Has the BP Bashing Gone Too Far?

First, it was the bust of Winston Churchill removed from the Oval Office. Then it was an inappropriate gift for the Queen. Now, the British press is asking again whether U.S. President Barack Obama has it in for the British, this time over BP.

There has been extensive coverage in Britain of the oil spill in the Gulf of Mexico. But now it is not the environmental damage that is the big issue; it is the economic damage to BP caused by American politicians, including the president, as they demand that BP pay for the cleanup as well as compensation, and are now demanding the company not pay its shareholders dividends.

Headlines in the British papers reflect growing pressure on the new prime minister, David Cameron, to get the Obama administration to back off. Earlier, the Daily Mail, which supports Cameron’s Conservative Party, blared "Lord Tebbit and Boris Johnson attack Barack Obama’s ‘anti-British’ rhetoric." (Lord Tebbit is a vocal former member of Margaret Thatcher’s government, and Boris Johnson is the Conservative mayor of London.) The more sober Financial Times ran with "UK alarm over attack on BP," quoting business leaders.

Influential Tory commentators have also joined in with calls for Cameron to defend BP. "I hope David Cameron has the balls to ring Obama today for ‘a full and frank discussion’ — diplomatic language for a blazing row," writes Iain Dale, a leading Conservative columnist. Tim Montgomerie, a prominent activist who runs the site ConservativeHome, says he hopes that "behind-the-scenes channels are being used" to convey the British government’s displeasure. The Daily Telegraph‘s Jeremy Warner ripped Obama for "crass populism which shows very poor statesmanship."

Cameron is scheduled to speak by phone with Obama over the weekend, and the former British ambassador to Washington, Sir Christopher Meyer, has been on the BBC’s The World At One program arguing it is time for the new prime minister to take up BP’s cause with the U.S. president. "The survival and ultimate prosperity of BP is a vital British interest, and I think the time has come to point it out, at a senior level, to the U.S. administration," he said.

Generally, the British don’t talk about businesses in this way, unlike the French, who have "national champions," including oil companies like Total, which the French government will openly support. BP has been a completely private company since Thatcher sold off the government’s shares during the 1980s.

But the debate that has erupted in Britain is motivated by more than hurt national pride. The value of BP shares has plummeted 47 percent since April, when the rig exploded, and this is hitting British pocketbooks. Last year, around 14 percent of all dividends in the country’s leading share index, the FTSE 100, were paid by BP, and it is estimated that one pound in every six in pension funds comes from BP. So it’s not just CEO Tony Hayward whose livelihood is being threatened — it’s those of thousands of ordinary Britons, too.

The enormous environmental and economic impact of the oil spill in the gulf region has been covered sympathetically by the British media, but now there is a growing sense that American politicians have gone too far and are causing unjustified long-term damage to BP. Even the left is growing concerned. There were critical questions from Labour peers in the House of Lords Wednesday, and Labour MP Tom Watson said Thursday, "This is now a serious crisis facing millions of pensioners in the UK, and we need to say to our U.S. allies that yes, it was a British company that made this mistake, but if they were subject to a regulatory regime in the UK they wouldn’t have been able to do that and the world’s insatiable appetite for oil was the cause of this, not British pensioners."

Cameron has been treading carefully so far. In comments Thursday, the prime minister responded to questions by saying he completely understands the U.S. government’s frustration with BP and that his government is ready to help with the cleanup. "I completely understand the U.S. government’s frustration," Cameron said. "The most important thing is to try to mitigate the effects and get to grips with the problem. It’s something I will discuss with the American president when we next talk." But the prime minister gave no hint of what he might say.

Cameron came to power saying that, in contrast to the previous Labour government, he would have a "solid, not slavish" relationship with Washington. British commentators are now seeing BP as the first big test of this promise.