Alexander: Unlimited Liability for Oil Spills Will Create More Dependence on Foreign Oil, Unsafe Tankers and Big Oil Companies

Suggests Requiring Collective Responsibility, Such as in the Nuclear Industry

Posted on June 30, 2010

WASHINGTON – U.S. Senator Lamar Alexander (R-Tenn.) today during a hearing of the Senate Committee on Environment and Public Works, of which he is a member, said that while unlimited liability on oil companies in the case of spills “is appealing at first, it would bring more dependence on foreign oil, more dependence on tankers with poor safety records, more dependence on a few big oil companies and possibly higher gasoline prices at the pump.”  The committee met today to vote on a measure (S. 3305) offered by Senator Robert Menendez (D-N.J.) to retroactively remove limits on the liability of oil companies.

“Also,” the senator continued, “the retroactivity in this legislation concerns me—the United States has proudly been the best place to create jobs and one reason is that we follow the rule of law and don’t change the rules retroactively. We’re not a banana republic—we don’t treat you differently under the law because you become unpopular. Senator Inhofe’s amendment is more practical because it suggests making sure victims are whole while allowing the president to set up liability limits that take into account the availability of insurance and eleven ‘risk-based’ factors,” such as the safety record of the rig operator and the depth of the water.

Alexander suggested that liability legislation could be improved by “adopting something that encouraged more collective responsibility in the nuclear power industry: the Price-Anderson Act. We could increase the existing Oil Spill Liability Trust Fund to such a level that it should take care of what needs to be done. We should not be spending the trust fund money on projects other than cleaning up the oil, as is being proposed today.”

About Senator Barbara Boxer’s (D-Calif.) amendment that would amend the requirement that the president have a plan in place for cleaning up worst-case oil spills, Alexander said the following:

“As I read the Oil Pollution Act, passed after the Exxon Valdez spill, it’s clear Congress took a hard look at all this and gave to the president the responsibility to create a clean-up plan and have the equipment and the personnel to implement that plan. Now I think in light of this tragedy in the Gulf, it’s proper to question: ‘Did President Clinton and President Bush, and does President Obama today, have a contingency plan and does he have the equipment and the personnel to ensure that the oil spill is cleaned up, or are we just relying on the spiller? Are we supposed to rely on future presidents? I’m not just talking about President Obama—if we have a future spill with a different president, should he have a backup plan – a backup group of personnel, a backup set of equipment? Should we have a different liability system that involves all of the oil companies in more collective responsibility for safety practices and cleanup afterwards? I would hope that we wouldn’t go forward with changing the responsibility until we make sure who is really on the flagpole, because according to the way the law is today, the question is, ‘What is the president’s plan and where are the people and equipment to implement the plan?’”