Obama Gets Tough(er) on BP

  • Share
  • Read Later

From the beginning of the Gulf of Mexico oil spill—which has now resulted in at least 50 million gallons oil spewing into the ocean, if not far more—President Barack Obama has been in an awkward position. The energy giant BP is financially responsible for the spill, but it is also the only company that has the technology, expertise and manpower to shut off the leak and clean up the vulnerable Gulf shoreline. So Obama and his administration have taken every opportunity they can to castigate BP—Interior Secretary Ken Salazar memorably said he’d keep his “boot on their neck”—but they still need to work with the company day by day to limit the damage from the spill. It’s a fine political line for Obama to walk—and it’s one that he’s struggled to do, with recent polls indicating that many view the government’s response as only slightly better than BP.

But Obama now seems ready to declare war on the spill—and on BP as well. The President plans to travel to Alabama, Mississippi and Florida on Monday and Tuesday—three oil-hit states he hadn’t yet visited in his three earlier trips to the Gulf coast since the spill. He’ll head back to Washington for a prime-time address to the nation Tuesday evening that will cover the spill and his Administration’s response. That will likely include a new plan to force BP to create an escrow account, potentially worth billions, to compensate businesses and individuals harmed by the oil spill. Those funds would be administered by an outside party, so that BP would no longer be the sole judge of future compensation claims. “We want to make sure that money is escrowed for the legitimate claims that are going to be, and are being made, by businesses down in the Gulf — people who’ve been damaged by this,” White House senior adviser David Axelrod said Sunday morning on NBC’s Meet the Press. “We want to make sure that money is independently administered so that [they] won’t be slow-walked on these claims.”

That announcement followed news that Coast Guard Admiral Thad W. Allen, the top federal official on the spill, had sent a letter to BP demanding a new and better plan to recover oil spilling from the blown well 5,000 feet below the surface of the Gulf of Mexico. Late last week a team of government and outside experts upped the estimate of the rate of oil spilling into the sea—the latest count is between 20,000 and 40,000 barrels a day, far higher than the initial estimates of 5,000 barrels. At its worst, that would be the equivalent of an Exxon Valdez-sized disaster every 6.4 days—and though the company has had some success over the past week with its containment cap, that flow appears to far exceed the system’s current capacity. “We were concerned, because if you look at the new flow rate numbers and the amount of oil that is going to be potentially out there at risk, we wanted them to give us a faster plan with greater redundancy and greater reliability,” Allen said Sunday on CBS’s Face the Nation. “And we hope to get an answer on that today. In fact, we will get an answer.”

But it’s far from clear what else BP actually can do to plug up the leak, which will almost certainly continue until a relief well is completed in August. And Allen’s letter perfectly captures the dilemma the President finds himself in. The government clearly lacks the technical capacity and experience to end the leak itself—a fact that shows just how poorly Washington had been regulating the offshore drilling industry. So all the Administration can do is excoriate BP in public and order them, in effect, to work harder—even as Attorney General Eric Holder undertakes an investigation into the Deepwater Horizon accident that could lead to criminal charges, and Environmental Protection Agency head Lisa Jackson calculates the millions in fines BP will face. The one thing the American public really wants—to end the spill—is beyond the ability of the most powerful man on the planet. As long as that’s the case, all the presidential visits to the Gulf Coast and the prime-time speeches are unlikely to change the impression that the White House just can’t fix this.

That isn’t to say the President is helpless. One area where the White House really can make a difference is by forcing the establishment of an independent escrow fund for compensation claims. There have been constant complaints over BP’s promise to pay all legitimate claims of damage caused by the spill—residents complain of waiting days for their checks, and of receiving too little given the scale of the disaster, which has wiped out fishing and tourism down the Gulf coast. It’s bad enough that the company responsible for the spill has been largely in control of the response and the cleanup—a situation Zygmunt Plater, an environmental law professor at Boston College, calls “having the criminal in charge of the crime scene.” Giving the corporation control over the claims process as well seems completely unjust. “BP ultimately will do what BP thinks is best for BP,” Louisiana state treasurer John Kennedy said on Saturday.

But Obama will need to keep the pressure on BP, and manage a business backlash that is already brewing. The company has resisted calls for it to compensate oil rig workers who’ve been furloughed by the White House’s six-month safety moratorium on deepwater drilling, and politicians and investors in Britain have complained the London-based company is being unfairly targeted in part because it is British. (Obama and new British Prime Minister David Cameron discussed the spill in a Saturday morning phone call.) Most of all, the President needs to manage public expectations for a battle that will likely drag on for months., “This is an ongoing crisis, much like an epidemic,” said Axelrod on Sunday. “There are millions of gallons of oil that have poured into the Gulf and continue to that are threatening the coastlines.” It may be BP’s fault, but it’s definitely Obama’s spill now.