TORT TAX - WEALTH CHANGING HANDS
It is clear who benefits from the "tort tax," but who pays it? You do, of course, even when compensatory and punitive damages comport with the degree of negligence.
Direct costs from such awards amount to more than $200 billion a year now and are growing at a much faster annual pace than the economy. These awards, combined with the enormous costs of insuring against such suits and awards, are paid by consumers through increased product and service costs. Put another way, the 2005 Current Population Survey lists median household income at just under $50,000; direct and indirect tort tax are estimated to cost each household more than $4,000 annually.
Clearly, lawyers are the big winners, and consumers are the big losers. The tort tax goes well beyond the increased costs of goods and services.
There's more. The tort tax you're paying goes well beyond the increased costs of goods and services. A growing share of your state and federal taxes is also usurped to compensate lawyers. For example, when the ACLU sues local, state and federal entities and prevails, those entities pay all the ACLU's fees. In other words, the ACLU is largely a taxpayer-funded organization.
Worse, consider this case, paid for in its entirety by taxpayers.
Daniel LaPlante was convicted of a triple murder. He broke into a home in Townsend, Massachusetts, raped and executed a pregnant mother, then drowned her seven-year-old daughter and five-year-old son in bathrooms adjoining their bedrooms.
According to Superior Court judge Robert Barton, who presided over LaPlante's case: "Of the 150 murder cases I heard, his is one of only five that I would personally have no problem pulling the switch on the electric chair myself. He was incorrigible, he would never be rehabbed, and we'd be wasting our money feeding and clothing him."
A few years after his conviction, LaPlante was concerned for his safety in the prison yard (even in the pen, they don't tolerate sociopaths like him) and was placed under lockdown (at enormous expense). Soon thereafter, he complained that the pornography he received by mail was being withheld. LaPlante's case was argued pro bono by the elite Boston law firm Palmer & Dodge. (Law firms, it should be noted, are expected to complete a certain amount of pro bono work to remain in good standing with the bar—though this hardly excuses the sickeningly poor judgment of this particular firm.) Palmer & Dodge thus argued before U.S. District Court judge Nancy Gertner that LaPlante's civil rights were being violated.
Attorney General Thomas Reilly, who originally prosecuted LaPlante, said, "To be worried about his civil rights? The victims had no civil rights. He executed them." But Gertner agreed and ordered that LaPlante should receive his pornography.
Palmer & Dodge then decided that they had too much time in the case to do it for free, so they submitted a bill for $125,000. Judge Gertner approved $99,981. In summary, according to the Boston Globe's Brian McGrory, "LaPlante gets top-shelf legal representation [and his pornography]. Palmer & Dodge gets another hundred grand. And as too often happens, taxpayers get nothing more than the bill."
So what about tort reform?
Conservative presidents have campaigned on promises of "tort reform" for generations but have had little success delivering on those promises. Why? Well, because Congress is controlled by lawyers. That fact alone goes a long way toward explaining our national government's bloated bureaucracy and legalistic paralysis. It also explains why President Bush's tort-reform measures have fallen flat.
Recently, President Bush has taken some well-deserved heat about the number of lawyers he has appointed to senior government positions—notably Michael Brown at FEMA and Michael Chertoff at DHS—both of whom have managed to mire their respective agencies in the mud of bureaucratic legalities. Perhaps the best advice for Mr. Bush, and the nation (with apologies to our colleagues at the Federalist Society), comes from William Shakespeare's Henry VI, when Cade's straight man Dick suggests, after the revolution, "The first thing we do, let's kill all the lawyers."