“Lawyers Gone Wild” or Just Desserts for Corporate America?

A recent series of articles by reporter Mark Tapscott currently running in the Washington Examiner suggests that tort litigation in the U.S. is out of control. Torts are the laws that cover personal injury cases, such as asbestos lawsuits. You may recall a recent story presented here about how asbestos cases very rarely make it to trial (see the post titled “Back-to-Back Asbestos Trials in Madison County”). There is a good reason for this. According to Tapscott, more and more corporations are finding that discretion is “the better part of valor” when faced with litigation and a verdict that could conceivably put them under–or at least make a large dent in their quarterly profits, which have exploded since 2001 (even as workers’ wages and living standards have dropped). While the asbestos litigation may have peaked in the U.S., putting the word “asbestos” into any search engine will still bring up hundreds of ads from law firms specializing in such litigation. Steven Hantler, legal counsel for the Chrysler Corporation, complains: “Incredibly, what Americans spend on lawsuits could pay for all the following government programs combined: Education, training, and employment; general science; space and technology; conservation and land management; pollution control and abatement; disaster relief and insurance; community development; Federal law enforcement and administration of justice; and unemployment compensation.

What is interesting is that Hantler makes a valid point. The problem, however, is that these government programs are not being funded, and one reason is because of reductions on corporate taxes and deregulation that allows these corporations to shelter profits in offshore ‘tax havens,’ further avoiding tax obligations. As a result, federal revenues decline, and the burden for maintaining the infrastructure that allows corporations to thrive falls on the shoulders of working people who struggle even as these corporations enjoy the highest profits in recorded history. It is what author and talk show host Thom Hartmann refers to as “internalizing profits and externalizing costs.” Asbestos companies did not want to accept the responsibility of protecting their workers or warn them or their customers about the hazards associated with their product. Most big corporations today behave similarly, failing to learn from the experience of the asbestos industry. Today, Corporate America (a large part of which is no longer “American,” but “global”) has, through its unprecedented levels of lobbying, been in virtual control of the legislative process for an entire generation, to their own benefit and to the detriment of the nation’s working citizens. If their proverbial chickens are now coming home to roost in the form of ruinous litigation, it’s difficult to have much sympathy.