We use our recently proposed microscopic modeling in the framework of linear response theory to investigate the complete phonon dispersion, the phonon density of states, certain phonon-induced electronic charge distributions and charge fluctuations (CF's) for anomalous soft modes of metallic BaBiO3 in its simple cubic phase where superconductivity with Tc up to 32 K appears. The theoretical approach already has been applied successfully to the cuprate high-temperature superconductors (HTSC's), simple ionic crystals (NaCl, MgO) and perovskite oxides (SrTiO3, BaTiO3). It is well suited for materials with a strong component of ionic binding and especially for "ionic" metals. In particular, the giant phonon anomalies related to the breathing vibration of the oxygen as found experimentally in superconducting doped Ba0.6K0.4BiO3, resembling those observed in the high Tc cuprates, are investigated. The origin of these anomalies is explored and attributed to a strong nonlocal coupling of the displaced oxygen ions to CF's of ionic type, essentially of the Bi6s-and Bi6p orbital. This points to the importance of both of these states at the Fermi energy. Starting from an ab-initio rigid ion model (RIM) we calculate the effect on the lattice dynamics and charge response of the most important electronic polarization processes in the material, i. e. CF's and dipole fluctuations (DF's). Taking into account these electronic degrees of freedom in linear response theory, we obtain a good agreement with the measured phonon dispersion and in particular with the strong phonon anomalies.