Wealth creators and wealth destroyers

Which support which party?

Trial lawyers support Democrats more than Republicans. There are some cross-overs. RINO Arlen Specter's son is a trial lawyer and Arlen has been a great friend of trial lawyers. Trent Lott's brother-in-law, Dicky Scruggs, is in deep trouble. Trent was not known for his opposition to his brother-in-law's profession. I leave profession without scare quotes just as I would leave Xaviera Hollander's profession without scare quotes.

Be that as it may, the fact remains that trial lawyers give most of their big bucks to Democrats. It is hard to think of any instance where the activities of a trial lawyer created any wealth for anyone except trial lawyers. I'd be happy to learn of such a case. Hint: The movie "Erin Brockovich" does not count as evidence. Famous trial lawyer John Edwards almost single-handedly destroyed the profession of Ob/gyns in his home state. It is hard to see how anyone but Edwards and a few lucky families benefited. Yet Edwards was a VP candidate in 2004. Luckily, even Democrat voters could smell a phony, and Edwards dropped out of the 2008 race, leaving two other phonies to slug it out.

But let's turn to a larger issue. What has been the most devastating blow to American manufacturing over the last decade? Japan? China? NAFTA? Bush?Unions? How about asbestos lawsuits? This 2002 post by Amy Ridenour indicates the scale of the problem:

Since January 2000, the wave of claims by healthy plaintiffs has pushed at least 20 companies that once sold or used asbestos products into bankruptcy protection.

The Mansville Personal Injury Trust, which pays almost all asbestos claims, reports that nearly 90,000 new claims were logged against it last year alone.

Over 1,000 corporate defendants have already been named in asbestos lawsuits. When insurance industry payouts are combined with corporate asbestos lawsuit-related costs, the total price tag is likely to reach a staggering $275 billion.

The latest wave of asbestos cases has the potential to do far more damage to America's economy than lawsuits related to the September 11 terrorist attacks and the collapse of Enron combined.

With 50,000 new claims filed by personal injury lawyers in each of the last three years, Wall Street analysts now estimate a total potential payout of more than $200 billion. That money they say eventually will be divided among 2.5 million plaintiffs and a handful of personal injury lawyers.

The nearly 50 companies already forced to seek bankruptcy protection because of asbestos litigation include such illustrious corporate names as Owens-Corning, W.R. Grace, U.S. Gypsum and GAF.

A host of other companies with only peripheral connections to asbestos - they relied on the experts of the day in handling the material - are now under full-scale attack.

Asbestos, it should be noted, was once considered an industrial godsend. Because certain varieties do not burn, conduct heat or electricity and are resistant to chemicals they were once widely used for making fireproof materials, electrical insulation, roofing and a number of filtering devices.

They include the Big Three auto makers (asbestos was once the mainstay of brake linings), most of the nation's electric utilities, shipbuilders oil refineries, construction firms, textile mills and even such far removed companies as Gerber, Campbell Soup and Gallo.

A study last year by the RAND Corp., the California-based think-tank, found more than 1,000 companies have been sued, and projects that more than half of all U.S. industries will wind up in asbestos courtrooms if lawsuits continue to be filed at their current rates.

Worse, many of the damage awards seem excessive at best. A prime example was a $150-million verdict returned by a rural jury in Lexington, Mississippi last October in a case against three companies. The money was divided among six plaintiffs and, of course, their lawyers.

None of the six workers had ever been in asbestos manufacturing or even distributed it. Indeed, they only handled products containing asbestos occasionally in jobs as laborers, janitors, maintenance men or plant workers.

Four doctors who examined them found no signs of any asbestos-related disease or condition in the men, and none of them claimed they incurred any medical expenses or ever lost a day of work due to asbestos exposure.

Such outrageous cases of "jackpot justice" ought to concern every American with money in an individual retirement account, a 401k or a pension fund. The chances are overwhelming that their retirement nest eggs includes stock in a number of companies already harmed, or on the hit list, of the asbestos lawyers.

As John Forelli, senior vice president at the Boston investment firm Independence Investment, told the Wall Street Journal in a February story, investors have been scared off by "tort lawyers and short sellers."

The Journal quotes Forelli: "Investors have lost a lot of money on this issue, there's no doubt about that."

The prospects of meaningful reform legislation passing a divided Congress anytime soon are slim at best. But judges and juries can help thwart the pending economic disaster by standing up to personal injury lawyers' attempts to enrich themselves by huckstering bad science and junk medicine.

Judges, particularly, bear a responsibility to weed out frivolous lawsuits filed on behalf of healthy patients so the truly suffering can be compensated for their exposure to asbestos. And so that the employees and stockholders of companies that never harmed anyone can be secure in their jobs and retirement funds.

I'd note that trial lawyers are still running prime-time TV ads trawling for potential plaintiffs. And donating to politicians depending on what donation brings the best return.

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