Who should pay for the BP oil spill?

Sounds like a simple question, right? Not so fast. According to the AP:

Responding to the massive BP oil spill, Congress is getting ready to quadruple—to 32 cents a barrel—a tax on oil used to help finance cleanups. The increase would raise nearly $11 billion over the next decade.

Let's take a quick trip down memory lane and revisit a moment in Pennsylvania history as reported in 2007 by the Tribune-Democrat:

On March 17, 1936, floodwaters fueled by heavy rains and melting snow surged through Johnstown.

The deluge took two dozen lives, destroyed 77 buildings and caused more than $40 million in damages.

And, in a sense, every modern-day consumer who buys liquor or wine in Pennsylvania still is footing the bill for that St. Patrick’s Day disaster 71 years ago.

The so-called “Johnstown Flood Tax,” an 18-percent surcharge on every bottle bought at a state liquor store, first was introduced a “temporary” tax to help Johnstown’s cleanup efforts in 1936.

And the levy, which is separate from the state’s 6-percent sales tax, lives on despite multiple attempts to kill it – and in spite of the fact that the tax’s proceeds have not flowed into Johnstown anytime in recent memory.

The article continues:

The tax originally was set at 10 percent. But instead of repealing the levy when Johnstown’s cleanup was complete, state lawmakers actually raised it twice in the 1960s to the current level of 18 percent.

As Pennsylvania Liquor Control Board’s retail sales have reached record-high levels, so have flood-tax revenues. Proceeds from the levy topped $200 million in fiscal year 2004-05 and rose to $239.4 million in fiscal 2006-07.

And it is not clear where that cash eventually ends up, since it simply is sent directly to the state treasury.

As of the date of the Tribune-Democrat article, 12/15/2007, $5.4 Billion had been collected via a tax that was instituted to pay for $40 Million in flood damage.

This oil spill is BP's fault; American taxpayers should not have to pay a single dime to fix BP's mistake. If anything, the Johnstown Flood Tax should remind us of an old Milton Friedman adage: "Nothing is so permanent as a temporary government program."