Practically the entire Senate Democratic caucus has written a letter to BP CEO Tony Hayward, asking the company to create the same kind of $20 billion dollar escrow account that the President will reprortedly seek to pay for economic damages and clean-up costs associated with the Gulf oil spill. The letter was signed by 55 of the 59 members of the caucus: only Mary Landrieu, Robert Byrd, Jeff Bingaman and Kent Conrad failed to add their names.
In the letter, Harry Reid and Senate Democrats cite the Exxon Valdez disaster as an example of how a corporate actor dragged their feet and failed to live up to their promises to responsibility for damages. Here’s the money graf:
Congress is currently gathering information and holding hearings in order to develop evidence-based legislative solutions to address the Deepwater Horizon disaster. Although legislative action is forthcoming, the damages are immediate. In order to ensure BP fully and quickly covers the costs of this disaster, we are calling on BP to immediately establish a special account of $20 billion, administered by an independent trustee, to be used for payment of economic damages and clean-up costs. Establishment of this account would serve as an act of good faith and as a first step towards ensuring that there will be no delay in payments or attempt to evade responsibility for damages. Although creating this account at this level in no way limits BP’s liability, we believe it will do more to improve BP’s public image than the costly public relations campaign your company has launched.
They ask for an answer by Friday.
In addition to the escrow account, the Senate continues to seek a permanent elimination of the $75 million dollar liability cap, which would be applied retroactively to cover the current spill. On a conference call today, Sens. Bob Menendez and Patty Murray argued for swift passage of the Big Oil Bailout Prevention Act, which would create “unlimited liability because they created unlimited risk and damage,” said Menendez. The escrow account should not be seen as a cap on BP’s damages, insisted Murray (who characterized the $20 billion as “a down payment”), nor should it preclude passage of this legislation to deal with existing and future spills. Republicans have blocked unanimous consent for this measure three times on the Senate floor. . . .
David Vitter has authored his own measure to ensure BP live up to its responsibilities and pay for all damages, but Menendez scoffed at it, saying that it gives unlimited liability just for the BP spill, that it creates a contract out of statements BP has made, and that it represents an unconstitutional bill of attainder, conferring one set of liability rules on one company. He suggested that it would instantly lead to litigation from BP because of the “loopholes big enough to navigate an oil tanker through.”
I asked Menendez why that would be different for his legislation, which seeks to lift the liability cap retroactively. Wouldn’t that also lead to a Constitutional challenge? Menendez didn’t believe so. “Our bill is Constitutional and would hold muster in court,” he said. He cited a Congressional Research Service study and the opinion of the Justice Department, as well as the precedent of Superfund, which applied retroactively to some clean-up costs. “It’s been well-litigated and held before… BP’s efforts wouldn’t be anything other than a delaying tactic.”
I also asked for a reaction to John Boehner’s apparent call for lifting the liability cap completely, on ABC’s This Week. His admission seems to have jump-started calls for accountability for BP from Democrats today. “I’m glad to see Congressman Boehner finally cleared up what he said with respect to the Chamber (of Commerce’s) position,” Sen. Menendez said. “If he believes unlimited liability is the way to go we hope he’ll join us.”
As for whether the liability cap bill would get a floor vote, rather than a continued effort to invoke unanimous consent, Sen. Murray said the caucus would “look at all opportunities to move this forward.” She noted that Barbara Boxer would be taking the legislation through the Senate Environment and Public Works Committee. It is expected that oil spill legislation would get folded into whatever energy of climate bill gets to the Senate floor this summer. There’s a caucus meeting on Thursday to determine the nature of that bill.