MR. GREGORY: Well, and, John, why, why--talk about foreign assets, right? So if another company says, "Look, we've got experience with this. We're going to send you, you know, send you our skimmers, send our"--and there seems the government has processes they have to go through before they can say yes to that.
MR. HOFMEISTER: Well, there's a Jones Act that gets in the way. The Jones Act, decades-long enforced, prevents foreign ships from operating in domestic waters.
MR. GREGORY: Mm-hmm.
MR. HOFMEISTER: It would have to have a waiver. There was a waiver after Katrina to help do whatever needed to be done. There should be a waiver now. This is a unique, unprecedented situation. The U.S. hasn't made supertankers in for--ever. Supertankers have always been made in foreign shipbuilding yards. And we need to bring that kind of scale to bear, in my opinion.
MR. GREGORY: Congressman, you're shaking your head. You don't...
REP. MARKEY: The, the Jones Act, the Jones Act does not apply to situations like this, emergency situations, relief situations.
MR. GREGORY: You should be able to get those ships in there right away.
REP. MARKEY: Yeah, and they can. There has been no request from another country that has been denied by the Obama administration at all.
MR. GREGORY: So you think all the assets are being used that could be used?
REP. MARKEY: They--listen, let's get right back--let's go right back to the very beginning of this, which is that in a hearing this week it was clear that all of the oil companies had been basically lying about their capacity to respond to a spill of this size. They said that they basically would be capable of evacuating walruses from the Gulf of Mexico when there hadn't been one there in three million years. They were going to be relying upon dead scientists with their phone numbers in the, in the report. And in the testimony today each one--this past week--each one of the CEOs said that, in fact, they were not prepared. They couldn't do a better job in responding. So...
MR. GREGORY: Well, I want to get to the issue of preparation in just, in just a minute, though. I want to go back to Governor Barbour.
GOV. BARBOUR: Yeah, David, if I...
MR. GREGORY: Yeah, go ahead, and then I want to ask you to respond to something else.
GOV. BARBOUR: Yeah, David, I was just, I was--well, I was just going to say, Senator Landrieu made a point earlier about command and control, which has been a huge problem. We recruited 1,200--1,163 vessels to work on our spill, designed a multilayered plan to start defending our shores 20 miles south of the barrier islands. And then, unfortunately, the
Coast Guard told us weeks later, "Well, we don't have a way to communicate with those vessels. We don't have a way to identify even where they are.” And so we've been relying for about three weeks on a system that existed but couldn't be executed." To their credit, in the
last two weeks the Coast Guard has, has, has corrected that or begun the correction of that. But while we've got a very different situation from Louisiana, the fact is the government's trying but the government is not getting the job done right now.
MR. GREGORY: Can I have you respond ultimately, Governor, to the sense of what government is capable of here? Because that's what people are really thinking about in the long term. Here's what the president said. He issued a promise when he was in Alabama, Theodore, Alabama, this week. Let's listen to that.
PRES. BARACK OBAMA: We are going to do everything we can 24/7 to make sure that communities get back on their feet. And in the end, I am confident that we're going to be able to leave the Gulf Coast in better shape than it was before.
MR. GREGORY: "In better shape than it was before." That caught my eye and my team because we went back to 2005, President Bush speaking in New Orleans, and this is among the promises he made.
(Videotape, September 15, 2005)
FMR. PRES. GEORGE W. BUSH: Our third commitment is this: When communities are rebuilt, they must be even better and stronger than before the storm.
MR. GREGORY: It didn't appear, Governor, to work so well after Hurricane Katrina. Can the government do it differently this time?
GOV. BARBOUR: Well, the big thing for us in the coast after Katrina, on the Mississippi Gulf Coast, while the government provided enormous amounts of resources for which we're grateful, it also gave us the latitude where the local people decided how the coast was going to be
real--rebuilt. And in fact, it's going to be and is in the process of being rebuilt bigger and better than it was before. But the federal government can't do that. The federal government can't dictate that to the Gulf Coast, to Mississippi or Louisiana or Florida or Alabama. Those
kind of decisions abou t how to rebuild are decisions for the local people. I am glad that--and expect BP to pay for everything, and the government has talked like--and I believe from this Mavis commission that they're going to try to put in some additional resources. But the local
people got to make the decisions about recovery, about rebuilding the coast.
MR. GREGORY: But, but, but...
SEN. LANDRIEU: David, I've got...
MR. GREGORY: Senator.
SEN. LANDRIEU: Let me, let me jump in here, because this is something that I've worked on almost for 20 years, and our state has been leading the effort along the Gulf Coast to build a more resilient coast. This is not just America's wetlands, and we share some of these wetlands with Mississippi, these are America's wetlands. The Mississippi River drains about 40 percent of the continent. John Hoftemeister has been one of the great leaders, along with environmental groups and the industry, and we've put together a great coalition over the years to say to the country and to the companies operating in the Gulf, "Share your resources that you are taking out of this gulf, millions and billions of dollars a year. Give the states along the coast, whether
they drill or not, some resources to build these barrier islands, to restore our marshes and to give the people an opportunity."
MR. GREGORY: Right.
SEN. LANDRIEU: But I'll say this: Yes, we need more local control at the local level, but the federal government has a great role to play. And as we've seen, corporations left to do their own will, sometimes make huge mistakes. So we need government oversight.
MR. GREGORY: But, Katty, can, can the president make good on that promise? Because President Bush certainly had a difficult time doing it.
MS. KAY: Well, it's very interesting. I've just come back from Louisiana, and the Senator kindly corrected my pronunciation of Buras earlier in the program. But people down there--and I was listening to Anne Thompson's comment that people are very frustrated with BP--they are
frustrated with BP. But they also want the oil industry down there. These are families where half the family might be working in the fishing industry, the other half the family might be working in the oil industry. And they don't like the moratorium on offshore drilling, and they're
saying, "We are being hit twice. We've been hit by the oil spill and the threat to tourism, and now we're being hit by the moratorium. And if we go ahead with this moratorium, the jobs will move across to Brazil or elsewhere in the world." And that's something that they do feel that the federal government could do for them is keep the oil industry there.
MR. GREGORY: Right.
MS. KAY: I was very struck by actually some--one businessman saying to me, "Listen, we shouldn't be banning BP and banning--boycotting BP. We should be buying BP because we need them to stay a strong company, we need them to do the cleanup, and we need the oil industry to provide jobs for us."
MR. GREGORY: Let, let me pause for just a minute. And I want to turn now to Ken Feinberg, the man who's now overseeing BP's $20 billion compensation fund.
Mr. Feinberg, welcome back to MEET THE PRESS.
MR. KENNETH FEINBERG: Thank you.
MR. GREGORY: You've got great experience on such horrible circumstances, the 9/11 compensation fund, among others in your experience. And I was speaking to somebody the other day who--whose brother grew up on his dad's boat as a, as a fisherman, as a shrimper. It's all he's known his whole life, and he's gone through his life, and all of a sudden it stops
cold, his livelihood is gone, not to return. What does that guy do as he turns to you and this compensation fund? What does he get?
MR. FEINBERG: He files a claim and he gets paid and he gets paid promptly. The president of the United States has instructed me, "Get these claims paid, get them played--paid quickly." When I met with Governor Barbour, he told me frankly, "Ken, time is the enemy." And he's so right here. I must make sure that this $20 billion fund provides for prompt payment, full compensation. It's an independent program. I'm not beholden to the administration; I'm not beholden to BP.
MR. GREGORY: But BP pays your bills, right?
MR. FEINBERG: Who else can pay the bills?
MR. GREGORY: Right.
MR. FEINBERG: You can't ask people in the Gulf to pay the bills. You can't ask state or federal government to pay the bills. What is the alternative? BP is stepping up, and they're going to make sure, I'm going to make sure that every eligible, legitimate claim is paid and paid
MR. GREGORY: So what happens--so--all right, so let's take our example of the shrimper. Out of business, doesn't know, you know, what he's going to do even for the immediate first few months. How much money do--does that shrimper get? But then what happens over the longer term? Is this one of these deals where you get one payment and then you say, "Therefore, I'm not going to sue in the future"?
MR. FEINBERG: Not--absolutely not. That shrimper should come right into this fund, doesn't need a lawyer, doesn't have to pay a lawyer 40 percent of what he receives. He should come into the fund, he will get an emergency payment without any obligation as long as he can demonstrate he's got a legitimate claim, of course. But we will pay that claim immediately, and then sit with him and over the next 30, 45 days, come up with a program that will provide him full compensation.
MR. GREGORY: You talk about legitimate claims. That's, of course, a big issue. And Tony Hayward is outspoken yet again on this point, quoted in The Times of London. Let me show it to you on the screen. "Mr. Hayward reiterated a promise that BP `will honor all legitimate claims for business interruption.' This was in The Times of London. "Asked for examples of illegitimate claims, he said, `I could give you lots of examples. This is America - come on. We're going to have lots of illegitimate claims. We all know that.'" What's legitimate, what's
MR. FEINBERG: We'll have to look at each claim. Now, the Congress provided some valuable guidance in the 911 fund as to what constitutes a legitimate claim. The direct causal connection between the claim and the spill, pay it. If it's an indirect claim, a restaurant in, in Las Vegas or Omaha, "I can't get shrimp so our business is being harmed," in the 911 fund, Congress said look to the law of the state of that claimant's residence. Would the law allow such a claim? It may be, as we develop this program, that congressional guidance in 911 might work here as well.
MR. GREGORY: You're, you're in the vortex of politics whether you stay clear of it or not. And Joe Barton from Texas was--got in a lot of trouble for something he said, apologizing to BP. Let me play you a portion of that.
REP. JOE BARTON (R-TX): And I'm ashamed of what happened in the White House yesterday. I think it is a tragedy of the first proportion that a private corporation can be subjected to what I would characterize as a "shakedown." So I'm only speaking for myself, I'm not speaking for anybody else, but I apologize.
MR. GREGORY: Is this BP fund of $20 billion a shakedown?
MR. FEINBERG: I don't think it's a shakedown. I, I think that BP--to BP's credit, in these other programs that I've set up, David, there was nothing in place. We had to start from scratch. Here there is a program in place. Now, it's not efficient as it should be. It's not working as
well as it should be, but BP's paid $100 million worth of claims so far. We can do better, and we can do quicker. But I don't think it helps to politicize this program. These people in the Gulf are in desperate straits. And I'm getting great advice from Governor Barbour and Governor
Jindal. I got some fabulous advice this morning from Senator Landrieu, who said, as for business interruption, maybe we ought to cluster all the oyster claims, all the fisherman claims, all the tourism claims, come up with a common methodology. This is input that is bipartisan. And as in these other programs I've done, I think it's pretty important to try and keep it bipartisan.
MR. GREGORY: I, I, I just want to try to button up the, the process here, which I, I think is complicated. So if you have an emergency claim, you may have an emergency claim for, you know, your loss of business in the immediate period. How do you make an assessment over the
longer term what somebody who's lost their livelihood should get, how much money should they get?
MR. FEINBERG: Well, in the short term, emergency payments with minimum corroboration, that's easy. In the longer term, just as with the 911 fund, we'll have to develop a business interruption methodology. Look, file your claim, give us some information on what you've earned in the past, not a lot, not detailed, so that we can, within 30 to 45 days, try and get checks out on business interruption. I think John is correct in your panel, it sure would help me if the oil would stop flowing so we could get some break date from which we develop these formulas.
MR. GREGORY: And by the way, when you say a method--in other words, just like in 911 where it was the grim task of assessing the worth of a life, frankly, in that kind of situation, here you have to try to assess what are projected earnings, a projected income that a fisherman might have over a period of time and make a certain judgment based on that. But on the suing issue, on the litigation, I mean, look, you're a lawyer, you know well that BP's going to be in court forever, frankly, on claims. Now, a lot of people would say, "Hey, they got this escrow fund. This is just a way to mitigate that. This is a way to get people to stop suing to pay out less. It's an up-front settlement." What do--what legal recourse will folks have beyond the money that they get for business interruption down the road?
MR. FEINBERG: As with 911, you know the 911 fund well, David, this is a voluntary program. Nobody's compelled to come into this fund. I would urge everybody to come into this fund. Quicker payments, faster consideration. You go and litigate, you're going to litigate for years,
the result is uncertain, your lawyer is waiting with a contingency percentage. I mean, it's the trade-off. Now, I'm confident, as with the 911 fund, that if claimants enter this fund voluntarily, they will be treated fairly, they will be treated in a comprehensive way, they'll be
given emergency payments with no, no requirement in terms of waiving your right to sue. These emergency payments are without condition. And then we'll, I think, be able to, to treat everybody fairly.
MR. GREGORY: Ken Feinberg, good luck with your work and thank you very much.
MR. FEINBERG: Thank you.
MR. GREGORY: I want to turn back to our discussion.
Senator Landrieu, before I ask you for some reaction to that, let me put up on the screen a sense of where public opinion is about BP and on this issue of payments. It was really striking what Gallup found this week on how much BP should pay. Fifty-nine percent say they should pay for everything even if doing so drives them out of business. So that's the backdrop for how this fund is operating. React to what you've heard.
SEN. LANDRIEU: It's very, it's very difficult. But let me go back to what Katty said. If you polled that nationally, you'll see that 59 percent want BP to go out of business, if you polled it in Louisiana, Mississippi, Alabama to Florida, that's the last company that our people want to see go out of business because we're the ones at the other end of the line. We want them to stay in business and pay these claims. And it may be over $20 billion. But I'm so proud of Ken and the president for appointing him, because the poor fishermen in Alaska, Ed Markey and John, they waited 20 years for justice. We cannot wait that long in the Gulf. So this is a way for people to get full payment. And it's not just $5,000 and $10,000, David. If a fisherman made $50,000 last year, Ken should write them a check for $50,000. But this is where it gets a little tricky. What about the quality of the water and the ability of fishermen to fish over the next two, three, four, five years? That's where we're going to have to have some collaboration. But let's make it quick, let's expedite the claim payment. I know the governors along the Gulf Coast and the mayors along the Gulf Coast are hearing this from their people.
MR. GREGORY: Governor, you--Governor Barbour, you've been concerned about the idea of this escrow fund, this $20 billion fund. Why?
GOV. BARBOUR: Right. Well, I thought that they were talking about taking $20 billion from BP all at once, and my fear was if you took $20 billion from them all at once, put it in an escrow account, then they wouldn't have the working capital to generate the revenue to pay us. I
think the president was smart, and I congratulate him and BP that they reached an agreement. Instead of $20 billion taken out of that working capital all at once, it's actually going to be $5 billion this year, $5 billion the next year, $5 billion the following year and $5 billion the fourth year. That makes sure--as Mary Landrieu says, we want to make sure that BP stays in business, generates the revenues that will pay what they owe the states and our citizens. And I think the--I don't know if it's a compromise or not--the agreement they worked out not to do all the $20 billion, put it in an escrow account all at once, means that we're
much more likely to get everything paid by BP, who, by the way, is supposed to pay everything.
MR. GREGORY: Congressman, are you satisfied with this?
REP. MARKEY: Yes. I think that, I think that this is really not a slush fund, it's not a shakedown. It's, it's really a lifeboat for the people in the Gulf. There could be no one better than Ken Feinberg to administer it. It's going to give people some hope that their families
might not have their lives permanently changed by this event just a couple of years after Katrina. And I think that the president has stepped up in order to ensure that the government works in the best way that the government should work to protect citizens against the worst egregious actions of the private sector. And, and so I think that the American people are in agreement, and that's, that's liberals and conservatives across the board that we're now finally beginning to do the right thing for the people in the Gulf.
MR. GREGORY: Let me go back to Katty Kay because this--the achievement of this fund was an important achievement for President Obama this week, and there's been a lot of focus on how he's performed, how the president has handled this crisis, and a lot of frustration around the country.
It was interesting, Tom DeFrank wrote in The New York Daily News an analysis of whether this was his "Hurricane Katrina" or something else, and I'll put it up on the screen his analysis. "The oil spill hijacking Obama's presidency" isn't Katrina. "It could be worse--more like the Iranian hostage crisis, which destroyed Carter. ...
"Each day the cable networks showcase images of more oil belching from the ocean floor resurrects symbolic parallels to the '79 through '81 Iranian debacle, which ended with Tehran releasing U.S. diplomats 444 days after their capture, on the day Ronald Reagan took office. Try as he might, Carter couldn't get the hostages set free. ...
"Obama risks being similarly victimized by the same perception that nothing works anymore." Is the--there a level of confidence now in the White House that didn't exist last week, that the $20 billion fund represents something the government can do well?
MS. KAY: I'm not sure that there should be that level of confidence. I don't think this was a massively good week for the president. The $20 billion fund was very important, but the oil spill has played into a perception that this is a president who finds it difficult to empathize with ordinary people, and that was one of the criticisms of him early on in this, that he didn't show enough emotion, he didn't show enough anger, and that he's not totally in control of this, and that his vision of big government is not particularly fixing this. And I think that narrative
is still dominating the scenario.
What he needed to do was come up with a concrete result. The speech that he gave from the Oval Office I think was pretty much a wash. I'm not entirely convinced of the need to have given that. The biggest thing that they got out of this was the $20 billion fund, and certainly down on the Gulf Coast that was all people were talking about. And they were talking about it particularly because these were people who had come out of Hurricane Katrina, battled with insurance companies to try and get money back, found that it was a very complicated, very long-winded process, and they like the idea that the money is there in escrow, administered by somebody else.
MR. GREGORY: But, Senator Landrieu, you, you, you were critical. I mean, even this past week you were saying that folks along the coast are not happy with anybody right now. You said it was troubling to see that another president would get the same kind of response that President Bush got after Hurricane Katrina. And that, ultimately, you said, in a crisis people want to see the commander-in-chief in charge. Do you feel he's achieved that now?
SEN. LANDRIEU: And they have been seeing that lately. And I want to say that I thought the Oval Office presentation and speech was excellent. The people that I represent were very happy to see the president speaking from the Oval Office because we think we have a national catastrophe, and that was verified, basically, by the president giving that speech from the Oval Office. Now, the proof is in the pudding. As I said, he was a little slow off the block, his Cabinet was there from the beginning, but he has lent his voice. And I think this claims process, as Ken said, is a testament to how the president, who set up this escrow account, who stepped up to do it, who can get these claims processed. Not only did our people have to fight insurance companies, we had to fight the federal government in the last administration to get justice for the people along the Gulf Coast, at least those of us from Louisiana. So we're happy to see this president step up and to get this claims process paid. But ultimately, David, what the Gulf Coast needs is a long-term restoration plan, and this is the first president that's used those words from the Oval Office, and that's music to the ears of people who are now up to their knees in oil. But we've been up to our chin in water, and we're tired of it. We need a internationally scaled plan that some of us have been working on for a long time to make sure this never happens again.
MR. GREGORY: All right. Well, we're...
SEN. LANDRIEU: And more regulation for the industry in the Gulf.
MR. GREGORY: We're going to come back and talk about some, some of these--the future here and some of these bigger questions. But before I take a break, Governor Barbour, what about the president's performance? You're a chief executive, New York Times this morning says you might be running for president in 2012, I know you won't make that decision now. But how do you assess how the president's done?
GOV. BARBOUR: Well, first of all, this is an unprecedented, unforeseeable, huge disaster. So, as somebody who had to go through Katrina, I understand when you--nobody's ever done something like this before, not everything's going to go right. And the, and the government has made some bad mistakes, they've done some things wrong, but as I said earlier, they've done more right than wrong. But until the well's capped, until the oil's cleaned up, till the bills are paid, everybody in America--I mean, who could say the administration's done a great job when the well hasn't been capped, oil, oil hasn't been cleaned up out of the water, and we haven't been paid. So when the American people say, "Hey, there's a shortcoming here," they're just expressing the obvious.
MR. GREGORY: But you are also a leader in the Republican Party, head of the Republican Governors Association, is your message to your party, "Don't pile on here, be constructive, don't go after the president"?
GOV. BARBOUR: Well, that's certainly the way I feel about it. My message always is, look, tell the truth, you know, put the, put the truth out, let the, let the public decide. The public's decision right now is pretty bad for the president.
MR. GREGORY: Mm-hmm.
GOV. BARBOUR: But that--I'm not going to pile on, as you've seen by the last 30 or 45 minutes of us talking.
MR. GREGORY: But you heard from the chief of staff, Rahm Emanuel, in an interview this morning saying they're going to make this issue of Joe Barton and his apology to BP, Democrats plan to make that an election issue in November. Should it be?
GOV. BARBOUR: Well, they're going to try to make anything but this oil spill a--they, they want to change the subject, and I can understand that. But, you know, one of the things that they've got to come to grips with that's very true, we've talked about Ken Feinberg's appointment being good for the president, it's good for BP. BP--that was to their advantage to get taken out of the claims business. The $20 billion, once it was done, where BP could continue to operate as a, as a growing concern and pay their bills that they owe Louisiana, Mississippi and Florida and Alabama, that also was a good deal for BP.
MR. GREGORY: But the question is whether Republicans as a political matter, as a substantive matter, are too cozy with the oil industry.
GOV. BARBOUR: Well, look, you're looking at a guy that's already told you 15 times today BP's responsible to pay every penny of this. We expect them to pay every penny of this. We're going to demand they pay every penny of this. And if that makes me cozy with BP, it's because I want to make sure that my people stay in their, stay in their wallet and their checkbook.
MR. GREGORY: So you thought Barton was wrong?
GOV. BARBOUR: Well, I don't think what he said was accurate because I think the way this worked out was that--was dividing it up into $5 billion a year instead of one $20 billion lump sum I think actually is a fair, good deal for everybody.
MR. GREGORY: All right.
GOV. BARBOUR: Including BP.
MR. GREGORY: I'm going to take a break here and we're going to come back and continue our discussion and look at some of the bigger questions about the fallout, the future of our energy policy, holding BP accountable, and this question of what do we do with so much risk in the
system? How do we better manage it? When we come back on MEET THE PRESS.
MR. GREGORY: Coming up, what role will the Gulf spill play in America's future dependence on oil? We'll continue our discussion with key voices on this issue after a brief commercial break.
MR. GREGORY: We're back on our special program devoted to the disaster in the Gulf Coast.
I want to get to an issue that just came up that I think is so important, and that, that is the balance here between government and government regulation, and technology and the art of what is possible. We are living in a world now where we are capable of so much, and we demand so much as a society and, as a planet, we demand so much. And yet in the process, we're tolerating a great deal of risk. So when something goes bad, the capacity to stop systemic disaster is very, very difficult. So it's a question for business, it's a question for government.
And, Congressman Markey, you know, if you turn on your TV this week you see government, you see members on Capitol Hill, including yourself, going after the oil companies, going after BP, and yet isn't it fair to ask where were you? Where was government regulation when all of this was going on before it was a crisis?
REP. MARKEY: I, I agree with you. When an agency responsible for safety turns into a lapdog and not a watchdog, then, unfortunately, boosterism creates complacency, and complacency leads to disaster. It happened in the financial sector. Goldman Sachs and Bear Stearns and AIG, they all said, "There's no risk with derivatives and credit default swaps. Don't worry." And it created a financial disaster. The same thing was true here. The industry said that the risks of a rig ever sinking were zero. Their capacity to handle a spill up to 250,000 barrels per day was absolute. None of it was true. And so, if you allow this risk to be built into the system, then it's ordinary families' financial and health and well-being which is affected, and the government has to play the role of protecting ordinary people against the short-term financial goals of companies that are going to assure the public that everything is safe.
MR. GREGORY: Right. But the political system wants compromise. The president could have spent all of his time reforming the Mineral Management Service before calling for additional offshore drilling. Now, that was in pursuit of a larger climate bill. He could have done that
first before calling for an expansion of drilling.
John Hofmeister, the reality is, what is true is that there are more than 14,000 deep well drills around the world. It is also true it is almost unprecedented for this kind of problem to arise. The problem is when it does arise, it's--we're watching--almost impossible to solve. What is
the role of industry to better manage the risk?
MR. HOFMEISTER: David, I just published a book called "Why We Hate the Oil Companies." Just came out a few weeks ago. And in that book I lay out what the fundamental problem is as I see it. The industry is in business for itself. The government has promised energy independence to the American people through eight presidents and 18 Congresses. We are
no further ahead today than we were when President Nixon first used the word in 1973. The issue that we have to come up with is we have to stop ad hocking our way into the future. We can't ad hoc to everything, and that's what we've been doing. We need a fundamental plan that starts with a zero to 10-year outlook, a 10- to 25-year outlook and 25 beyond. Nobody's ever done that. This nation has done all kinds of things with its space program. It's had accidents, but the space program has been fantastic because they have this long-term view. We have taken energy as an ad hoc system, and we have just taken one bit at a time. The industry is fragmented. There's no such thing as an energy industry. It's fragmented into bits and pieces--oil and gas, coal, renewables, geothermal, you name it, and it's all broken up into bits. They're not going to solve the problem. The solution is a government-led plan that
goes through administrations, through Democratic majorities and Republican majorities. And if we can't do that, then we're going to be sitting here--and President Obama's going to have a real problem with the moratorium when the price of gasoline skyrockets.
MR. GREGORY: Right. Well, to the--to that point, Governor, what's worse, the moratorium or the effects of this spill on the region? And I talk about the moratorium on offshore drilling.
GOV. BARBOUR: Well, the moratorium. The skill--the spill's a terrible thing, but the moratorium is a, is a terrible thing that's not only bad for the region, it's bad for America. Thirty percent of the oil produced in the United States comes out of the Gulf of Mexico, and 80 percent of
that is from deepwater drilling. So that's a fourth of all of our oil. As, as John may have said or somebody said, this is going to drive the price of energy up. Now, there are people like Congressman Markey whose bill in Congress, the--that mostly effects electricity, would drive up, up energy costs. As President Obama said, under--he told a San Francisco paper, and I quote, "Under my cap and trade plan, electricity rates will necessarily skyrocket." One of the things President Obama and I agree on. This moratorium is going to have the same sort of effect.
MR. GREGORY: All right.
GOV. BARBOUR: These--as somebody said, these drilling--I think it was Mary Landrieu--these drilling rigs are going to leave and they're not coming back in six months.
MR. GREGORY: Con--all right.
GOV. BARBOUR: They're going to be off the shore of west Africa, Brazil. And, and the American people are going to pay the price because it means...
MR. GREGORY: All right, response...
GOV. BARBOUR: ...more imported oil.
MR. GREGORY: This issue of a broader climate change bill, a price for the amount of carbon used by companies, is the governor wrong, Congressman?
REP. MARKEY: The governor is wrong. And the governor is using something that then Senator Obama said three years ago, not the Waxman-Markey Bill along with senator--along with Speaker Pelosi that we passed through the House last year. What we do is we create a, a program of market-based incentives so that we move towards wind and solar, towards geothermal, towards biomass, towards plug-in hybrids, towards all-electric vehicles; efficiency, doubling the efficiency of the homes and the, and the buildings that we work in; moving in a way that captures the innovation, captures the science lead that we have on the rest of our country. And over time it will actually lead to lower electricity, lower energy bills
for our country. We only have 2 percent of the oil reserves in the world, and we consume 25 percent of the world's oil on a daily basis. That is nonsustainable. Either we have this technological revolution going forward while we keep the oil and gas and coal that we have, but unless we unleash this market-based revolution and make it possible for us to back out the oil from OPEC, make sure China isn't selling all of these new products to us...
MR. GREGORY: Right.
REP. MARKEY: ...and creating two million jobs here...
MR. GREGORY: But...
REP. MARKEY: ...then we will have made an historic mistake.
MR. GREGORY: Senator, Senator, you are a Gulf state senator.
SEN. LANDRIEU: Yes.
MR. GREGORY: You are for lifting the moratorium.
SEN. LANDRIEU: Yes.
MR. GREGORY: And you want that oil drilling. But here's a statement you put out on Tuesday speaking about the future, and it was very interesting. You wrote, "Oil has paid tremendous dividends to our country. It helped us win World War II, it helped create an industrial
revolution, and it built the greatest middle class the world has ever seen. But its time has come and is moving past us, and the transition to clean renewable energy is one our country has to begin immediately."
SEN. LANDRIEU: I agree with that.
MR. GREGORY: Is there the political will...
SEN. LANDRIEU: Not only I agree with it, I said that and...
MR. GREGORY: You said it, so I think...
SEN. LANDRIEU: Yes, I said it and I not only agree with it, I wrote it.
MR. GREGORY: But, but, but is there--but, but is, but is there the political will to really make that change?
SEN. LANDRIEU: I think that there is growing political will. I want to say, although I don't support the bill that came out of Ed Markey's committee--but I have the greatest respect for him--that I do believe that we can have a sustainable, cleaner future. But I want to go back to two points then I'll come back.
MR. GREGORY: Mm-hmm.
SEN. LANDRIEU: One, part of the--your issue about beating up on the companies, yes, there's been a lot of that. But we also have to look in the mirror to the regulators of this industry. Half the Congress has wanted to sort of let the industry do whatever it wants. Obviously, that
was a mistake. And the other half of the Congress wants to kill the oil and gas industry so badly they don't really take the time to regulate them well. And I'm hoping that both sides of the aisle can come together, recognize this is a vital industry. We need it for right now. We may not need it in 50 years from now or 30 years from now, Ed, or 25 years. But we need it now, and so we've got to regulate it correctly, make BP accountable for everything, and then think about building a future where we can rely less on fossil fuels. And if we do it right,
even the oil and gas industry has been sending signals that if it's done correctly with the right transitions, and natural gas can be that bridge...
MR. GREGORY: Right.
SEN. LANDRIEU: ...to wind and solar in the future.
MR. GREGORY: Katty, we only have about 20 seconds left, but look at the enormity of the challenge, we put it up on our screen, in terms of our use and dependence on oil. The United States--put it on the screen--uses nearly 20 million barrels of oil a day. That's how much we consume. We blow everybody else away on that. That's the challenge.
MS. KAY: That's the challenge, and the new challenge is for government to regulate an industry that is ahead of it technologically. Whether it is in finance, whether it is in bioethics, whether it is in oil, it is the industries that are ahead of the regulators. And for regulators to
keep on top of industry is an increasingly difficult problem.
MR. GREGORY: I'm going to make that the last word. Thank you all very much for a thoughtful and, I hope, constructive discussion.
We'll be right back after this brief station break.
MR. DAVID GREGORY: A quick programming note before we go. Tune into "NBC Nightly News" and the "Today" program all this week for a special health series we're calling "Be Well, Be Healthy," news coverage focusing on fitness, food and weight.
That's all for today. And to all the dads out there, mine and yours, happy Father's Day.
We'll be back next week. If it's Sunday, it's MEET THE PRESS.