June 17, 2010 / 4:16 PM / in 9 years

CORRECTED - Some Republicans consider BP deal a US "shakedown"

* Texas Republican apologizes to BP

* White House quickly denounces

* Politically risky stance (Corrects lead paragraph to say CEO instead of Chairman)

By Steve Holland

WASHINGTON, June 17 (Reuters) - The first apology that rang out in a congressional hearing about the Gulf of Mexico oil spill on Thursday was not from BP CEO Tony Hayward.

It was from Texas Republican Representative Joe Barton, who apologized to Hayward for BP’s (BP.N) (BP.L) having to agree to a deal with President Barack Obama to set up a $20 billion fund for Gulf damage claims.

“I’m speaking totally for myself, I’m not speaking for the Republican party ... but I’m ashamed of what happened in the White House yesterday,” Barton said.

He called it “a tragedy of the first proportion, that a private corporation can be subjected to what I would characterize as a shakedown, a $20 billion shakedown.”

Barton’s point was that BP should pay for damage claims but should be allowed to follow the “due process and fairness” of the American legal system.

As Republicans are seeking to pick up seats from majority Democrats in November’s congressional elections, it is a politically risky stance that is bound to be unpopular in the Gulf region, where out-of-work fisheren are desperate for claims payments to survive economically.

White House spokesman Robert Gibbs quickly denounced Barton and called on members of both parties to repudiate his comments.

“What is shameful is that Joe Barton seems to have more concern for big corporations that caused this disaster than the fishermen, small business owners and communities whose lives have been devastated by the destruction,” said Gibbs.

BARTON NOT ALONE

Barton is not alone among Republicans holding this view.

Georgia Republican Representative Tom Price, chairman of the Republican Study Committee, a group of conservative House members, issued a statement on Wednesday arguing the same point.

He said the White House does not have the legal authority to compel a private company to set up and fund an escrow account. The White House has dismissed such criticism.

Price said BP’s willingness to go along with the White House’s new fund suggests that the Obama administration is “hard at work exerting its brand of Chicago-style shakedown politics.”

“These actions are emblematic of a politicization of our economy that has been borne out of this administration’s drive for greater power and control,” Price said.

And former Texas Republican Representative Dick Armey, a leading voice in the conservative Tea Party movement, told a Christian Science Monitor breakfast this week that Obama lacks the constitutional authority to set up such a fund.

“The Constitution doesn’t give that authority to the executive branch.... There are courts for this purpose,” Armey said, according to the Dallas Morning News.

In addition, conservative Republican Representative Michele Bachmann of Minnesota was quoted as telling the Heritage Foundation think tank on Tuesday that the escrow account was a “redistribution-of-wealth fund.”

“And now it appears like we’ll be looking at one more gateway for more government control, more money to government,” she said, according to the Minnesota Independent.

Barton is the biggest recipient of oil and gas industry campaign contributions in the House of Representatives, according to the nonpartisan Center for Responsive Politics.

Its data showed that Barton has collected $1,447,880 from political action committees and individuals connected with the oil and gas industry since 1989.

Additional reporting by David Morgan, Deborah Zabarenko and Jackie Frank, editing by Vicki Allen

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