The GOP's oil spill single payer plan

Republican scheme for insuring oil companies against disaster looks a lot like a sensible healthcare plan would

By Andrew Leonard
July 28, 2010 8:03PM (UTC)
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This image provided by the U.S. Coast Guard shows fire boat response crews battle the blazing remnants of the off shore oil rig Deepwater Horizon Wednesday April 21, 2010. The Coast Guard by sea and air planned to search overnight for 11 workers missing since a thunderous explosion rocked an oil drilling platform that continued to burn late Wednesday. (AP Photo/US Coast Guard) (AP)

Republicans and Democrats are battling over how to change the $75 million liability cap currently applied to offshore oil companies responsible for oil spills. Democrats want to get rid of the cap entirely. Republicans demur, claiming that making oil companies liable for the full cost of future disasters will make it impossible for smaller companies to afford the necessary insurance to keep operating.

So they've come up with their own plan:


From the New York Times:

Sen. Lisa Murkowski of Alaska, the top Republican on the Energy Committee, who offered her own bill last Friday with a plan to spread the risk of major catastrophes across the entire oil industry, said yesterday that Reid's liability cap is the "biggest-ticket item" for her party.

"I think that unlimited liability will be a very significant issue. Not just for Republicans," Murkowski said, warning of economic reverberations. "It is not an issue that the Democrats are united on."

Spread the risk of major catastrophes across the entire oil industry? Wouldn't that mean those with the ability to pay would be, in effect, subsidizing insurance for those who could not? What a radical idea! As reader David Ricketts astutely notes, "the contrast with the Republican position on health care couldn't be more stark: a single payer system, with a larger risk pool works for the oil industry but somehow doesn't work for consumers when it comes to health care."

The Republican proposal can be found here:


If an incident on the Outer Continental Shelf results in economic damages claims exceeding the maximum amount for strict liability for economic damages to be paid by the responsible party under subsection (a)(3), the claims in excess of the maximum amount for strict liability for economic damages under subsection (a)(3) shall be paid initially, in an amount not to exceed a total of $20,000,000,000, by all other entities operating offshore facilities on the Outer Continental Shelf on the date of the incident, as determined by the Secretary of the Interior, in accordance with paragraph (2).

(2) PROPORTIONAL PAYMENT- The amount of liability claims to be paid under paragraph (1) by an entity described in that paragraph shall be determined by the Secretary of the Interior based on the proportion that--

(A) the number of offshore facilities operated by the entity on the Outer Continental Shelf; bears to

(B) the total number of offshore facilities operated by all entities on the Outer Continental Shelf.

From each according to their ability, to each according to their need...

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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