Welch Leads BP Dividend Fight

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(Host) Congressman Peter Welch’s demand that BP suspend dividend payments until it has paid to clean up the oil spill in the Gulf has gained momentum in Washington.

As VPR’s Bob Kinzel reports, the idea could become one of President Obama’s strategies.

(Kinzel) It’s only been a week since Welch drafted his letter asking BP to take a positive step in dealing with the environmental damage caused by the company’s enormous oil spill.  But in that time, the plan has become a key part of the political debate surrounding BP. 

In the letter, Welch requested that BP suspend $10 billion in dividend payments to stockholders. And he also asked the company to cancel its $50 million public relations ad campaign.

Welch says he circulated the letter to dozens of his colleagues and then contacted many of them personally.

(Welch) "I spoke directly to many members. And now I did this all very quickly because we were on that recess. And the fact that we have 49 members on it really with only a day to gather those signatures is an indication that members thought this really made a lot of sense. It’s a common sense thing to do."

(Kinzel) Welch says the letter doesn’t have the force of law but he thinks it’s been more effective than an actual bill.

(Welch) "It’s just that it put the question out there that people were asking themselves: ‘How can a corporation that owes everyone so much money on the Gulf Coast be paying shareholders instead of meeting its obligation?’ So I think it was just a common sense expression of what many, many people feel. And I think that’s why the letter had such an impact."

(Kinzel) Welch says his visit to the Gulf of Mexico several weeks ago has had a big impact on his involvement with this issue.

(Welch) "It was a very compelling experience to see this orange flame slick across the ocean and then even worse to go see the fishermen and women who were now threatened with the loss of their lives and their livelihood."

(Kinzel) The price of BP stock has fallen substantially since the beginning of this crisis, and according to a new report, Americans own 40 percent of the company’s shares.

(Welch) "The list of innocent victims as a result of the recklessness by BP includes the stockholders. Folks who own that stock, depend on that dividend, have a right to be extremely upset with this mismanagement."

(Kinzel) The suspension of BP dividends is expected to be one of the items that President Obama and British Prime Minister David Cameron will discuss during a special telephone call this weekend.

For VPR News, I’m Bob Kinzel in Montpelier.

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