9/11, Katrina, and the BP Oil Spill: The Inconsistency of Compensation
The by-now predictable, tedious, and irresponsible Republican bulwark against raising or eliminating the criminally low liability cap that would leave claimant against BP out in the cold really has me frosted. And it’s gotten me thinking about how we compensate people for loss in front-page cases: September 11; Katrina; and this BP oil “spill.”
Let’s talk about who was responsible for these tragedies, and how the victims have (or haven’t been) compensated for their losses.
September 11 was, of course, a terrorist act, but under established principles of tort law, other actors could be liable: airport security, airlines, and — further down the chain — the federal government, for missing the warning signs. But the government, to bail out the struggling airline industry, and in an effort to pile sandbags full of money at the border, created the Victim Compensation Fund. At taxpayer expense, the Fund (not really a “fund” at all) paid out more than seven billion dollars, mostly to surviving family members of those killed when the Towers fell. Some received millions, because payment was largely based on a tort model. I’ve criticized this approach, noting that government should not be compensating people as though they’re tort victims, and that doing so reflects a confusion between the principles of corrective justice (righting an imbalance between two parties caused by one party’s negligence) and distributive justice (deciding how best to allocate the resources across society).
To call what happened in New Orleans “Katrina” is really a misnomer, because the hurricane isn’t what caused the widespread and continuing destruction of large sections of the city: the government did so, through the negligence of the Army Corps of Engineers in connection with the building and maintenance of the levee system, and of untold bureaucrats in designing the Mississippi River-Gulf Outlet (“MR-GO”). The government is immune from suit for the levee failure (but not for MR-GO related negligence), so those injured, financially wrecked, or rendered homeless in the wake of Katrina had to content themselves with the meager assistance afforded by the Federal Emergency Management Agency. (Criticisms of FEMA’s response are legion and some, like this one from Kevin Drum in Mother Jones, are devastating; but they miss the more central issue.) I’ve criticized this approach in several places, including the documentary film “America Betrayed,” and this article.
Now comes the BP disaster, which threatens to swamp the rest. Yet because of an ill-considered federal law that I discussed here, BP will be liable for clean-up, but for only a relative pittance ($75 million) for liability to those economically or otherwise ruined. Unless this cap is lifted — and the legal change is made to apply retroactively — or unless there’s a government “fund” created, many of those destroyed by BP’s probable criminal acts will be entitled to…nothing.
How can our different responses to these tragedies be explained? Only by thinking about politics and power, not by looking at justice. But there might be a limit: Expect the law to change, and for BP to be held accountable. (Please!) If not, President Obama has suggested that the taxpayers will be on the hook. If we are (and I wouldn’t object), let’s spend more time thinking about a better model of compensation when we’re all left holding the bag.
And we must demand more comprehensive regulation: As Rachel Maddow pointed out this week (with her outrage well-justified by the facts), a similar spill went on for months about thirty years ago, and the same useless efforts were made then, as now, to stop it. She concludes, correctly, that Big Oil has gotten much better about drilling deeper and deeper (200 feet v. 5,000 feet), with correspondingly higher risks, but not any better at all about stopping it once it happens. Enough.