Retirees
Plaintiff lawyers are driving up all your expenses, threatening investments
Looking for what to do next? Find out at the end of this article.
Plaintiffs’ lawyers advertise their services as being in the interests of consumers. That is not always the case. Every person in this country, whether they are aware of it or not, pays a tort tax because of the excessive litigation produce by those attorneys. Jackpot Justice, a study conducted by the Pacific Research Institute, estimates the total cost of litigating civil cases is $865 billion a year. America’s out-of-control legal system makes a $2.36 billion hit on the economy each day.
Staying Alive – Legal Reform Adds Years to Your Life
The benefits of reining in runaway litigation are not all monetary. A 2006 study by Paul H. Rubin and Joanna M. Shepherd found that tort reform laws passed at the state level from 1981 to 2000 prevented roughly 22,000 net accidental deaths from occurring during that period. The researchers say excessive legal liability increases the costs of developing and selling many risk-reducing products and services, but because some states have put limits on lawsuits, these products have become more available to consumers.
Injured parties need a judicial system that will appropriately compensate them for the harm they suffer. But the country needs reasonable tort laws that limit the damages juries can award and minimize the incentives that encourage plaintiffs’ attorneys and plaintiffs themselves to seek fortunes through the civil justice system. None need it more than small businesses and families.
Now For a Dose of Financial Facts
In the big picture, lawsuit liability costs now exceed $865.37 billion a year. This figure represents more money than the unprecedented 2008 U.S. federal bailout – more money than the cost of the wars in Iraq and Afghanistan on an annual basis – and more money than the Gross Domestic Product of the majority of nations in the industrialized world.
According to Pacific Research Institute, which has conducted multiple econometric studies on the cost of the American civil liability system, more than half the amount spent on liability lawsuits each year is excessive. The U.S. spends approximately 2.2 % of Gross Domestic Product on direct tort liability costs, while most advanced economies spend .9 %. So, compared to our economic competitors, the U.S. spends 59 % more on excessive liability costs. That’s the equivalent of a 13 % tax on annual income in the U.S – income that supports retired Americans and Americans on fixed incomes.
Additional costs can be measured not only in dollars, but also in availability of medical services, jobs lost or outsourced, and critical innovations either stalled or foregone altogether.
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The annual loss to U.S. stockholders due to liability lawsuits is $684 billion – the equivalent of all U.S. supermarket sales for a year, or the entire economic output of the State of Florida.
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Drawing on data from the Institutes of Medicine, 114,000 people would be alive today if not for excessive tort liability in medical services during the past two decades.
- The so-called “tort tax” on an American family of 4 is $9,827.
Now What Do We Do?
Foundation for Fair Civil Justice (FFCJ) exists to bring empowering programs and education to retired Americans and Americans on fixed incomes.
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Please take the time to sign up for our Fairness Matters e-newsletter, which will bring you news items right to your email that tell the ongoing story about the need for legal reform by clicking here. We don’t share your email address with anyone – that’s important to us.
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Learn more about the bread-and-butter, common sense need for legal reform and how lawsuit abuse affects you as a retired American or American on fixed income by listening to our “Let’s Be Fair” radio commentaries, hosted by FFCJ Senior Fellow Bob Dorigo Jones by clicking here.
Bob is a bestselling author and founder of the nationally profiled “Wacky Warning Label Contest,” which annually picks the wackiest warning labels on products to underscore the absurd lengths to which American business has to go in response to the threat of lawsuits.
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Finally, we hope that FFCJ programming is a good investment for your business and for America! Please take the time to invest in our work to protect you by making a tax-deductible contribution by clicking here.
