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Interior Proposes Insulting Settlement of Trust Fund Litigation

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by Brad Jolly, Partner

March 9, 2007

This week, the United States proposed paying $7 billion to settle the Cobell trust litigation - less than the $8 billion being considered by the previous Congress. Under the terms of the government's proposal, the United States would pay $7 billion over ten years to individual Indians and tribes, without interest. In return, all tribal and individual trust mismanagement claims against the government would be dropped and the government would be relieved of any future liability. As with the Bush Administration's earlier comments on the settlement legislation before the Senate, this offer would return the United States to the abhorrent,embarrassing, and failed termination policy of the 1950s. The settlement would end the government's trust responsibility over the next 10 years.

Senator Byron Dorgan (D-N.D.), Chairman of the Senate Indian Affairs Committee, said that he would hold hearings on the administration's proposal. While acknowledging that the terms of the settlement are controversial, he added that it is significant that the federal government has, for the first time, acknowledged amulti-billion-dollar liability for mismanagement of trust funds. However, the Department of Interior took issue with Senator Dorgan's characterization. Associate Deputy Secretary of Interior Jim Cason said, in response to Senator Dorgan, the offer is merely "recognition that where we are right now is not very productive" but not an admission of a liability. According to Cason, only about half of the $7 billion would be used to settle the Cobell litigation. It is not clear how much of the money would be used to settle the more than 250 tribal trust claims.

Ultimately, the government is offering approximately $3.5 billion to settle an approximately $100 billion liability. It is very doubtful that the United States would ever ask any people other than Indian peoples to accept such apaltry settlement for the government's wrongdoings. Not only is the settlement amount insulting, but the government's continued attempt to terminate the trust relationship and insulate itself from future mistreatment of Indian peoples is beyond frightening. At a minimum, it shows that not much has changed in the last 517 years with respect to the United States dealings with Indian peoples despite their words to the contrary. Once must ask how one branch of government can be considering an apology to Indian peoples while the other attempts to return the United States to one of its darkest moments in its history of relations with Indian nations and peoples.

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