Civil
Justice Resource Center
Truth About Make-Believe Legal System Costs
"The cost to our economy of litigation is conservatively estimated
to be over $230 billion a year." –George W. Bush
Misleading Legal System Costs Based on Study Done By Insurance-Industry
Consulting Firm.
Bush and other proponents of so-called "tort reform," (the
limitation of Americans' legal rights), have based their assertion
that consumers pay a $200+ billion cost for our legal system on a
study by the insurance industry-consulting firm, Tillinghast-Towers
Perrin. Yet, data from the Congressional Budget Office, Business Week,
and now the Economic
Policy Institute (EPI) all discredit this report. EPI concludes
that TTP's cost estimates are one-sided, inflate the impact of the
tort system and ignore its benefits, and that corroboration supporting
their numbers is weak or nonexistent. [Economic Policy Institute,
5/17/05]
Bush Attributes
CEO Executive Pay to Legal System Costs.
By Bush using the supposed $230 billion number for legal system costs,
he is also lumping in the millions of dollars made by insurance executives
as part of his calculation. [Center For Justice &
Democracy, 7/22/04]
Bush Says Asbestos
Victims Poisoned by Halliburton are Responsible for Consumer Costs.
By using the alleged $230 billion number for legal system costs,
Bush considers approximately 320,000 victims of asbestos poisoning
by Halliburton subsidiary Dresser Industries a cost of the legal system.
[Business Week, 5/21/03]
Bush Covering
Up $5 Trillion "Corruption Tax."
According to Securities & Exchange Commissioner Paul S. Atkins,
the corporate scandals occurring under the Bush Administration caused
a $5 trillion loss in stock market value. Calling the scandals by
Bush supporters such as Enron CEO Ken Lay "spectacular failures,"
Atkins pointed out that every American household lost an average of
$60,000, or $17,544 per citizen. [Associated Press,
11/14/02]
Number of Civil
Trials Dropped by 47 Percent Between 1992 and 2001.
According to statistics released by the U.S. Department of Justice,
the number of civil trials dropped by 47 percent between 1992 and
2001. The number of personal injury cases decreased by 31.8% during
the same period. ["Civil Trial Cases and Verdicts
in Large Counties, 2001," Bureau of Justice Statistics, U.S.
Dept. of Justice, 2004]
Median Payout
for All Tort Cases Dropped 56 Percent Between 1992 and 2001.
According to the U.S. Department of Justice, the trend in damage size
for tort cases is down. The median inflation-adjusted payout in all
tort (personal injury) cases dropped 56.3% between 1992 and 2001 to
$28,000. ["Civil Trial Cases and Verdicts in Large
Counties, 2001," Bureau of Justice Statistics, U.S. Dept. of
Justice, 2004]
Tort Filings
are Decreasing While Contract Cases are Increasing.
According to the non-partisan National Center for State Courts, tort
(personal injury) filings by individuals are steadily decreasing while
contract cases are greatly increasing. Tort filings have declined
5% since 1993. Contract filings, which are more likely to involve
businesses than tort cases, rose by 21% over the same period. ["Examining
the Work of State Courts, 2003," National Center for State Courts,
2004]
The costs of the legal system are created by those
who cause injury, not those injured through no fault of their own.
For more information, see:
Updated May 17, 2005
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