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President's Message: Election Time is "The Time" To Call a Halt to Lawsuit Abuse |
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Written On: September/October 2004 |
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Litigation is out of control in our country, and election time is “The Time” to call a halt to lawsuit abuse. Those of us who provide jobs, manufacture products, and sell goods and services need to elect people to Congress and the state Legislature who will restore fairness and balance in our courts.
Lawsuits are so pervasive in the United States today that they consume 2.2 percent of our Gross Domestic Product (GDP). In 2002 that was $233 billion and of that total, business forked over half of that money — some $129 billion.
That amount is substantially higher than any other country in the industrial world and, according to the American Tort Reform Association (ATRA), lawsuit costs are on average 2.5 times higher here than in other countries — nations we compete against.
And, personal injury attorneys like Democrat vice presidential candidate John Edwards make millions suing people. They get 40 percent of the money right off the top.
Litigation Killing Small Business
While some may believe it is big business and insurance companies — the so-called “deep pockets” — which pay the tab to settle lawsuits, a new report shows tiny companies are hit the hardest.
Now, the U.S. Chamber of Commerce Institute for Legal Reform has found that 68 percent of those business costs — $88 billion — are paid by firms with one employee and revenues of less than $10 million a year. That translates into an average of $150,000 per employer — money that would otherwise be available to hire additional workers, expand operations, develop new products, or improve health coverage for their employees and their families.
The importance of this new study is that it breaks down the legal costs by who pays. For example, Jim Mickelson of Northwest Embroidery, a small business in Fife, has a $14,000 unpaid bill from a manufacturer bankrupted because of asbestos lawsuits. But in addition to this lost income, Mickelson has to pay more each year for his liability insurance, raw materials and transportation because his vendors are being sued. It is an endless cycle!
Families Hit By Hidden Lawsuit Taxes
Consumers are feeling the bite as well through the so-called “hidden tort taxes” buried in the price of goods and services. It averages $809 per person annually. Can you imagine what a family of four could do with an extra $3,236 banked each year for their children’s college education? If allowed to accrue interest over a decade, that money would cover a year’s tuition, books, board and room at an Ivy League college for one of their children.
Keep in mind none of these costs include the additional taxes we pay because school districts, parks districts, and city, county or state governments are sued every year for billions as well.
The question is: When will lawmakers stand up and reform our legal system? That’s a great question to ask those running for office this year. Every consumer, job-provider and worker should support only those candidates who are willing to stand up to the politically powerful personal injury attorneys to restore fairness and balance to our courts.
No one, whether they are a small business owner, a school director, hospital administrator or doctor, wants to take away a person’s right to recover legitimate damages and be fairly compensated if they have been injured or treated unfairly, but our legal system is out of whack.
It is up to the voters to initiate change on Nov. 2. Otherwise, the personal injury lawyers will continue to get richer while the small business owners watch overseas competitors uncut them in the marketplace. That just isn’t fair, and it is not good for our country or our children.
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