The economic impact of the Gulf oil spill is reaching far beyond the fishing and tourism industries that were first hit. Everyone from plumbers to beauticians says they’re feeling the pain. But some people are much more likely than others to get money from BP’s compensation fund.
While scientists watch to see if oil might make its way through the entire marine food chain, the economic food chain has already been spoiled for everyone from fishermen to oil rig workers.
With no one fishing and many restaurants hurting for business, it’s also having an impact on Scott Burke’s bottom line. His company, Loop Linen and Uniform Service, launders and rents tablecloths and napkins just outside of New Orleans.
The Trickle-Down Effect
Washing machines that usually run until 9 p.m. are turned off, and linens rented out to restaurants are piled high on shelves.
“As the restaurants slow down, we slow down,” Burke says. “It’s just a trickle-down effect.”
And the trickle doesn’t stop with Burke.
“The people who supply me — I’m not using as many chemicals to wash,” he says. “I’m not buying linen ’cause there’s just not a demand. So, everyone’s feeling the pinch.”
Many are also trying to make a claim. Even a local plumber hired a lawyer.
Shucking oysters tends to muck up the drain pipes in restaurant kitchens. But no shucking means no clogging. And now he’s sitting around wondering if he’s eligible for compensation
Kim Truong, who owns Paradise Nail Salon in Westwego, La., says her business has plummeted by about 40 percent since the spill. She says she tried to file a claim with BP, but was told they don’t know yet if they’ll be able to offer her anything.
Kim Truong, who owns Paradise Nail Salon in Westwego, La., says her business has plummeted by about 40 percent since the spill. She says she tried to file a claim with BP, but was told they don’t know yet if they’ll be able to offer her anything.
“We have no customers — we’re very slow, like [a] 40 percent drop down,” says Kim Truong, who owns Paradise Nail Salon. Truong says she’s worried about her business. Many female customers say they no longer have the money to get their nails done because their husbands are out of work.
Truong says she tried to file a claim with BP and presented old tax returns, as well as receipts from this year. But she says BP officials told her they don’t yet know if they’ll be able to offer her any compensation.
Feinberg’s Judgment Call
Kenneth Feinberg, the administrator of BP’s $20 billion compensation fund, determines who gets paid. The guy who owns a beachfront motel on the Gulf is a sure bet. Real estate brokers who aren’t renting as much are likely to receive something. But Feinberg says a golf course located 50 miles away is unlikely to receive anything, even if its business is way down.
“That’s a judgment call,” Feinberg says. “At some point you have to make a call: These claims are eligible; these claims are not eligible. I could be wrong. You people could draw the line somewhere else.”
Preston Mayeaux, 59, knows where he would draw the line.
Losing ‘Golden Years’
He walked into a BP claims center this week seeking compensation because, he says, the property value has plummeted at the small cabin he owns on Bayou John Charles. He says he can no longer enjoy summer weekends on the oily water.
“I lost my golden years that I wanted to be able to go to my fishing camp, and how do you put a price on that?” Mayeaux says. “I don’t know how you put a price on that.”
Apparently, neither did the BP claims official who Mayeaux says gave him a lot more pushback than sympathy. If BP’s recklessness caused the spill, then he says people like him should be compensated.
BP has repeatedly insisted that it will pay “every legitimate claim.”
“That’s the magic word. What will be considered legitimate?” says John Alario Jr., a Louisiana state senator. “I think some people will end up having to go to court to prove what is legitimate. It’s yet to be seen how fair they’re going to be. We can only go by trust at this point.”
Feinberg doesn’t disagree. His offers will all be driven by what he thinks someone would be able to get if they chose instead to sue BP.
Feinberg says those further down the food chain who are not happy with his offer can try their luck in court.
“But I don’t think they’re going to win,” he says. “I think they’re on a fool’s mission.”
