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A Gulf Between Words and Actions A Gulf Between Words and Actions

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Energy

A Gulf Between Words and Actions

Six Months After the BP Oil Spill, Washington's Lack of Action Speaks Volumes

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Oily water in May at the site of the Deepwater Horizon oil spill.(Getty Images)

Six months, 185 million gallons of spilled oil and upwards of 60 congressional hearings after BP’s well exploded in the Gulf of Mexico, and what does Washington have to show for it? Not much.

The 111th Congress is probably not going to pass any bill addressing the worst oil spill in U.S. history, and the oil and gas industry deflected the two major reforms President Obama and Democratic leaders in Congress wanted: removing the $75 million spill liability cap and increasing taxes on the industry.

 

Environmental groups immediately pointed to the Gulf disaster as a tragic example of why the country must shed its dependence on oil and overhaul its energy mix, but they have been noticeably quiet about the spill recently. They have issued some news releases marking the six-month anniversary of BP’s Macondo well explosion, which is today.

“People were angry, sensed that something had to get done,” said Michael Olsen, former deputy assistant Interior secretary, of the reaction by lawmakers and others in the immediate wake of the disaster. “Gradually the outrage was slowly muted by the fact that it appeared science and technology had eventually caught up with the rhetoric,” added Olsen, who is now an attorney with Bracewell and Giuliani, a firm representing oil and utility companies.

Environmental groups have steadily turned their attention to other issues, most notably those affected by the midterm elections. The League of Conservation Voters ran several ads this summer highlighting the oil spill and targeting a handful of senators, including some seeking re-election like Republican Richard Burr of North Carolina and Democrat Blanche Lincoln of Arkansas, for their connection to Big Oil. But now LCV has shifted its focus to California’s Proposition 23, a ballot initiative backed by Texas oil companies that would suspend the state’s landmark greenhouse gas emissions law. LCV is not running any ads right now on the oil spill, a spokeswoman said. Other groups, like the Natural Resources Defense Council and the Environmental Defense Fund, are focusing on the cap-and-trade bill the House passed in 2009 and forthcoming EPA carbon regulations, both in the context of Election Day.

 

For its part, the American Petroleum Institute led rallies around the country in September that protested proposals to raise taxes on oil companies. API executives said increasing taxes on the oil industry would result in job losses, something Democrats and environmentalists dispute. Fast-forward to the upcoming lame-duck session of Congress, and the only energy bill that will even get face time on the floor probably won’t pass because the current offset raises taxes on the industry. That’s a nonstarter for most Republicans who might otherwise support it, like Burr. The legislation, which costs $5 billion and incentivizes the use of natural gas-powered vehicles, would be paid for by raising the 8-cent-per-barrel tax on oil and gas companies going into the Oil Spill Liability Trust Fund to 21 cents per barrel. 

Two left-leaning groups, the Sierra Club and Center for American Progress Action Fund, released a report last week that said API has spent nearly $40 million on advertising this year. Many progressive advocates argue that’s the main -- if not only -- reason Congress could not coalesce around an oil spill bill. The report’s numbers are compiled from Kantar Media’s Campaign Media Analysis Group, a media strategy and tracking firm.

“It certainly demonstrates the grasp that Big Oil has on Congress right now,” said Regan Nelson, senior oceans advocate for the Natural Resources Defense Council. But she also said that after the initial shock of the disaster, most voters around the country -- and their representatives in Congress -- turned their focus elsewhere. “The oil spill was something that, unless you live in the Gulf, it doesn’t personally affect you,” said Nelson, who spent about two weeks stationed in the Gulf.

Despite major oil spill legislation not passing this Congress, progress has taken place. Experts predict more action will continue, albeit with less fanfare without the backdrop of oiled wildlife on magazine covers and cable channels.

 

The Interior Department is in the midst of an overhaul to reorganize and ramp up its Bureau of Ocean Energy Management, Regulation and Enforcement -- formerly the Minerals Management Service. Oil and gas companies must follow stricter regulations to drill offshore, and environmental groups will ensure that is no easy feat, Olsen predicts: “I do think that there will be an increased focus on potential challenges to decisions made by the Interior Department on offshore leasing.”

The presidential oil spill commission’s final report, expected in January, could provide some legislative fodder for the next Congress. The commission has already released preliminary reports faulting the administration for its response. By January 12, it will report on the root causes of the oil spill and recommend regulation and policy changes aimed at preventing future oil spills.

With Republicans poised to gain seats in both chambers, it’s unlikely Congress will pass the reforms, including removing the liability cap and increasing oil company taxes, that most GOP members have opposed this session. After all, only two Republicans voted in favor of the oil spill bill the House passed by a vote of 209-193 at the end of July.

But congressional reaction to past environmental disasters suggest it’s possible. Eighteen months after the 1989 Exxon Valdez oil spill in Alaska, the 101st Congress passed the landmark Oil Pollution Act. That measure established many of the liability and tax laws that lawmakers are now seeking to change in response to the BP disaster.

This article appears in the October 20, 2010 edition of National Journal Daily PM Update.

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