ustxtxb_obs_1995_03_24_50_00013-00000_000.pdf

MOLLY IVINS ‘Fixing’ the Courts How come America can’t produce the kind of news Mexico produces? We’re falling so far behind in the generation of interesting news, it’s a blue-bellied shame. We’re a second-rate powera pitiful, helpless giant knocked off Page One by shenanigans that make O.J. pale by comparison. In Mexico, at last report, the brother whose brother was knocked off covered up for the brother of the last president. The cash is stashed in Houston. Is this good stuff or what? And what do we have? Just piddly stuff, like you can’t get your day in court anymore unless you have at least $100,000 worth of whip-out money ready to hand over. Most of us weren’t planning to sue Exxon any time soon anyway; it’s the sort of thing that occurs to you only if you’re a fisherman and an Exxon tanker runs aground and kills all the fish in the sea so you can’t make a living anymore. Or something like that. Bought a house in Love Canal. Lived next door to Rocky Flats. Some carelessness on your part of that nature. Or maybe you live in Alton, Texas, and some pop-bottler truck with faulty brakes rams into the local school bus and kills both your kids. You may believe that large trucks should not be running around with bad brakes and killing school kids, but unless you have that big dough to whip out upfront, you got no case. Now, in a moment of mercy, even the Republicans figured a straight-up loser-pays law was a little stiff, so they changed their bill from the original Contract With America proposal: Under this dandy modification, you’re the loser if you don’t win more than the company offers to settle for. Here’s how it works: You have a legitimate claim against a corporation. They offer you $50,000 for the damage they done you. You ask for a jury trial, but the jury thinks your injury is worth only $40,000. Instead of winning $40,000, you are now the “loser,” and you have to pay legal costs, which happen to amount to $50,000. Congratulationsyou won, but you’re in hock. This here is what is called “incentive to settle,” meaning: Take what the company offers you and shut up. It’s not exactly as though you were ever going into court on a level playing field against Exxon to begin with. Sure, your Molly Ivins, a former Observer editor, now a columnist with the Fort Worth Star-Telegram, recently was named by readers of the American Journalism Review as the best nationally syndicated columnist. friendly local legal shark agreed to take your case in the first place because he knew it was worth at least $40K, and he’ s going take a big cut of the settlement. But your friendly local legal shark, no matter how sharky he or she may be, is still up against a team of Exxon lawyers the size of the Justice Department. On top of that, 60 percent of sitting federal judges were appointed by Republican presidents who chose them because they had records favoring big business over injured citizens to begin with. Now, your local legal shark has less incentive to take your case and even less incentive to fight it. He’s no foolhe’ll take the settlement. Big corporations would rather keep paying one out-of-court settlement after another than change an unsafe product. Ask anyone who got hurt in a Pinto crash; ask the women who can’t have children because of the Dalkon Shield. So, now we’re going to get more unsafe products on the market injuring more people. But doesn’t the government stop companies from marketing unsafe products? The Federal Trade Commission, the Food and Drug Administration, the Occupational Health and Safety Administration, all those guys? Ah, you have failed to appreciate the full beauty of the Contract With America. The FTC, FDA and OSHA will be, the Senate permitting, under dandy new rules that put health, safety and the environment subordinate to the cost of protecting them. They call it task-assessment/cost-benefit analysis, and it has already passed the House. The amazing thing about these developments is that they’re based on the unlikely assumption that poor, picked-upon Exxon can scarcely function anymore because it is so beleaguered by “frivolous lawsuits.” Uh, checked the stock market lately? Looked at any annual reports? Bidness interests in this country always a make a b.f.d. out of any jury award that goes against them. Take the woman who got millions for spilling McDonald’s coffee on herselfsilliest thing you ever heard of, right? Juries, oddly enough, are seldom made up of total idiots. They seem to have been impressed by the fact that McDonald’s had had 700 previous complaints about people burned by hot coffee without doing anything about it. And, of course, the woman’s settlement was knocked down to a fraction of the original judgment on appeal. In other words, the system was working fine. But the Republicans just fixed it anyway. But good. Regulating the Markets Remember the ominous thud … thud … thud in Jurassic Park? Well, there was just another heavy thud from the derivatives market. The case of the 28-year-old trader who bet $29 billion of his company’s money and lost did hit the front page for a day because it forced the bankruptcy of the 233-year-old Barings Bank of Britain. But there are still a lot of 28-year-old traders out there. In fact, traders tend to be junior. Novelist Po Bronson, in an essay for the New York Times, said, “Thirty-year-olds manage mutual funds for the same reason we send 20-yearolds to fight our wars: They don’t realize they could get killed out there.” Bronson is not the first, or the 100th, Cassandra to point out what’s happening in the financial industry. The industry got hooked on the easy profits from the huge drop in interest rates during the early ’80s. When interest rates started up again, the industry tried to sustain growth by inventing new investment products: closed-end mutual funds, collateralized mortgage obligations, interest-only strips, specialty stock indexes, special investment vehicles, swaps, straddles, futures, junk bonds, derivatives. No one knows how much money is out there in those high-risk markets, but it’s enough to make October 1929 look like a day in the country. Meanwhile, the new ideological blinders in Washington prevent anyone from even discussing the problem, much less doing anything about it. Mention the word “regulation,” and you’re told it’s not in the Contract With Americathey’re busy saving us all from peril by throwing out the environmental laws. The fact that the markets look like the beginning of the savings-and-loan disaster seems to interest no one. The only pol I know of working on this is Senator Tom Daschle of South Dakota \(thank God get the government out of guaranteeing losses in these nutball trades. You recall that’s how we wound up with the tab for the S&L mess: The FDIC still guarantees $100 K in bank accounts. Another sporty little item on the bidness page is the grand jury looking into whether Wall Street has been screwing with the taxpayers on municipal bonds. According to an insider who is, in his own words, “ratting on the industry,” securities firms have been charging artificially high and potentially illegal prices for securities sold to local governments in complex bond deals. Keep an eye on this little hummer; we’re talking hundreds of millions of dollars in losses to the Treasury. Hell, the. Republicans might not even need to cut poor crippled kids off SSI if we had that money. [11 THE TEXAS OBSERVER 13 .4011071.411#i.pcv