FW: Kick Ass?

Date: Tue, Sep 7, 2010 at 8:30 PM
Subject: Kick Ass?

How our Bright Young President should get wise advice before he starts
bragging about kicking Ass. I hope he has wised up and shuts up.

           New Definition of 'Kick'

Astute business and accounting folks ought to really get a laugh out
of this one.

 It seems like a miracle our beloved leader was able to convince BP to
establish a $20 billion slush (oops, 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; he had to resort to
Chicago-style negotiating.
But let's take a closer look at the effect on BP's finances:

1. BP will establish a $20 billion fund, but will pay only $7 billion
into it during 2010.

2. BP is a British corporation which has a very large operating entity
in the US, but only about 30% of its income is derived from the US.

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.

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 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.

Let's put the results into a table easily understood by the small
people (including me):
BP Cash Flow:
o Escrow funding  ($7 billion)
o Dividend saving ($7.5 billion)
o Tax savings       ($7 billion)
o Net favorable cash flow: $7.5 billion

US Treasury Tax Receipts:
o BP Corporate income tax-----minus $7.5 billion
o BP Shareholders--------------minus $0.45 billion
o Net unfavorable tax receipts-minus $7.95 billion

I guess we really should expect this. After all, our dear leader is
the most inexperienced man in ANY room he enters.
Now tell me, did the enlightened one "Kick Ass", or did he get "Sucker
Punched"? This is just one more reason why a "community organizer"
should NOT be negotiating anything dealing with money and finances!

Bottom line: 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" (in his own

In reality, BP executives are laughing at him and 'kicked his ass". Oh
well, what's new with this "President" anyway? He's in over his head
when he starts dealing with "business people".
Jim Green


Anonymous said...

Um, I don't get it.

I thought BP was just obeying the dictates of the free market by doing whatever it could to maximize its profit, and that such behavior was not only good, but righteous (according to the Church of Rand), and that taxes are BAD BAD BAD, esepcially when poor little corporations have to pay them, and that we're supposed to be "starving the beast" that is the government, so...why aren't you happy?

Has the right turned into liberals? Or is anything the black guy does wrong, no matter how pro-business it is, just because?

Like I said - I don't get it.

Marc with a C said...

The best part is that if the situation were different (and it may well be), this forward would read OMG OBAMA IS TAKING MONEY AWAY FROM BP SOCULISIM!!11!!1!1!!!1!

I believe that this is a technique referred to as "concern trolling."

ferschitz said...

The rightwing has baldly stated that they are diametrically opposed to anything and everything that Obama does. Period.

So whining about this is par for the course.

Until contards come up with some real alternatives or other solutions, this is just b.s. propoganda sent out to gin up fake outrage over nothing.

Hooray4US said...

Are conservative thinktanks now admitting that BP is responsible for the oil volcano? I thought the libertarian T-Partiers had claimed, somehow, that BP wasn't responsible at all.

So confused. Which is it?

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