Dirty Politics and Slippery Money; the Gulf Gets the Shaft

Louisiana Governor Bobby Jindal and his wife, Supriva Jindal. The biggest donors to his wife's foundation? Corporations with strategic interests in Lousiana. It may not be illegal, but certainly seems suspect. (Photo: AFP/Getty Images)

A trio of news stories have come out during Week 46 of the Gulf Coast Oil Spill, each of the three proving that the more things change in the region—whether natural disaster (hurricanes), manmade screw up (oil rig explosions) or government intervention (drilling bans)—the more they stay the same.

Within weeks after the Deepwater Horizon rig exploded and sank nearly one year ago, the Obama Administration banned all new deepwater drilling. The ban lasted until October 12. During Week 46, the Department of Interior  approved its first new permit to drill deep in the Gulf of Mexico.

The new Bureau of Ocean Energy, Regulation and Enforcement—the reorganized Minerals Management Service, the federal office that had cozied up to the oil industry for years—says it thoroughly vetted the prizewinner, Houston-based Noble Energy. Back a year ago, Noble had been drilling toward 13,858 feet when the operation was halted by the spill.

Oil industry shares on Wall Street jumped at the announcement. "We expect further deepwater permits to be approved in coming weeks and months based on the same process that led to the approval of this permit," said the regulation and enforcement agency’s director, Michael Bromwich.

For Louisiana Governor Bobby Jindal the permit was a “good first step.” The first-term governor—who faces election this November—wants more permits granted faster. “We must quickly get to a level of issuing permits that represents a critical mass so thousands of oil and gas industry workers can get back to work fueling America again.”

Jindal’s enthusiasm is no surprise. As the Times pointed out, Jindal’s long “cozy” relationship with the oil industry is complicated—or greased, depending on your point of view—by a foundation his wife set up the month after he was elected in 2007, the Supriva Jindal Foundation for Louisiana’s Children. 

Among Mrs. Jindal's biggest donors—all legal under Louisiana law – are Marathon Oil ($250,000), Israeli oil company Alon USA ($250,000), Dow Chemical ($100,000), Northrop Grumman, AT&T and other oil companies, insurers and construction companies.

Campaign donations are limited. Donations to Mrs. Jindal’s foundation are not.

Above and beyond supporting the foundation’s goal of delivering much-needed hi-tech equipment to schools in the poorest neighborhoods of Louisiana, AT&T hopes the governor will sign a law allowing it to sell cable TV rights without negotiating directly with individual parishes; Marathon was granted approval a year ago to expand the amount of oil it can refine at its Louisiana plant; Alon is seeking a permit to dump more pollutants at its Krotz Spring refinery. And on and on.

Politicians using do-good foundations to (vaguely) mask corporate bribery is hardly a new tactic. PACs and political interest groups on both sides of the fence have been doing it for decades.

But in Louisiana, where corruption is a long-practiced fine art, the Jindals’ mutual interests aren’t masked at all. A picture of the governor with his wife graces the foundation’s website. His chief campaign fundraiser is the charity’s treasurer. An employee of the governor’s office, working as an aide to Mrs. Jindal, is the contact for the foundation’s books.

While corporations continue to have their way in Louisiana, basic residents whose lives were impacted by last April’s oil spill will have to wait a bit longer for compensation.

Citing “lack of adequate documentation,” Ken Feinberg—appointed by Obama to dole out up to $20 billion of BP’s money to those whose livelihoods were affected by the spill—admitted that more than 100,000 claims currently on file might never be paid.

“Roughly 80 percent of the claims that we now have in the queue lack proof,” Feinberg said last week in Washington, admitting it was “a huge number.”

To date, his office has paid out nearly $3.6 billion, to 168,000 individuals and businesses across the Gulf, mostly emergency payments of a few thousand dollars.

Feinberg’s denials angered state governments in Louisiana, Mississippi, Alabama and Florida, the White House … and a boatload of individuals in the region who’ve either lost businesses or need money to jump start them. The states are appealing to the courts for redress, which means the lack of payments will go on for months. Individuals are largely left holding the bag.

From its perspective, BP feels Feinberg has been “overly generous.” Any of the $20 billion not paid out goes back to BP. Meanwhile, the oil company is paying Feinberg’s law firm $850,000 a month to administer the fund, a price that is currently being renegotiated—upward. The lawyers are richer by the month as the payment process drags on … and on.

A six-time grantee of the National Geographic Expeditions Council, Jon Bowermaster has spent the past two decades circling the world’s ocean, studying both its health and the lives of the people who depend on it. He is the author of 11 books (his most recent, OCEANS, Threats to Our Seas and What You Can Do to Turn the Tide, was published by Participant Media) and producer of a dozen documentary films. His blog—Notes From Sea Level—reports daily on issues impacting the ocean and us. Follow Jon on Facebook.