WHEN THE oil spill legislation goes into effect, a crucial experiment in regulation will begin. Most of the coastal states' laws say that a tanker's owners have unlimited liability in a spill. The administration wanted to preempt those laws with a federal limit and an international agreement. Otherwise, it argued, the big companies would back out of the business and leave it to fly-by-nights and one-ship operators working out of places far beyond the reach of American law. That, the administration fears, would mean more oil spills rather than fewer.
The Senate has adamantly held to the opposite view, and the bill now about to emerge from conference will follow the Senate's wishes. One reason for its firm stand is that Alaska, site of the Exxon Valdez spill last year, has more power in the Senate than in the House. Perhaps another is that the Senate's majority leader, George Mitchell, is from Maine. He believes that, contrary to the administration's dark warnings, unlimited liability will only make the shipping companies and their captains more careful. The country will shortly see who's right. It will probably be Mr. Mitchell and the Senate.
In a smaller line of trade, the specter of liability might well push the largest and most responsible tanker operators away as the administration fears. But feeding the American appetite for oil is a gigantic business, and the incentives for staying in it are impressive. Most tankers will increase their rates to cover the risk and continue to sail into American ports as before. The slightly higher cost of transportation will be passed on to consumers, and that's fair enough. It's entirely proper that the users of oil bear the costs of spills.
Ships carrying oil have faced unlimited liability in most states for many years. But the Exxon Valdez case has greatly heightened concern. The states saw how much damage a big spill could inflict, and the oil companies saw how high the price of the cleanup can go. The current estimate there is around $2 billion, a figure that would have bankrupted any but the largest companies. That looming example, compounded now by the congressional refusal to limit ship owners' liabilities, is likely to have three consequences: somewhat more expensive oil, a ripple of new business for the insurance industry and much sharper attention to safety on the part of the shipping companies. The first will be tolerable, and the last is all to the good.