Obama Working With Congress To 'Significantly' Raise BP's Liability

The president and his team are currently in the process of working with members of Congress to "significantly" raise the amount of money that oil companies like BP would have to pay in economic damages in the event of a spill.

White House Press Secretary Robert Gibbs told reporters on Wednesday that the Office of Management and Budget was working with members to lift the $75 million cap that currently exists on the amount oil companies pay for non-cleanup and containment costs.

Gibbs did not put out a number for where the president would like the new cap to be, saying merely: "We would be in favor of significantly lifting that cap, a cap put in place in the Oil Pollution Act of 1990, so at least 20 years old."

Earlier this week, Sen. Robert Menendez (D-NJ) introduced legislation that would raise the cap to $10 billion. An opponent of offshore drilling, the New Jersey Democrat said that the $1.6 billion that oil companies pay into a trust fund for cleanup and containment costs was "little consolation to the small businesses, fisheries and local governments that will be left to clean up the economic devastation that somebody else caused."

On Wednesday, House Democrats followed suit, with Rep. Rush Holt (NJ) introducing the same bill as Menendez. The effort was co-sponsored by Reps. Suzanne Kosmas (FL), Allen Boyd (FL), Paul Hodes (NH), Kendrick Meek (FL), Artur Davis (AL), Frank Pallone (NJ) and Jay Inslee (WA).

Gibbs neither endorsed nor opposed these bills. But he stressed that BP is "going to get a bill for the recovery of cleanup and the damages caused" by the current spill in the Gulf

Comments

[NWBrunette]

01:33 AM on 05/07/2010

Right. Like it'll be retroactive. Right.

[samknox]

08:29 PM on 05/06/2010

Those oil rigs are there in the first place because of a worldwide thirst for oil. Deep water oil drilling carries the risk of an accident just like this one, it just happened to be BP. If you're looking for someone to blame, check out your reflection in the glass on a gas pump.

[FACTISFACT]

01:52 PM on 05/06/2010

After a long time it is good to see that the congressional representatives are working for a noble cause in national interest. How the Americans wished the trend to carry on forever. It would have been so but for the betrayers, and hidden treacherous people who retarded the progress of the country and divided the population because of their love loyalty to a foreign country having a deep rooted Anti-American policy. These people accuse the government because of anything they can think. They even have the audacity to think of unthinkable.

Americans welcomed the initiative of the President and the response of the congressional representative with regard to legislate law to raise the BP’s oil spill damage liability bill and other connected matters that commensurate with the damage done and to clean up the mess created.

This should have been done long back to raise the limit but for lack of sagacity the previous regime remained busy with making wealth forgetting their national responsibility.

As now a senator is facing “PAY BACK TIME, THIS PERSON CANNOT EVEN SHOW HIS FACE except mewing like a cat. He says accidents happen to divert the issue on a different path to save his dear friends and he himself.Political Analysts opined, they added that this senator has who is trying to divert the issue of the oil spill has an evil spirit in him that retarded the country at least for a century to be sure if not more.

[ohnoforgotmyusername]

01:00 PM on 05/06/2010

Ok..lets start with the first pro driing dem president...

---

U.S. exempted BP’s Gulf of Mexico drilling from environmental impact study

By Juliet Eilperin
Washington Post Staff Writer
Wednesday, May 5, 2010

The Interior Department exempted BP’s calamitous Gulf of Mexico drilling operation from a detailed environmental impact analysis last year, according to government documents, after three reviews of the area concluded that a massive oil spill was unlikely.

The decision by the department’s Minerals Management Service (MMS) to give BP’s lease at Deepwater Horizon a “categorical exclusion” from the National Environmental Policy Act (NEPA) on April 6, 2009 — and BP’s lobbying efforts just 11 days before the explosion to expand those exemptions

....and who was lobbying the obama admin. for BP to get the safey inspection waver? none other than uber insider and obam pal Tony Podesta.”

[Telemachus]

12:16 PM on 05/06/2010

It's time for a revolution.

[hippie4ever]

11:22 AM on 05/06/2010

And what if the damages exceed $10 billion? We the taxpayers get stuck with paying the difference, which could be huge. I suspect this will cost over $100 billion before it's over if it costs a cent.

Nationalize the oil industry to recover our damages. These CEOs and shareholders are culpable.

[robzter]

12:39 AM on 05/07/2010

That's what I keep thinking about too - how far above $10B will this go. Also bugging me is that our oceans, of course, are priceless, but the emphasis seems to keep being placed on getting cash out of BP without an acknowledgment that $10 trillion would not be enough.

[AverageJose007]

09:43 AM on 05/06/2010

Good Luck. Remember EXXON Valdez? People praised the fine but in reality their Lawyers litigated for 20 years and greatly reduced the fine. Same with BP, they will pay very little and the Tax payer will fork over. So, where are the TeaPartiers gonna be? Watching Faux news blamin the Guvemnt.

[TomDegan]

09:32 AM on 05/06/2010

That faint rumbling sound you hear in the distance is Theodore Roosevelt doing somersaults in his grave.

But for something called an "acoustic regulator" this catastrophe might very well have been avoided. That device was deemed too expensive by BIG OIL and the Bush/Cheney administration allowed it to be discarded.

The price? A half a million dollars.

Andy Hardy: Dad, can I talk to you, man-to-man?

Judge Hardy: What is it, son?

Andy Hardy: I'm starting to think that deregulation wasn't a very good idea.

Judge Hardy: No s**t, Sherlock!

Some are calling this "Obama's Katrina". They're wrong. As a matter of fact it's not even close. This disaster is owned by George W. Bush and Richard B. Cheney. Make no mistake about it.

http://www.tomdegan.blogspot.com

Tom Degan
Goshen, NY

[searles7]

11:22 AM on 05/06/2010

You have been fanned, primarily for your blog, which is a worthwhile read. Thanks for not drinking the "Kool-Ade".

[TomDegan]

12:40 PM on 05/06/2010

Thank you - I try to avoid that drink but it is difficult. I have an easier time with alcohol! Thanks for the kind words.

Tom Degan

[newteacherwithtime]

08:59 AM on 05/06/2010

Just because these d-bags keep repeating this nonsense does not necessarily make it so. Use your brain folks because thinking IS an act of god.

[Peter007]

08:21 AM on 05/06/2010

Liability caps have to exist. To say they don't is insanity. Imagine if every time a tree limb fell in a neighbors yard or a spouse accidentally bumped into another car in the super market parking lot, there existed a possibility for a billion dollar lawsuit and bankruptcy.
The caps being talked about in the article have to do with damages that are not readily measurable. Pain and suffering comes to mind. 90% of the readers on the Huff Post are suffering emotionally from this oil spill but the courts are not going to allow them to file claims.

[JePense]

08:58 AM on 05/06/2010

From 7 things BP doesn't want you to know article BP LIkes FInes:
"BP has proven time and time again that they'd rather pay off their mistakes rather than take steps to prevent them. They have paid $485 million in fines in the U.S. alone in the past five years. BP paid $87.43 million to the Occupational Safety and Health Administration in October 2009 -- the largest fine in OSHA's history -- for the Texas refinery explosion. They paid an additional $50 million to the Department of Justice for the same explosion. Last month, BP paid $3 million to OSHA for 42 safety violations at an Ohio refinery. The company was also fined $20 million by the Department of Justice for the Alaska Prudhoe Bay spill (pictured), which violated the Clean Water Act.

"Mother Jones' Kate Sheppard notes that all this is pocket change compared to the company's $5.65 billion in profits in just the first quarter of this year, up 135 percent from last year. According to CNBC, while this increase in profit does have to do with an increase in oil prices, it is also due to the company's extensive cost-cutting. "

BP was licensed to go to 18000 ft, but continued to 25000. Pumped oil into the ocean that is visible is the size of Rhode Island - but the oil has saturated the seabed and leaked 13,000 feet below it. This damage will rob the gulf of commercial fishng and boating jobs for decades.

[TracyA]

09:23 AM on 05/06/2010

Apples and oranges. If people file meritless claims, the courts will sort that out, but this cap is completely arbitrary. BP's liability is capped whether a handful of fisherman in LA are impacted, or whether the entire gulf coast is impacted, from Texas to the Keys in every manner from tourism to fishing. It's not equitable. I could support a per-claim cap, but not an overall liability cap when there is no way of knowing how far reaching the affects of the disaster will be.

[carmachu2]

08:06 AM on 05/06/2010

Interesting, so not only is Obama BP's biggest donor in ever in 20 years, but they got an excemption to evironmental study in 2009......

http://www.washingtonpost.com/wp-dyn/content/article/2010/05/04/AR2010050404118.html

The Interior Department exempted BP's calamitous Gulf of Mexico drilling operation from a detailed environmental impact analysis last year, according to government documents, after three reviews of the area concluded that a massive oil spill was unlikely...

...[The] Minerals Management Service (MMS) [gave] BP's lease at Deepwater Horizon a "categorical exclusion" from the National Environmental Policy Act (NEPA) on April 6, 2009...

[outnow]

07:04 AM on 05/06/2010

If an 18-wheeler truck runs your family over in a crosswalk, there is unlimited legal liability. But if BP causes damage there is suddenly a cap on the damages. BP is in a position to obtain insurance but the insurance carrier and the re-insurance carrier would insist on safety rules. BP doesn't want that.

How about a cap on a child's life, e.g., "in not event shall the life of a child be worth more than $100,000."

That law would make many people very, very happy. Especially those who are the most careless.

Caps are unconstitutional and dysfunctional. When it is your child or your marine environment, then you can see the problem with tort reform. The tort system keeps the responsibility on those who can prevent the harm. If safe, the activities can be insured against and the cots passed on and redistributed. The insurance carriers ask the hard questions about safety because they have an incentive to do so.

[rougebaisers]

06:15 AM on 05/06/2010

This president that we elected must make good on this to the American people and he must do it soon. He must dump Salazar. He must reverse his obscene decision to expand offshore drilling. He must investigate the haliburton connection to this blowout and so many others. He must reverse the secret Cheney gifts to oil companies that removed safeguards which could have prevented this catastrophe. We the people do not ask that he does this, WE DEMAND IT.

[Telemachus]

12:12 PM on 05/06/2010

Seconded, and faved.

[Guytar]

05:06 AM on 05/06/2010

BP must pay for every dollar of environmental repair after the Louisiana oil spill in 2010.

That is non-negotiable. BP made a terrible mistake.

[polishlogician]

02:59 AM on 05/06/2010

NoSillyName 2 hours ago (1:01 AM)
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Why is there a cap on liability in the first place? That is absurd.

----

Not absurd at all...you may recall the chairman of BP saying that his firm was responsible, but did not cause the accident. Do you think he would be willing to a penny for even containment and cleanup if he felt his firm didn't cause the diaster?

The 1990 agreement is a means to get some third party to assume responsibility immediately, but in return that third party asked that civil damages be capped.

That being said, containment and cleanup offer a wide scope to recover damages (such as species restoration for all wildlife affected). A cap at some pre-determined monetary amount on the civil side is necessary if the US government wants to insure offshore oil production--and oil transport, remember this law was passed in response to the Exxon Valdez diaster--which presumably it does.

[outnow]

07:17 AM on 05/06/2010

The owner of the well, BP, has a non-delegatable duty because of the peculiar risk doctrine. So the subcontractors can be pursued and BP can claim indemnity from the subcontractors - but BP is ultimately responsible up to the limits of the cap.

Caps are rarely raised automatically for inflation such as MICRA in California - limiting pain and suffering in medical malpractice case to $250,0000. This limit was enacted in 1975 and never raised. That is thirty-five years.

Caps are bad law. Corrupt politicians never raise the cap. The most severely careless tortfeasors get off the hook when they cause the most severe damage. Caps discriminate against the worst injuries and damages.

Drilling is not economic because it does more damage than the market can bear. That's the first clue that the activity itself should be banned rather than have the loss fall on fishermen and the environment.

[Telemachus]

12:14 PM on 05/06/2010

Correct on all counts.