BP and DOJ: Deal or No Deal?

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The Associated Press reports that the Department of Justice may be seeking to cut a deal with BP over fines resulting from the Gulf spill rather than hashing it out in court. The AP’s main source is the office of Rep. Steve Scalise (R-La.), which says it as tipped off via their work on a spill-response bill.

A DOJ official tells Politico there’s no deal in the works. But, deal or no deal, how the department handles this issue is crucial, as there is a huge amount of money at stake.

The question right now is whether the DOJ will make the case that it was BP’s negligence that led to the explosion and subsequent spill. Here’s why that matters: fines for Clean Water Act violations begin at $1,100 per barrel spilled and jump to $4,300 per barrel if the company is deemed negligent. If DOJ settles with BP, the company would likely fork over the cash faster, whereas seeking the higher penalty would almost inevitably result in protracted legal wrangling. But when you consider that an estimated 4.9 million barrels of oil were dumped into the Gulf over the course of the spill, the difference between those two penalties could really add up. Based on the Justice Department’s conclusion, BP could face anywhere from a $5.4 billion to $21 billion fine.

This becomes even more relevant this week, since on Tuesday former Mississippi governor and Navy Secretary Ray Mabus, who Obama tapped to lead the Gulf recovery planning effort, recommended that the money go directly to the region to cover both short- and long-term restoration efforts (as the Gulf coast was already facing quite a few environmental challenges before the spill). Under current law, the revenue from those Clean Water Act fines is supposed to go into the Oil Spill Liability Trust Fund to cover future oil spill cleanups. But the Mabus report recommends that Congress pass a new law to direct a “significant amount of any civil penalties” to a new fund, and create a Gulf Coast Restoration Council that would determine how best to spend that money. The report also endorsed sending some of the funds directly to the states to support their restoration efforts.

The Obama administration endorsed the recommendations of the Mabus report yesterday, but whether Congress will take action is anybody’s guess. Scalise and other Gulf state legislators, including Democratic Sen. Mary Landrieu of Louisiana, are lobbying for a change that would devote 80 percent of that money directly to impacted states. How the DOJ decides to approach the fines will make a huge difference in how much money there is to fight over.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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