“My car has a flat tire.”
“You should buy a new car.”
Every time I hear President Obama and other Democrats talking about “health care reform,” that’s what the conversation sounds like. A health care crisis is declared and the only solution is to replace the entire system. At most, around 15% of the American population is without health care insurance. Ignoring the fact that for most of them, this is a matter of choice, it also means that 85% are insured. And of that 85%, something like 70+% like their current coverage and don’t want the government to touch it.
So for the vast majority, the current system works and works great. Yet, because of the minority for whom it allegedly does not...toss it all, start again.
Admittedly, regardless of insurance coverage, it all costs too much, but again, the only accepted approach to controlling costs are to throw out everything and turn it all over to the government. Tactics that are proposed to address specific cost issues are not considered.
One of the biggest is tort reform. So what is tort reform? Since we’re talking about out of control costs, let’s look at some out of control costs.
Just so we understand some basics, in simplest terms, a tort is a civil wrong for which the government will recognize a civil remedy.
When all is said and done, for the most part the only civil remedy the state can provide is monetary, i.e., you suffer a loss, the party at fault pays you.
That payment breaks down into two parts: Compensatory, which are your actual monetary losses, e.g., loss salary. And punitive, which are additional payments meant to discourage the conduct that result in a tort, e.g., punishment.
Tort reform seldom, if ever, discusses changing compensatory damages. Those damages are, for the most part, black and white. Rather, tort reform almost always revolves around punitive damages.
Some true life examples of why:
A man buys a new BMW. He discovers that while it was being transported to the dealer, it suffered some paint damage. The dealer’s body shop repainted the car and the dealer sold it as new. The man sues, and rightfully so since the dealer never told him about the damage and repair. The jury finds that the compensatory damage was around $5,000, the cost of the paint job...and awards the man $5 million punitive damages.
In another case, a man starts smoking after the surgeon general’s warning. That means that every pack of cigarettes he’s ever bought and consumed has worn a label saying that smoking can kill him. He gets cancer. He sues “big tobacco” for his addiction. He wins. His compensatory damages are around a couple of million, for loss wages, life-time medical expenses, etc. The punitive award, to this one man, is $2.5 billion.
Even the notion that punitive damages should bear some reasonable relationship to compensatory damages is adamantly opposed. For instance, a suggestion is that punitive damages can’t be any more than ten times your compensatory damages. That means BMW man would have gotten $55,000, not $5 million; stupid cancer dude would probably have received around $27-33 million (assuming $2.5-3.0 million compensatory). Considerable sums of money, given the damages suffered, but arguably within the realm of reason.
But no, can’t do that. Every tort lawyer in the country, including “consumer advocate” Ralph Nader, opposes any sort of tort reform. Given that the normal legal fee for a tort is around 30% of the settlement, it’s easy to see why.
In the current health care reform debate, tort reform isn’t even on the table. How many millions of dollars are doctors forced to pay, each year, for malpractice insurance? How many billions are paid out, for both righteous and frivolous lawsuits? How much have these costs contributed to rising health care expenses?
Why do we graduate more lawyers each year than engineers…or doctors?
You can’t even talk reform in a state which itself suffers because of existing tort law. For example, my home state and employer, California. The state Department of Justice is the legal representative for all state departments save one, the Department of Transportation (Caltrans). The overwhelming majority of lawyers (and I mean approaching or exceeding 70%) who work for California work at Caltrans.
Why? Because in California if you sue a group of people for a tort, they are all liable for your damages. Whichever of the defendants can pay, pays all. He then has to turn around and sue his co-defendants for their share.
For Caltrans that means that whenever an accident occurs on a state road, highway, or freeway, Caltrans is automatically named as a co-defendant. If found even 1% at fault, Caltrans, i.e., California, i.e., the state’s taxpayers, pays the entire settlement. Caltrans, i.e., California, i.e., the state’s taxpayers, then has to turn around and sue the other defendants to recoup 99% of the cost.
Just to be clear, if rough pavement is found to have to contributed 1% toward a drunk driver accident, and the victim is awarded $10 million as a result of that accident, the state of California pays the entire $10 million rather than just its share of $100,000 (1%). Plus the state has paid the Caltrans lawyers who worked defending Caltrans. Plus California pays the Caltrans lawyers who now sue the drunk driver (the one, in this example, found 99% at fault) to recover the $9.9 million Caltrans wasn’t found liable for.
And because the state is always included, there’s always a “deep pocket” available, and so the amount of damages awarded the victim are generally beyond generous.
The Democrat-dominated state legislature won’t even consider correcting this problem, even at a time when California’s budget continues to implode. And if not for this problem, they certainly, on a national level, won’t look at tort reform as part of health care reform.
So instead...
“My Toyota runs rough.”
“You should buy a new Hummer.”
Sure, makes perfect sense.
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