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BP to Put Up $20 Billion; Waging War on the Spill; Powerhouse Duo Fight for Same-Sex Marriage
Aired June 16, 2010 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(JOINED IN PROGRESS)
ISHA SESAY, CNN INTERNATIONAL CORRESPONDENT: --but, you k now, things really can go a way you hadn't predicted, and that's what we had today -- T.J.
T.J. HOLMES, CNN ANCHOR: No, I'm a huge football fan. I like the Cowboys and things like that.
SESAY: Yes, right.
HOLMES: No, I know what you mean. I know.
Last thing here, though. You couldn't get those people to be quiet with those horns for your live report?
SESAY: Seriously, T.J., the vuvuzelas have been the emblem of this World Cup. I'm trying to understand the psychology.
Why do they just blow them all the time regardless? I've been here for a couple of hours now. They have been blowing them for hours, and they're not going to stop anytime soon -- T.J.
HOLMES: And if you can't get them to stop, then nobody can.
Isha, my dear friend, good to see you, as always. We'll be checking in with you plenty. Talk to you soon. Enjoy yourself there.
SESAY: Bye-bye.
HOLMES: Well, we are going to continue here this next hour, let you know about what we've got on our "Rundown" in this second hour.
First up, President Obama squaring off with BP bosses at the White House on day 58 now of this Gulf oil disaster. In this hour, we're standing by for the president to tell us all about that meeting. We're going to bring that to you live when it happens.
Also, reaction from Gulf Coast residents to the president's Oval Office speech, how they feel about his plan for helping them recover from the nation's worst environmental disaster.
Also, they were once fierce rivals. Now two powerhouse attorneys are on the same side when it comes to same-sex marriages. Closing arguments begin today in a California case that's sure to have huge implications.
But first, we're keeping an eye on what's happening at the White House. We're expecting -- and you need to let you know -- the White House -- the president expected to speak at any moment. We're told it's going to happen at the top of the hour, but he is going to speak to us, update us, about the meeting he had with several BP executives today.
The big news that came out of that was this escrow fund the president mentioned last night. But we got a number, $20 billion, to go into this escrow fund that the oil company is going to put in there to go towards payments to try to make the people of the Gulf Coast whole. This is going to be managed not by the government, not by BP, but by a third party.
So, again, expecting to hear from the president as we, once again, see some pictures that you're so familiar with now, those live pictures of what's happening.
We do know, as well, 160,000-plus barrels of oil have actually been collected since they put the cap on. That's great. That is great news, to hear that any of it is being collected.
However, at the same time we're getting word about how much is being collected, we're also getting word about how much more could be possibly going out. Estimates went up saying that possibly, 35,000 to 60,000 barrels every single day have been spilling out into the Gulf. Those are the updated numbers, numbers that seem like they continue to go up, certainly from the beginning estimates we got.
Let's bring in CNN Senior Political Analyst Gloria Borger. She's standing by for us.
Gloria, hello to you once again.
The president -- I mean, this $20 billion fund, you and I talked about last hour, is this what the president needs, something he can point to and show something tangible, we got this done?
GLORIA BORGER, CNN SR. POLITICAL ANALYST: Yes, he does. He needs to have a success. He needs to let the people in the Gulf know that he's doing something that they can count on.
I think as we were talking about earlier, you know, we just don't know exactly what the ultimate liabilities are going to be in this, T.J. So we have a $20 billion figure here. We don't know how it was arrived at. We don't know if it's going to be enough in the long term.
We don't know who's going to contribute to it. I mean, maybe it's BP, or maybe it's BP plus, some of the other corporation that is owned part of the rig. We don't know who's going to be covered, when it's going to start.
So, all of these are questions that clearly are very complex, that the president and his folks have been negotiating with BP all morning long, and for a week or so before that. So we have to get some answers here.
HOLMES: And some of the answers we are getting, at least, this fund is not going to be managed by BP, not going to be managed by the government.
BORGER: That's right.
HOLMES: I guess in some way, that should make people feel a little better. But explain a little bit exactly who this guy is.
BORGER: Well, Kenneth Feinberg is his name. And he's a tough gentleman who managed the compensation fund for the survivors of the 9/11 victims. And he did a very tough job, and he did it very well, by all accounts.
He's also now the administration's pay czar, that has been the guy in charge of putting the caps on those Wall Street salaries for the folks who run the firms that got bailed out by the American taxpayers. So he's somebody with a great deal of experience, and I think he's somebody that comes to this job with an awful lot of credibility. So that's obviously why they chose him.
HOLMES: And Gloria, and to our viewers, as well, we're standing by to hear from the president, expecting him at the top of the hour. It's a few minutes past the top of the hour, but any moment coming out to speak.
What more are we expecting to hear from this president? What more -- certainly a lot of people are asking, what more can he do? But right now, what more can he say to us?
BORGER: Well, you know, right now, this is the matter of BP. He promised to the American public last night in his speech that BP was going to pay. Now he's going to be delivering on that promise with a deal that BP will pay.
And it's going to be very clear, I think, when we hear from the president that he is in charge of this, that the federal government is in charge of this, that the money will be supplied by BP and the rest of the folks, but that the government will be in charge of dispersing it and administering it to make sure that none of the payments are being slow-walked. And they don't want that to happen.
They want people to get their money as soon as possible. They want this fun to be replenished as soon as possible.
You know, we don't know. Are they putting in half of it now, half of it later? Will they replenish it over the quarters in years to come?
So, you know, these are kind of the details, that the president has to let the American public know that the government is going to make sure that people get what they deserve.
HOLMES: Well, maybe those details will come in just a few minutes, when we hear from the president. Expecting him sometime very soon, and we'll certainly have that live.
Gloria Borger, always good to chat with you. We'll talk with you again really soon.
BORGER: You, too. Yes.
HOLMES: Well, a lot of people were watching the president last night, watching the president's Oval Office speech. He talked to the American people about what's happening in the Gulf, how we got to this point. But also, he talked certainly about the move forward, and energy legislation and the need for it.
Our Ali Griffin, who's usually here with you this hour, he was hosting a town hall in Louisiana after Obama's speech to get some reaction, immediate reaction, to what they thought they heard the president say.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: I didn't mind what the president said about stopping oil drilling, because we have a lot of family -- I'm a fisherman. My son went into the oil business because the prices of the shrimp were so bad, and we're worried about stopping drilling.
ALI VELSHI, CNN ANCHOR: This gentleman over there, you're a prime example of somebody who's telling me you don't think anybody outside of this place has a good picture of this.
UNIDENTIFIED MALE: Well, you can't let the fox watch the hen house. I mean, you know, hey, BP's watching the hen house. You can't do that. You've got to bring people in that know.
VELSHI: What would you like to see happen now?
UNIDENTIFIED MALE: Stop the leak.
UNIDENTIFIED MALE: Stop the leak.
UNIDENTIFIED FEMALE: Stop the leak.
UNIDENTIFIED MALE: Clean up the oil.
VELSHI: Is anybody here complaining about stopping the leak?
UNIDENTIFIED MALE: No.
UNIDENTIFIED MALE: But if they don't stop the oil, the houses are going to be over with. There won't be no more houses here. All the ladies are here and all the men are out there, but if they don't stop that oil from coming in them passes, there will be no houses, because once the storm hits and puts all the oil in it, instead of jacking them up they'll all be full of oil.
UNIDENTIFIED FEMALE: I mean, how would you sleep at night when you know you lost your livelihood? And I've got kids to feed, and I don't know what I'm going to do next. UNIDENTIFIED MALE: There are plenty of women in here, because all the guys are working trying to clean this oil right now. And we need to get it stopped, blocked off at the pass, get it cleaned up. That way we can get our Louisiana bayous out there and tell us if we're going to work again in five years, 10 years, six months, or whatever.
VELSHI: Well, what happens if they tell you it's 10 years?
UNIDENTIFIED MALE: Well, then -- I'm 47 years old. Who is going to hire me?
Yesterday was the first day I ever took a physical to get a job. Yesterday.
I'm going to work for BP. The first time in my life since 1981, when I graduated from high school.
I always made a living. I had two kids and I've had a family, and I've fed my family every year since then. Never had another job. And it's everybody in here, is the same thing.
(END VIDEOTAPE)
HOLMES: Well, you have been hearing a lot from the president lately, military talk about attacking the Gulf oil spill, saying that it's an assault on our shores. Well, we have a general coming up next who has a battle plan for the spill.
(COMMERCIAL BREAK)
HOLMES: Retired Army Lieutenant General Russel Honore, who is a CNN contributor, he talked about this Gulf oil spill and how you actually have to treat this thing like "World War III." And he has a battle plan for it.
He told it to our Gary Tuchman.
(BEGIN VIDEOTAPE)
GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: General, we came to the National World War II Museum here in New Orleans today because you said we need to declare World War III when it comes to this oil disaster.
LT. GEN. RUSSEL HONORE (RET.), U.S. ARMY: Absolutely. We need to act like it's World War III. You know, when we did the World Wars, everything was immobilized. Nothing was left on the table. All branches of the military should be there working for Admiral Allen, apply man power and advanced command and control to find this oil and kill it.
TUCHMAN: I mean, you're treating this like it is a battle?
HONORE: Absolutely. For the people of the Gulf, this is their life. And it would be just like an enemy force invading the Gulf and taking over our shoreline. We need to treat this like a war if we're going to get the effects we want as opposed to an environmental spill.
TUCHMAN: One of the things you're saying is that inherent problem with having BP responsible for the cleanup is a problem?
HONORE: Absolutely! It's like getting mugged and have the burglar determine what your compensation is. The government needs to be determining that.
TUCHMAN: What is the first thing would you do immediately, within an hour, to change the way this cleanup has occurred in line --
HONORE: I would go on the offense. I would go on the attack.
We've been playing defense for too long, waiting for the oil to come to the shoreline. I would mobilize Northern Command -- that's U.S. Northern Command out of Colorado. I would tell them to send men and equipment from the Army, Navy and Air Force to get command and control in the Gulf so Admiral Allen has command and control to find the oil.
We leave nothing on the table. Whatever it takes. You know, the effect of losing this battle and have that amount of oil come ashore could be equivalent beyond what the ramifications of levering the war in Afghanistan or Iraq.
TUCHMAN: And that brings up an interesting point. You said that you would consider taking troops who are currently in Iraq or Afghanistan and bringing them here.
HONORE: Whatever it takes.
TUCHMAN: Should Americans be as worried about what is going on in the Gulf with the oil as they are about Iraq and Afghanistan?
HONORE: I think we should, as well as equal to what we're concerned about terrorism. You know, we keep worrying about this one guy slipping through and having a significant event and blowing up a building up or airplane. But this is at that level in harm because we see this as a man-induced event from an accident. We understand that, but we have to fight that oil.
TUCHMAN: What kind of pressures need to be put on BP?
HONORE: I think one of the things we need to look at is a date certain out there, whether that's 1 July or 15 July. They say, if you haven't made progress, this is what's going to happen. We are going to put that well hole in receivership.
TUCHMAN: You want to declare World War III, basically, on this. Can you actually draw out a battle plan?
HONORE: Absolutely. This is Mississippi River, Louisiana coastline, state of Mississippi, Alabama and Florida. We need to divide this into zones, get military, Army, Navy and Air Force assets, put them in the water. Combine them by zone. This is the Florida coast here. You'd have a two-star general here, whether a National Guard division commander or an active duty commander or naval commander that would be responsible for defending the coastline along Florida, as well as running reconnaissance vessels and aircraft throughout this part of Florida. Find the oil and kill it.
TUCHMAN: So, for each state, though?
HONORE: Each state. We need to start now. We need to go from the defense to the attack.
(END VIDEOTAPE)
HOLMES: And just a reminder, we are standing by, expecting to hear from the president this hour after his meeting with BP. When he speaks live from the White House, we'll take you there.
Meanwhile, two powerhouse attorneys, once fierce opponents, now on the same side when it comes to same-sex marriage. They're fighting for opponents of Prop 8. Closing arguments begin this hour. We'll tell you how this unlikely alliance came together.
(COMMERCIAL BREAK)
HOLMES: Well, this hour, in a San Francisco courtroom, closing arguments in the legal battle over same-sex marriage. Arguing against California's Prop 8, Ted Olson, a well-known conservative who successfully argued for George Bush's election before the Supreme Court. Also the man he defeated in that case, Democratic trial lawyer David Boies.
They have come together in the fight for same-sex marriage, a case they expect will go to the Supreme Court. It's an alliance that seemed impossible 10 years ago.
Here now, Senior Political Analyst Gloria Borger.
(BEGIN VIDEOTAPE)
AL GORE, FORMER VICE PRESIDENT OF THE UNITED STATES: We now need to resolve this election.
BORGER (voice-over): It was the historic case that decided the presidency and divided the nation. Olson and Boies were the ones on the steps of the Supreme Court battling it out.
That was then. This is now. On the streets of New York, they're talking anything but the law.
TED OLSON, FIGHTING PROPOSITION 8: It's called "Crazy Heart."
DAVID BOIES, FIGHTING PROPOSITION 8: Oh, I know.
OLSON: Jeff Bridges.
BOIES: I know. I know. I haven't seen that.
OLSON: Have you seen it?
BOIES: I haven't seen that. I want to see that though and "Avatar."
OLSON: Yes.
BORGER: They've come a long way.
(on camera): Let me play a little game with you. OK? Great lawyer.
BOIES: Ted.
OLSON: David.
BORGER: That's too easy. OK.
(voice-over): The adversaries are now friends, really good friends. And when we asked to meet with them, they suggested a personal spot, David Boies' apartment in New York City.
(on camera): If anybody had said to me nine years ago that I would be about to be interviewing the two men who fought each other tooth and nail in Bush versus Gore on the same side of a constitutional fight, I would have said are you crazy?
OLSON: Actually, David and I talked about this in 2000, as we were getting ready to argue in the Supreme Court, that some day, we'd like to be on the same side in the United States Supreme Court.
(CROSSTALK)
And we said in the chambers, some day -- some day --
BOIES: Right.
OLSON: -- someone is going to come to us who will want to get married and they'll be gay.
BORGER (voice-over): It would take nearly a decade for that to actually happen.
UNIDENTIFIED MALE: What do we want?
PROTESTERS: Equal rights.
BORGER: Olson was recruited by a group of Hollywood activists who wanted to challenge Proposition 8, the controversial 2008 ballot initiative that banned same-sex marriage in California.
OLSON: Good morning, everyone. Thank you for being here.
BORGER: He said yes, which was startling enough, but he knew he needed some political balance on the team, so he picked up the phone. BOIES: And he told me what the case was about, and I think it took me about 15 seconds to say yes.
OLSON: It took you less than one second.
BORGER: It was a case made for David Boies, and Olson knew it.
BOIES: I think it is in some senses the last major civil rights battle that we're fighting in this country, hopefully. This is not a liberal conservative issue. It's not a Republican Democratic issue. It's an issue of civil rights and human rights.
BORGER (on camera): Do you find yourself defending Ted Olson to your Democratic friends?
BOIES: No.
BORGER: When they say to you how can you work with him?
BOIES: No, I find myself defending Ted Olson to my Republican friends. Democratic friends are easy. BORGER (voice-over): Politics aside, their wives joke that they're like an old married couple. They go biking together and both enjoy the finer things.
(on camera): But what do you like about each other?
BOIES: Where shall we start? Shall we start with the wine or the bike trips?
BORGER: Yes, let's start with the wine. After a long day, a glass of --
BOIES: A glass, definitely.
OLSON: Chardonnay.
BOIES: Yes, Chardonnay.
BORGER (voice-over): They have known each other for decades as super lawyers practicing in a rarified legal stratosphere. Then came Bush versus Gore, the hottest case of all, a case that to this day they don't agree on.
BORGER (on camera): Do you still think you were right?
BOIES: Absolutely.
OLSON: Well, he wasn't obviously. Supreme Court decided. Furthermore, by the way, the journalists all went back to Florida and counted these votes about 12 different ways and they all came out the same way. But I will say this --
BOIES: Well, it didn't all come out the same way.
OLSON: Well -- BORGER (voice-over): Well, they'll never resolve that professional argument. But ironically, that case brought them closer personally.
BOIES: Something happens in the sense that you get so deeply involved in a case that about the only person that really appreciates what's going on is the lawyer on the other side who's just as deep into the weeds as you are. They can appreciate all these little nuances. And so, it's a natural kind of affinity.
BORGER: That affinity was strengthened by tragedy. A year later on September 11, 2001, Olson's wife Barbara was killed on flight 77, the flight that crashed into the Pentagon. Boies knew his friend was suffering and reached out to him.
BOIES: I was being given an award by the lab scroll in Washington and it was an annual award that they give. I'm dyslexic and they give it to somebody who has achieved, and I said to get Ted Olson. I would like to have Ted Olson give me the award.
OLSON: I'm very honored to be here with my colleague David Boies because he is the best.
I could hardly talk about it because it is such an emotional event. That gesture of David asking me to be with him on the stand receiving that award in front of the 2,000, 3,000 people was a wonderful gesture by him. It's ten years ago now and I can hardly talk about it.
BORGER: That strong bond is still there a decade later, as together they take on the fight for gay marriage.
UNIDENTIFIED MALE: They're the wonder twins. They're not the odd couple.
BORGER: Paul Katami and Jeff Cirillo are one of the couples that Olson and Boies are representing.
UNIDENTIFIED MALE: I can tell you that both those guys, they put their heart and soul into this. And when they're fighting for our equal rights, they are on the same page and they are doing it together.
OLSON: Our nation was founded on the principle that all Americans are created equal.
BORGER: Their legal strategy is simple. Olson and Boies argue that banning same-sex marriage is unconstitutional, period. They expect the Supreme Court to be the ultimate decider for the nation.
UNIDENTIFIED MALE: It would be the Roe versus Wade of our generation.
BORGER: They have their critics, conservative legal analyst Ed Whalen. ED WHALEN, CONSERVATIVE LEGAL ANALYST: And there's nothing in the constitution properly construed that remotely supports a right to same-sex marriage.
BORGER: And even some of those who agree with Olson and Boies say that same sex marriage should be left to the states.
(on camera): There are lots of skeptics out there who say that you're going too quickly here. That you're essentially going to wind up at the Supreme Court and you're asking the Supreme Court to do a pretty heavy lift.
BOIES: Every civil rights struggle, there have always been people who have said you're moving too fast. The country is not ready for it. How many people in 1954 were saying the country is not ready for desegregation. Brown against Board of Education just too soon.
BORGER: But everyone says this is a conservative court. So why are you doing it now?
BOIES: Everybody says Ted is a conservative guy. I mean, there are lots of conservative people. The idea that civil rights and human rights is exclusively a liberal preserve, I just think is flat wrong.
BORGER (voice-over): Their clients have faith their lawyers will win.
(on camera): Will David and Ted be at the wedding?
UNIDENTIFIED MALE: They better be.
UNIDENTIFIED MALE: They just might officiate the wedding.
UNIDENTIFIED MALE: That would be interesting.
BORGER: Or they could be best man.
UNIDENTIFIED MALE: Yes. Man and man, right? Yes.
BORGER: Whatever.
UNIDENTIFIED MALE: In our wedding and in life.
BORGER (voice-over): But in the end, that's likely to be a decision for the high court.
(on camera): Last time you went to the Supreme Court it didn't go so well for you. What's going to be different this time with the two of you together?
BOIES: Well, one thing, this time I've got Ted on my side.
OLSON: I would say the one thing that would be different is this time we'll get all the votes that I can persuade and all the votes David can persuade. And there will be no votes left on the other side. (LAUGHTER)
BORGER: No recount?
BOIES: No recount.
OLSON: No recount.
BOIES: No recount necessary.
(END VIDEOTAPE)
HOLMES: All right. Standing by here with Gloria Borger.
And Gloria, I certainly want to talk to you more about the piece we just saw, but also need to let our viewers know -- and you can come in handy, having you here -- well, right on cue, President Obama coming out at the White House now, talking about his meeting with BP officials.
Let's listen.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I just concluded a constructive meeting with BP's chairman, Carl-Henric Svanberg, and I raised two issues at the meeting. First, was the containment of the oil that is still spewing into the Gulf.
As I mentioned last night, my administration has directed BP to mobilize additional equipment and technology. And in the coming days and weeks, these efforts should capture up to 90 percent of the oil that is leaking out of the well. Now, that's not good enough, so we will continue to press BP and draw on our best minds and resources to capture the rest of the oil until the company finishes drilling a relief well later in the summer that is expected to stop the leak completely.
The second topic revolved around the issue of claims. As I traveled across the Gulf, I heard growing frustration over the pace at which claims have been paid. And I also heard concerns about whether BP will make resources available to cover legitimate claims resulting from this disaster. So, this discussion today was essential.
Currently, under federal law, there is a $75 million cap on how much oil companies could, under certain circumstances, be required to pay for economic damages resulting from a spill such as this. That amount obviously would be insufficient. And that's why I'm pleased to announce that BP has agreed to set aside $20 billion to pay claims for damages resulting from this spill.
This $20 billion will provide substantial assurance that the claims people and businesses have will be honored. It's also important to emphasize this is not a cap.
People of the Gulf have my commitment that BP will meet its obligations to them. And BP has publicly pledged to make good on the claims that it owes to the people in the Gulf. And so, the agreement we reached sets up a legal and financial framework to do it.
Another important element is that this $20 billion fund will not be controlled by either BP or by the government. It will be put in an escrow account administered by an impartial independent third party. So, if you or your business has suffered an economic loss as a result of this spill, you'll be eligible to file a claim for part of this $20 billion. This fund does not supersede either individuals' rights or states' rights to present claims in court.
And BP will also continue to be liable for the environmental disaster it has caused. And we're going to continue to work to make sure that they address it. Additionally, BP voluntarily agreed to establish a $100 million fund to compensate unemployed oil rig workers affected by the closure of the deepwater rigs.
We've mutually agreed that Ken Feinberg will run the independent claims process we're putting in place. And there will be a three- person panel to adjudicate claims that are turned down. Every effort will be made to expedite these claims.
Ken has long experience in such matters, including running the fund that compensated victims of 9/11. And I'm confident that he will ensure that claims are administered as quickly, as fairly, and as transparently as possible.
BP's liabilities for the spill are significant and they acknowledged that fact. We will continue to hold BP and all other responsible parties accountable and I'm absolutely confident BP will be able to meet its obligation to the Gulf Coast and to the American people.
BP is a strong and viable company and it is in all of our interests that it remains so. So what this is about is accountability. At the end of the day, that's what every American wants and expects.
The structure we're establishing today is an important step towards making the people of the Gulf Coast whole again. But it's not going to turn things around overnight and I want all Americans to know that I will continue to fight each and every day until the oil is contained, until businesses recover and until the Gulf Coast bounces back from this tragedy as I know it will.
One last point, during a private conversation with Chairman Svanberg, I emphasized to him that for the families that I met with down in the gulf, for the small business owners, for the fishermen, for the shrimpers, this is not just a matter of dollars and cents. That a lot of these folks don't have a cushion.
They were coming off Rita and Katrina, coming off the worst economy that this country's seen since the great depression and this season was going to be the season where they were going to be bouncing back. Not only that, but this happened, from their perspective, at the worst possible time.
Because they're making their entire income for the year in the three or four months during which folks can take their boats out, people are coming down for tourism. And so I emphasized to the chairman that when he's talking to shareholders, when he is in meetings in his boardroom, to keep in mind those individuals, that they are desperate, that some of them, if they don't get relief quickly, may lose businesses that have been in their families for two or three generations.
And the chairman assured me that he would keep them in mind. That's going to be the standard by which I measure BP's responsiveness. I think today was a good start and it should provide some assurance to some of the small business owners and individuals down in the gulf who I was visiting with that BP is going to meet its responsibilities.
But I indicated to the chairman that throughout this process, as we work to make sure that the gulf is made whole once again, that the standard I'm going to be applying is whether or not those individuals I met with, their family members, those communities that are vulnerable, whether they are uppermost in the minds of all concerned, that's who we're doing this work for. Thank you very much, everybody.
(END VIDEO CLIP)
HOLMES: Listening to the President of the United States talking about his meeting today with BP and what came out of that. Two things, first, $20 billion, he says, BP has agreed to put in this escrow account that's going to be handled by a third party, not the government, not by BP and claims would be paid out from this $20 billion.
He wanted to remind people, however, that this is not a cap. This does not mean that all BP is going to be responsible for is this $20 billion. This is essentially a start in what they agreed to at this meeting with several BP execs. He did meet with several BP execs at the White House today.
Also another $100 million, he just told us, they've agreed to put into a fund that will go to unemployed rig workers, rig workers who are out of a job because of this whole mess. Let me bring in Gloria Borger, our Senior Political analyst still standing by here with us.
Something else, Gloria, that jumped out here. He spoke of -- probably the first time we've heard this -- the president said, this is a strong and viable company and we need them to be a strong, viable company.
A lot of people have come down on him for coming down so hard on BP might push them into bankruptcy and we need this to be a strong company so we can pay up.
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: You know, we've heard James Carville on our air saying this time and time again that you need BP to remain viable because you want these claims to be paid.
Another thing that really jumped out at me, T.J., was the fact that the president really put a human face on this crisis. He said he was telling all the folks at BP, you have to think of these people who earn their livings in the next few months and who have lost everything and who are going to come to you to make them whole.
And the standard that I'm going to set is whether you are doing that quickly enough because you need to help them now. You cannot help them some time down the road. So it's very clear that those are the instructions that the president is also going to give to Ken Feinberg who's going to administer this escrow account.
It's clear that he heard from the folks in the gulf when he traveled down there that these are people who cannot live without this income because this is the time when they earn their income for the entire year.
HOLMES: And something else, you mentioned earlier, the president said a lot of these folks don't have a rainy day fund. They need help and they need it right now.
It was something you mentioned, I don't think we got specifics from the president now. Exactly when is that $20 billion going to be in that account, exactly how long it will take to get this claim filed? When can somebody get a check? We still have a lot of questions here.
BORGER: We still do have a lot of questions out here and I'm sure that that's what we'll be hearing from Ken Feinberg about and we may hear a little bit about it from BP.
You know, the important thing also is that as you mentioned earlier, there is no cap on this $20 billion. It's very hard to say how much money in the end is going to be involved here because we don't know what the clean-up is going to entail, we don't know how much income is being lost. We just -- these are numbers that may seem right now. But five years down the road, they may seem small.
HOLMES: And I wanted to remind our viewers, your polls (inaudible) excuse me for cutting your off, but to our viewers, we're expecting here in the next 60 seconds or so, BP officials, who were, of course, a part of that meeting, to step out -- step to the microphones and going to hear from them.
But as we wait, we'll continue to keep an eye on that picture. We'll just leave that up and I want to keep talking to you here, Gloria. Something else we heard and I think a lot of people will key in on as important, saying that you can still present claims in court, even though we have this $20 billion escrow account set up, he's still saying, maybe BP, you can still go after them at least in the legal system.
BORGER: Right. This doesn't limit their liability. Also what he said is that the panel that's going to be run by Ken Feinberg is going to have an arm of three people that will be able to adjudicate claims for people who may be turned down.
So if you submit a claim, you get turned down, you also have recourse within this escrow structure to say, OK, I want to make my case here and Ken Feinberg's panel is going to be able to hear you out.
HOLMES: All right, and Gloria, they're stepping to the microphone now. It looks like the chairman stepping, Tony Hayward who's been the face of this disaster. He is in the background there as well. Let's go ahead and listen in.
BORGER: Right.
(BEGIN VIDEO CLIP)
CARL-HENRIC SVANBERG, CHAIRMAN, BP: Ladies and gentlemen, we have had a very constructive meeting today with the president. We appreciate his deep concern - and we appreciate the deep concern that he feels for the people in the region and you could hear on his speech today his frustration.
I trust also that we, through the meeting, that the president sensed the sadness and the sorrow that we feel for this tragic accident that should never have happened. BP has always met our obligations and responsibilities and we have made clear from the first moment of this tragedy that we will live up to all our legitimate responsibilities.
We have agreed today with the president a framework that should assure the American people that we mean what we say. We will look after the people affected and we will repair the damage to this region, the environmental damage to this region and to the economy.
We are announcing today, as you heard from the president, a $20 billion commitment to make sure that all appropriate claims are handled swiftly and fairly. We have also announced an independent adjudicator that will make sure that the right people will get the right money at the right time.
The BP board has today decided that we will not pay any further dividends this year. We made it clear to the president that words are not enough. We understand that we will and we should be judged by our actions. What has been clear today is that this administration and our company are fully aligned in our interest of closing this well, cleaning the beaches and care for those that are affected.
Finally, I would like to take this opportunity to apologize to the American people. On behalf of all the employees in BP, many of whom are living on the Gulf Coast and I do thank you for the patience that you have in this difficult time. Through our actions and commitments, we hope that over the long term we will regain the trust that you have in us. Thanks a lot and I will take a couple of questions.
UNIDENTIFIED FEMALE: Are you going to resign from BP?
UNIDENTIFIED FEMALE: Did BP take safety shortcuts on the deepwater rigs? SVANBERG: We are going through a series of investigations and we and the board -- we will do our own independent investigation where we will scrutinize everything that we do to make sure that we understand the root cause of this tragic accident because it shouldn't happen. I have no further comments than that.
UNIDENTIFIED MALE: What were the points of disagreement that had to be resolved? Are you concerned about illegitimate payments?
SVANBERG: No, I think it was a very constructive meeting and it is a meeting that includes many different parts. And it is important to get all the language right. But the determination and the ambition to get through this was clear from the beginning.
UNIDENTIFIED MALE: How long did you spend with the president himself?
SVANBERG: I spent a fair amount of time and I must say that he is - he comes across as a -- he is frustrated because he cares about the small people and we care about the small people. I hear comments sometimes that large oil companies are greedy companies or don't care, but that is not the case at BP. We care about the small people.
(END VIDEO CLIP)
HOLMES: Well just a couple of questions the chairman took. But you heard him say there at the end and maybe it will mean something to the people of the Gulf Coast just to hear it come out of his mouth.
But he said he apologized to the American people on behalf of BP. Also you heard him say there, a lot of people will shake their heads and shrug their shoulders and not believe a word that came out of his mouth. But, in fact, he still did say that BP cares about the small people.
That was Carl-Henric Svanberg that is the chairman of BP after his meeting and several other BP executives met with the president at the White House. Coming out and talking about this $20 billion escrow fund that has been set up in fact to try to make the people whole of the Gulf Coast.
Claims will be paid out of that. Gloria Borger standing by with me here. Interesting to hear from him and for the American people to hear from him live. Now, you correct me if I 'm wrong, if I 'm being a little too hard on him and mincing words and being a little too cynical here.
But there were a couple of things jumped out. Words mean a lot here, Gloria, and he said, we will live up to legitimate responsibilities. He also said, all proper claims handled swiftly and fairly. Now, are we just mincing words here a bit or are they being strategic and careful about what they say?
BORGER: Well, I 'm not a lawyer, but you know legal words when you hear them and those are two legal words. The thing that jumped out at me was the fact that he announced that they were going to suspend their -- I believe it's $10 billion in dividends.
HOLMES: Yes, it was $10 billion.
BORGER: This year and that is essentially an important gesture saying, look, we're not going to pay out our shareholders because we need to take care of the gulf right now. That's something that clearly has ramifications for BP as a company.
But -- so I think that he -- the president, did not make that announcement. The chairman of BP made that announcement and so that was something that a lot of people are going to take notice of as well.
HOLMES: And something that the president actually in the gulf region on one of his visits actually gave them flak for. You're telling me you've got $10.5 billion, was the number the president said, going to be paid out to your stockholders and your shareholders and you're saying you don't have enough money for the people of the gulf region.
BORGER: Right.
HOLMES: Where do they go now? I mean, would you call this, Gloria, at what we've seen in the past couple of hours, frankly, one of the most productive days we've seen in moving forward with this whole gulf oil disaster?
BORGER: Yes, it's the culmination, I would think, of an awful lot of negotiation and I think that the president in his speech last night made a point of saying, we're going to hold BP accountable.
Today, you saw that there's going to be this escrow fund that clearly is not going to be run by BP, although BP will be supplying the money for that escrow fund. We also saw that they're not going to be paying out dividends to their shareholders.
It was interesting to note for me as sort of a political observer, the optics of this. You saw the president give his statement separately from the folks -- from BP who are out on the driveway, right? They are not standing next to the president of the United States.
At the beginning of this crisis, T.J., we were told, you know, BP and the federal government are working together. Now they may be working together on this escrow fund, but the government is clearly in charge here. And the president didn't want those folks standing next to him.
HOLMES: I believe that was down on the Gulf Coast, Thad Allen made the announcement, we will not be holding any more press conferences with BP.
BORGER: You bet.
HOLMES: You bet, all right, one last thing here. No matter what we see here about escrow accounts and money and making people whole, will the American people really not respond and think things are going well until we can stop showing that live picture of oil gushing into the gulf?
BORGER: Absolutely. You know, this is really -- we've been talking about this politically. This is a question of competency, not only of the Obama administration, but also of the federal government. People don't think the federal government can do much of anything these days.
And so people sit there helpless. They watch those pictures, T.J., and they see that up to 60,000 barrels of oil now the estimates are spewing out of that, that they want to see that hole plugged. Barack Obama wants to see that hole plugged.
And he keeps making the case now that BP -- and this will be investigated -- knew how to drill the hole, but didn't know how to plug it, that the technology for cleaning up is not anything like the technology for drilling. And you can be sure that that's going to change as we come out of this crisis.
HOLMES: Well, it's a hell of a lesson to learn and a hell of a way to learn it, but we got to get something out of it. Gloria Borger, we absolutely or I appreciate having you here with me these past couple of hours. Talk to you again soon, but thanks so much. Quick break here at 10 minutes at the top of hour. We'll be right back.
(COMMERCIAL BREAK)
HOLMES: Hi, welcome back. Didn't think I 'd be back so soon. We just saw an interesting couple of hours, really, but certainly in the past couple of minutes as well.
With the president coming out to speak at the White House live and we also heard from the chairman of BP, both men speaking after they met today at the White House discussing, among other things, this $20 billion fund, this escrow fund that's now going to be used to pay out claims for people who are trying to be made whole down in the Gulf Coast.
That is being set up, going to be run by a third party, not by the government and not by BP. Also, something came out, a gesture if you will, from BP saying they will not, in fact, make those dividend payments to their shareholders that you heard so much about and they got so much criticism for.
Some $10.5 billion was supposed to be paid out. In fact, they say they're not going to do that this year now so a gesture there. Also of the chairman coming out and formally and on live television here apologizing for what happened in the Gulf Coast.
Folks on the Gulf Coast, they are sizing up the president's speech on this whole disaster. Many say talk is cheap, they want to see some more action from the federal government. It's time for the stake out with Ed Henry. ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, T.J., you're probably wondering why I 'm not live for you right now. It's because, look, Ali's not anchoring, I 'm not going to deal with the "B" team. I'm just kidding. You know, I love you. I had to catch a flight back to D.C. in order to do my day job and actually I do some work instead of staying here on the beach.
But I can tell you in talking to people here on Pensacola Beach, they were interested not just in the president's speech last night, but really that meeting at the White House with BP officials because that's going to determine their fate here.
You can see the water looks really beautiful behind me, no sign of oil either there or on this white sand beach right beside me. Nevertheless, tourists aren't showing up because of a fear that oil may be here in days.
I spoke to one man, Michael, who runs a pizzeria here. He met with President Obama when the president walked this very beach yesterday and Michael said that he's gotten $10,000 from BP so far but he's lost $60,000 in business just in the first two weeks of June.
He's worried if oil does show up in the next few days, it's only going to get worse for the rest of the month. So this claims process is so critical to people here and while I certainly heard criticism over the last few days that some people are saying the president's response is too little too late.
Other people like Michael told me when he felt the president was here, he was very sincere. He was very knowledgeable about the issues, asked the right questions and basically, bottom line for Michael and some of the other residents and small business owners here in Pensacola Beach, is basically that while the speech was important in the oval office, the follow-up, this meeting with BP officials and the hearings on the hill, the other meetings to come in the days ahead are going to be a lot more important in terms of determining their fate than just one big speech - T.J.
HOLMES: California's proposition 8 invokes a critical day for both sides and in "Wordplay," we're exploring the arguments.
(COMMERCIAL BREAK)
HOLMES: I want to give you a look at some of the other stories that are making headlines this is hour. Day 58, of course, of the oil catastrophe. President Obama met with the top BP execs this morning.
The big news that came out, you heard it right here live, BP has agreed to place about $20 billion in an escrow account for people economically impacted by the disaster. Attorney Kenneth Feinberg will handle the payouts. He did the same for September 11th victims' families.
Also, we've just learned about the Colorado man arrested in Pakistan while trying to hunt down Osama Bin Laden has been moved to the capital Islamabad by the government. The Pakistani doctor has also determined (Gary Faulkner) had psychological problems.
But a U.S. Embassy spokesman says they weren't aware of any medical exam to determine that. His bother says, he isn't crazy, he just believe strongly in bringing Bin Laden to justice. The U.S. State Department is offering a reward, up to $25 million for information that directly leads to Bin Laden's arrest.
Now another fellow to introduce you to now, this is Joe Miller. He's a Republican U.S. Senate candidate from Alaska. The Tea Party Express is making a major endorsement for the 2010 election and CNN has learned that he is it.
Miller is a lawyer and the underdog in the race, but the source tells us the Tea Party will pour resources in to get a win.
Well, now time to play with words, "Wordplay," as it's called here. Today, we're talking about ultra vires. This is a legal term that's at the center of the arguments against California Prop 8, the ban on same sex marriages. Closing arguments in the court case happening today.
The Prop 8 is being called an ultra vires amendment. It's a legal term that means beyond powers. Basically, it's argued that the passage of Prop 8 stretched the powers of voters too far. It's the basis of the judicial review.
Supporters of the law banning same sex marriages say the passage of Prop 8 was the will of the people. They also want the court to nullify around 18,000 marriages performed before Prop 8's passage.
Attorney Ted Olson who introduced you to here a little earlier, a couple of pieces by our Gloria Berger, he's arguing against the law and he said, it's an attempt to enforce private moral beliefs on a disfavored majority.
So your word for the day, ultra vires. Coming up next, I think we're going to take a quick break and give you a little "XYZ" the segment today. We'll tell you how somebody who kicks around a round ball can actually bring peace to a country.
(COMMERCIAL BREAK)
HOLMES: From 2002 to 2006, the west African nation of Ivory Coast was in the midst of a brutal civil war, but the first of such case in the (inaudible) continent. This one like many others borne out of ethnic and political tensions and today, the Ivory Coast still in what's described as an uneasy peace still, nothing like it was when they were in the middle of civil war.
Two sides didn't resolve all of their issue when they decided to lay down their arms? So why did they? A lot of the credit is given to one man. He's a native of the Ivory Coast, not a politician, not a soldier, not a mediator. His name is (inaudible). Considered one of, if the not, the most influential people in his country.
He made an impassioned plea in front of television cameras for the two sides to lay down their arms and they did. So why did they listen to him? Why does he have such influence? Because he's a footballer.
To you, that would be a soccer player, soccer or football in Africa have a special relationship. Hard for us here to understand what the game means on that continent. It's the most popular sport in the world.
Even if it's probably behind (inaudible) when it comes to popular sports in the U.S. On a continent mired in war, poverty, corruption and disease, the beloved game of football and those who play it can actually make a difference. South Africa right now, the host team for this year's World Cup, but there are actually five other home teams, Ghana, Ivory Coast, Cameron, Nigeria, Algeria.
Ghana became as well the first --
