saying, these people who have been serving in washington are part of the problem. we need to get a fresh-faced and new blood. he is running with the support of a lot of liberal activists who just feel that blanche lincoln ha not been with them as much as they want him to be on health care, organized labor issues. they are sending a message of saying, no, we are not going to tolerate these variances from the party line. bill halter is not a down the line progressive or liberal, but strong enough on in of key issues that democrat activist voters care about, and those of the ones who vote in primaries, and certainly primary runoffs. it is hard enough to get to the polls on the sprinkler summer just for a primary. then having to combat three weeks later, like the democrats had to in arkansas, is a whole other thing. host: bob benson is a senior

political analyst and spent many years covering legislation and politics. he wilget to your calls in just a couple of minutes. the phone lines are all the bottom of the screen -- let us stay in arkansas for a few minutes. who ishis person likely to face? guest: the congressman from northwestern arkansas. arkansas traditionally had one very strongly republican district, this visit. he won outright in the republican primary. the did not have the brawling that blanche lincoln and bill halter has had. he is an experienced politician, a conservative record -- record. and if this turns out in november to be a strong

republican year nationally, it will be it harder either for blanche lincoln or bill halter as the upset primary winneto hold the seat. not impossible. arkansas traditionally is a southern state that has swung least strongly to the republican party during the transitional period, from the 1960's on. host: we need to get to california. a couple of important races there. on the senate side, the gop side, three republicans are vying to try to unseat senator boxer. who are these three republicans and what have they brought to the ra? guest: karlene dear reenah -- carly fiorina is still today but highest ranking woman in the business world. i should say, she held the highest position in the business world as the chief executive officer of hewlett-packard computer company.

when she entered the race, it looked like it would be a t- person race between her and devore, very conservative, activist tea party candidate in the race. everybody expected that she would try to play kind of a mainstream centrist conservative republican role against the very hard-line conservative. but tom campbell,ormer u.s. representative, he ran for the senate against dianne feinstein, the of the democratic senator for lifornia back in 2000. conservative on fiscal issues but more moderate on social issues. he had been running for governor. well, the governor's race got to behis huge big spending affair between a couple of very wealthy candidates and he felt like he could not compete there and switched over to the senate race. now carly fiorina is positioned

between a moderate candidate and a conservative candidate. what she has done, appealed ve strongly to the conservative base, which is pretty much the majority of almost every state republican primary, and it looks like she has boxed out devore on the issue and it has become a race between campbell and fiorina. it will be interesting to see what the impact of that is, the republican gubernatorial primary. meg whitman, the former ebay ceo, and the state insurance commissioner. host: one more question about the senate race. president obama went out to campaign for senator boxer twice this year. how the any of these republican senate candidates fare against senator boxer at this point? guest: looks like it could be a competitive race. there are some polls that interestingly show that tom campbell, because he is a bit more moderate on social issues

-- remember, california has been trending democratic over all in its politics for about two decades now. so, a hard line secured -- conservative candidate on social issues will be challenged. but the problem is not everybody votes in the california republican primary. it is likely that one of the more conservative candidates could come out of there. if that is true, then barbara boxer mike reestablish a bit of an edge. it will be close and competitive race and very expensive. host: watch for victory and concession spehes through the evening. we will focus on several of the key states. off -- our guest is bob benenson. our first call is from toronto, ohio. we will show you a map from "the wall street journal" of the u.s. essentially the dark states are

e ones who have action today. bernie, a caller from ohio. i think he cannot wait any more. we were talking so long. guest: i apologize. host: it is my fault. linda on the democrats' line from the mexico. go ahead. caller: my question is about carly fiorina. i did not know when she left hewlett-packard. at the time it is my understanding that she was fired. but i have not heard one word about that. host: what does it mean it is true? caller: it means to mate she probably was not bowing as good a job and she would like us to think she was. because i do believe she was fired. and i would like to know the truth. host: would that make heard less and effective elected official? caller: it would make it less attractive to me, yes. legacy as fiorina's

head of hewlett-packard appears to be a matter of significant debate in the businessorld. there was a very interesting profile of her in "thnew york times" magazine this week that you might want to access online which real goes into a great deal of detail on that. there was a lot of controversy over her decision to push ahead with a merger of hewlett-packard with the compaq computer company. in the short run it did not appear to of the benefits to hewlett-packard as seemed to have been promised so there was an uprising on the board and she was fired. today there are still some people who stand by that decision and say, yes, she just wasn't do it and of job. others who say in the long run the merger with compaq looks better than it did in the short run and she deserves to be given a reconsideration. .

>> that's going to be a big test in california. host: leon in arizona, independent caller, hi, leon. >> hi. i want to thank c-span for all the good things they do. my goal is to vote all incumbents out of office. our government has been taken over by the corporations and i don't know any other way to get the point across to them that we

are not going to take it anymore. one problem is, every voter thinks their guy is a good guy in congress. and until we can get over that, we are not going to be able to change government. most voters are robot voters. host: that trend seems to be changing according to a new poll. if you have seen it in the "washington post." this is a new poll by the post and abc, it's a national survey, they showed 29% of americans now say they are inclined to support their will the house suspend the rules and pass in november. this is even lower than in 1994. 29% only at this point. so the trend seems to be changing. guest: that's a serious change. that doesn't mean 29% of the people will vote for their incumbent. what's interesting, especially in midterm elections like this, presidential elections tend to focus people's attentions much

earlier on, but midterm elections they don't necessarily tune in. even in a period like this one when there is a lot of talk about voters being activated by concern over the economy, issues turnout for primaries is not -- has not been particularly esection eppingsal -- exceptional. we may be in a very dicey situation for campaign strategists and governments and candidates alike in november that people may just not tune in until the last few weeks of the elections. whoever runs the most effective campaign is going to be in terrific shape. in almost all cases, even in this kind of political atmosphere, incumbent also have more money, they have the party infrastructure, their own personal campaign organizations. that's a big advantage. it comes down the stretch, people might say let's throw the bums out. but then when they get there, all the wonderful things they do

for their constituents, and how bad the opponents are, kind of levels the playing field. yeah. it's difficult atmosphere. the playing field a ltle bit. it is a difficult atmosphere. host: tiffany now on the line for republicans from georgia. they have a special election runoff. go ahead, tiffany. caller: yes, i'm calling from georgia and i don't really have a question. it is more of a comment. i just wanted to say hi to john stuart's show. i love the show. thank you. host: there is a special election there in georgia in the congressional district. guest: well, that is one of these interesting situations where in the first roupnd primay whoever the top two vote getters

were wind up going to the runoff. this is such a republican distct, a district that was vacated by a long-time coressman who was a democrat when first elected but he was one of the handful who switched after the big 1994 republican takeover in the contract with america election. so, this is republican versus republican so is won't change the balance of power in kopblgs. a former state rep named tom graves quit the state legislature to concentrate on this house campaign. and a state nor named lee hawkins are fightin it out. both are quite conservative, southern republicans and i'm sure they will vote a pretty solid party line. host: back to california.

governor schwarzenegger is headed out. who is running and what are the dynamics and what is the likely outcome? guest: this is a situation, you are talking about the an anti-incumbent atmosphere. california is in a tremendous economic mess. it benefited from the economic boom that we had earlier this decade and it -- like a lot of places that were growth areas during the early part of the decade it crashed harder than a lot of places. a huge number of foreclosures, high unemployment, double digit unemployment and it was accustomed to thinking of itself as the golden state, the place that was kind of an american paradise. so, you had a situation with schwzenegger boming governor where you had a republican governor, democrat controlled legislatu

legislature, gridlock, stalemate. budget problems. all kinds of situations. so, it has been kind of a pox on both houses an makes the governor election this november a bit of a tossup. jerry brown, very familiar figure in american politics, he was the youngest governor in modern california story or since the 20th century began. he served from 1975 to 1983. if elected, he will make his comeback as the oldest governor of california. he's had an interesting career. after he served as governor he ran for president a couple of times. he served as mayor of oebgsd, now state attorney general. and so he has had an enduring career. the question is in an rather where there seems to be a fascination with new, different, whether the republicans can cast him as a retread as the same old

business or whether they will be able to -- whether he can say it is aew thing. on the republican side it a shootout between meg whitman former c.e.o. of ebay and steve poisner. he started as a moderate republican and has turned sharply right and has been trying to challenge whitman by saying shes not conservative enough. that is -- she is adamant that she will be tough as nails on, say immigration on border security. the big difference in that race is meg whitman made a lot of money running ebay and she is spending a lot of it running for governor. and ppoizner is not poor and he

has more than $20 million spent. but whitman is pushing nine figures in the primary. at least $80 million of her own money. even in california that is hard to compete against. host: one of those races we will be folling. might be on the air until 1:00 or 2:00 a.m. waiting for results from california and nevada, which we will talk about in a couple of minutes. a call now from savannah, georgia, leonard, democrat, on the line. tkpwhrao good morning, fellas. you are talking about specific races. a few weeks ago there were the predictions about the democrats losing so many seats and our power swing withing, maybe losing control of one of the

houses. that talk seems to have died down the closer we get to actual elections. so, in a macro sense what is the outlook for the balance of power in the united stat congss? guest: well, enough seats are in play for the republicans in their takeover bids that there is a possibility, if the circumstances are really clicking for them they could get control of one chamber or the other. again, i have always felt that campaigns matter and the candate matchups matter. i think that predictions as the caller suggests that say the die is cast already, five months out from election day, are

premature. we have discussing that the poll shows that voters across the board are unhappy with their incumbent. the same poll you referd to by the "washington post" showing that three-fifths of the voters are disapproving of the republican party. so, the dynamic this year has not been the democrats coming down and republicans coming up. it is basically the democrats coming down to the low esteem at which the republican party has been held the last couple of election cycles. host: we will let one of our viewerssk this question via twitt twitte guest: the influence that the tea party has involves mainly voter turnout. i think most polls of tea party

participants show tt they are people who have mainly adhered to the republin party over the last few years. many of them are self-described independents. because of their conservative viewpoints in most cases they would vote for republican candidates. so, unless the rublicans nominate candidates who are too moderate, too liberal, to generate any enthusiasm, most of thes voters will vote republican. so, the question for democrats is, can they close the enthusiasm down? tea party activists are fired up. if you are fired up enough to go to rallies, to go to tow meetings an berate your congressman, you will probably be fired up enough to vote in november. democrats were the fired up people in 2006 and 28 and they had their own motivating figure.

president george w. bush who they were strongly opposed to. they won all of these big victories in 2008. can they generate that same enthusiasm especially since a lot of liberal or progressive voters who great expectations from barack obama's hope and change campaign and then those expectations meet the gritty reality of the legislative process here in washington and they may feel like the president hasn't accomplished the kind of sweeping change in washington that they felt they were promised. and if that is the case, whatever the polls say, even if the support for the parties is relatively equivalent, it only would take a mall percentage of greater turnout on the other side to swing coif sees. host: to tuscaloosa, alabama, an

independent voter. caller: you are talking about the pow shift. first everybody was against the republicans, then everybody against the democrats and whoever has the most money wins but what i don't like the republica republicans, the democrats got in and they got the balance of power and you have seen it for the democrats. that is the my mother and us grew up democrats but switched to republicans because the democrats ain't got a lot of power and at the keeping the republicans down. they don't want the repubcans to have anything to do with everything. host: comment on the shifting winds over time. guest: it is interesting, the last 20 years or so, most of the electionutcomes have really been more against than for. very rarely in the last few decades have you had a figure or

a party that was personally popular enough to making people want to go out and vote for them. obama was one of those candidates in 2008, generated a lot of enthusiasm. ronald reagan was one. but those instances are few and far between. starting in 1992, when you had the first wave of populist rejection of the establishment embodied in the campaign of ross perot, came out of nowhere and drew 19% of the voten a presidential election and bill clinton won over the first president bush, two years after they electeded bill clinton for chan change, they threw the democrats out of congress and elected publicans. republicans thought they would use that to capture the white house, bill clinton made a comeback in 1996.

you have seen that in the last couple of years with the swings. first, the people outraged by president bush, put the democrats in control of congress and white house within months after presidt obama takes office and the democrats have complete control of the federal government. there is this wave back. so you have a base party about a third of the electorate each then the group in the middle called independents not affiliated with either party but within that group there are a number who are either mainly republican voters or mainly democratic voters and once in a while they will split the tickets. then you have a constituency it is hard to gauge but 10% to 15% that is truly unaffiliated and they basically don't like either party. they don't think either party is working in their personal interests.

and they have been swinging back and forth opposing whoever is in power. whethe ross perot or bill clinton or newt gingrich or barack obama or the tea party. that is who they are attaching themselves to and that is why our politics keep swinging become and forth. host: south carolina, a state with a lot going on today. easley, south carolina, pat on the republican lane. -- republican line. caller: i wanted to ask do you think nancy pelosi will be voted out today in guest: no. no. host: any other thoughts and perspective? what is the most important race to y today in south carolina? calleri think the governor. i kind of want to go with nicky haley is probablyho i will vo

vote with. i'm not sure yet. i hope south carolina can get ck to the morals that we stand for, because what our governor done was a disgrace and it shouldn't happen. i just hope that south carolina can get back to morals what we stand for. host: thank you. take us deeper. this has gotten a lot of play. guest: it sure has. whatever your position on the morals of the state are, i think everyby down there must have a desire to get back to some political comity and a little less of the ranco we have seen thlast couple of years. the politicaless really started last year when mark sanford, two-te governor, seen by some people because he was

kind of an icon class particular kevin tough figure, one of the first governors to come out strongly saying we are not going to take all the stimulus money after the bill was passed. some were talking about him as a potential 2012 presidential candidate. then we know, he disappeared a few days, his staff said he was out hiking appalachian trail and he came back and admitted an extramarital relationship with a woman in argentina. so, this destroyed his political career, created disruption, raised questions even about whether the republicans in this very republican state could hold the governorship. it is such a conservative state that that seems likely. but the primary for the republican nomination has not been at all pretty. nikki haley regarded a fresh

face, very conservaveers well liked by a lot of the conservative activists, drew an early endorsement from sarah palin which has a lot of symbolic value to a lot of conservative republicans, came out of nowhere, surge into a lead in the primary over some veryxperienced figures. lieutenant governor andre bauer and henry mcmaster. gresham barrett. then rumors started circulating that there be a scandal and a conservative blogger said he had an inappropriate relationship with nikki haley. then a political consultant who is associated with andre bauer one of her opponents said he, too, had an inappropriate relationship. she firmly denies any of this.

at she has been totally faithful to her husband during the entirety of their marriage. but it just throws the whole issue of personal morality and behavior in t spotlight again. the polls taken indicate that most of nikki hailey's republican supporters are sticking with her. she may have a problem because you have to have 50% and whoever finishes first doesn't get 50% will have three more weeks of this. then when you get in the he said, she said things involving personal behavior, somebody really telling a whopper of an untruth. and if it is the other people, then shame on them. if it is her, she has a political problem. host: we have a couple of calls from mae, another state voting today. we will get to them but we have to get out to vada.

another competitive race. this is on the g.o.p. side for the right to take on harry reid in the general election. who is out there right now and who has the best chance of taking down the majority leader? >> this is an interesting situation. members of congress who serve long careers work their way up the ladder, those who have leership ambitions scramble up to the top and get harry reid is that person. he represents a state, nevada, that is politically competitive. where he would be vulnerable to a challenge. and over the past year he has been a political lightning rod, carrying the banner for the

democric agenda which contains a lot of items on the liberal progressive agenda particularly the very controversial healthcare bill. and he's been in the middle of the pitched partisan battles. then he has to go back to a state where not only is the electorate at best centrist but because of a population boom senators serve six years. since the last time he was before the voters in 2004 the population of nevada grew by a third so there is a third that never has voted for or really seriously considered harry reid as a candidate. his approval ratings dropped sharply and polls started showing him running well behind almost all of the major republican candidates. two problems for republicans. one is that they didn't really max out on the candidate recruiting. they were hoping that congressman dean heller from

reno or john porter who represented suburban las vegas for a few years would be their candidate. neither of them decided to run for the senate. the candidates they have running are -- do not have necessarily distinguished political track records. you have the state republican chairwoman and danny tar containian, a developer, ran for office a couple of times but best known as the son of a famous basketball coach jerry tarkanian. and sharon angle, a very conservative former state assemblywoman ran for congress, lost the republican primary a couple of yearsgo and has caught on very strongly with conservative activists. voters in nevada are now -- they may not like reid but they ar

starting to say reid has been a senator this long, he has a powerful position and all the influence, do we want to surrender that for a new candidate just as a protest? so, a lot of voters say i'm voting for anybody but reid. this is really an anybody but reid situation. host: more about nevada. "wall street journal" writes the g.o.p. feud bodes well for reid. that is page a-2. poland, maine. janet. democrat. hi, janet. caller: hi. host: are you from poland, maine. caller: no. host: we will get to you next. go ahead, sir. caller: first off, on the call from south carolina i won't name names but i believe south carolina lost its morality back as far as lee at wate

with regard to florida, what is the chance of charlie criss? guest: for an independent candidate, third paerty candidae charlie crist has a better chance than most. he is the incumbent governor. he does come in with a size believe political base. his ability to win the election would really depend on his ability to win independent voters who mainly would be inclined to vote democratic and some moderate replicans who just regret the strong conservative teufpl of the former -- conservatism of mark rubio. but also to go on to democratic turf. the democrats most likely nominee has a pretty liberal

voting record for a state like florida but doesn't mean he can't win in a three-way contest especially. but charlie crist is a substantial figure and voters -- what is interesting is this was one of theepublican party's prize recruits. they begged him to run in the spring of 2009 when it bail apparent that mel martinez was not going to run and was resigned and was replaced. but the problem is -- and this is again we talk about candidates embracing somebody. charlie will i ist's big problem is when barack obama came down to promote his economic policies in february charlie crist not only introduced him at a speaking engagement b gave him a hug. and for a conservative voter in florida that is totally

unforgivable. host: to maine again. republican voting on a house governor and other state offices. paula. caller: yes, hi. i just want to say about -- a few things. you talked about swing voters. i used to be an independent. i just switched to republican becae there were people that were urging me we are going to do something, you know, get together and there are a lot of good republican candidates for governor this race. most of the democrats, however, have taken advantage of maine's clean elections money which we have here with taxpayer funding to fund the candidate. it is ironic because we have spent millions of dollars on the campaign we we could have taken the money and hired them all. is iron. but that is the way politics

works and the media and printing presses get their money because of the advertising that the candidates do. host: any thoughts? guest: well, there is the ongoing debate and it will probably never end about what is the best way to finance campaigns. there are people like the caller who don't believe in public financing and feel like it is a waste of taxpayer money and the candidates should go out and raise their own money. what is interesting though, and it sounds like she would also be an advocate of limiting campaign spending because she did comment that media advertising a -- is very lucrative and that the taxpayers wind up paying for that. but when you try to lit campaign spending then you run into constitutional arguments that campaign spending is the equivalent of t first

amendment eedom of speech and the supreme court has consistently ruled it is unconstitutional. host: as we begin to wrap up we will ask you if there are any races we haven't talked about that you want to mention but we will take a couple of calls first. virgin, utah. charlie, independent. caller: thank you for taking my call. been a couple of years since i talked to you. people seem to be upset but they shouldn't be because we are getting the best government with money can buy. with all the lobbyists, about 500 per congressman and senator we are getting what we expect. if we didn't haveny lobbyists maybe the senators an congressmen would listen to their constituents. host: to big bear lake, california, terrence, democrat. hi there. caller: yes. i would like to know from the gentleman which of the candidates running for governor

is more likely to balance the budg budget. the $20 billion in the hole. which will take on the task of handling the pensions for the state? guest: i will have to leave thato the voters. everybody has their own plans. repuicans tend to promote deeper cuts in the state budget and oppose tax increases. the democrats usually propose more of a mixed plan for the state government. they are a little more wary to suggest anything that resembles a broad based tax increase. if it it was easy to balance the

budget, it would be done. theroblem is that in principle everybody says we need to reduce spending. but when you talk about cutting spending, that impacts constitucies directly. those are not the budget cuts they want. it is always pork barrel spending is spending in other pele's states an districts. host: we have time for one more call from ohio alex, independent. caller: good morning. my brother is in the army and he has -- he works as a communications analyst. i believe he is in qatar. i'm not quite sure on that. however, an analyst two chairs down from him intercepted a message from a terrorist with a message yesterday as a matter of

fa fact. a group calling themselves the silver chiefs -- you will excuse me -- he had a message issued to th government about the primary elections in this country and how they are so silly. and i'm just not sure about that. i don't know if it is the whole freedom thing or if it is the jihad thing. but i just don't know about that. -- host: your point from alex in ohio, where else should we have our attention? guest: it is very interesting primary for governor of iowa. terry branstad served a governor four materials from 1983 to 1999. he is seeking a comeback and wants to calendar the current democratic governor in november.

he faces two challengers. it looks like a more competitive one is a businessman who was the republican nominee for lieutenant governor in 2006. again, this is one of these party sacramento versus conservative activist primaries. that is very interesting although endorsements don't necearily mean anything. i hate to keep referring to sarah palin laying her hands on candidates and giving them her blessing. butn this case

>> it is the busiest election day of the year so far for congressional and gubernatorial elections. with 12 states holding primaries or runoffs today. here in california, democratic senator barbara boxer will learn who her republican opponent will be. california has a republican primary in the race to succeed term limited republican governor around schwarzenegger. we'll have live coverage tonight of key races starting at about 9:00 eastern on the c-span networks. back on capitol hill, the u.s. senate has gaveled in for the day. they will come back shortly from their party lunches. they continue work on that package of expiring benefits and tax breaks. live coverage of the senate is on c-span2. the house comes in with some five pieces of legislation this afternoon, votes at 6:00, including one honoring the explorer, couscous. late they are week a bill that -- jacques cousteau. and later this week one that

would back mortgage loans. we'll have it live for you when they do gavel in here on c-span. until then a look at the headlines and phone calls from today's washington journal. busy week here in the nation's capital on june 8. as we continue to follow the money here in washington, we find this story. off-lead in "the washington post."

we will cover the peter orszag speech on all of this on tape today. we will show it to you a bit later. we want to get your thoughts on this latest proposal by the white house to cut 5% of the budget across the agencies. we will read more but here are the phone numbers first -- the post goes on to say that republicans have that leslie hammered obama and congressional benefits for their role driving budget deficits to record levels.

they go on to put this quote from rahm emanuel -- water down massachusetts. curt on the line for democrats. what do you say? 5% budget cut across the board. a new proposal from the white house. caller: does not seen it is actually accomplishing much. i don't know, i really don't see the point in 5% cut on this. i think what we need to do is we need to raise taxes. we are way over due to raise taxes. host: what kind of taxes? caller: corporate taxes need to go up.

maybe not so much raise taxes but more on lines of stop tax cuts whave had. there are too many exemptions. even tax cuts for married people. i'm married myself but i really don't see the logic of getting married people tax benefits. i think we need to back off from that sort of thing. host: kurt from massachusetts. don't cut, raise taxes. connecticut, what do you make of this 5% proposal? caller: i think if it is done right, it is ok. there should be a drastic cut in the military budget because we are spending, what, $700 billion a year and we are not solving that much. we have not called bin laden and dave do not have a defined mission. i don't want to see them hit the scene years any harder. we paid -- i don't see him hit

the seniors any harder. we paid into social security and the money was taken out to pay for other things. st: you are saying cut defense, protect seniors. where else might you cut to achieve the 5%? caller: would say some aid to foreign countries. i don't know why we just gave israel more money and theve health insurance. and other countries we should not be giving aid to, either. we've got to help our own country first. it and we've got to get tougher on letting people into the country and taking, like, illegal aliens and taking advantage of our medical system. we've got to take care of our own people first. host: previous administrations have yet to justify programs but budget analysts cannot recall a time when they were ordered to volunteer programs for elimination -- obama will also asked congress

for new authority to lead agencies keep half the savings they identify. point to 110 programs dead sailted to advancing science and math education, and more than 40 to employment and job training. quote, this is redundancy wastes resources and makes it harder to act on each of these worthy goals. orszag will say in the speech today. they want the list for the budget office by september 13. agencies must cut 5% of the budget. that's the new news out of the white house today.

new hampshire, barry, democrat, thanks for waiting. caller: good morning. i think that 5% is a joke. they are rearranging the deck chairs on the titanic. they need to cut something like 50%. i'm a retired army officer. retiredarline pilot. we are spending way too much on the military. when you pay a private in the army $30,000 a year, you just can't feel the size of the military as you need it. but we need something drastic along the lines of what ron paul is recommending. so this is just a joke. this is just a joke. host: there are some points about defense in this piece in "the post." it i modeled on defense department program aimed at encouraging military and civilian bureaucracy to find $7 billion to help cover the cost of combat operations. similar programs of also been used successfully by state and local governments.

moving on to woodbridge, virginia. kevin, republican. good morning to you. hello, kevin. caller: i'm sorry. good morning. i would say there is at least 5%. i'm not sure i agree with the previous caller that we could do 50%. but again, involved with some local budgeting in the town that i didn't. it is amazing how folks just think the budget should be the same as last year plus 5% or + 7% there does not seem to be any concerted effort t look for savings. so, 5% should be easy. it should even be a little more than that.

host: lauren from indianapolis on t independent line. caller: i was thinking rather than cutting some of the areas -- again, i think the 5% number ofusiness school. i would think the government to look atutsourcing some things. the first one that comes to mind is the postal service, especially since the gao, their own accountants, issued a report, i think earlier last year saying jal is projecting they will lose billions of dollars in the next few years unless something drastic about. why not let somebody like fedex, who already successfully runs liberty services, and whether they want to approach the postal service. host: from a congressional and goal, "the post" piece says that house leaders are discussing the budget plan --

madison, nebraska. steve, republican. caller: i think 5is a nice start but w really need to do is go in and start cutting some of these programs -- i mean, some of the wasteful useless programs. i would put a plug in for that youcut website which actually gives people the opportunity to actually see what some of these programs are. host: how about your own viewpoint? you said cut several programs. any particular ones in mind? inler: i've got hundreds

mi. i mean, there's no bill -- limit. three or four of them -- host: which ones? caller: department of defense, i mean, i would cut the education and turn it back to the states. anything that the states can do, the federal government does not need to benvolved. keep it simple, down to the lowest common denominator. the only thing congress does when the are in session is passed laws. with only takes three months out of a year for them to do what they are doing. it is just make work projects. all congress is, it is a make

work job for them. st: that was steve in madison, nebraska. tacoma washington is on the line with matthew back to the democratic line. yes, sir. what are your thoughts? caller: i think they should increase the size of high schools and do it like college style teaching, 50 kids in each class. host: what would that accomplish? caller: you would have less teachers. host: would that help the kids? caller: i don't know. it won't hurt them. it will prepare them for college. also, i would not give people cash of they are unemployed. i would just give them food stamps, maybe a little bit more money than they get out for food. but i would keep it strictly food money. host: asking about this headline -- obama is cuts in agency budgets. talk about a 5% figure. peter orszag, budget director, will talk about it today.

we will be covering it. part of the "doing what works" program. he is asking for these voluntary ideas from agencies. we are asking your thoughts on all ofhis and we will do this for another 25 minutes or so. there is some republican reaction to this idea. they are dismissing this spurt of presidential activity, they write, vague promises that will have little effect until after the election. scottsboro, alabama. don on independent line.

caller: i think congress and the senate should take a 5% pay cut. also i think that the military -- not the military servicemen but the military industrial complex should be cut by 5%. and also i keep hearing people talking about the taxes that the corporations pay and saw on cbs a couple of years ago about -- i think it was in the cayman islands where they had this one office, had a telephone there, and all of these companies were registered offshore to evade taxes. so, i think that corporate taxes should go up because a lot of

them don't pay any taxes, you know? they used these offshore accounts to evade taxes instead of payg their fair share. host: maury on the republican line from montana. caller: good morning. first, i would like to say there's got to be something in the military budget that we can cut. bases in just about every country as near as i can figure out. probably i would like to say the food stamp program. i go into the store every month in the beginning of the month when i get my check, social security, and i see all of these youngeople with food stamps and they are buying bags of chips and soda pop. i think if there is some kind of voucher program for food it would be a lot better than just letting them go spend theoney on whatever they want.

host: to the oil story this morning. we will continue to cover lots of related events on capitol hill and all through the week, as we take a live look beneath the gulf of mexico, as work continues. this front-page photo, as we get started telling you about oil stories in "the washington post." brown pelican chicks wait at a rescue center in fort jackson, louisiana, to be clean. a tough way to spot -- start life, is the headline. another headline below -- bhad a history of problems. internal inquiry showed a firm continued to ignore safety and environmental rules. that is from "the washington post." here is that story on drilling itself. "the wall street journal" makes it the lead. obama to reopen drilling. new rules on shallow water

exploration. obama administration, facing rising in anger over the drilling moratorium -- both issued amid public pressure, threaten thousands of jobs. that's the "wall street journal" story. as to the leak itself, the spill itself and the cleanup, here's what the president had to say yesterday at the white house. president had to say yesterday at the white house. the the here's what we know. even if -- >> here is what we know, even if we are successful in containing some or much of this oil we will not get the problem completely resolved until we have the relief well completed, and that will take a couple more months. we also know there is already a lot of oil that has been

released and there will be more oil released no matter how successful the containme effort is. that is why it is so important for us to continue to put every effort that we have -- booms, skimmers, vessels, hiring local folks and local fishermen's, equipping them with the skimmers, getting every asset that we have out there to make . . >> you can watch that segment and all of today's washington journal online at c-span.org. . . the speaker pro tempore: the house will be in order. the chair lays before the house

a communication from the speaker. the clerk: the speaker's room, washington, d.c., june 8, 2010. i hereby appoint the honorable zoe lofgren to act as speaker pro tempore on this day. signed, nancy pelosi, speaker of the house of representatives. . the speaker pro tempore: the prayer will be offered by our chaplain, father coughlin. chaplain coughlin: god of wisdom and love, you are the source of life and have gifted us with many blessings. open our minds and hearts -- may all our decisions set us on the path of truth and all our actions manifest your goodness. to you the honor and glory both now and forever. amen.

the speaker pro tempore: the chair has examined the journal of the last day's proceedings and announces to the house her approval thereof. pursuant to clause 1 of rule 1 the journal stands approved. the pledge of allegiance will be led by the gentlewoman from north carolina, congresswoman foxx. ms. foxx: would you all join me in the pledge to our wonderful flag. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. the speaker pro tempore: the chair lays before the house a communication. the clerk: june 3, 2010. the honorable the speaker, house of representatives,

madam this is to notify you formally pursuant to rule 8 of the rules of the house of representatives that i have been served with a trial subpoena issued by the superior court of the district of columbia for testimony in a criminal case. after consultation with the office of general counsel, i have determined that compliance with the subpoena is consistent with the precedents and privileges of the house. signed, sincerely, sarah gesher, chamber support services. the speaker pro tempore: pursuant to clause 4 of rule 1, the following enrolled bill was signed by the speaker on monday, may 31, 2010. the clerk: h.r. 5330, to amend the antitrust criminal penalty enhancement and reform act of 2004, to extend the operation of such act, and for other purposes. the speaker pro tempore: without objection, the title to h.r. 5136 is amended so as to read.

the clerk: a bill to authorize appropriations for fiscal year 2011, for military activities of the department of defense, for military construction, and for defense activities of the department of energy, prescribed military personnel strength for such fiscal year, and for other purposes. the speaker pro tempore: the chair will entertain requests for one-minute speeches. for what purpose does the gentlewoman from arizona rise? ms. kilpatrick: the administration is acknowledging what i myself across the country have been saying for months. the time for business as usual in washington is over. and the time to cut speing is right now. our demand for actions are finally being heard. i have repeatedly called on the

white house to crack down on this kind of waste. if done right this push could mean real progress towards a balanced budget. but this is washington. and every window is easier to talk about eliminating inefficiency than to make the tough choices required to actually get it done. we need to hold this plan to its promises. the federal government has to fully commit to doing more with less. agencies must be creative and aggressive using 5% cuts at a minimum and not a final goal. this congress should also play an active role in finding cost-effective ways to achieve our goals. this is an opportunity that cannot be allowed to slip by. i yield back. the speaker pro tempore: the gentlelady's time has expired. for what purpose does the gentlelady from north carolina rise? ms. foxx: permission to address the house for one minute. the speaker pro tempore: without objection, so ordered. ms. foxx: thank you, madam speaker. we've got a debt problem in

america. the federal government keeps spending money and running up the national credit card at a record clip, $8.5 trillion over 10 years. congress can't just cross its fingers and hope everything works out. that will only make the debt crisis that much more severe for our children and grandchildren. we must start cutting spending and reducing the deficit now. to do otherwise and watch our national debt prepare to overtake us reckless. it is as if we are on the titanic. we know there's an iceberg ahead of us in the darkness, but we refuse to change course. no amount of denying our debt crisis will change the fact that this iceberg exists. we can avert disaster but we must act quickly to restore fiscal responsibility before it is too late. i yield back. the speaker pro tempe: for what purpose does the gentleman

from michigan rise? without objection, the gentleman is recognized for one minute. >> madam speaker, i rise today to honor the detroit tigers and the pitcher, galarraga, for his spectacular performance against the cleveland indians last week. during the game on june 2, he threw 8 2/3 innings perfectly against cleveland. without giving up a hit, walk, or error, on what would have been his 27th out, major league baseball umpire made what he admitted was a mistaken call. spoiling what would have been the detroit tiger's first game in history.

throughout the ensuing controversy, they have displayed extraordinary grace under pressure and tremendous sportsmanship. setting a fine example for sports fans everywhere. it's my hope that major league baseball commission will consider the decision and will correct what was clearly a faulty call. with the full support of the entire michigan delegation, i have introduced a resolution today declaring that galarraga pitched a perfect game and urging the mlb to overturn a miss taken safe call. i believe to do so will more than please the 17,000 fans who were in the stands that day and place galarraga a part of the game's history of having pitched a perfect game. the speaker pro tempore: the gentleman's time has expired. for what purpose does the gentleman from texas rise?

>> ask permission to address the house for one minute. revise and extend my remarks. the speaker pro tempore: without objection, the gentleman is recognized for one minute. mr. burgess: madam speaker, just within the past hour governor mitch daniels came and addressed the congressional health care caucus. he gave us some particular insights as to what's been happening in his state of indiana in regards to health care costs, but in particular he expressed how distressed he was over the health care bill that this congress passed in march. they described it as a lost opportunity of historic proportions and perpetuates and extends the problems of the existing system. the plan is add men straightively complex and states in fact have no way 20 comply. the cost of states, the significant financial burden proposed to the states, are truly going to be obstacles. it's odd. every time consumer directed health care posts a win we find a way not to recognize the success that governor daniels has. he described as heading at warp

speed down a dead end road with a debt burden that threatens the vitality of our republic. there is a better way. the simple truth is that something magic happens when people spend their own money. governor daniels employing a system of consumer directed health care in his state of indiana has held health care costs down by 11% in the past year. i wish medicare and medicaid could say the same. i yield back the balance of my time. the speaker pro tempore: the gentleman's time has expired. for what purpose does the gentleman from virginia rise? without objection, the gentleman is recognized for one minute. >> thank you, madam speaker. abc reported yesterday that roughly 600 people were killed in darfur in may. mr. wolf: a new high since peacekeepers were deployed in debate. additional thousands have fled their homes. against this backdrop internationally war criminal was inaugurated as president of sudan and unbelievably the obama administration sent a u.s.

government representative ceremony. add vowcy groups expressed their dismay, it was said, quote, the administration missed an opportunity to lead by example. getting nothing in return for this reversal of long-standing u.s. policy is baffling and ineffective diplomacy. i could not agree more. vice president biden is leading a delegation to africa this week. he would be the highest ranking u.s. official since meeting the suedianese, we can only hope this will mark a new beginning for the administration's long faltering and ineffective sudan polcy. i yield back the balance of my time. the speaker pro tempore: the gentleman's time has expired. for what purpose does the gentleman from florida rise? >> permission to address the house for one minute. the speaker pro tempore: without objection, the gentleman is recognized for one minute. >> madam speaker, the national

now is $1 trillion t took 206 years to get the first $1 trillion of national debt. the last trillion is took six months. if you took $13 trillion and stacked it next to each other you could go to jupiter and back. we talk about greece and their challenges, we are the next greece if we don't balance the budget and get serious about our national debt and our deficit. mr. by can nan -- mr. buchanan: last year $1.4 trillion in deficit. this year we are expected to exceed $1.5 trillion. we need to balance the budget now. my first year 3 1/2 years ago i introduced a balanced budget amendment that just says we don't spend more than we take in. we need to do that or we are going to be the next greece. i yield back. the speaker pro tempore: the gentleman yields back the balance of his time. for what purpose does the gentlelady from florida rise?

without objection, the gentlewoman is recognized for one minute. ms. ros-lehtinen: thank you, madam speaker. in the last 50 days approximately 35 million gallons of oil have spewed into the gulf, resulting in the worst environmental disaster in american history. the oil spill has destroyed wildlife, wreaked havoc on our marine echo system, and debilitated thousands of families who depend on fishing and tourism for their way of life. and while b.p. has stated it will provide compensation to those individuals and businesses economically impacted by the oil spill, its claim office is in the florida keys in my congressional district have provided little assistance to those seeking relief. individuals so overwhelmed by the b.p. process claims have actually had to hire lawyers to help sift through the mounds of paperwork required. these additional burdens imposed by b.p. are deplorable.

if b.p. is committed to fixing this disaster and rebuilding our devastated communities, then it must act quickly and responsibly in processing these claims. thank you, madam speaker. the speaker pro tempore: the gentlelady's time has expired. for what purpose does the gentleman from texas rise? >> request permission to address the house for one minute. the speaker pro tempore: without objection, the gentleman is recognized for one minute. mr. poe: madam speaker, when kagan was dean of the harvard law school, for personal and biased reasons she banned military recruiters from campus. by her actions she violated the right of free speech. in a university setting of all places. a college campus is just the place for free expression, free speech from all points of view. kagan's actions also denied the students the right to hear the information. she denied the students the right to even discuss military career as a choice because of her own prejudices. and when kagan personally joined

a lawsuit to uphold her banishment of the military recruiters, the very supreme court she wants to join unanimously said she was wrong. in her judgment. she's hostile to the first amendment. she wants control over free thought and free expression unless she personally agrees with it. kagan's attack on the first amendment chose her dangerous distrust for the principles of the constitution. her lack of objective judgment shows she has no business giving judgment on the most powerful court in the world. that's just the way it is. the speaker pro tempore: the gentleman's time has expired. . for what purpose does the gentleman from texas rise? >> to address the house for one minute. the speaker pro tempore: without objection, the gentleman is recognized for one minute. mr. smith: madam speaker, with the democrats in control, millions of jobs have been lost. the main job creation has been in the federal government, not the private sector.

the national debt has doubled and the national deficit has tripled. taxes have gone up and will increase more at the end of the year. and the democrats in congress have not bothered to propose a federal budget. if a budget is not approved this year it will be the first time since the budget act was enacted in 1974. one party controls the house of representatives, the senate and the white house. we need a political balance in washington, not a one-party monopoly. the speaker pro tempore: the gentleman yields back. pursuant to clause 8 of rule 20, the chair will postpone further proceedings today on motions to suspend the rules on which a recorded vote or the yeas and nays are ordered or on which the vote incurs objection under clause 6 of rule 20. recorded votes on postponed questions will be taken after 6:00 p.m. today.

for what purpose does the gentlewoman from california seek recognition? mrs. napolitano: madam speaker, i move to suspend the rules and pass h.r. 4349 as amended. the speaker pro tempore: the clerk will report the title of the bill. the clerk: h.r. 4349, a bill to further allocate and expand the availability of hydroelectric power generated at hoover dam, and for other purposes. the speaker pro tempore: pursuant to the rule, the gentlewoman from california, mrs. napolitano, and the gentleman from utah, mr. chaffetz, will each control 20 minutes. the chair recognizes the gentlewoman from california. mrs. napolitano: thank you, madam speaker. i ask unanimous consent that all members may have five legislative days to revise and extend their remarks and include extraneous material on the bill under consideration. the speaker pro tempore: without objection, so ordered. mrs. napolitano: thank you, madam speaker. h.r. 4349 would update the statutory allocation of electric power generated at the hoover dam located on the colorado river to its various

users. the current allocation of this hydropower resource expires at the end of fiscal year 2017. in this regard, 4349 would increase the amount of electricity will be marketed by the western area power administration, known as wapa, and provide to native american tribes and other previously excluded entities the opportunity to acquire federal power. the allocation will remain in effect from 2017 to 2067. h.r. 4349 has 43 bipartisan co-sponsors. this hydroelectric generation, which provides renewable, affordable and accessible resource to the american southwest in this bill is being made available to additional users through this legislation. western area power has committed to implement a full and transparent process in the allocation of this resource. we expect that the state regulatory agencies of arizona

and nevada will follow the same procedures and commitment to an imparblee and undieased allocation. hydropower is a valuable resource to our country. the 50-year time frame for allocation of this resource matches the commitment by the collaborators to fund the lower colorado river multispecies conservation program. the conservation program is a nationally recognized example of high diverse stakeholders can together find solutions. without litigation. that allows everyone to use the lower colorado river to promote economic growth while in comblines with the endangered species act and protecting over 100 species which the lower colorado river has. mr. speaker, i ask my colleagues to support h.r. 4349, and i reserve the balance of my time. the speaker pro tempore: the gentlewoman reserves her time. mr. chaffetz from utah is recognized for 20 minutes.

mr. chaffetz: madam speaker, i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. chaffetz: the hoover dam may be 85 years old but its legacy of providing emissions-free electricity for cities and farms, flood control and environmental protection remains to this day. it is a symbol of what our nation's legendary infrastructure has done and will continue to do for generations to come. this legislation specifically continues the promise of delivering clean and renewable hydropower generated by the legendary hoover dam. it helped make the southwest united states of what it is today. this bill costs nothing, which is important in these tight financial times. since the costs will be born by the electricity ratepayers. i appreciate the gentlewoman for bringing this bill forward, the bipartisan manner in which

it was crafted and i urge my colleagues to support this important piece of legislation. at this time i'll verve the balance of my time, madam speaker. the speaker pro tempore: -- i'll reserve the balance of my time, madam speaker. the speaker pro tempore: the the gentleman reserves. the gentlewoman from california. mrs. napolitano: do you have more speakers? mr. chaffetz: i have no more speakers and consequently i'll yield back. the speaker pro tempore: the gentleman yields back. knapp -- mrs. napolitano: i want to thank my colleagues for endorsing this bill, especially the water staff on our side and on the minority staff. the collaborative effort is an example of how we can get things done. i'm very happy that we are able to do that in this bill and urge my colleagues to vote for this bill. i yield back. the speaker pro tempore: the gentloman yields back. the gentleman has yielded back. the question is will the house suspend the rules and pass h.r. 4349 as amended. those in favor will say aye. those opposed, no.

in the opinion of the chair, 2/3 having responded in the affirmative, the rules are suspended, the bill is passed, and wowed the motion to reconsider is laid on the table. -- and without objection the motion to reconsider is laid on the table. for what purpose does the gentlewoman from california seek recognition? mrs. napolitano: madam speaker, i move to suspend the rules and pass h.r. 2008 as amended. the speaker pro tempore: the clerk will report the title of the bill. the clerk: h.r. 2008, a bill to authorize the secretary of the interior to facilitate the development of hydroelectric power on the diamond fork system of the central utah project. the speaker pro tempore: pursuant to the rule, the gentlewoman from california, mrs. napolitano, and the gentleman from utah, mr. chaffetz, each will control 20 minutes. the chair recognizes the gentlewoman from california. mrs. napolitano: thank you, madam speaker. and i do ask unanimous consent that all members may have five legislative days to revise and extend their remarks and include extraneous material on

the bill under consideration. the speaker pro tempore: without objection, so ordered. mrs. napolitano: thank you, madam speaker. h.r. 2008, introduced by our colleague, representative jim matheson, the cost allocation of 161 million on the indictment fork system in utah and would defer those costs indefinitely in accordance with section 211 of the central utah project completion act of 1992. h.r. 2008 is a perfect example of a win-win situation. this legislation will facilitate the development of 50 megawatts of clean hydroelectric power while generating revenue for the government for the use of its water facilities. i am glad we were able to bring this to the floor. i ask my colleagues to support passage of this bill and i reserve the balance of my time. the speaker pro tempore: the gentlewoman reserves.

for what purpose does the gentleman from utah rise? mr. chaffetz: i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. chaffetz: i thank you. i want to thank my colleague, representative jim plattson, for introducing this -- jim matheson, for introducing this important piece of legislation. i look forward to working with his staff. it represents both the districts and truly the population of the state of utah and consequently the united states of america. the facilities and beneficiaries of this bill are located in both districts. and we again appreciate mr. matheson and his leadership on this issue. the indictment fork system of the bonneville unit was constructed under the central utah project completion act. the bonneville unit is a system of dams and pipelines and tunnels that transfers water. this allows for hydropower developer to install up to 50 megawatts at the existing facility at the indictment fork system. this will benefit the people of my district and the u.s.

taxpayers in a variety of ways. this legislation expands on the historical benefits of proven green technology. hydropower is the original green electricity that time and again has kept the lights on in the western united states. with an additional 50 meg awatts of hydro-- megawatts of hydroelectricity, my district again will be at the forefront of the future. this bill will be paid for by the power users, not the taxpayers. once signed into law, this will generate money to the federal government by allowing a nonfederal developer the right to generate hydropower. without passage, the congressional budget office said it will not be developed anytime within the next decade because the initial investment would be uneconomical for potential developers. this is a good bipartisan bill tt benefits the environment, the taxpayers and the people of utah, and i urge my colleagues to support it. again, i appreciate the bipartisan approach in developing this piece of legislation. and at this time i have no

additional speakers but i'll continue to reserve the balance of my time. the speaker pro tempore: the gentleman reserves. for what purpose does the gentlewoman from california rise? mrs. napolitano: madam speaker, i also do not have any speakers, but i serum want to commend -- but i certainly want to commend my colleagues for working on this particular bill, and i thank them very much for the bipartisan way this was carried out. water has no boundaries, no color, no political designation, and we need to continue to work on these issues that are going to help the american people be able to have clean, sustainable, green power. so with that i want to thank the staffs on both sides for their marvelous work and yield back the balance of my time. the speaker pro tempore: the gentlewoman yields back. the gentleman from utah. mr. chaffetz: i yield back. the speaker pro tempore: the gentleman from utah yields back. the question is will the house suend the rules and pass h.r. 2008 as amended. those in favor say aye. those opposed, no. in the opinion of the chair,

2/3 having responded in the affirmative, the rules are suspended, the bill is passed, and without objection the motion to reconsider is laid on the table. for what purpose does the gentlewoman from guam seek recognition? ms. bordallo: madam speaker, i move to suspend the rules and pass h.r. 1061 as amended. the speaker pro tempore: the clerk will report the title of the bill. the clerk: h.r. 1061, a bill to transfer certain land to the united states to be held in trust for the hoh indian tribe, to place land into trust for the hoh indian tribe, and for other purposes. the speaker pro tempore: pursuant to the rule, the gentlewoman from guam, ms. bordallo, and the gentleman from utah, mr. chaffetz, each will control 20 minutes. the chair recognizes the gentlewoman from guam. ms. bordallo: madam speaker, i ask unanimous consent that all members may have five legislative days to revise and extend their remarks and include extraneous material on the bill under consideration. the speaker pro tempore:

without objection. ms. bordallo: madam speaker, h.r. 1061 would transfer certain federal and nonfederal land in the state of washington to the hoh indian tribe, to be held in trust by the united states for the benefit of the tribe. the hoh indian tribe is located on the coast of washington. its coastline is situated such that it is subject to frequent flooding and is located in a tsunami zone. the tribe was acquired approximately 420 acres of land from private forests to relocate its government offices and tribal members. the bill would place this newly acquired 420 acres of land into trust for the tribe. h.r. 1061 would also transfer approximately 37 acres of land from the olympicic national park into trust -- olympic national park into trust from the tribe in order to acquire

the newly acquired land to its current lands. the national park service has no objection to this transfer. no gaming may be conducted on any lands placed into trust pursuant to this act. in addition, there are several restrictions on the land being transferred to the tribe from the olympic national park. and i want to commend our colleague, madam speaker, mr. dicks of washington, for his hard work and dedication to this legislation, and i ask my colleagues to support its passage, and i reserve the balance of my time. the speaker pro tempore: the gentlewoman reserves her time. mr. chaffetz. mr. chaffetz: madam speaker, i yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. chaffetz: thank you, madam speaker. i commend the democrat majority for scheduling h.r. 1061 under suspension of the rules today. today, the house is setting a valuable precedent by removing certain lands managed part of the olympic national park from federal ownership to meet a legitimate need. the national park service has

expressed support for conveying these federal lands to the hoh indian tribe without consideration. to date, we have not been made aware of any opposition lodged by environmental groups to this national park land transfer. the hoh tribe has demonstrated a compelling need to add lands to its existing reservation in which they can construct housing and other facilities for its members. the tribe's reservation currently lies within one of the rainiest areas of the country on the olympic peninsula of washington. classified as a tsunami zone and prone to major flooding, the reservation receives upwards of 140 inches of rain per year. the transfer of land by h.r. 1061 enables the tribe to expand the eastern side of its reservation a little further upland a a safe distance from major flooding. the land so transferred are currently part of the olympic national park, one of the most beautiful and pristine parks in the united states of america. . the precedent should encourage

the house to additional land transfers to benefit communities with safe and affordable housing and other economic development interests. again, madam speaker, i'm pleased to exprs my support for h.r. 1061 and urge the house to pass it in a bipartisan way. with that i reserve the balance of my time. the speaker pro tempore: the gentleman reserves the balance of his time. the gentlelady from guam. ms. bordallo: madam speaker, i yield to the gentleman from washington, mr. dicks, as much time as he may consume. the speaker pro tempore: the gentleman from washington is recognized. miss dicks: i -- forbes force mr. dicks: i ask unanimous consent to address the house for one minute. the speaker pro tempore: without objection, so ordered. mr. dicks: i appreciate very much the distinguished chair lady yielding to me. i rise to urge passage of h.r. 1061, the hoh indian tribe safe homeland act, which i sponsored. the hoh's are one of eight tribs in the district i represent. this legislation is primarily for the safety of the hoh tribe to help them relocate out of a tsunami zone and flood plain.

the legislation accomplishes this goal by transferring a small parcel of land in the olympic national park to the tribe. in addition, the legislation would place into trust this transferred park service land, along with other lands recently acquired by the track. there is a companion bill in the other body which is sponsored by senator murray and co-sponsored by senator campo. the whole tribe lives in an extraordinarily spectacular place on the olympic peninsula where the whole river mts into the pacific ocean but with this beauty comes real danger. throughout the year the hoh tribe must deal with the threat of a tsunami. the pacific coast is an extremely active zies economic zone. every time there is an earthquake in the eastern pacific area, the hoh tribe along with other coastal tribes in washington state must be vigilant for a tsunami which could prove devastating.

in addition to the tsunami threat, the tribe must deal with severe flooding on a more or less annual basis during the winter storm season which lasts far longer than the time period officially designated as winter. the tribe's dry land on their already small reservation has shrunk over the years because the whole river and the pacific ocean are encroaching upon their lands. they have suffered through high floods that have destroyed homes, tribal buildings, and other tribal infrastructure. a few years ago my office had to call the washington state national guard in order to help the tribe place sandbags during a flood emergency. let me reiterate that all of the tribe's current reservation is located within a tsunami zone and nearly all of it within a flood plain. sadly it has become an unsafe place for the tribal members who live on the reservation. these threats preclude federal agencies, including the b.i.a., fema, and h.u.d. from providing

assistance due to the location within a flood-prone area. this clearly is an unacceptable situation for the tribe. in response, the hoh tribe has come up with its own plan on how to solve this problem. and i support it strongly. the tribe has purchased several parcels of land a short distance and upland from the current reservation that would be acceptable for housing, infrastructure, and other tribal projects. more importantly, this newly acquired land is away from the flood plain in the tsunami zone. the state of washington's department of natural resources also has given the tribe a parcel of land in the same area. to add to the newly acquired property, this legislation would transfer to the tribe a 37 acre parcel of land currently part of olympic national park. this small parcel would make all of these lands contiguous to the existing reservation. in addition, the main road for

the tribe runs through this parcel currently owned by the national park service. the tribe, olympic national park, and others within the park service have agreed to transfer the parcel to the tribe. with certain restrictions on development, including a prohibition on gaming. this is a mutually agreeable arrangement worked out by the tribe and the national park service. the transfer of this land to the hoh tribe is also of benefit to the park service. this land has been logged repeatedly and therefore not considered to be a high value from a ecological point of view. the paragraphs until its current state also is difficult for the park service to manage because it is a 37-acre sliver of land surrounded by nonfederal land. another reason the land transfer is beneficial to the park service and would further demonstrate how olympic national park is a good neighbor. any of my colleagues who represents districts with federal land know how important it is for the agencies to

respect their nonfederal neighbors and provide them benefit. the tribe has done a good job reaching out to its neighbors in the area and getting support for the project. local landowners, the hoh river trust, environmental organizations, and others support this legislation. elected officials who support the legislation include governor greg water, the local state representatives and senators, and the jefferson county commissioners. so clearly it is time for the congress to do its part and pass this legislation. we need to clear the way for federal assistance from fema, b.i.a., h.u.d., and other federal agencies in an area desperately in need of it. i want to thank chairman rahall and ranking member hastings for shepherding this legislation through the process that brought us here to the house floor today. i also want to thank janet erickson who is the new staff director of the office of indian affairs. and i would be remiss if i did not recognize the hard work on

this bill by janet's predecessor, marie howard. in closing i want to commend the hoh tribe anti-tribal council, chairman maria lopez, and the executive director for their vision. their steadfastness of purpose and their sustained effort to fix the serious problem. you have done a remarkable job of doing your part to solve this very difficult problem that you face. now it is up to the house to pass this legislation. so it can soon be signed into law. and i appreciate yielding me time today. this is an important issue in my district and i appreciate the bipartisan cooperation that we received on this bill. thank you. i yield back. the speaker pro tempore: the gentleman from utah. mr. chaffetz: we have no additional speakers. we again urge passage of this important bill and support its passage. with that we yield back. the speaker pro tempore: the gentleman yields back the balance of his time. the gentlewoman from guam. miss bordello: --

ms. bordallo: we do not have any additional speakers. i again urge members to support this bill. i yield back the balance of my time. the speaker pro tempore: the gentlewoman yields back. the question is, will the house suspend the rules and pass h.r. 1061, as amended. so many as are in favor say aye. those opposed, no. ms. bordallo: on that i request the yeas and nays. the speaker pro tempore: the rules are suspended, the bill is passed, and -- without objection, the motion to reconsider is laid upon the table. the yeas and nays are requested. all those in favor of taking this vote by the yeas and nays will rise and remain standing until counted. a sufficient number having arisen, the yeas and nays are ordered. pursuant to clause 8 of rule 20, and the chair's prior announcement, further proceedings on this motion will be postponed.

the speaker pro tempore: for what purpose does the gentlelady from guam seek recognition? ms. bordallo: mr. speaker, i move to suspend the rules and pass house resolution 518, as amended. the speaker pro tempore: the clerk will report the title of the resolution. the clerk: house resolution 518. house resolution honoring the life of jacques-yves cousteau, explore, researcher, and pioneer in the he field of marine conservation. the speaker pro tempore: pursuant to the rule, the gentlewoman from guam, ms. bordallo, and the gentleman from utah, mr. chaffetz, each will control 20 minutes. the chair recognizes the gentlewoman from guam. ms. bordallo: mr. speaker, i ask unanimous consent that all members may have five legislative days to revise and extend their remarks and include extraneous material on the resolution under consideration. the speaker pro tempore: without objection, so ordered. ms. bordallo: mr. speaker, i rise in support of house resolution 518. it's a resolution to honor the life and the achievements of

jacques-yves cousteau, introduced by my good friend from florida, ileana ros-lehtinen. mr. cousteau spent his lifetime as a researcher, explorer, and pioneer in the field of marine conservation. he produced more than 120 films, wrote more than 50 books, and was the first diver to take color footage at a depth of over 150 feet. mr. cousteau's work brought the colorful, exotic, and unknown world of undersea life to the homes of people around the world, and in doing so sparked a generation of conservation-minded ocean activists. the cousteau society for the protection of ocean life founded by cousteau in 1973 today boasts more than 360,000 members globally.

house resolution 518 would officially honor the brilliant and inspirational work of jacques-yves cousteau and recognize his invaluable contributions to our understanding of the world's oceans. it is the most fitting that we honor him today, mr. speaker, because today is world oceans day. with that i ask members on both sides of the aisle to support the passage of this resolution and i reserve the balance of my time. the speaker pro tempore: the gentlelady reserves the balance of her time. the gentleman from utah. mr. chaffetz: thank you, mr. speaker. i'd like to yield as much time as she may consume to the author of this legislation, ms. ros-lehtinen from florida. the speaker pro tempore: the gentlelady from florida is recognized. ms. ros-lehtinen: thank you very much, mr. speaker. i thank my good friend, the gentleman from utah, congressman chaffetz, for yielding me the time. thank you, sir. mr. speaker, as the author of house resolution 518, i would like to also thank the natural

resources committee ranking member, congressman doc hastings, as well as chairman nick rahall, for their support and their assistance in moving this resolution to the floor today. today is world oceans day. i would also like to recognize the bipartisan support by members of the natural resources committee, including ocean subcommittee chair, madeline bordallo, thank you very much, and congresswoman lois capps of california. later this evening, mr. speaker, congresswoman capps and i will be honored by the national marine sanctuary foundation for our work on ocean issues, namely coastal restoration and coral reef rehabilitation. of course we take inspiration from the extraordinary life and career of captain jacques-yves cousteau. captain cousteau was a pioneering explorer of the seas and of the many environmental issues that we face today.

when explaining his relentless passion for ocean exploration and conservation, he said, people protect what they love. my congressional district, mr. speaker, includes the florida keys national marine sanctuary, one of the largest coral reef tracks in the worth, countless species of fish and wildlife, and three national parks. today countless small business owners and their families are fighting to protect the ecosystem and the way of life that they hold dear. for 50 days crude oil from the deepwater horizon oil rig has spewed 40 million gallons of oil in the gulf of mexico resulting in the worst environmental disaster in american history. according to recent analysis by the university of central florida, the oil rig disaster will cost florida's economy $2.2 billion and 39,000 jobs in the

tourism and fishing industries. i am certain that captain cousteau would be horrified by b.p.'s noncha lance in responding to this crisis. my constituents in the beautiful florida keys are particularly frustrated and angry at the lack of transparency and the lag response time by b.p. b.p. must work on all fronts at once. it is responsible for capping the leak to prevent more oil from gushing into the gulf, and it must provide the financial support to those individuals whose livelihoods have been devastated. b.p. and the coast guard must also make a stronger effort at coordinating with our local government, especially in the keys, and utilizing the expertise and know how of local businessmen an fishermen, as well as our many research facilities in florida's colleges

and universities. as oil makes its way further into north florida beaches, hundreds of fishermen, environmental activists, students, and other concerned residents have gathered together ready to assist in the cleanup effort. commercial fishermen and charter boat captains have offered their assistance to lay boom and skim oil before it reaches the shore. in key west, organizations like the united way and the florida keys environmental coalition have gathered volunteers ready to patrol the shoreline for tar balls. i am so grateful for the loordship of these great local -- leadership of these great local organizations during this crisis. their daily activism is a tribute to jacques cousteau. i thank the speaker for the time. i thank the gentleman for the time. i'm glad to yield backhe balance of my time. .

the gentlelady yields back. the gentlelady from guam. ms. bordallo: i continue to reserve. the speaker pro tempore: the gentleman from utah. mr. chaffetz: briefly, i want to yield myself such time as i may consume. the speaker pro tempore: the gentleman is recognized. mr. chaffetz: this recognizing the life of jacques cousteau for bringing the underwater world to the living room through his shows and documentries. i, like countless others who have been impacted our life, the work that he did with that staff and that crew had a profound impact upon countless people, including myself. it's an honor to stand here and support the passage of this important resolution and thank him and the great impact that he had for the deep appreciation and education that he gave relating to our oceans. we have no additional speakers. we urge passage and i yield back the balance of my time.

the speaker pro tempore: the gentleman yields back the balance of his time. the gentlelady from guam. ms. bordallo: mr. speaker, in closing i want to go on record to say that i agree with the gentlelady from florida, that this oil spill is a tragedy, and i will work very closely with our chairman, mr. nick rahall, to ensure that the laws are changed to prevent such a disaster in the future. and, mr. speaker, i again urge members to support this resolution, and i yield back the balance of my time. the speaker pro tempore: the gentlelady yields back the balance of her time. the question is will the house suspend the rules and agree to house resolution 518 as amended. those in favor say aye. those opposed, no. in the opinion of the chair, twids being in the affirmative -- 2/3 being in the affirmative. ms. bordallo: mr. speaker, on that i request the yeas and nays. the speaker pro tempore: the yeas and nays have been requested.

all those in favor of taking this vote by the anne will rise and remain standing until counted. -- by the yeas and nays will rise and remain standing until counted. a sufficient number having arisen, the yeas and nays are ordered. pursuant to clause 8 of rule 20 and the chair's prior announcement, further proceedings on this motion will be postponed. pursuant to clause 12-a of rule 1, the chair declares the house in recess until approximately 6:00 p.m. today.

at a processing plant for shrimp here in louisiana. we normally would be working 100 hours a week, now we're get 20 to 30 hours a week. that's how we make our living, put away money for the wintertime. it's hard to make do with what we're making do with, when you're used to having money coming. in b.p. has been good to us, they've been giving us money and helping us out and we greatly appreciate that but we need people to know, it's not just the fishermen. the fishermen don't catch, we don't work. we all have to go in together and help each other. we do appreciate the help we are getting. i was asking for information and she was nice and she answered my question.

because a lot of times you don't know what's going on, you hear so much. so i come today to find out for me and other girls at the factory that work with me. >> did you fuelly file a claim today? >> no, i have always filed my claim and i received my money and i wanted to see how the second part worked. >> how much did you receive? >> i did receive $2,000. >> and that's to cover for what? >> my household living expenses. not getting a salary. which normally i would be. and it doesn't cover everything but it is a big help. >> i've been there for 30 years. this is what i pay my home with, this living. and it's really not enough money to survive on. >> have you been filing claims? >> yeah, filed one claim. >> and how much did they give you? >> $2,000. >> how much do you need to cover your expenses? >> about $3,000 a month.

>> talk about the shrimp plant. are there any ships going there at all? >> there are giving people turns. usually it's a 24-hour shift and now they have so many workers that they rotate them. that's what we're going through. it's just not enough. it's really i think they closed the season now. >> yeah. >> and -- how much more can we go? and like she said, we make enough money from may to december to survive from january to may again. we're used to that. so now we're not going to have any unemployment put in. and there's nothing to survive off of. >> and what are you here to do today? >> i'm here to see if they can give me the other $500 that i heard that they was giving the other people $2,500, and that some of them get to $2,000, went back to get the $500 and they gave it to them. >> and what's the process like when you go in that door, what's the process, walk us through that process.

>> oh, that is a slow process. the people i dealt with were very nice, but it's very, like, degrading. it's like you're asking them for a handout that you don't deserve when it's not our fault that it happened. we'd rather work full time but we can't. when they close the waters down on us and the fishermen can't catch, there goes our water. >> is it degrading the way you're treated or the fact that you have to ask? >> we have to ask for a handout. >> it's a lot of questions asked. >> it's a lot of questions that we shouldn't have to answer, you know. we're proving our point that we do work in the shrimp industry. it's embarrassing. >> what kind of questions do you get asked? >> just different kinds of questions that, you know, personal questions. >> can you share an example? >> well, ok, if we're proving and showing our check stubs and tax papers that we do work for this company, why do some ask,

are you sure you make your living? well, yes, that's how we make our living. it's like you're asking for handout from somebody and you don't deserve it. you don't want to ask for a handout. you'd rather be working. we can make more money working. this here is really nothing, like she said. by the time you make your house payments and the house insurance, after we went through katrina and all that, the insurance went up, we've always had to replace things but we've made it. but now this, well, how long's it going to take for us to recover from this? >> that's. he's trying to help us. he had another plant in du lac. they had to close it because

they had no work from them. >> and if it doesn't come back or several years before it comes back, what will you do? >> we don't know. >> i've been there 19 years, she's been there 30. tell me, what do we do? [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> oil companies are liable for after oil spills. the limit is currently $75 million. we'll hear about efforts to lift that liability cap in the wake of the b.p. oil spill in the gulf. patrick leahy of vermont chairs this two-hour hearing. >> good morning. i appreciate everybody -- everybody being here. i know this may be an emotional meeting. i'd ask everybody to recognize the appropriate degree of

decorum. i understand we have families who have gone through terrible tragedies and show the respect dufort them. it's been now 50 days since b.p.'s deepwater horizon oil rig exploded and oil began gushing in the gulf of mexico. dead leaf contamination has reached the shores of the wetlands of the gulf coast. our nation faces an environmental catastrophe. americans are angry. in fact, the past week when i was home in vermont, i don't know when so many people have come up to me on one issue as this saying what's happening. the american people want to know how and why this happened. as attorney general holder and others investigate this disaster, i'm confident the facts will become known, and if

criminal conduct occurred, it should be and it will be prosecuted to the fullest extent of the law. senators on both sliles believe that those -- sides of the aisle believe that those should be held accountable. we should not let big oil companies play roulette with our economic and environmental resources. a region that has already suffered so much from natural disasters has yet another tragedy on their hands, this time at the hands of one of the largest oil companies in the world. much attention is being given to the unfolding environmental disaster, but i'd hope that americans would never forget the loving men who lost their lives, men who left behind children and wives, parents, brothers and sisters, christopher jones is here to represent all these men and

these families. mr. jones, i'm glad you're here. i know you're accompanied by your father, keith jones. and i understand mr. jones sr., from you that the president is having families at the white house later this week. mr. jones, you have our condolences. i know the discussions i've had with the president, he feels strongly about this. you should feel free to tell him exactly what you're thinking and any suggestions you have. he actually wants to hear what you have to say. but you also have my commitment to work to achieve some fairness under lawsuit for your family and all the families lost in this disaster. today's hearing will examine how the applicable laws have shaped big oil's behavior. we have to find out whether our legal system itself gives some

kind of incentive to big oil companies to cut corners. the supreme court's decision in the exxon valdez case, the oil pollution act of 1990 and the limitation of liability act encourage corporate risk and misconduct. we're going to ask whether current maritime statutes, we're going to ask whether they're fair and whether the current legal structure tempts corporations to devalue human lives in their profitabilities. no one's life should become an asterisk in somebody's cost benefit analysis. it is immoral. the death in the high seas act is a remedy for those killed in international waters. but this law does not recognize all that is lost with the death of a loved one, such as loss of

care, companionship. it shouldn't be some kind of indifference in the loss at sea than what happened when the b.p. employees are killed when working in a facility on land. and the disparity is further insult to the loving victims of this tragedy. 10 years ago congress amended the death in the high seas act for those who perish in plane crashes over international waters. it's time to modern o's this law again. later today, i'll introduce the survivors equality act to make sure these families are treated fairly. another law congress should consider updating is the limitation of liability act. it limits the total liability to the post-incident value of the vessel. that law was passed in 1851, for a different time and before

the civil war. the company that owns the deep water horizon trance ocean wasted in time filing a motion in court to limit the liability to the value of the sunken drilling rig. they want their liability limited to the value of what is now a piece of junk sitting a mile below the surface. that's perverse. i think congress should act to avoid this absushed result. of course there's the statuary -- statutory liability act on damages in addition to the cost of cleanup and that needs re-examination. two years ago, an activist supreme court made the decision in exxon versus baker created an arbitrary limit to punitive damages in maritime cases itch expressed my concern at the

time that the supreme court's decision would encourage corporate misconduct. why? because it are reduced the consequences of their misconduct to a discounted cost of doing business. that's almost like saying, we're giving you a green light to do whatever you want to do. i can't imagine why anybody would be surprised that if the supreme court capped damages to punish misconduct oil companies would cut corners. the exxon valdez was another in a string of business-friendly supreme court decision in which a narrow majority has written new laws and disregarded laws enacted by congress. the impact on lives and livelihoods of americans is enormous. two years ago we heard from alaskan fishermen. now we're worried about the livelihoods of shrimpers in the

gulf, people who spent decades, generations or baying every single rule, building their business, something they could leave to their children and they followed the rules and because somebody else doesn't they lose it all. i join the senator's efforts to overturn the supreme court's exxon valdez decision. they bear the cost of their full extreme misconduct. our law should encourage safety and accountability. they do not create the right incentives, we have to change them. as a result of greed or incompetence or negligence, b.p.'s conduct has devastated the lives and livelihoods of countless people in their community that may threat then gulf coast's very way of life. it's been said by others that b.p. can spend millions and millions of dollars running ads saying how wonderful they are

and how environmentally conscious they are, they can spend a lot more money helping families that are suffering. the american people deserve better from all big oil companies who exploit our new hampshire ral resources for enormous profit. in the months ahead, the people on the gulf coast will work to reclaim their westlands, their livelihoods, a many of us here will help them. the families of those who lost their lives will not be able to reclaim their loved ones, the 11 men who were killed on the deep water horizon rig deserve better. we're going to try to make it better. i pledge that to their families and i renew that pledge today. i thank senator whitehouse for co-chairing this meeting. i'm going to yield to senator sessions who does represent a

gulf state. and then senator whitehouse and then we'll begin the hearing. >> the deep water horizon disaster is now and remains a threat to our coastal environment, our coastal economy and particularly, our thoughts and prayers remain with those who, like christopher jones, lost family members on that rig. 11 wonderful americans lost their lives. i had a long meeting with governor riley and congressman bonner friday in mobil and we -- in mobile and we talked about the problems that the nation faces and we listened to the mayors of gulf shores and orange beach and people who represent the mobile bay area and the threats that are being faced there. that's quite a bit of concern, frankly. a lot of intensity of feeling that things have not gone as well as they could and we do

need to do better. we must do better. i really want to thank governor riley for his perge leadership in leading the effort to coordinate the response with regard to the alabama area. today marks the 50th day that oil has been pouring into the gulf of mexico and it looks like it'll be some time before we're fully able to comprehend the impact of this spill and the extent of the damage to our environment. stopping this leak, of course, is the top priority because defensive measures, trying to stop what's flowed out, will never be able to -- will never be able, as i have learned to completely stop the flow into our estuaries and beaches and even small amounts can cause serious damage. the coast guard, b.p., m.m.s., noaa, the e.p.a. continue toe valuate and implement subsea and subsurface areas to stop

the flow while closely monitoring its effect on the slirmente. i am encouraged by yesterday's announcement where admiral allen confirmed the capturing by b.p. of around 462,000 gallons of oil a day, which is a substantial increase from what was occurring friday. that is a positive step. if this procedure continues to work, i'm hopeful that the containment cap will begin to successfully collect as much oil as the surface tankers can handle. that being said, this is only the first step in what could be a long process and it's without question that the potential environmental and economic impact of the accident is unprecedented. b.p. is a multibillion dollar international country. as i said it shortly after this event occurred, they are the responsible party. they are liable for the damages up to the extent of their very

financial existence and they are not too big to fail. i believe that -- i believed that then and i believe that today. they've made great profits and so be it. but they assume risk. they became and signed as the responsible party. i believe that they are going to have to honor that commitment to be the responsible party. in fact, the first quarter of this year, b.p.'s profits averaged $93 million per day. b.p. is the one that under the law and under the procedures of our drilling is rethe responsible party. i question those executives, those at trance ocean and halliburton at the energy committee, of which i'm a member and administration

officials seeking explanations for the cause of this accident and confidence and assurance that the responsible parties will accept the full responsibility for the damages. officials have repeatedly stated from b.p. that the company will pay all cleanup costs and that it willig forethe $75 million liability cap established by the oil pollution act of 1990. indeed there is no cap on the cleanup cost. every dollar that's spent cleaning up any oil on the beaches and estuaries, that will be -- there's no cap on that and in addition, there's no cap, as i understand it, we'll perhaps ask our witnesses, on the individual lawsuits that can be brought against them under state law. company spokesmen said they will not seek reimbursement from the government from the

oil spill liability trust fund. that remains to be seen how that will play out, but it's certainly available if need be. while those corporate entities responsible will be held liable for the actions, i think it is appropriate, mr. chairman, that we analyze precisely the legal causes of actions that are available and whether or not they appropriately fit the circumstances of this case. and we also need to examine the government -- did the government play an adequate role in responsing to the disasters. according to coast guard logs released by congressman daryl issa, ranking member of the house oversight and government reform committee, the administration knew this was going to be a spill of, quote, national significance, within 24 hours of the event. those logs also show discrepancies between the information they contain and the previous released white house timeline of the events.

while the titetholve hearing obviously assumes a level of irresponsible corporate behavior on behalf of entities like b.p. we need to examine also how well the administration responded to this event. instead of allocating the administration, it appears we have other actions that are less effective. i think a -- an appropriate evaluation of possible criminal activity should be conducted, but it should be conducted in a fair and just way. we must be careful in implementing new policies to address this. in late may, the president announced he's extending the moratorium on permits to drill new deep water wells for six months. i think we need to be careful about that and examine very carefully whether or not, and how, we should go about further

deep water drilling. while this moratorium can be necessary to review safety and environmental regulations, it will clearly have a negative impact on production, jobs, and revenues to states and the federal government. the offshore industry is responsible for nearly 200,000 jobs around the gulf of mexico and over $13 billion a year in nontax revenues for the gulf coast producing states. the revenue collected by the treasury for all operations total $5.9 billion in 2009 alone, drilling on the outer continental shelf is an important issue not just for the gulf states but the entire country. there are overall investigations into the cause of this rig explosion and the administration established an independent commission to submit a plan to the president

within six months providing solutions to prevent and mitigate future spills from offshore drilling. i hope that we can complete that review and it will be effective at identifying the dangers and risks involved but i do hope we'll be able to move forward with greater energy independence and self-sufficientity by adopting the kind of plan that will allow us to be successful. the greater our dependence on foreign energy, the greater the threat to america's national security. offshore drilling in the gulf of mexico supplies 30% of america's domestic energy production. most people do not fully realize that and 80% of the gulf's oil and i did not realize, comes from operations in more than 1,000 feet of water. 80%. for this reason, we must

continue the safe and secure offshore drilling. it's important to our economy, jobs, and national security. mr. president, our communities are hurting, we've got our seafood industry that's basically shut down, hundreds of low wage workers have lost their jobs, we've got probably almost half of the rental capacity in our beach front properties have been lost or are beginning to be lost so it's a national issue. but also we have thousands and thousands of good americans who are working on those rigs every day whose lives are at risk and need to be assured that the production that's occurring is safely done. thank you for allowing me to have these remarks. >> thank you, chairman leahy, for holding this hearing and thank you for inviting me to

co-chair it. like you, i believe congress must do whatever they can to prevent another family having to hear their loved one perished on an oil rig. congress must also do everything possible to prevent the environmental destruction we see unfolding day after day. gordon jones and 10 other men died. the gulf has been devastated. something has to change. how did it come to this? we already know that b.p., trance ocean and halliburton failed to meet important safety standards. they undertook risky drilling without a proper degree of care, 5,000 feet below the surface of the gulf, 18,000 feet to the oilres. vaw, among meth thain deposits that are dangerous. they were irresponsible, the result was tragedy. sadly, key regulatory agencies also appear to have been asleep at the switch, shirking their responsibilities to protect our oceans and american workers at sea. i am convinced that something

was fundamentally amiss at the mineral management service at the department of the interior. i strongly suspect that m.m.s. had long since been captured by the oil industry and ceased to serve the public interest. but regulatory agencies, even when functioning properly, never have been america's sole line of defense against disasters. we also should make sure it is in a corporation's clear economic interests to adhere scrupulously to the law. meaningful civil and criminal fines and damages are are one crucial tool for ensuring that a corporation takes proper precautions to avoid tragic errors. in contrast a corporation that does not have to pay for its mistakes does not have to worry about making them. unfortunately, many of our current law, whether by statute or court decision, cap the liability of big oil corporations. both for worker injuries and deaths, and for harms to the environment.

rather than making responseable parties pay for harm done, they noyce this burden onto the families of the lost and onto the american taxpayers. as a result, corporations lack proper market incensivities to act responsibility -- incentives to act responsibly. these restrictions on liability are unfortunately consistent with a tax upon the institution of the your by powerful corporate interests. the founders but the -- put the jury in the constitution and bill of rights three times, and for a reason. to ensure that in at least one form of government, the powerful and the powerless have equal standing. not for nothing did de tocqueville describe the jury as a mode of the sovereignty of the people. that is as true today as it was at our nation's founding. the tide of corporate money that influences politics stops

at the hard, square corns of the jury box and that is why corporations fight so hard to attack the institution of the jury. you know this as well as anyone, mr. chairman, and i'm proud to co-sponsor the legislation you are introducing today. it will eliminate the strange quirks in american law that would result in the survivors of the 11 men killed on the deep water horizon rig being treated unfairly. i also urge my colleagues to support two bills i have introduced, one to raise penalties for worker safety violations under the outer continental shelf lands act. the other would overturn the supreme court's regrettable exxon v. baker decision that capped the level of damages at the level of compensatory damages. the exxon court believed predictability for corporations was more important than

deterring corporate misconduct. i disagree. the people of my home state, rhode island, the ocean state, would put our environment and our safety ahead of profits for irresponsible corporations. in fact that is exactly what rhode islanders have done. john torgan, thenary gans et bay keep for the rhode island urk submitted a letter catalogging the legislative and other reforms put in place after the north cape skandia oil spill off the coast of capetown. we know how important penalties and fines are to keeping sea farers safe and marine ecosystems healthy. like my fellow rhode islanders, i insist that in the future oil companies do everything they can to prevent needless deaths whether in the gulf, of the coast of nonge or anywhere in our great country. today's hearing is an important step toward that goal and i applaud you for holding it, mr. chairman, thank you very much.

>> thank you very much. our first witness is christopher jones. mr. jones is currently a partner at the law firm in baton rouge, louisiana. more important than his professional background, he's -- he's the brother of gordon jones who is one of the 11 rig workers who lost their lives the day of the explosion. gordon jones is survived by his wife michelle, two young sons, stafford maxwell -- stafford and maxwell, one of the sons irk understand, was born shortly after the accident. is that correct? mr. jones, please go ahead, the floor is yours. >> chairman leahy, ranking member sessions and other members of the committee, thank you for the opportunity to appear before you today. my name is chris jones, seated behind me is my father, keith jones.

gordon is my only brother. gordon is survived by his wife and two sons, stafford and max. stafford is 2. max was born three weeks ago. gordon is also survived by a mother, sister, in-laws and other family members and many friends who miss him very much. words cannot describe what gordon meant to this family. i appear before you as a representative of only one family affected by to this accident. unfortunately, there are many more. i stood with those other family members as a recent memorial event. a service no one should have to experience. though we never met before this disaster, i want those other family members to know we grieve for them and are committed to telling our story so we can try and correct the inequities in the law so no one else will find themselves in that situation in the future. of course, you are aware that gordon died board the oil drilling rig.

he was employed by a contractor for b.p. hired to provide mud engineering services. he worked aboard the rig for the past two years and was excelling in his profession. as many rig workers do, he expected to gain experience on this rig and continue to advance with his company. he never got that opportunity. this is a picture of the backyard fort gordon built with stafford's help for stafford and max. although you may not be able to tell, it is not finished. gordon planned to finish it when he returned home. he will never get that chance. certainly others will step in to make sure it is finish and try to fill the tremendous void left by gordon's death but this is another example of an incomplete life and what has been lost.

i am at least comforted that it will be finished and stafford and max will enjoy it for years to come and know their father built it for them. the next picture is taken shortly after max's birth. notably absent is gordon. his presence in the delivery room was limited to a single family photograph. lastly, i show you possibly the last picture taken of gordon before his death. it is taken just after -- just after gordon gave stafford his first golf lesson an experience gordon thoroughly enjoy. i'm saddened that neither will experience this joy again. i want to take this opportunity to address a recent -- address recent remarks made by tony

hayward, c.e.o. of b.p. in particular, he publicly stated he wants his life back. mr. hayward, i want my brother's life back. i know the families of the other 10 men want their lives back. we will never get gordon's life back, and his wife will live life without a husband and her two children a life without a father. at the top of the united states supreme court building is the phrase equal justice under law. as a united states citizen, and as a lawyer, i agree with that principle. unfortunately, it does not exist in the cases of death os curring in federal waters. this is not a phrase that applies to michelle, stafford, and max in this instance. this is not right and i make this request for change for my family, the families of the other 10 men, and others who

may find themselves in our same position and who will quickly learn that our current laws do not protect those who need it most. i want to be very specific. we're asking you to amend the death on the high seas act to allow for the recovery of nonpecuniary damages. currently, michelle, stafford, and max can only recover pecuniary damages. stafford and max will never play in the father-son golf tournament with their dad. or experience the thrill of their first saturday night in tigers stadium with their father at their side. likewise, michelle will never again experience a quiet dinner at home after a hard day with her true love. she will not celebrate another wedding anniversary. the last one would have occurred only three days after this accident. most recently, michelle did not have gordon there to comfort her in the delivery room and

tell her how much he loves her and the beautiful baby we now call maxwell gordon. these are all experience, among many, many others, for which there is no compensation under maritime law for victims. the overwhelming impression i've gotten from the party responseable for gordon's death is that they are immunized by the current law. there's a finite, maximum amount michelle and her boys can recover, and nothing more. think of it as a liability cap. while some, but certainly not all of course the same parties express their sympathies and claim to want to do the right thing, they can also hide behind the law and say they are protected from doing any more. there is an exception for the recovery of nonpecuniary damages for the victims of the commercial airlines accidents. in response to that event this

congress passed a retroactive amendment to allow for recovery of nonpecuniary damages. currently while victims of airline accidents are allowed recovery of nonprepe kuehneary damages, others are not, including aboard cruise ships and in this instance oil rigs where hardworking men make a living to support their families. during this past month and a half, i have gained tremendous perspective on things. certain things that i thought were important before april 20, are just not important anymore. this is important. this is fortunate michelle, stafford, and max. and all the other families affected by this tragic event. you have an opportunity to make this right and create equal justice under law for these families. . thank you. my father and i are more than happy to answer any questions you may have.

our next witness -- i'll go through all three witnesses therning go to questions. our next witness is jack coleman, a consulting partner for energy north america. he served as counsel for the house committee on natural resources, former senior attorney general for royalty and offshore minerals, for m.m.s., the minerals management service under presidents george h.w. bush and president clinton. mr. coleman, go ahead, sir. >> thank you, chairman leahy, ranking member sessions and members of the committee. it's a pleasure to be here. i retired about a year ago after 27 years as -- working for the federal government, the last six years in the house of representatives. during that time, most of my work has been in the area of

offshore oil and gas. here on the hill, it was also energy and minerals generally. prior to working as senior attorney general for royalty and offshore minerals, i also served for 3 1/2 years as senior attorney for environmental protection for the department of interior. prior to that, i was special assistant to the associate administrator of noaa for 3 1/2 years. i served four years on active duty in the army as a judge advocate general court officer. native of mississippi, went to ole miss undergraduate and law school. the focus of the hearing is on a variety of liability issues related to offshore gas and oil production. the ongoing tragic oil spill in the gulf of mexico, tragic for the families of those killed and energy, including the gentleman's family represented here today, to all of whom i

extend my deep condolences. but also tragic for the environment and the energy security aspirations of the american people. this is unequaled in size in our nation's histrained -- history and resulted in numerous legislative proposals to amend the oil pollution act of 1990 and other applicable laws and in actions by the administration related to offshore oil and gas leases. i'll limit my remarks to the potential of the liability of the united statesfish breach of contract as a result of if a few of these legislative proposals and executive branch actions. first i'd like to go over a few facts. senator sessions mentioned some of them, about the importance of offshore energy to the nation. currently, the united states consumes about 20 million barrels of oil a day. 20 million. about 60% of that, or 20 million barrels of oil, come from foreign sources. our largest source is canada. but the majority of the rest

come from overseas. so our yearly amount of imported oil totals about 4.2 billion barrels. many times, i've heard statements that the united states doesn't have much oil, doesn't have much natural resources. this really needs to be put in the context of our use and the context of what is available to us to produce. certainly we don't have the resources that saudi arabia has but we don't need to have the resources that saudi arabia has. to make a very important contribution to our energy security. as of the time of the last department of the interior offshore oil and gas national assessment in 2006, just over 14 billion barrels of oil had been produced from the federal offshore but another 15 billion barrels as of that time had already been discovered and were reserves available for production.

further, there were another 86 billion barrels of oil that are believed to be economically and technically recoverable in the offshore that have not yet been drilled. that's just for the oil. a toal of 101 billion barrels in the offshore. if these are made reasonably available to the american people for production. one of the things i'd like to emphasize is this oil belongs to the american people. the bounty and the voofl this oil cannot be made -- accessed for the benefit of the american people if it's not made available. that alone is sufficient, just in the offshore, sufficient to take care of all the imported oil needs at the current rates of the united states for about 25 years. so that's not an inconsequential amount of oil. it would take care of all of us, like i said, including displacing all the canadian oil. we have similar numbers for natural gas.

enough natural gas in the outer continental shell to have at least, conventional natural gas, to at least take care of all the natural gas needs of the nation at the current rate for more than 20 years. one might ask, what's the value of these reserves and resources for the american people? frankly if you use standard pricing, base it on -- just the reserves and resources that we have, the -- without any other benefits, economic benefits, just the royalties and corporate taxes would bring in $4.5 trillion from production of that more than enough to pay off about 1/3 of the national debt without any tax increases. when you add in the ability to produce methane high grates which now international research has shown is likely that would be another $7.5 trillion. all of those methane hydrates, by the way, 99 pk of them are in the deep water. certainly deeper than 2,500

feet. so if we don't allow deep water drilling that whole value of that will unavailable for the american people and that's $7.5 trillion in corporate income tax and royalties. so those two together, about $12 trillion. getting to the liability question, i had the honor of being the lead attorney for the interior department on a case which became mobil v. u.s., decided in the year 2000 and this involved a case where, a rider as part of the oil pollution act, the outer banks protection act, was added in 1990, which prohibited the secretary of the entiror from granting permits to drill off the coast of north carolina for 14 months. the supreme court justice writing the opinion decided that was a material breach of the leases, that the lessees had a right to rely on the law

at the time the lease were issue and therefore thelessees recovered all of their expenses. so this is an important matter and i would encourage that. >> i will tell all witness, your full statements will be made part of the record. and if there are additional things you feel should be added, we'll keep the record open for that. professor tom gallagher is professor, in london, new hampshire a neighbor of sorts, i've been many times there and new london is a beautiful community. prior to serving colby czar college he served as dean at

the law school of tennessee. is that correct? >> that. is >> professor gallagher, go ahead, sir. >> chairman leahy, ranking member sessions, senator whitehouse and other members of the committee, thank you for inviting me to appear before you today. my name is tom gallagan and i'm president of the college in new hampshire. we are forced to ask whether our laws are fair, consistent and up to date? do they provide adequate compensation? do they provide proper incentives to ensure investments in safety? an analysis of the relevant laws reveals a climate oment -- climate of limited liability and a possibility of increased risk. let me begin with a discussion of wrongful death recovery for seamen under the jones act and anyone killed on the high seas under the death on the high

seas act. both of those statutes were passed in 1920, another era. as you said and chris jones said, neither of them as interpreted allows recovery for loss of society damages to the survivors of those killed in maritime disasters. loss of society are damages for companionship, for the loss of care, comfort, and companionship caused by the death of a loved one. the majority of american jurisdictions today do recognize some right to recover for loss of society damages in wrongful death. but not the jones act and not dosa. a spouse, child, parent, or a sibling who loses a loved one suffers a very real loss and the law should recognize that loss. as chris jones also noted, there is one exception to the rule barring recovery of loss of society damages under dosa. in 2000, after the korean airline and t.w.a. air disasters, you retroactively

amended dosa to provide recovery of loss of society damages to the survivors of those killed in high seas commercial aviation disasters. but for anyone else killed on the high seas, on a cruise ship, on a ferry, on a semime submersible floating rig or on a helicopter, the survivors do not recover loss of society. the law should be the same for all and you can make the law the same for all by amending the relevant statutes to provide recovery for loss of society. as i understand, senator leahy, your proposed survivors equality act of 2010 would remedy that inequity. now in fact the climate of limitation fostered by the no loss of society ke re-covery rules has been expanded because some courts extended the jones act and dosa to other maritime contexts and other types of tajs. those courts have done so based

on your supposed intent in 1920 when you enacted the jones act and dosa. those judicial decisions deprive injured persons and their relatives of compensation for very real losses and they also adversely impact the deterrent effect of maritime tort law. amending the jones act and dosa would reverse that friend. now, of course, tort law is concerned with corrective justice. with fairness, with consistency, and with compensation. but it is also concerned with deterring unsafe behavior that poses risks to people, property, and to the environment. tort laukkanen courage efficient investments in safety so that society faces an optimal level of risk, no more, no less. but if tort law undercompensates, it underdeters because when deciding what to do and how to do it, people will consider the real anticipated costs of their

actions. if the law does not force a foreign take account of the costs of accidents when deciding what to do and how to do it, he or she may well underinvest in safety and therefore increase risk to people to property, and to the businesses and to natural resources. undercompensation and underdeterrence in the maritime setting are exacerbated by the ship owners limitation liability act, originally passed in 1851, the act allows a vessel owner to potentially limit its liability to the post-voyage value of the vessel. the act was passed before the modern development of the corporate form and before the evolution of bankruptcy law and its operation today can lead to drastic undercompensation for the victims of maritime disasters. finally, these cumulative problems of limited liability in maritime law might be alleviated by the recovery of punitive damages and the

supreme court has twice in the past two and a half years recognized the right to recover punitive damages in maritime cases. however, the court has limited the recovery of punitive damages in most maritime cases to a one to one ratio between the punitive damages award and the compensatory damages awarded. the ratio cap deprives a judge our jury of the traditionally available ability to tailor a punitive award to the particular facts of the case including the level of blame worthiness, the harm suffered, the harm threatened, and the profitability of the activity. senator whitehouse's proposed bill on maritime punitive damages would restore that particular ability to tailor a punitive award to the facts of the case. thank you and i'm happy to answer any questions. >> thank you very much, professor. let me begin, mr. jones, with

with you. obviously, i thank you for your testimony and you said you are representing one family, but obviously you're standing up for all the families that were affected by the disaster. we talked a lot about the death on the high seas act as one of the few exclusive federal remedies for the families who lost lives on the deep water horizon. the law arbitraryly restricts recovery for the very significant loss of more than a dozen children in all, marne dozen parentsmark widows are experiencing as a result of what happened. if this had been an accident on land, it would have been -- if it had been a refinery on land, there would be protection. if left unchanged, if we're

unable to change the law, what's the practical effect for your sister-in-law and the two young nephews we just saw. >> the way the current law is now if it were allowed to remain in effect as it is, the company the party responseable for gordon's death, they want to go out and get an economist, calculate what his earnings would be, subtract the income taxes we he would have paid in his earning life, his work life expectancy, subtract out what he would have consumed himself, because that's what the law allows and then write a check and walk away. aside from the fact that that may not be enough to support michelle, max, and stafford, it does not allow for the recovery, like many other laws, for united states citizens to recover for life experiences, for the comfort and care that gordon would have provided his sons and the support he would have provided to his wife over the years. >> that's something that could

have suth had it been an accident on land. you're a lawyer, i'm a lawyer, can you tell me any logical reason why it should be different whether it's on the open sea or on land? >> absolutely not. as an example, i'll refer to the b.p. explosion that ooccurred on land in texas several years ago. i believe b.p. paid $1.6 billion to the families of the victims from that explosion. i don't want to speculate what could be recovered by these family, it's certainly not that. a the texas -- in texas, punitive damages were allowed to recover. >> but the deaths are still the same? >> absolutely. >> and to go back to something prfersor galligan said when he talked about the, how careful you are if you're running something like this, there's a

direct corollary, my words, basically but a direct corollary to how much liability you might face. would you agree with that? if you thought, boy, you're really going to have to pay for any psychiatryup you do are you going to be a lot more careful? >> of course. and i'll -- i know this, having had discussions with some of the attorneys involved in this case they want to pay what they're obligated to pay under the law. they want to pay it and move on. i'll give you an example of another family, a family of another victim in this accident, he had no dependents, no children, no spouse, and under the death on the high seas act, potentially the only thing his family can recover is his funeral expenses. because in body was found, that could be $1,000. they could write a check for $1,000 and walk away.

>> we talked about before, trance ocean, they want to -- transocean they want to use the liability act and say we're only limited to the value of our rig, it's down there a mile below the surface, but that's all the value. do you see any logic in that whatever whatsoever? >> i do not. i did file an action in houston, texas, they represented to the court that the value of the rig was zero they hired an appraiser, official appraiser, who submitted a court to the -- a report to the court and said it's worth zero. they want to limit their liability to the sthreefl rig and freight that goes for not just the victims, the families of these victims but also all the economic damages and realistically, the financial and economic impact on the coast and the businesses is going to dwarf any recovery potentially by the families, think of it in bankruptcy context. the families as victims could ultimately at least from the

rig owner recover pennies on the dollar. >> nobody can call that fair. >> absolutely not. >> and we hear the arguments about the increased liability or increased regulation is going to make production more expensive. let's be serious about this. do you have any doubt in your mind that b.p. could have and should have done a lot more to ensure the safety of the people on that rig? >> what i'm shocked at is their profits. we're talking about billions of dollars here. billions of dollars in profit. and for something like this to happen and cause such a dramatic impact on the lives of so many people, including the families of the victims and all the people that have been impact aid long the gulf coast, it's mind-boggling how they can

throw up their hands and say they could not have anticipated this or not had the resources in place to prevent it. >> we'll come back to this but just speaking personally, we sometimes forget we let the motive -- the profit motive outweigh the lives of people, not just the 11 people on there, but all these families who have played by the rules, generation after generation, fish and otherwise use the resources. they played by the rules, we expected them to play by the rules they did what they were supposed to do. somebody didn't do what they were supposed to do and ruined them -- it for them. senator sessions. >> thank you, mr. chairman. i agree with you. -- i agree with you, mr. jones, that the size and financial

scope of this industry, the risk that drilling presents, indicates to me that the company -- this company in particular, i don't know about the others, but i'm worried about it, failed to invest sufficiently in insuring the safety of their employees and i believe that that is something which must change out of this whole experience. mr. coleman -- or maybe, professor gallig nambings. -- galligan. the question of punitive damages, mr. jones says that you're limited to only compensatory damages, supreme

court case did hold that punitive damages are recoverable but limited that to the economic loss, one to one ratio? >> not just the economic loss, but the compensatory damages. whatever compensatory damages were awarded, the one-to-one cap is the punitives could not in most cases exceed the award of compensatory damages. i think that traditionally, let me expound on this a little bit, traditionally punitive damages have not been able under the death on the high seas act or for jones act seamen. a case called atlantic sounding, decided last summer make open that question up again, but in dombings sa cases, punitive damages may not be available at all so the one-to-one cap may not apply there. but in other cases, yes, sir, one-to-one.

>> mr. coleman, i've offered legislation, i think similar to senator whitehouse's, that would raise the $75 million cap retroactively. congressional research service says that's constitutional. the deputy attorney general, mr. pirelli, testified recently at the energy committee hearing, when i asked him about it, that he thought it was constitutional, although the department of justice had not recommended a retroactive legal policy. and -- but i have to say, some of my staff doubt that. as a matter of fact, some of my staff think it is unconstitutional to retroactively do that. i'm a little concerned, that's why i asked the deputy attorney general about that. what is your view about the ability of congress to alter

the liability to $-- the $75 million limit? although i would note b.p. had repeatedly and insentently said they will not be bound by and will pay whatever the liability is. >> yes, senator. with regard to the constitutional questions, they are more, i think, more difficult than the contractual issues. as i remember, the associate attorney general said that there was more liability potential for the government in the contractual base than on the constitutional issues. i have -- i would say i would agree with your saff that there's more risk on the constitutional issues than what the testimony that you've had before the congress to date. however, i am very confirmed that on the contractual, on the breach of contract issues,

which would come into play in the case of -- court of federal claims case, that any kind of change, material change to the open damages, $75 million limitation, would be a material breach of the lease and would open up the united states to enormous damages. >> well, it's just something i think we need to wrestle with. i've always believed we should not offer legislation we reasonably believe is not constitutional, even though it may sound good at the -- at the time and something we may like to accomplish. i'll continue to review that.

professor galligan, it's generally easier, is it not, on a question of initial liability, under the jones act, for a plaintiff to get in the court, whereas if you have an accident on the shore, that your proof of negligence is very real and can be a complete bar to the plaintiff going forward. traditionally, having been on the gulf coast like i have, in mobile, for most of my legal career, i've been aware that it's easier to make out a case and to avoid this miss -- avoid dismisal of a case or summary -- dismissal of a case or summary judgment is that a compensating reason for some lack of equality in actual damages recoverry, you have an easier -- recovery if you have

an easier basis for the lawsuit? >> i have never seen in the legislative history any indication at all that congress thought when passing the jones act that by possibly easing the burden of the plaintiff there was some quid pro quo with other recoverable damages. however, i would also say this. first you have to establish that you're a seaman. and that is not an easy hurdle to clear system of first, to have the availability of the jones act claim, you have to establish that you are a seaman. what you are talking about is that in an fela case, federal employees liability act case called rogers many years ago, the jones act incorporates the fela, the supreme court said you could recover, if you could prove cause in any way. caused in whole or in part and that has been interpreted to slightly reduce the burden of proof on causeation for the jones act seamen but first that

he or she has to establish status, then they have to establish a breach of duty of reasonable care that same rule does not apply in a general maritime law case if the claim is unsea worthiness -- is on sea worthiness of a seaman or a general maritime tort law claim filed by any other than a seaman nor does it apply when a seaman seeks to recover from a third party. it is limited to a seaman versus an employer. >> my time is up, if you'd like to comment, mr. coleman. >> i don't have any comment that would disagree with what professor galligan said. >> thank you. >> senator whitehouse. >> thank you, mr. chairman. thank you again for holding this hearing. mr. jones could you tell me a little bit more about the circumstances that exist right now between b.p. and your

brother's family? you indicated that he worked for a contractor, contractor to b.p., presumably? >> correct. correct. >> and if you could answer that in the context of the limit on economic damages, that b.p. has been so noisy about saying that it would not be bound by that it would go beyond the $75 million in economic damages and make sure that everyone affected by this was made whole, i think that's been their corporate statement in terms of its measure against your family's experience. what do they see? >> every time i wake up in baton rouge and open up "the advocate" i see a full-page ad from b.p. is that that says they'll make things right and pay all legitimate claims and

we sat through a hearing where they continued, repeating that saying that they'll pay all legitimate claims. i don't think they're referring to our family's claim. i don't think they've made no overtures to us, i've never spoken to anyone from b.p., they've made no effort to speak out and extend their sympathies. >> say that again? >> no one from b.p. has contacted anyone from our family to extend their sympathies. i'm not asking them to take responsibility but they made it to the memorial event, a couple of weeks ago, i heard that they were there but we haven't heard from them. >> you haven't. ok. how does the contractual

relationship intervening between gordon and b.p. affect this, in your view? >> first things first, i'm not a maritime attorney, i've learned a lot about maritime law in the last month and a half, of course,. it's my understanding there's a -- an agreement between the contractor and b.p. whereby there's potentially some type of indemocratnyity but gordon's family -- >> meaning b.p. has agreed to indemocratny fi? >> or swako agrees to indemocratny fi that. but i can't speak on that, i haven't seen documents to that effect, it's what i've heard. as far as gordon's family, they have potential recovery against his employer under the jones act and then -- >> limited recover -- recovery only to the formula you described with future earnings. >> then a claim under the death on the high seas act regardless

of what claims he has, there's a cap and he cannot recover anything more than that regardless of who is at fault and what percentage of the fault lay, we ultimately determine down the road there may be some subrogation claims from one party to the next but there's a cap and they can pay that and go home. >> and somebody killed in an air travel accident would not face that cap? someone killed in a traffic accident in louisiana would not face this cap? this is a cap that is narrowly falls on this group of victims? >> it's unfortunate that a catastrophic event is what precipitates this legislation, and that's why that specific exception to the -- to dosa was made and introduced and passed in 2000, after a tragic event much like this one and that's why we're here today is to ask

for that same amendment so that everybody who perishes in federal waters is protected equally under the law and allowed to recover nonpecuniary damages in which case there is no cap, that cap is determined by the jury. >> do you have any reaction by mr. coleman's reaction that tofertse make things right to mr. gordon's family would lead to impairment of the contract that b.p. has with the united states government and we should not address it for that reason? >> well, like i said, i anticipate that all the companies involved and responsible for gordon's death are more than happy. i heard they made a grant of $500,000 to l.s.u. to mitigation efforts. i'm sure there are' more than willing to pay what they're obligated to pay under the law to the families. as far as everything else i don't really have much to

comment. i have personal thoughts, but, you know, that's generally how i look at it that they want to pay what they're obligated to pay under the law. it's almost like they're strained from doing any more and hiding behind that. >> well, i appreciate that. senator feingold. >> thank you, mr. chairman, for holding this hearing. i want to thank the witnesses for joining us. mr. jones, i want to express my most sincere condolences to you and familiarityly on the tragic loss of your brother. this tragedy, which resulted in the loss of 11 lives and now biggest environmental disaster in united states history highlights the need for improved regulation and updated laws, restarters, as the witnesses have indicated, we need to make sure that the oil companies are liable for their actions. one way to deter wrongdoing and encourage the kind of responsible drilling we need is

to decrease the oil spills. and i am the co-sponsor of senator menendez's legislation to do just that. i appreciate the witnesses' valuable suggestions. we also have to end the cozy relationship between the federal government and the oil companies it is supposed to regulate and oversee. that means getting end of giveaways for the oil and gas industry and means making sure that regulators aren't simply acting as a rubber stamp. too often the federal government ends up listening more to the powerful industries that is supposed to be regulating than the consumers it's supposed to be protecting. so whether it's wall street or big oil or calling -- who are calling the shots, the results are rarely good for my constituents in wisconsin. trr many other actions we need to make, such as passing my use it or lose it legislation, to make sure they're exploring the federal leases that they currently have and restoring the clean water act which is

the main statute to prosecute pollutors who dump oil in the waters of the united states. in your testimony you talked about the strong laws. and attorney general holder said the federal government is undertaking a criminal investigation in the gulf oil spill and the clean water act is something to use. given the oil companies' sizeable annual profits, does a maximum $25,000 per day fine, as the act provides, appear to be a deterrent? >> i think you have to look at the whole package of deterrent measures that are in place. so you have to look at criminal laws, regulation and regulatory fines and civil loiblet. i am not an expert in administrative law. however, 25,000 dollars a day does not sound like an awful

lot of money in light of the terrible things that we've seen in this and other environmental disasters. >> i wanted to talk to you about mr. coleman's testimony about receipt row actively increasing liability caps. senator sessions also inquired about this. it contains a provision that seems to give the federal government to modify the $75 million damages cap without raising breach of contract or constitutional concerns. section 1018-c states nothing in this act shall in any way effect or be construed to effect the authority of the united states to impose additional liability or additional requirements relating to the discharge of oil, end quote. do you agree this is a significant provision? >> i do agree this is a significant provision. i am not a lawyer on this so i cannot respond on the contractual issues. on the constitutional issues,

it's my understanding that as long as a piece of legislation that's being imposed does not violate a fundamental right, that it will be reviewed by courts under a rational basis test. you ask if any enabilityment be rational. you look at the policy reasons that underlie the decision to apply retroactively. here, let's take the death on the high seas act, to make it compensatory would be rational bay sees. >> i agree for that. let me say that may 12 memorandum from c.r.s. be entered in the record, mr. chairman? >> without, objection. >> i have double approval there. mr. jones provided some personal moving testimony. mr. galligan, you made suggestions how congress should update the law.

do you think this needs to target all vessels or drilling rigs? >> i think all vessels on the high seas because that would encourage consistency. god forbid there should be some disaster involving a cruise ship but it would be tragic in five years that happen, another group of people before you say that cruise ship victims are treated differently than victims of maritime or environmental disasters. >> i thank you, professor. thank you, mr. chairman. >> thanks, mr. chairman. mr. jones, i've been on this committee for 12 years and we've considered this this issue issues, issues of medical malpractice, meezeo theelyomea froms a pest oast.

i've never accepted lowering the cap and fought it for 12 years. i say the appearance of your father and yourself and your testimony in five minutes did more to make the case that i've ever made in 12 years. showing those photos of your brother's family and your brother, photos that would be shown to a jury i hope will start to convince some in congress that we should cap the amount of money that can be awarded to a family like that for the loss of your brother's life. so if for no other reason i thank you for coming today. i think you've had a profound impact on all of us. i sincerely regret your loss under these circumstances. i do believe your brother's family is entitled to full recovery from their loss in this. although money just won't buy your brother back. you know that as well as i do in your testimony. mr. coleman, i'm trubblet --

you have a tough responsibility here. are you in position, which is not that popular, so i respect you for coming here and giving it your best professional effort. but i would say that there is one sentence in your testimony that troubles me. particularly troubles me. you say on page 15, i hope our political leaders will not implement what i believe to be reckless policies that would impair such an enormous source of jobs and revenue. i want to tell you what i've heard. the leaders of major oil companies other than b.p. are telling members of congress and this administration privately that what b.p. did in this circumstance was to materially misrepresent their capacity to stop this type of blowout in the permits filed with the federal government. and further, to engage what i consider to be reckless misconduct in establishing a blowout preventer that was not redundant, clearly failed, and

that now has contaminated one of the most magnificent bodies of water in the world today. so i'd look like for you to balance for a moment the reckless misconduct, as i see it, on the part of b.p. with what you characterize as the possibility that we will enact reckless policies, reckless policies like offering to ms. jones' family, the loss of companionship, as this father and husband is gone for the rest of their lives, reckless policies like suggesting that the current cap on liability does not even come close to measure the loss that's going to be part of this disaster in the gulf of mexico. can you really put these on the same level, the conduct of b.p. and their reckless misconduct and what we're suggesting as changes in the law? >> senator, thank you for asking the question. i also a native of the gulf

coast of the state of mississippi have enjoyed the gulf coast my entire life. certainly my comments in my testimony were not directed toward the jones act issues. they were dealing with the oil pollution act question of lifting the $75 million damages limitation. in my testimony i did not come out against an increase in that for future leases. i was dealing with it from a contractual oil point of view. and the great damage to the industry that would come about from a $10 billion cap or unlimited cap on damages in addition to the full response cost. >> let me ask you this question. if we follow in your logic here and did not increase the cap on liability and what you characterize as a small or

medium-sized drilling operation engaged in the same type of activity in b.p., resulting in the same level of damages, who do you think should pick up the cost of that? >> senator, as you know and actually i was involved in reviewing the various drafts of the oil pollution act at the time and helping the department of the interior to determine what its position should be, i was part of the team evaluating the exxon valdez and looking at the federal government to go after exxon. this is not a matter new to me. but i do have to say, and i do believe that the caps potentially that were set in 1990 which the government -- which the congress gave the executive branch the ability to increase over time by regulation, which they failed to do, they probably should be raised some. but -- >> who is going to make up the difference? who makes up the difference? if a small or medium-sized

company does the same type of drilling operation, incurring the same type of damages as b.p., are you saying taxpayers have to pay for it? >> under the oil pollution act, above the damages limitations, the excess claims go to the oil spill liability trust fund. >> what is the current balance? >> current balance i understand is $1.6 billion. >> and once we exhausted that, who pays the difference? >> under the law that is the end of it. >> it's not the end of it. it's the taxpayers. >> i will add, though, as we have had discussion today earlier, this is just dealing with the federal claims under federal law. the state law claims are unlimited. and those, particularly in this case, are probably likely to be larger than even the federal law. >> mr. chairman, thank you for giving me an additional minute here. i happen to believe if you're engaged in drilling and can

create this level of damage it carries with it a responsibility that you accept liability for the damage. if you cannot accept that liability, stay the hell out of the business. thank you, mr. chairman. >> you may end up with billions of dollars of profits. senator clobe char. >> mr. chairman, thank you. -- senator klobuchar. >> mr. chairman, thank you. you actually argue that retroactively you don't believe we could change this $75 million cap, is that right? >> you can do it. congress can do it. it's just that you can't do it without paying for it. there will be a contractual price to doing it. this is similar to what the supreme court said in the mobile case. congress changed the law after the fact which they had the perfect right to do, but there

were contractual repercussions, contractual damages that the government incurred by that congressional action. >> well, mr. galligan, others and i disagree with that. i want to clarify mr. durbin's points, if in fact we don't change this, if we're unable to be doing this retroactively, who is supposed to pay this $8 billion, $10 billion that b.p. cost in damages? >> once again, the damages limitations retroactively against the lessees, my firm belief, would be a breach of contract. however, there are other options. one of them has been suggested by senator individualer, an offer to change their liability limits on this contract so congress can enact a law that accepts that offer. senator one is, of course, the oil spill liability trust fund. that does not raise --

>> isn't this the one that you just told senator durbin has the $1.6 billion in and we're looking at almost $10 billion for this right now? >> you could adjust it and make it retroactive and claims from this accident could be paid from that and provide additional fees or taxes to support that. >> let me give you some other facts that makes us concerned about having b.p. tell us that they are going to do something. i am looking at the exxon valdez spill. i am familiar with the case because the law firm that represented the fishermen is in minnesota. b.p. has said it's going to pay all legit mate economic claims but exxon made the same statements after the oil spill in alaska. it then proceeded to litigate the claims brought against it for nearly two decades. what do you think we can do to ensure that families like the joneses will have a swift resolution of legitimate claims

of b.p., transocean and other subcontractors, because exxon was same the exact same thing? >> i am certainly not involved in the claims process, senator. i did happen to see the testimony at the house judiciary committee from the b.p. representative. that's basically what i understand is these claims are filed with b.p. if they pay them, then they pay them. if they don't, they are rejected and sent to the coast guard for payment under the oil spill liability trust fund. i'm not sure what else you might be asking. >> it's that companies make claims, take big ads out and say things, we can't assure that the joneses will be accounted for. i'm confused that transocean has seeked its liability under the limitation of liability act

that 1851 law that would limit transocean's liability to $26 million, as has been discussed. should we repeal it and how do you respond to some of the things that mr. coleman said? >> let me start by saying what i said before is i can't say things about the breach of contract claims. i was speaking more from the constitutional sense. let me also add when you talk about claims, and i don't think anybody said this yet, and it's really important, open 90 does not apply to personal injury and wrongful death claims. open 90 does not apply to personal injury and wrongful death claims. that would be maritime law and maritime tort law solely. as to the limitation of liability act, i mentioned in my statement it was passed in a very, very different historical context. it was passed in 1851 to encourage investment in

maritime shipping and commerce. the corporate form hadn't developed. bankruptcy law had not developed. so you ask yourself today, is that law still salient from a policy perspective? and what happens is the ship owners starts a concursive proceeding in a federal court somewhere and someone that has a claim has to file that claim in that federal court. what then happens is they say, we want to go back to state court for some issues and they he want into stipulations and come back to federal court. it's an expensive, time-consuming, slow process. >> mr. jones, i'm sure that isn't good to hear. i just want to assure you that we will do everything we can to help your family. i was just struck by senator

whitehouse's comments, did you get anything in writing for them? how long did your brother worked for them? >> he had worked for his particular employer for about five years. he had worked on that particular rig, which was operated by b.p., for about two years. and for that time he had helped b.p. make a lot of money. you know, the only reason i heard that the b.p. executives were at the memorial event, i didn't see them until after when they were running out the back door in dark tinted window s.u.v.'s. >> anybody people killed on that day got any communication? >> well, i came face to face with some of the other families. it was awkward and uncomfortable situations. i had discussion with some family members, not all. i can't really speak for them.

>> i'm so sorry for your loss. thank you for being here today. it made a difference. >> thank you very much. senator franken. >> thank you, mr. jones. and all of us appreciate your being here and express our condolences to you and your dad and your entire family. mr. coleman, as i understand from your written testimony, you're saying if we change our liability laws it's going to place an unacceptable prohibitive cost on oil companies. but someone needs to bear these costs. what you're saying is these costs should be born by mr. jones and his family, by the

fishermen, by oystermen, by the homeowners along the coast. don't you think that the oil companies who make such huge profits should be the ones bearing these costs? >> senator, i appreciate the question. as professor galligan mentioned, the question of the loss and the claims of the family are not involved in the issue that i was addressing which is of damages liability cap under the oil pollution act. however, of course, loss income by fishermen and other activities is involved in that. certainly i'm very concerned about the -- and extremely concerned about the loss of income, not only for the individuals -- >> well, you write to non

pecuniary damages, if those were allowed, loss of comfort, those kinds of things, it would impose a burden on the oil companies, on mom and pop companies. that's what i get from your testimony. >> i did not address that issue at all in my testimony, senator. >> well, in your written testimony you were questioned if it imposes, quote, an unacceptable threat, under, quote, current conditions that would justify moratorium. are you saying that the b.p. rig was operating in such an irresponsible and reckless fashion that it was wrong and such egredgeyussly neglect manner that -- egregiously neglect manner that it would be irrational to put on a six-month moratorium on new deepsea drilling? >> once again, thank you. the question -- my statement with regard to that had nothing

to do with the facts of the b.p. case. because i don't know the facts. i am not the investigator of it. >> you write that -- >> those will be determined. >> you write, a six-month drilling moratorium because under the conditions the deepwater horizon poses an unacceptable threat of irreparable harm to the environment is highly questionable. what questions here is an unacceptable death? the fact that many deepwater drills have been drilled -- you're speaking exactly to that. and what i'm asking you is the b.p. -- if what we've just seen here, such an outliner, that we shouldn't have a six-month moratorium? >> that's exactly what i was discussing. senator, you're exactly right. >> you just said you weren't

discussing that. >> well, i wasn't talking about b.p. that is an aberration. >> it's an aberration. let me ask you this, if eight weeks ago someone had said we should put a moratorium on deepwater drilling, would you have said yes? >> i would absolutely say no. and i still say no because -- >> have you been looking what's happening in your beloved coast? >> i absolutely have. but what we have -- >> so in retrospect you would not have stopped that drilling? i'm asking you if eight weeks ago you would have stopped that drilling and you say no? >> i would not because we have to be bound, senator, and the administration has to be bound by the regulations in place and the contractual rights of the lessees. >> look, we're -- >> i want to hear the rest of mr. coleman's answer. >> the -- what matters from a contractual point of view -- and this was an issue.

what was a nets to leasee say in the mobile case? that was extremely important before the supreme court. if you take away a contractual right based on a regulation that you cite and says it means one thing and it doesn't mean that, then you've not followed the law. so what i have been addressing in that -- in those questions that i included there is they cited that there's an unreasonable threat and risk of damages. if that's what the outer continental shelf statute cited, then we can't have any drills at all because there would be risk of a blowout. that's the point i was trying to make. there have been 3,000 or 4,000 wells in this water depth that was similar to it without ever having a blowout. is that an unreasonable risk?

and i would say from my legal judgment it is not an unreasonable risk to allow more drilling. >> senator franken, i interrupted. please go ahead. >> since we have so little time in these questions -- >> i'm just giving you more time. >> yeah, i understand. mr. jones, if eight weeks ago you were asked should we put a moratorium on drilling and in retrospect, what would you say now? >> eight weeks ago before the explosion, of course. >> of course. >> we would still be here. >> right. so it's a very different perspective, isn't there? i mean, i don't understand your reaction. you know, there are other b.p. deep wells. what i'm asking you is, is the conduct, the way this rig was run so different from all the

others that doesn't warrant a look at and a moratorium on this kind of drilling so that we learn our lessons from this and prevent it from happening again, or are you willing to let this happen again? >> senator, what i was saying is we've had thousands of these similar type of wells drilled. there were obviously something very unusual that happened on this one case. obviously it needs to be fully investigated and whatever adjustments need to be made they need to be made. but we have through our experience shown that this type of drilling is a, in the scope of comparable things, is a very safe way of producing energy. >> thank you.

i'm done using my time. >> thank you, mr. chairman. i just want to follow-up on that thought, i think if you had 3,000 wells out there and a well went down you'd say it's one in 3,000. but your testimony is quite eloquent in talking about incentives, that we have to have the proper incentives for offshore drilling. >> yes, sir. >> it seems me that the one thing that i noticed about the way things can happen in our present society, we don't have disincentives for bad bamplete and i think -- behavior. and i think what senator durbin said earlier, one of the things we are concerned about, how do we have the disincentive for the bad behavior? and could you just give me your thoughts on how you think that there should be a disincentive? if we sent a message after this example that really b.p. can

get away from this thing for a relatively minor, are you concerned that a corporate board room somewhere in the future -- and i'm not talking about bad people. i teach a course at duke law school with m.b.a.'s and law students and m.b.a.'s are very concerned about the fact that you have to look out for the shareholders' money. you have an obligation. so if you're sitting there and you're b.p. and you're looking at what's going to happen if in fact you don't do the proper safety, you don't have the people out, b.p.'s been accused of in a number of cases in saying, go ahead, we need this well, we need it fast, we need it produced, don't worry about the concrete, don't worry about doing a relief well, does that concern you at all about the current liability structure? >> senator, i have -- i am a strong believer in regulation, inspections, aggressive inspections. i do have questions as to

whether the inspections were handled properly on this situation. certainly one of the things that could be done is send out the inspector, to be there to test the blowout preventers and make sure that works before you start drilling. i think that would be a commonsense -- just one thing, among many others. certainly penalties -- and there are numerous statutes for failure to perform. >> what about a private sector -- you're a private sector guy. what about a private sector approach that says, well, the government is going to do all that, but why not have trial attorneys out there trying to make sure this happens. and in order for them to be involved they have to incur damages, what do you feel about that? >> i must say, i found that the private sector bar is very adapted to doing, you know,

taking on that role. they do it aggressively. i don't have a criticism of lawyers taking the opportunity to see that the government and others and private sector implement the laws. >> you wouldn't be opposed -- there's an idea out there that maybe it's a liability that the private sector could operate against punitive damages and things like that that may have a value, where we're talking about the economic value or not, that it is a disinseptemberive for a corporation to decide what they're going to do if they know that the payoff will be greater and isn't it important in terms of this b.p. case? isn't it important that we send a clear message -- taking your approach, which these are wells, 3,000, no problem, but we have this one. it really went bad. so if you're in the oil business, you're out drill in the gulf and you drill a well and you don't do the proper things, that you're going to have to pay a major price for

that? mr. jones' brother, the fishermen, isn't there an economic -- straightup economic reason that b.p. should pay a major price for this problem? >> i agree from a public policy point of view there needs to be a major price to be paid for this kind of accident. and i would submit to you that there is -- i think everyone is seeing that there's a major price. not only has their share value gone down tremendously, they are projecting -- i've seen projections to $30 billion-some-odd that may have to be paid under current law for -- by b.p. for what's happened heemplet i do think that the idea there's not enough -- not a significant price to pay is not accurate. >> right. >> oh, but you say there should be a significant price to pay when you make a mistake like this? there's incentives for drilling

in the gulf and disincentives if you make a mistake. >> i agree. and our current law sets up those very significant prices to pay. >> thank you. mr. jones, with others, i'm sorry about your loss. it does bring home to people. just in talking to the families, is there any anecdote of how safety was handled on that rig? >> well, i haven't had really much of an occasion to speak to a lot of them. and those that would have known about that are no longer here. we've had some discussions with some of the survivors. some of the folks who were rescued that came through the visitation line which really wasn't an appropriate time to discuss that. and quite honestlyy we have not had a lot of time in the last month and a half to have those questions. i've had a lot of anecdotal evidence, emails, comments made

by a lot of different sources as to what happened. you mentioned the b.o.p.'s but the b.o.p.'s didn't cause this. they failed to prevent. so there's a lot of stuff that went wrong well before that happened. so there's a lot that's going to play out in the months and unfortunately years before there's ultimately, you know, results here. and michelle and her boys can move on. >> you know, we hear a lot of testimony, senator feingold said, this is a lot like wall street. there is a common theme that weaves its way through these things. it's washington's fault. we didn't have the proper rules, we didn't have the proper regulators. we heard from washington mutual. it's almost like -- and i agree we do not have regulators. i agree. you hit it right on the nail.

it's like cops on the beat. it doesn't mean you can break a window, steel jewels out of the thing. the idea there weren't regulators, i'm big on the fact that we have regulations just like we need cops on the beat, referees on the football field. we just need to do that. mr. coleman, i am not accusing you. we have to understand that it was washington's fault. and because it wasn't a cop on the beat we can do whatever we wanted. we can't worry about safety. i think it's important that we have a responsibility and i think corporate america did not have an -- did not have the ability to go in and do what they did because they weren't regulators on the beat. thank you, mr. chairman. >> thank you. do you have a further question? >> a few. professor galligan -- president

galligan, is it reasonable to assume to maximize their own economic self-interest? >> i think that's what they exist for. obviously they are concerned about societal's interest but the definition is to make a profit and there's a dutyy to the shareholders to do so. >> specifically they are under a dutyy to their shareholders to maximize their own economic self-interest as a matter of law, correct? >> correct. >> if we swift to the question of criminal restitution, criminal restitution, i believe this is a laydown law, it has other criminal consequences, is there anything that prevents criminal restitution, the resolution in the criminal case from supplementing areas in which there is an unnecessary or inappropriate cap or

restraint on liability that's reviewed by these facts, for instance, to the gordon jones' family? >> i am not a criminal lawyer but i am not aware of any limits. but at the same time i am not aware of any creative cases in which that kind of restitution has been liberally extended because there are constitutional issues regarding a criminal defendant. >> mr. coleman, the exxon decision cut very favorably towards the oil industry by limiting unlimited punitive damages. did that affect any existing agreements? and shouldn't the government have renegotiated at that point existing agreements because of material changes and its contractual relationships? >> i don't see that affected the contracts that the government has. >> all right. let's hypothesize that we were here putting a restriction on liability, that we were

reducing -- saying $75 million applied not just to economic damages but to other damages as well. if that were made here, if we were considering a piece of legislation to reduce liability, would you be here arguing that that was a material impairment of the contractual relationship between the government and the corporations and that, therefore, the government was supposed to renegotiate to those in the change? >> senator, if the congress were to have reduced the $75 million down to $35 million or something like that, then the $75 million remains the contractual deal, but from a legal perspective, they would not have to pay more than $35 million. and so it would not -- >> so what you're suggesting isn't a one-way wrap sheet. that works in favor of the corporations and against the government in every circumstance in which the government acts -- the congress acts with respect to a contract

with the government? >> while there would be some exceptions, and this would require some lengthy briefs. >> but generally you would have a one-way wrap sheet that would work in favor of the corporations and not in favor of the government if they change the terms of the contract? >> it's two parties to a contract. if one makes a unilateral change -- same if the private sector party to the contract said they were going to make a change and they quoo repudiate the contract just as the government does, the government would be entitled to damages. so it's not a one-way street. it works both ways. >> well, works only one way from congress' perspective and that's in favor of the corporations under your theory. the final question i'll ask is for mr. jones. you mentioned the blowout preventer. we're told that in norway and in brazil and in places where there's considerable drilling there's a device called an

acoustics switch that's required that is a safety device that encourages the oil -- and that the industry argued vociferously against it because it costs $500,000 for that piece of equipment. i just want to put that in the context of b.p. first quarter earnings this year. they earned $5.6 billion in the first quarter of 2010. for that, they could have bought 11,000 of these devices that are required in other states. instead, they argued against being required to buy one. how do you feel that the incentives and economics work in terms of how this affected the safety on the deepwater horizon? >> well, from a purely economic

perspective, i personal feel that if you're going to play and you're going to make billions and billions and billions of dollars, they need to pay to avoid the they that mr. coleman mentioned. even though this is an aberration, it's not an aberration in my life. it's not an aberration in michelle and the boys' life. any threat is too much from my perspective. i know that other people think differently about that. i don't sitting here today for the reason that i'm here. i don't think that way. i think that half a million dollars is nothing compared to the loss that we've experienced and all the other families have experienced. >> thank you, mr. jones. thank you, mr. chairman, again. >> senator, do you have more questions? >> yes, thank you. thank you, again. i was going back to where my last questions was more

specific in how the law works. i was thinking about this $75 billion cap and we will try to find other ways to do this. the question is whether b.p. would have acted so recklessly if they knew there wasn't a $75 million limit, if they could have foreseen damages and that they were in a comfort zone because they knew their maximum liability would be for so much, would they have put in a backup blow yut preventer, other safety measures that would have prevented this disaster. i'm looking at this how do we best incentivize in a free market these companies to do the right thing. obviously we wanted them to -- if you have a free market then they pay for those damages. professor galligan, do you want to start with that? >> yes. the whole lawn economics theory

of tort law is based on what you just said. which is that for there to be an effective optimal deterrent scheme in tort law you have to face the full costs of your activities because when you decide what to do and how to do it, if you don't have to pay a cost, if you see a cap, if you see a liability limitation, it is rational as an economic actor to not consider that cap. that's the basis of the judge's work on law and economics. and law and economics, as you know, has become one of the prevalent theories, along with correctives justice, with tort law. >> and i took a class from professor easterbrook. i keep going back to that and it seems the an tit cis. it seems being from the midwest

and the ethanol industry, they have to have insurance. i am not sure they have some major law in place if a ethanol plant blows up that they would have the federal government coming in and protecting them with a liability limit, i want to look at it. i know they have to get insurance but i haven't heard that they have the protection of these liability caps. so it almost seems like we're picking one industry over another. are there other energy industries that have these liability caps, professor galligan? >> i cannot -- none that i am aware of to this extent. i am an expert in maritime and maritime tort law. what you see here is the accidents of time. a statute passed in 1851. statutes passed in 1920 that have not really been re-examined and reconsidered except in limited context and now a chance to look at them comprehensively. >> now, this issue of small oil

and gas producers, we don't want everyone to be big. mr. coleman said they could make the liability. sometimes if you have a smaller company then they have a different role to play in exploration. maybe they're doing things less risky so they can afford the insurance because in the end it seems inconsistent with free market principles to allow companies to externalize the risk of oil spills and pass it on to society. do you want to comment on the size issue? >> i think you're right on the size issue because i think the key issue is not size but safety, and if whether large or small, the entity is up able to invest in safety, then i think we want to deter those operations because we want to have a sufficiently safe world. we have expectations about risk and we want those expectations

to be consistent with fairness. i think it goes hand in hand with the safety issue. >> mr. coleman, do you want to respond to any of this? >> senator, thank you. you know, with all due respect, all these things -- the world is filled with risk. and so if we -- you know, if we don't -- if we stop doing things that add risk to them, then we won't do much. there are many industries and many activities in the commercial world that have limitations on liability. certainly the nuclear industry has limitations on liability. the shipping industries. it's all a matter of balancing. i understand the difficult role that people in congress -- >> ethanol, solar, wind, do they have the limit? >> i don't -- not sure whether the ethanol. i don't think that the solar and wind folks do. they're not in a particularly

highly risky endeavor. >> interesting. that's probably true. but even what the wind people -- what the impacts of wind are extremely serious to many people considering the amount of birds that are killed every year by windmills. so everything has its own -- if you don't have this offshore oil and gas production in the united states, 1.7 billion, 1.8 billion barrels a year, you'll have a lot more tankers. that's the matter it's going to be for decades. the fact is the national academy of sciences says that's a more dangerous way for the environment to have this oil brought to this country. >> and you know, mr. coleman, two things. one is i don't think we should stop doing things that are new and taking risk. i just think we have to protect the taxpayers from taking those risks. because it wasn't their decision to go down 5,000 feet and take this risk. and i think we need to protect mr. jones' family from that.

so it's a free market decision of how to make money. i'm' not saying you should ban oil drilling. i'm just saying that we have to assess what the potential damages are. and make sure that the people taking those risks pay them. and there may be other places to drill, in north dakota, i don't know, that would come with less risk that these smaller businesses can do. comparing birds and the windmills to the damage that we're seeing, to not just to wildlife, but to mr. jones' family, i just don't think it's an equal comparison. thank you. >> supposed to wrap this by 12:00. senator franken, please go ahead. >> thank you for indulging me. >> you'll have the last question. >> i take up amy's point. i've never seen a solar panel or a wind turbine kill 12, 11 people. i've never seen a 50-day

ethanol spill. and i think that we have to rethink our entire energy portfolio and how -- and what we're doing to drive the man for oil. i think this is a wake-up call. you say that the american people in your testimony -- this is from your written testimony -- that the american people continue to strongly support offshore oil and gas drilling. cbs poll says 51% oppose it. you cite a rass mudson poll or statistic that 15% support it. offshore drilling as of june 1, did the survey ask people whether they supported deep offshore drilling? >> i'm not certain, senator. >> one you cited. >> i think the question was, do

you support continued offshore drilling. >> and do you hear the president say suspend all offshore drilling? >> the president has suspended everything except in 500 feet of water and 92% of the oil that we have yet to get is beyond that. so in essence he has basically said he's putting a 92% off-limits as of the current time. >> but the survey that you cited, you don't even know. you cited a survey but you don't know what the questions on the survey were? >> i have read -- i read the previous survey that they asked. and this is a follow-along. i guess it was offshore drilling, offshore oil and gas, do you support that? >> the question is, do you think offshore drilling should be allowed? and obviously the president thinks offshore drilling should be allowed. the president would be part of that 58%, right?

>> senator, i think the implication is that the american people -- they're talking about -- they're seeing in context this accident in 5,000 feet of water, that i think is the most reasonable interpretation that they're thinking about that kind of drilling. >> i don't necessarily buy that at all. ok. do you -- there's some people that say -- you say that mostly oil is in deep water, right? >> yes, sir. >> 92%. >> according to the government. >> we've been hearing from certain quarters that the environmentalists cause the deep sea drilling. but isn't it true that the deep sea drilling is done because that's where the oil is? >> senator, as i said in my

testimony, you need to be allowed to be able to go where the oil is. >> i just want to speak to this. we've heard in certain corners, william crystal from sarah palin that the environmentalists caused this spill because they forced the oil companies to drill in deep water. and you seem to be an expert on deepwater drilling. would those statements be true? >> i can just say, i don't know where they got their talking points from, senator. they didn't get them from me. my view the reason we are in deep water is because the united states offshore oil and gas industry has driven the development of technology to produce oil and gas. and as we have driven the technology we've been able to go further and further in the offshore. >> so we're in agreement here. we're in agreement here. i want to end on that. >> that would be great. >> so we're in agreement here

that those people who say that environmentalists caused this spill because they spores forced the oil and gas industry to drill as far away from shore as possible is maybe oh, poppycock? >> i wouldn't say that, senator. >> you don't say that environmentalists -- >> i wouldn't agree with the poppycock. >> ok. so environmentalists -- maybe we don't end up agreeing. >> senator, if it's not poppycock, what is it? >> i think the environmentalists have had impacts on offshore oil and gas drilling. i -- to say they don't have any

impact on how far you drill is not accurate. they have absolutely pushed to a degree getting further away from shore. there are many -- i can tell you -- >> but you say that 92% of the oil is offshore -- is deep, in deep water, and then you say that you have to drill where the oil is, but then you say it's the environmentalists' fault? >> i never said that. >> but then you would say that it isn't poppycock to say -- this doesn't make sense to me. >> if i could, the -- >> i'm sorry, mr. chairman. i know you need to go. i apologize for -- i think i should wrap up, please. >> i'm reminded of the question and i whispered to senator whitehouse when willie sutton who was arrested from bank robbery spree.

asked, why do you rob banks? that's where the money is. why do you drill deep? that's where the oil is. >> mr. chairman, may i ask that two documents, one, a letter to me from john tor combmbings gan from rhode island, and the other a letter from professor susan feredy be made part of the record in this proceeding? >> without, objection. if the senators have follow-up questions or if the -- any of the three testifying wish to add to their answers they'll get to do that. we stand in recess. i thank you very, very much. >> thank you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010]

>> cleanup crews continue to -- affected by the gulf of mexico oil spill which has reached more than 100 miles of beach. this was at the fort jackson bird rehabilitation center in venice, louisiana.

[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> it's the busiest day of the year so far for congressional and governor elections. with 12 states holding primaries or runoffs today. here in arkansas, democrat senator blanche lincoln is in a runoff against the lieutenant governor. voters are choosing democratic and republican nominees like iowa. we'll have live primary coverage of election results when they come in tonight on the c-span networks. new british prime minister takes questions from the house of commons tomorrow morning. we'll have live coverage. prime minister's question time starts at 7:00 a.m. eastern live on c-span2. >> no candidate in this race, democrat or republican, has given voters of new hampshire or the voters of america an opportunit