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Washington Independent: Obama Administration Wants It Both Ways on Gulf Spill Liability
May 19, 2010

Posted by Matt Dempsey Matt_Dempsey@epw.senate.gov

In the News... 

The Washington Independent 

Obama Administration Wants It Both Ways on Gulf Spill Liability

By Mike Lillis

5/19/10

Link to Article

There have been plenty of headlines generated by President Obama's apparent criticism of Senate Republicans for blocking legislation to raise the oil spill liability cap. The implication has been that Obama supports the Democrats' proposal, which would hike the cap from $75 million to $10 billion.

Not so.

Testifying before Congress yesterday, Interior Secretary Ken Salazar told lawmakers that the administration supports lifting the cap, but the $10 billion figure is "inadequate."

And by "inadequate," he didn't mean that it's too low (some have suggested that there should be no liability cap at all), he meant that it's too high. Lawmakers, he said, have to be "thoughtful" not to impose a cap that pushes smaller oil companies out of business just because they can't afford the drilling insurance.

"You don't want only the BPs of the world to essentially be the ones that are involved in these efforts," Salazar said.

And  if that sounds familiar, it's because Sen. Jim Inhofe (R-Okla.) said the very same thing on the Senate floor yesterday when he blocked passage of the Democrats' bill. In fact, Inhofe invoked the White House when he objected.

"We need to increase the caps," Inhofe said. "I understand that. But I do agree with the President - he left that [amount] blank - because we don't know just how high that should be. ... Big oil would love to have these caps up there so they can shut out all the independents."

It's not an argument that sponsors of the $10 billion proposal find persuasive. Sen. Robert Menendez (D-N.J.), for example, asked Salazar why the size of the company should influence spill liability when even the smallest operation could potentially devastate an offshore ecosystem.

"If you could create the potential risk that we have in this [Gulf] spill, and you could be the cause of this spill, does the size [of the company] matter?" he asked. "In essence, we'd be saying [that] if you're smaller, you should have less liability. And I don't think the American taxpayer would believe in that."

Salazar responded vaguely, saying he'll work with Congress "to find a number that is not an arbitrary number."

Meanwhile, you can bet that the White House will continue blaming Republicans for blocking the same proposal that Obama himself opposes. In other words, they'll be seeking the political gain while opposing the policy.

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