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Worst Oil Spill in U.S. History; Where's the Money?

Aired April 19, 2011 - 21:00   ET


PIERS MORGAN, HOST: Tonight, follow the money. More than $20 billion. That's how much BP says it's set aside for the victims of the worst oil spill in American history.


UNIDENTIFIED MALE: We were told, every day, we'll take care of it. We'll take care of it. Until it comes time to pay and deny our claims.


MORGAN: $20 billion for the little guy, the fishermen, the widows, but less than $4 billion has been paid out so far.


UNIDENTIFIED MALE: I hope it works out. But I'm suspicious.


MORGAN: Where's the money? Are the wrong people getting paid? Are enough people getting paid?

I'll ask Ken Feinberg, the man who holds the purse strings.

And how bad is the damage? I'll ask our special correspondent, Philippe Cousteau.


Good evening. By all accounts, this was a pretty ordinary day in the Gulf, boats going out, fishermen hauling in their catch, oil rigs pumping out crude. On the surface, it almost looks the same.

When you go deeper, absolutely nothing is the same. It all changed on the day a year ago when the Deepwater Horizon blew up, killing 11 workers, and flooding the Gulf with 205 million gallons of oil. Even now, a year later, we don't know the full extent of the environmental damage.

Joining me now is Courtney Kemp and Shelly Anderson, widows of two workers killed in the Deepwater Horizon explosion.

And also joining us is Earnest Cannon, Shelly Anderson's attorney.

Courtney and Shelly, first of all, let me offer you both my deepest sympathies. It's the first anniversary since this terrible explosion, which obviously wrecked your lives in many ways. Both your husbands were killed.

I'd like to ask you both from the start, really, how your lives have been able to rebuild themselves.

Courtney, let me start with you.

COURTNEY KEMP, LOST HUSBAND IN DEEPWATER HORIZON BLAST: Well, you know, each day is a new day and I pray that the Lord will give us strength to make it through another day.

I've had a lot of tragedy this year with the passing of my husband, who was killed, and also one of my younger brothers were killed in a car accident so -- five months after my husband. So there's been a lot going on and I just thank the Lord every day that he gives me the strength to make it through that day.

MORGAN: And Shelley, like Courtney, you have two young children as well. What's it been like for you since that dreadful incident?

SHELLEY ANDERSON, LOST HUSBAND IN DEEPWATER HORIZON BLAST: It's very hard, but we get up every morning, through people's prayers, their support, the people that love us, our friends and our family, and people all across the world, who send us their prayers, that allows us to get up every single morning and do what we have to do to go to school and go to work and just one step at a time. Day by day, with the grace of god, we make it through.

MORGAN: Have you been able to talk to your children? Are they too young, really, to understand what happened?

ANDERSON: River is too young to understand. He just knows that his daddy is not there to play with him anymore and hasn't come home yet. Lacy knew right off of the bat, whenever I took her to school that following Monday morning, she actually told me -- I knew I'd have to have that conversation with her, but Jason intervened there and she asked me if her daddy was in heaven.

And I asked her why she thought that he was, and she said that her daddy had told her that he was OK and that he was in heaven now. I didn't have a reason to argue with that.

MORGAN: I mean, it's desperately sad to hear you talk about the repercussions of what happened.

Let me take you back, Courtney, to that fateful day and one of life's dreadful scenarios. Your husband Wyatt was actually scheduled to leave the rig and come home on the night of the explosion. How did you find out that he'd been killed?

KEMP: Actually, Wyatt was scheduled to come home the morning of April 21st. He was to get off of tower at 11:30 that night. At approximately 4:30 the morning of April 20th, I received a call from a lady at Transocean who told me that there had been an emergency evacuation to the Deepwater Horizon and that the Coast Guard was on the scene.

Of course, I was coming out of a sleep and asked her to repeat all of that again and she told me again. And I asked her, of course, where my husband was. And she said, she didn't know. And I said, well, is he OK? And she said, I don't know. And I said, OK.

And she told me that she would give me her name and number and I could call her back. And of course, I did, every hour, on the hour. It wasn't until 2:30 that afternoon that I found out that Wyatt was one of the one of the 11 who were missing.

MORGAN: What goes through your mind? Obviously, this is not a risk-free job, and there have been incidents like this in the past. I mean do you have to live with the risk every day when you're married to somebody that does this kind of job, or do you kind of think it's never going to happen to you?

KEMP: Of course. You -- of course, it crosses your mind, and you think about it. Actually, every time, you know, they leave the house, you think, OK, well, is he going to come home? And my -- the last time I always told Wyatt was that I love him and to be safe and to make sure he came home.

MORGAN: Shelley, your husband Jason actually expressed concerns about his safety on the rig, didn't he? What did he say to you?

ANDERSON: He never actually said something directly to me. It was different things that he just wanted to take care of. And in the months before the explosion, that didn't seem all that unusual at the time, but later just made me think he was getting his will in order and we were really going down the list of things that he wanted done at the house.

He actually left me a list of things to finish at the house and different things that he wanted the kids to do. It just seemed like he was really concerned, and he needed to get all of those things done. And it was very important to him that last hitch home.

All of the things that he taught me to do and told me to do on that last hitch home, it seemed so pressing to him that I knew all of these things that he wanted me to do, that I knew how to start the motor home, that I knew how to -- that I needed to get the septic system fixed and I needed to do the fence, and I needed to do all these things.

It seemed very pressing to him that I knew all of these things and that I needed to take care of them.

MORGAN: I mean, do you think that he knew? Do you think something was going on there that he wasn't telling you? That there was a problem, that there was a clear danger?

ANDERSON: That would be Jason. He would not tell me something that would deliberately make me worry. That was not his version of taking care of me. He knew that I had enough on my mind, staying at home with the babies, and doing what I could around the house with him not being there for three weeks that he didn't need to give me anything else to worry about.

That would not be his way of taking care of me.

MORGAN: Courtney, the well that your husband was working on was called the well from hell. Why was that?

KEMP: Well, to my knowledge, it was deemed the well from hell because there was so many problems on it. You ask any oil field worker and they'll tell you, there is a degree of difficulty with every well.

But for whatever reason, this well was different. You know they had a lot of problems. They received a lot of kicks from the gas pressure and everything that was taking place out there. And actually, this well had been started in 2005 by another rig and they were not able to handle it. And had to pull off of it when Katrina was coming through the Gulf.

And, of course, BP wanted Deepwater Horizon to get on that well because they were the best at what they did.

MORGAN: Shelley, let's turn to the legal situation here. What has happened in terms of your legal actions with both BP and Transocean who controlled the rig?

ANDERSON: Transocean has filed a lawsuit against me and my children, forcing us to go to the lawyers in New Orleans and be apart of the multidistrict litigation. I already have a lawyer.

These lawyers in New Orleans don't know me. They've never bothered to introduce themselves to me. They don't have my best interests at heart. They don't have my kids' interests at heart. But Transocean is forcing me into this and making me go to New Orleans to be with these lawyers, who care nothing about me, and are just pretty much looking for a way to retire, as far as I see it. They don't want -- they don't have my best interests at heart.

MORGAN: But Shelley, I mean, I guess I misheard you there. Did you say that Transocean is suing you?

ANDERSON: Yes, sir, they filed a lawsuit against me and my children and the rest of the people that were killed to limit their liability, to limit what they're responsible for.

MORGAN: I mean, it seems completely outrageous. Maybe I should bring in at this stage your lawyer who's with us today.

Why on earth would Transocean be able to file any kind of lawsuit against widows like Shelley in this position?

ERNEST CANNON, SHELLEY ANDERSON'S ATTORNEY: Piers, Transocean picked up on a 150-year-old outdated technicality in the law where they could file a limitation proceeding, saying we're going to take you widows and you victims, you hurt people, to a court of our choosing and limit you, your recovery, to the value of our rig at the time that it sunk.

That doesn't make any sense to you or to me because it doesn't make any sense anymore. But that's the option that -- as opposed to Transocean taking up their responsibility and living up to their responsibility to these widows, they chose to hide behind a 160-year- old law that was designed to protect shipping interests 160 years ago, not to protect a Swiss corporation.

MORGAN: I mean, Courtney, it seems completely outrageous to me that they would even contemplate such a legal action. It must have felt to all of you like a kick in the teeth that you're still involved in any kind of legal action.

Why do you think they're just not prepared to settle and look after you all?

KEMP: Well, you know, Mr. Steve Newman, the CEO of Transocean, sat in my living room and told me not to worry, that we would be taken care of. And Transocean wanted to settle, quickly. And I did, too.

Actually, I -- before I got an attorney and everything, I sat down with Transocean. They gave me some numbers and it felt like a complete slap in the face. It was nothing what I thought was even close to what my daughters and I deserved. And because this was a man-made accident. This accident could have been avoided.

And it was total gut wrenching. And, of course, I went out and interviewed several attorneys and my attorney is Barry Roche out of Lake Charles, Louisiana, and I -- Shelley and I got together and we've become very good friends, and Natalie Roshto, and we said, basically, that we'll fight to the bitter end to get what we deserve.

MORGAN: I mean, Shelley, since this happened, BP's profits have begun to rise again. Their share price is up 50 percent on the low that it hit at the height of this crisis. We've also seen reports that Transocean announced that in 2010 the company had its best year in safety performance. And the company actually gave top executives bonuses.

What do you think of all this? I mean, it seems that the people responsible for the deaths of your husband and Courtney's husband and the others are now just back making as much money as they were before.

ANDERSON: BP has actually come forward and been very sympathetic here very recently with us. And Mr. Feinberg is -- has at least listened to me, and been -- and pursued -- he wants to listen to me. He's being nice.

Transocean -- one of Transocean's lawyers that we met with wouldn't even listen to me when I was trying to explain to him what Jason meant to me. And as a husband and as a father to my children, and just tell a Jason story. That lawyer from Transocean wouldn't even listen, and he stormed up and off from the table and took off and wouldn't even speak to us anymore.

But Mr. Feinberg has come forward and he's willing to listen. And he's been sympathetic towards us. And I can appreciate that at this time.

MORGAN: I mean, I have Mr. Feinberg next to interview on the show. What would you like him to now do to finish this? To bring things to a conclusion that you feel is fair?

ANDERSON: At this point, I'm just excited that he's willing to listen to me.

MORGAN: Courtney, did you want to say something?

KEMP: I was just going to add that I'm hoping that we can come to an agreement that both parties will be OK with and because, you know, Transocean and BP both have -- their public relations department has been just terrible, if you ask me. And things could have been handled in a much better way.

You know, they -- neither one of these companies had to -- had to dig up this 100-year-old law. They could have done what was right and taken care of us. And even though they didn't want to, we still fall against the moratorium. We went -- when we spoke to the president, we told him that we needed -- we needed the oil industry. That it was so vital to our economy.

And we will still fight for the oil industry every day, because that is -- that's what our husbands would want to do and that's what we do to honor them.

MORGAN: Well, it's very eloquent the way you're saying that because it shows that you are supportive of industry, and that's why the industry, to me, needs to really just sort itself out and look after you.

And Courtney Kemp, Shelley Anderson, thank you very much indeed for your time.

KEMP: Thank you. We appreciate it.

ANDERSON: Thank you.

MORGAN: When we come back, I'll put those questions to the man who holds the purse strings of the $20 billion compensation fund. Ken Feinberg.



UNIDENTIFIED MALE: We make a paycheck but we're struggling. You've got to stay out there the next few days and the fish are just not coming up like they should.

(END OF VIDEO CLIP) MORGAN: The fund established to compensate the people of the Gulf Coast after last year's massive BP oil spill has paid out just $3.8 billion so far out of the total set aside of $20 billion. And more than a few residents are angry about that.

Joining me now is the man who controls the purse strings, Kenneth Feinberg, the administrator of the BP Deepwater Horizon Disaster Victim Compensation Fund.

Mr. Feinberg, you were listening there to the very evocative testimony of two widows who lost their husband that day. BP did say, you know, we will make things right and is quite clear that things have not been made right so far. Why not?

KENNETH FEINBERG, BP VICTIM COMPENSATION FUND: Well, you'll have to ask BP what they said and why they said it. I'm running this claims process for the past nine months. I think the program that I'm administering is working fairly well.

It's not perfect, there have been errors and bumps in the road and they continue to be criticisms directed at the fund. But I think, overall, we have distributed about $4 billion to 300,000 claims.

And we have received, Piers, in nine months, 850,000 claims from every single state in the union. Every state. And we're doing our best to --

MORGAN: But why -- why, Mr. Feinberg -- let me just focus on these window for a minute. Why have these widows not have their money?

FEINBERG: They just filed with me in the last few weeks. I can't speak for why they didn't get their money from the defendants. That's not part of my jurisdiction. They've filed, I've talked with some of them, their lawyers.

I'm confident that we'll be able to settle these claims. I'm confident we will be able to do that. Money is a pretty poor substitute, I must say, for lost loved ones. I learned that in the 9/11 fund.

MORGAN: Well, it is, and I -- yes, listen, I don't for one moment hold you accountable for anything that happened that day. Clearly, you've been brought in to sort out the mess. The problem is, it remains a huge mess. And talking to those ladies, you know, we are a year on now, and they are still involved in brutal business of litigation.

You have $20 billion set aside. Isn't there a kind of moral duty on the behalf of everyone related to this incident, and you control the compensation purse strings here?

Let's put Transocean to one side for a moment, and BP. There's this fund of money. Why are these women still having to fight these legal battles? Why can't you just take a slug of that cash and give it to them and say, you know something, this is deserving for you to be able to rebuild your lives?

FEINBERG: I have every intention of doing that. I'm agreeing with you. These two women are a good example. For whatever the reasons, they're not pleased at all with the traditional, conventional litigation system. You've heard them.

They've come to me in the past few weeks. I've listened carefully. I commiserate with them. I'm sensitive to what they're saying. We will honor this obligation to pay them. And I'm completely agreeing with you that I wish they had come to me six months ago. And I would have dealt with this sooner. They've come to me in the past few weeks, and I will deal with it.

MORGAN: How many claims have you so far denied?

FEINBERG: Oh, my goodness. We have denied probably about 300,000 -- 350,000 claims.

MORGAN: Now I fully accept that people in these situations try it on. You know, they will be filing bogus lawsuits. You've already, I think, got a large number of people that you were recommended to be -- to be sued for fraud here.

Let's put those to one side. There will be a number of those people that you've denied to, on the basis, I believe, and you correct me if I'm wrong, that they can't produce the documentary evidence that says their loss of earnings were X, Y, Z.

But a lot of these people are fishermen who are just used to dealing in cash and going about their businesses, very small businesses, who just don't have that kind of accounting procedures.

Aren't they the very people that you ought to be helping, not basically throwing to the wolves?

FEINBERG: I agree with you again. I very much would like to help fishermen, who have an all-cash business. There's nothing illegal about an all-cash business, as you know. But, but, I will not accept a claim where a fishermen says, or a shrimper, or anybody in the Gulf says, trust me. Trust me when I tell you this is what I lost.

I have, Piers, over 100,000 claims where there was no proof whatsoever offered with the claim. I will not pay those claims. Now I don't need tax returns. I don't need an official accounting. And I'll take trip tickets. I'll take other evidence of what you've been -- how you have been damaged.

I'm agreeing with you. Those are the people that ought to be helped. I've helped thousands of them so far. And there are still a lot of --

MORGAN: How do you feel -- how do you feel about Transocean awarding executives bonuses after this incident?

FEINBERG: You know, that's not -- I've got enough problems of my own without worrying about Transocean. That has nothing to do whatsoever with my program. I mean, I must say, it's a public relations disaster, but it's not on my watch. I've got to deal with the fishermen, the shrimpers, the oystermen, the very people you're talking about here this evening. I'm with you on that.

MORGAN: But you see, Mr. Feinberg, here's the thing. You ask to trust from these fishermen. You say, look, I've got to trust -- I can't just go on your word. I've got to see documentary evidence. That trust isn't enough.

And yet, of course, they're out there now having to trust BP. There won't be another disaster like this. Can you offer them any kind of comfort the other way, that there isn't going to be another explosion and more problems to their livelihoods?

FEINBERG: Piers, I can't do more than what I can do. All I can do -- and it's not much, I must tell you, for a lot of these people, money is no substitute for a lost heritage, six, seven generation fishermen. It is a serious tragedy.

All I can do is provide under our system compensation. I can't promise them there won't be another explosion. I don't have that power, that authority. I can't promise them there won't be a hurricane or that oil might not come up from the bottom of the Gulf.

I don't have that power. All I can do, small as it may be, is to try and offer them some dollars for the damage they've suffered.

MORGAN: Mr. Feinberg, just hang on one second. I want to take a short break. When we come back, I want to talk to you more about exactly what we're going to do to compensate the people in this region.


MORGAN: Back now with my guest, Kenneth Feinberg, the administrator of the BP Deepwater Horizon Disaster Victim Compensation Fund. One of the problems you face is that every day that goes by, where these small businessmen are not being helped, is another day where they face complete ruin.

I mean, you've got 20 billion dollars sitting there. And you've only so far dished out just under four billion. You know, you've got two years left to administer this. Shouldn't you just get on with it and give these people proper compensation for the loss of their livelihoods?

We saw what happened in that area. We saw the damage to their reputations, to their businesses, to everything. They got wiped out, these people. And they are crying out for cash, aren't they?

FEINBERG: They are. Now, I've paid thousands of the very people you're referencing in your comment, thousands of people. Now, there are thousands of claims. I've processed 72 percent of all of the claims. Now, I agree with you; these are the people I want to help. I need some help from them. If you have an idea, Piers, as to what ought to be a valid substitute -- do you want me to just say to every fishermen, whatever you say you want, I'll give you.

Remember, that 20 billion that you keep referring to isn't just for me. That 20 billion is paying government claims. It's paying cleanup costs. I'm drawing on that 20 billion. I've already, in nine months -- you say the glass is half empty. I say it's half full.

In nine months, we've paid out four billion dollars, to 300,000 claims -- 200,000 people. I mean, I think I'm doing something right. It's not all one way.

MORGAN: Well, I think you've hit the nail on the head. You're doing something right, but many would argue not enough and not fast enough. Because speed is the essence here, to get that area and the people who work there back on their feet.

I mean, you talked about a PR disaster for Transocean. Many would argue that you, yourself, with your firm, awarded yourselves a pay increase from 850,000 dollars to 1.25 million. Was that the most sensible thing to do in the middle of all this?

FEINBERG: Let me tell you. This is a huge undertaking. In order to --

MORGAN: I'm sorry, just to clarify, that was a month. So your pay went up from 850,000 dollars a month to 1.25 million. I mean, that's a big rise, isn't it, right in the middle of tricky negotiation with people who are trying to claim, in some cases, a few thousand dollars.

FEINBERG: This is something that I anticipated. So what did I do? I went to the former attorney general of the United States, Michael Mukasey, in the Bush administration. And I asked Attorney General Mukasey, please, Mr. Attorney General, I anticipate Piers' question. Will you please look independently at the cost of administering this program, the time, the effort, the number of people, and give me an independent report on what you think is fair.

He wrote this report and said that that increase and the overall cost of administering this program is reasonable, eminently reasonable, and justifiable. Now, I don't expect people to always agree. But I just want you to know this isn't something that I imposed on BP or anything like that. I asked for independent appraisal of the proposal. And he found that it was perfectly appropriate.

MORGAN: Do you accept, finally, Mr. Feinberg -- and this seems to me to be the crux of this problem that you now face -- that your insistence on having the right documentary evidence for loss of earnings is genuinely going to hurt a lot of people in the area who simply didn't run their business in that ordered, structured manner?

And isn't there a kind of moral compulsion on your part to look at this in a fairer way and say, OK, you know, we clearly see that the pattern of trading amongst many of these fishermen, who were making very little sums of fun, but were wiped out by this, doesn't involve the paper trail that we would need normally, but we are going to override that and just give them some help anyway?

FEINBERG: Yes. I agree with that. The question is, what do you propose? I don't need the type of documentary evidence that you would get from a big corporation. I agree with you. The question is what is the balance?

I'm paying thousands of fishermen and people in the Gulf every day, Piers. I am very sensitive and sympathetic to what you are saying this evening. But what I want to respond, I have a moral responsibility not only to those people, but I have a moral responsibility to make sure that this program is not simply come one, come all, and just, with Piers at my side, just pay me on the basis of a handshake.

I can't do that.

MORGAN: Yes, but I would argue -- I would argue that when it comes to the morality of this situation, better that you pay some people who perhaps don't deserve it, but look after the majority who do, then to withhold payment from a lot of people right now. And you talk about the hundreds of thousands you've helped. You know there are hundreds of thousands that you haven't helped or you denied help to on the technicality of evidence. And it's those people who have come to us saying, this is completely unfair, and we are getting ruined by this.

FEINBERG: Well, my answer is I would like to retain you as a consultant to this fund, so that you can tell me what you think would be appropriate evidence that would allow me, in a principled way, to pay people who are entitled to this money. And if you can come up with a way, I'm all ears. I'm all ears on that.

MORGAN: Well, with the greatest of respect, Mr. Feinberg, you're being paid 1.25 million dollars a month to exactly do that job. And you're being handsomely looked after. As I say, I don't blame you for anything that happened. That would be ridiculous. You weren't there.

But you have been told to sort this out. And on the first anniversary of what happened, there are a lot of people suffering in that area still whose businesses were never put right, who are relying on you to release funds from 20 billion dollars of which, so far, you've released under four billion.

I would say you could go further than you're going.

FEINBERG: Well, I'm not disagreeing with you. If there's a way -- and I'm looking for ways to accelerate those payments -- I will do so in a principled way, that will be justifiable and be acknowledged to be justifiable.

MORGAN: Well, I'll leave you with one thought. Why don't you try putting the heart before the head on this one? FEINBERG: I'll listen to what you have to say.

MORGAN: Mr. Feinberg, thank you very much.

FEINBERG: Thank you.

MORGAN: When we come back, are the right people getting compensation from the victims' fund? I'll ask the president of St. Bernard Parish.


MORGAN: How hard hit were coastal communities after the oil spill and are the right people being compensated? Joining me now is Craig Taffaro, the president of the St. Bernard Parish in Louisiana. Mr. Taffaro, how bad was it where you were? We're told it was one of the worst areas for the post-spill impact.

CRAIG TAFFARO, PRESIDENT, ST. BERNARD PARISH: Sure. Between St. Bernard Parish and our neighboring parish, St. Plaquemines parish, we were the worst hit in Louisiana coastline. And we still are struggling with getting our industry and coastline back to where we need it to be.

MORGAN: You may or may not have heard me talk earlier to the man responsible for dishing out compensation. What is your reading of the people in your area? Are they getting compensated? Are many being denied money they should be getting?

TAFFARO: You know, we continue to the see what we think are significant problems in the claims process. You know, M. Feinberg has come to St. Bernard twice. We're waiting for a third visit that he said he'd come down and actually meet with the fishermen again to talk about what the problems are.

You know, we hear statistics such as 65 percent of the claims being paid. But when we break that down into St. Bernard numbers, only 14 percent of our claimants have been paid. We're talking about just in the interim payment process. We have over 1,200 people waiting to receive an interim payment.

And those who have been paid, about 66 or so, are only paid on an average of about 7,000 to 7,600 dollars. On the final review, we still have nearly 1,000 people waiting for a final review, and basically, to close their claim. And even the ones that -- almost 100 of those that have been paid are only paid at 11,000 dollars.

You know, I hear Mr. Feinberg talk about he wants some suggestions. We know exactly what to help him with if he would allow us to do that. We've been through a disaster. We've been through disaster response. We've been through disaster management.

If he would let us partner, we could help him process what are the legitimate claims, who are the legitimate fishermen, and how they should be compensated. We have just been shut out of this process, even to the point of offering a specific liaison that would do nothing but assist in the government processing of these claims for our commercial fishermen.

We have not been invited to the table. It's all about keeping the doors closed, when we could help.

MORGAN: Mr. Taffaro, one of the problems, as he rightly pointed at the start, is a lot of people are making fraudulent claims or too high claims. People do try it on when these kind of things happens. And we all know that. There are also -- and I have to say this -- allegations that you yourself have profited from BP money. You've been nicknamed a spillionaire in the area. How do you respond to that?

TAFFARO: Yes, those are just part of disaster rhetoric. We offer anyone that needs to come in and take a look at what really is going on and what has happened in St. Bernard Parish -- we have put our fishermen to work in the response. But that doesn't take care of their need in terms of what has happened to the industry.

You know, crab prices are down. Crab production is down. Oyster fishing has nearly been devastated. Those are the things that are being missed here.

In terms of disaster response, it's a common known fact that disasters bring big business. When we talk about who the individuals are that have been most impacted, that's where the focus should be. Those fishermen, those businesses, and those individuals who have been impacted by this spill are the ones who should be compensated.

I have certainly nothing to hide. We've been open booked. We have a lot of work that we have done to put our fishermen in place and to support our local economy. We will continue to do that.

But we can't get off the mark here. And this is important, Piers, that one of the main things that has happened is we have had a spin on what is really going on. We have forgetting, this is the largest oil spill disaster ever -- ever.

And we somehow have gotten away from the fact of the damage that has been created.

MORGAN: Craig Taffaro, thank you very much.

When we come back, the environmental cost of a disaster in the Gulf. CNN special correspondent Philippe Cousteau is in the region.





UNIDENTIFIED FEMALE: Every day, something new washes ashore, so some new layer. And if you just glance at it, you might think it's pebbles. But what it is is all of these are tar balls. PHILIPPE COUSTEAU, CNN SPECIAL CORRESPONDENT: And here we go. Just mushy, gross. You can smell the hydrocarbons, which means there's still some toxicity to these.


MORGAN: The National Wildlife Federation says the Gulf Oil Spill contaminated a stunning 3,000 miles of beaches. CNN's special correspondent Philippe Cousteau is in Grand Isle in Louisiana for us tonight and he joins me now.

Philippe, how bad an environmental disaster was this, now that we have had time to properly assess it?

COUSTEAU: Well, Piers, the extent of the environmental damage is now just becoming apparent. You know, over the last year or so, just under a year, the science started to get geared up in understanding what was happening in the marsh. We're beginning to scratch the surface.

You have to also understand, though, that the impacts on the surface is different than the impacts at 5,000 feet down. While we have had fisheries reports that red snapper are showing up with lesions on them and compromised immune systems -- we, of course, have had hundreds of sea turtles, hundreds of dolphins, thousands of birds that have shown up dead.

We still have oiled marsh lands and oil on the beaches. But what's happening at the surface is different than what's happening 5,000 feet down. That is even more unknown at this point.

MORGAN: Where do you think it will end? I mean, you've had experiences of similar disasters in the past. And they do tend to just get worse before they get better. What is your gut feeling about this?

COUSTEAU: Well, Piers, I think the future is unknown. Unfortunately, we have never had -- I should say, fortunately, we have never had this kind of a disaster before. But unfortunately, thus, have no baseline of an understanding of what this means.

The Exxon Valdez in 1989 in Alaska was a surface spill with much less oil. Yet even that still has impacts on the wildlife there 20 years later.

I was with CNN off the coast of Vera Cruz in Compatri (ph), Mexico in November, looking at the consequences of the Ishtaq Oil Spill of 31 years ago. And there's still oil there on the coral reefs and on the mangroves.

So while we are not sure exactly the extent of the damage, we know it will be long term. We know it will continue to have an impact not only on the environment, but on the people who rely on a healthy environment for years and likely decades to come.

MORGAN: You may have heard my interview with Ken Feinberg earlier, who has been in charge of paying out compensation for this. I mean, his argument is that a lot of people are overselling what they're due, that other people are being fraudulent. And as a result, you know, two thirds or more of the money remains unpaid.

What is your sense on the ground of the real impact on the economy today? How many people do you think are not getting the money they ought to get?

COUSTEAU: Every single person who doesn't get made whole from this is too many. We were in Alabama a few days ago visiting with community members along the coast of Dauphin Island, around Mobile, Alabama. Over the last few days, I've been in southern Louisiana visiting with fishermen, many of whom have not seen a scent and are truly, legitimate fishermen that have been doing this for 15, 20 years.

So there's a lot of challenges. In fact, some of the fishermen haven't even been compensated for the time they operated as vessels of opportunity, which was a contract that they had with BP. And BP still has not paid them what they owe them.

So it's not even always a case of paperwork. I agree with you 100 percent, Piers, that this is an issue where we need to be thinking with our hearts more than our minds. There's a lot of money that is needed to help these communities that have suffered so greatly from this catastrophe.

MORGAN: And also, we all know -- the reason I said that is we all know that the fishing industry in that kind of area has for years operated on a cash basis. I suspect the documentary evidence of many of the transactions just doesn't exist. T

hat doesn't mean they didn't happen and doesn't mean that many, many viable businesses have not been completely ruined by this.

COUSTEAU: A lot of people have been completely ruined or are just hanging on by the skin of their teeth. Many of the Cambodian and Vietnamese fishermen who we have met with over the last few days, again, who have been here for a very long time, are still having great difficulty in getting any of their claims filed, and are still suffering, and not sure what the future will hold.

The shrimp season has only been open two days. And we're already starting to hear preliminary reports that there's very few shrimp out there to be had. So this is a challenge that is not going anywhere. There's still a lot of suffering on the ground.

MORGAN: Philippe Cousteau, thank you very much.

We'll be right back after this break.


MORGAN: That's it for us tonight, one year on from the BP disaster, which for many people in that region remains a disaster. We'll keep on that story. Now here's Soledad O'Brien, in for Anderson Cooper, on "AC 360."