While watching the ongoing coverage of the BP Oil Spill in the Gulf, Americans residing in areas outside of the Gulf may naively assume that only those individuals residing and working in the affected geographical areas will be financially impacted. Not true. Many American wallets across the country will be pinched and feel the painful costs in the aftermath of the oil spill.
A simple explanation of the Butterfly Effect metaphor; the concept is based in chaos theory and refers to the far reaching “ripple effects” that are created from the changes which occur once a butterfly flaps its wings. This theory is studied at length in both semi-classical and quantum physics. The Butterfly Effect also appears in popular culture, typically in time travel fiction and films such as drama, “The Butterfly Effect”, starring Ashton Kutcher.
Picture a giant green and yellow BP butterfly covered in dollar sign tattoos., flapping its wings furiously. Here is a preliminary list of who will be affected financially from complete to partial loss of income, reduction in spending or use of services, organizational cost cutting and finally increased cost of goods and services. This is by no means a full compilation, more like the tip of the iceberg.
1) Residents of the Gulf employed by fishing industry
2) Residents of the Gulf employed by hospitality and tourism industry
3) Small Businesses Owners in the Gulf such as diners, gas stations, and franchises
4) Residents of the Gulf employed by small businesses
5) Shareholders who rely upon BP stock dividends as part of their annual income.
6) BP employees
7) Vendors & Sub-contractors doing business with BP
8) Banks doing business with all of the previously listed
9) Insurance Companies, their employees and shareholders
10) Individuals and Businesses faced with higher insurance premiums
11) Individuals and Businesses who purchase gas and seafood products….
Due to spatial constraints, I end the list and trust that the point is made; the damage is not limited by geographical proximity. BP has set up a $20 billion trust for reparations, as of Day 65, over 51,000 lost wage claims were filed but only approximately 26,500 claim payments were actually issued by BP. Therefore, it is safe to assume that the other claimants are in some degree of financial crisis, with escalating credit card dependency and diminishing cash reserves. Chapter 7 or Chapter 13 Bankruptcy may be the only option for some individuals. Remember though, these are the people that are covered by BP’s $20 billion dollar trust fund, what about everyone else?