According to the Wall Street Journal (December 15, 2010) Americans now spend more on tort litigation than they do on new cars.
What a waste. What a waste of energy and creativity that must be siphoned into unproductive litigation or insurance and administrative protection. What a profound nonsensical silliness is our system that so richly rewards a parasitic institution which so effectively and legally preys on small and large business alike.
Surely the rest of the world must laugh at this institutionalized suck on our corporate efficiency. The courts are full of such frivolous items as the $54 million dollar pair of pants that a Washington D.C. cleaner supposedly ruined in 2007. Yet such nutty nuisance lawsuits can hit any one of us at any time.
The simple answer to all this is loser pays, a system like England and most of the rest of the sane world has. The problem is the power of the tort lobby, of course, which makes the second largest political contributions in the U.S. to keep our system less profitable and less productive. The tort bar is a true national villain: It is a profoundly anti-business, anti-efficiency, anti-employment and purely self-enriching force.
However, there is hope and (as most creative governmental ideas these days) this hope is coming from the states. For example, Texas is proposing a British-style, loser pays rule which would require the plaintiff to pick up the legal costs of their targets if they lose their suits.
Texas has had its gimlet eye on the tort bar already, with reforms in 2003 and 2005. Again, the Wall Street Journal states in an editorial of December 15, “Before the reform, Texas was a kind of holy place on the tort bar pilgrimage. Now it is a Mecca [particularly] for doctors…” but increasingly for small business in general. So yee-haw. God bless Texas, an increasingly bright and seminal beacon of business enlightenment and legal sanity.
So as not to end the year with another grumpy screed, I am happy to note that business does appear to be improving. Most economic indicators are pointing up for the next year, almost across the board. I’m certainly seeing a spike up at Corporate Rain International. So God bless us each and every one as we embark on 2011.