At the most, BP’s oil spill will cost it less than 2 hour’s revenue in liability for damages to beaches, the gulf fishing industries and so on.
Thanks to the Oil Pollution Act of 1990, BP’s liability for damages resulting from the oil spill will be limited to $75 million. The Act reads:
§1004 The liability for tank vessels larger than 3,000 gross tons is increased to $1,200 per gross ton or $10 million, whichever is greater. Responsible parties at onshore facilities and deepwater ports are liable for up to $350 millon per spill; holders of leases or permits for offshore facilities, except deepwater ports, are liable for up to $75 million per spill, plus removal costs. The Federal government has the authority to adjust, by regulation, the $350 million liability limit established for onshore facilities.
BP had revenues of $375 billion in 2009 or more than $1 billion per day. So, let’s see $75 million is a little less than 2 hour’s revenues.
Why does BP get to enjoy such limited liablity for its actions. Here is a hint:
In 2009, BP spent nearly $16 million on lobbying the federal government, ranking it among the 20 highest spenders that year. It spent $10.4 million on federal lobbying in 2008. Also, in 2008, BP spent more than $530,000 on federal elections, placing it among the oil industry's top 10 political spenders.
Just goes to show. You get what you pay for.
Apparently, BP thinks it shouldn’t even have to pay the $75 million and has been taking steps to limit the right of fishermen to sue it for damages. Also, Alabama Attorney General Troy King, says BP has been getting fishermen from Alabama to sign away their right to sue BP in return for a payment of $5,000 and a contract to help deploy booms to contain the spill. After protests and a complaint from the Attorney General, BP has agreed to stop insisting upon the waiver requirement in the boom contracts and has agreed not to enforce those contained in agreement already signed.