POLITICS
05/18/2010 05:44 pm ET | Updated May 25, 2011

Obama Urges GOP To 'Stop Playing Special Interest Politics' On Oil Liability

President Barack Obama urged Senate Republicans on Tuesday to "stop playing special interest politics" and allow a vote on legislation that would drastically raise the liability for oil companies responsible for economically damaging spills.

The president put out a statement late in the afternoon expressing displeasure that Republican senators had twice blocked a unanimous consent vote that would raise the caps on economic damages from $75 million to $10 billion.

"I am disappointed that an effort to ensure that oil companies pay fully for disasters they cause has stalled in the United States Senate on a partisan basis," read the statement, issued from the White House press office. "This maneuver threatens to leave taxpayers, rather than the oil companies, on the hook for future disasters like the BP oil spill. I urge the Senate Republicans to stop playing special interest politics and join in a bipartisan effort to protect taxpayers and demand accountability from the oil companies."

The statement is Obama's most direct engagement in the liability cap debate to date. And it reflects both a heightened sense of the political problems posed by the spill and an implicit strategy on the part of Democrats to paint the GOP as doing the bidding of Big Oil.

On Tuesday, Senator James Inhofe (R-Okl.) became the second Republican this week to block a measure to increase the liability faced by companies like BP. The Oklahoma Republican said he wanted to raise the cap as well but thought that the $10 billion cap introduced by Sen. Robert Menendez (D-N.J.) was arbitrary.

The Republican Party has put out a counter-proposal that ties liability for an oil company to the equivalent of a year's worth of that company's profits or $150 million (whichever is bigger). Menendez -- the chief Democratic lawmaker on the measure -- rejected the idea on Monday, noting that some companies, including one currently involved in the Gulf catastrophe, actually didn't earn money this past year. A $10 billion liability, they argue, may be randomly set. But it is certainly better and more concrete than liabilities based on profit margins.

On the floor Tuesday morning, Inhofe also argued that by raising the liability level too high, the government would make it prohibitively expensive for smaller oil companies to operate offshore. Both Menendez and the White House have scoffed at that reasoning, noting that it would be shortsighted to allow companies to drill offshore if they don't have the funds to cover major economic damages should a spill occur.