Made in America: Corporate Gall

(CBS)  Attorney Andrew Cohen analyzes legal issues for CBS News and CBSNews.com.

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Like the child who kills his parents and then begs for mercy because he is an orphan, the U.S. Chamber of Commerce now is begging President-elect Barack Obama to protect corporate interests in the nation's civil litigation system as a way of restoring jobs and bolstering an economy shattered largely (as we now know) by corporate greed and misfeasance.

Talk about your gall.

Here is what the president of the Chamber's legal arm wrote in an open letter to Obama: "We understand the critical necessity of revitalizing the economy by restoring American jobs, encouraging the growth of U.S. businesses, and protecting the savings and investments of millions of Americans. However, we are concerned that the potential expansion of legal liability significantly impairs these much needed steps toward a national recovery."

The quote may be roughly translated this way: "Now that corporate America has helped screw everything up and led us into the greatest economic crisis since the Depression, we need to make sure that corporate America isn't aggressively punished for its misdeeds or legitimately thwarted from misdoing them again."

This is either an astonishing hypocrisy - Is corporate America unaware that the rest of us are in on the secret of the causes of the recession? - or the clearest indication there can be that Big Business is, always has been, and always will be about protecting Big Business.

The Chamber has been pushing tirelessly for decades to rein in plaintiffs' attorneys (who look to punish corporate negligence or fraud with civil lawsuits), deregulate industry and commerce (we all know how well Wall Street did with its freedom), and nullify important consumer protection laws (like the one in Maine which is allowing smokers to go after tobacco companies for false advertising). The lobbying effort has been national and local, highly-public and super-secret, and devastatingly successful.

Thanks in part to the Chamber and its Orwellian-named Institute for Legal Reform, the Securities and Exchange Commission backed off its scrutiny of screwy deals and schemes, the Congress was lax in its oversight of the mortgage industry, litigators were thwarted or punished, and the White House and Justice Department pushed a legal doctrine ("preemption") that almost always helped employers over employees.

All of these things, and more policies and practices endorsed by the Institute, helped unshackle the savageries of corporate America and left individuals less protected against an ever-freer and more predatory market.

Indeed, aside from the occasional Supreme Court decision that has helped the little guy, and the heroic efforts of states to help protect consumers and the environment, the history of our "litigation system" (as the Institute puts it) over the past 20 years is one of unremitting advances for the Chamber and its fellow travelers in law, politics and governance.

The Environmental Protection Agency has been reduced to a shadow of its former self so that polluters have gone unpunished, the Madoffs of the world have been nurtured and coddled and thus have flourished, and the brutal Savings and Loan crisis of the late 1980s has been made to look like a bake sale compared to the trillions of investment dollars lost and the hundreds of billions soon to be spent by our government.

Even the Web site for the Institute reads like a cruel parody. Not surprisingly, it does not highlight the personal stories of the millions of victims of corporate greed or managerial incompetence. It does not measure the number of lives saved, and fortunes protected, and pollution cleaned through these lawsuits. Instead, under the banner of "lawsuit abuse," it tracks the lives of people who believe for one reason or another that they have been unfairly sued.

[Now, tell me, have you ever known someone who believed that he or she had just been fairly sued?]

Plaintiffs' attorneys aren't responsible for the mortgage-fueled economic meltdown. Class-action litigation isn't, either. And don't blame overzealous regulators or greedy employees who want better pay or conditions in their own factories. The people with whom the Chamber and the Institute do battle are not the people who invented or allowed the great pyramid schemes which brought down Freddie Mac and Fannie Mae. They did not force consumers to spend more than they earned or save less than they should. Corporate America is directly responsible for what has just happened to corporate America, and if you don't believe me, ask the folks at Ford, GM and Chrysler.

The economic meltdown came about because business interests were able to greatly decrease the vital tensions between industry and regulation, between oversell and oversight. And it will take the restoration of those tensions by government leaders not just to help bring us out of our slump but to help ensure that the next downturn doesn't come again for a long time.

So it seems to me that the last things the Obama administration ought to do once it takes over is further shackle lawyers, or stifle well-meaning state laws, or make it easier for businesses to avoid liability and culpability for their actions.

The Chamber and the Institute want us to believe that one of the problems which created our misery also happens to be one of the solutions to it. They call it "reform."

I call it nonsense.
By Andrew Cohen

[whammersley]

Get real!!! The consumer looks for two principle things in the goods bought. First; price. Specially today with the economy the way it is, price is foremost in the consumer's thoughts. Second; quality. In the world economy the quality from foreign countries is as good or in some cases, better, than American manufacturing can produce. As long as prices are low and quality is acceptable we will continue to buy without regard as to where a product comes from.

[magnamanv45]

I heard on the news this morining that a Auto plant in Lorain Ohio is closing down. Are they closing any of the Auto plants that are not in the U.S.? I feel that when the Government did their Auto bailout, that ALL Auto manufacturing outside the U.S. needs to be moved back inside the counrty. MADE IN AMERICA is not made in America anymore. Our jobs are our country. We`ve become a giant shopping mall for all the worlds garbage. We need to make the phrase "MADE IN AMERICA" mean something again. Chevroletts are made in Mexico, Fords are made in Canada, and Harley Davidsons are made in Japan.

[ausus-2009]

mytoosense,

If everybody has your attitude, Zimbabwe will be sending us aid.

[mytoosense]

After a decade of trickle-down disasters for the middle class, the results have finally arrived.

The only voice the middle class has that anyone listens to is their vote and their spending habits.

I voted strait Democrat and I will spend as little money as possible until things improve for the middle class.

Corporate America be DAMNED!

[perfectstom]

ausus,
It all boils down to the perception that a product gives to the consumer. You are right that American car quality is much better than people give us credit for. But once a general impression has been formed by the consumers it is very hard to change. It''s also very hard to establish initially. You have to be intentional and it has to permeate the entire industry.

So for pharmaceutical companies the very great danger is that a poor general impression is being formed of them little by little by the consumer. We read every day of the dangers of prescription drugs, corruption and ineptness in the FDA management ranks, doctors on the take, hidden trial results, the list goes on and on. Eventually the general public''s perception will define American Pharmaceutical Companies to be synonymous with dangerous and untrustworthy. Recovering from that perception will be a monumental task. I hope this never happens but it seems to be a repeat of the auto industries slide.

[Netterz]

The biggest problem the US is facing, is that we allowed unfair trade practices. We also pay people wages that allows them to support there own families, instead of 4 or more generations, or 4 siblings and family all under one roof. Its the greed up at the top of the food chain, they have sold out the American peoples jobs, moved there companies and holdings over seas, where they can hire labor for far less. There is very little left in what was once known as middle class. It will be the filthy rich, and the very poor. This is far worse than just a depression, it is the groundwork for socialism. Land of the free, for we the people is fading very fast.



The true reason that Americans have the highest litigation rate, is because we allow far more rights to prisoners, to tie up and stall courts, then changes to laws to make there lives so easy and comfy in prison, and they have nothing better to do, than think up other things to sue over again.

[ausus-2009]

perfectstom,

Don''t kid yourself there is much of an American pharma. A lot of the medicines are made in India and bottled in the US.

As to Japanese cars, I had one of the greatest lemons ever, and it was Japanese. It was a new Nissan with 35 faults discovered in the first six months, including headlights and tires that refused to remain aligned, a window that fell out, a brake that nearly fell off and a head gasket that blew.

With cars these days, it is a form of snobbery that Americans do not buy the American models.

[perfectstom]

ausus, I say this because I want pharma to succeed - Don''t be fooled, the American consumer won''t be fooled. Quality counts. If you don''t have it you won''t succeed. Japanese auto makers didn''t get to where they are by being second rate in quality. Initially it wasn''t the case for them but they learned quickly and what they understood is what the American consumer wanted, how big the market was and what they needed to do to capture it. They did capture it. If American pharma stumbles too much there will be others ready to claim a portion of the trillion dollar prize.

[ausus-2009]

perfectstom,

Americans buy foreign manufactured goods, not because the quality is any better, but because they are price competitive. I have been guilty of this myself, even though I try to buy American as often as possible. A major component of the price of American manufactured goods is the cost of legal compliance, legal threat and legal insurance. Certainly Chinese goods are often inferior to American goods, and sometimes dangerously so. Examples range from lead paint, poisonous additives to food and items that break apart easily, meaning sharp edges.

I certainly am not advocating removing the oversight of industry nor the removal of the right to sue when it is warranted.

It gets back to the old legal saying: "It''s not whether you win or lose the case, it''s how many billable hours you can turn it into."

If somebody is sued, it is ultimately the consumer that pays and the lawyer that walks away with the lion''s share of the money.

[perfectstom]

Concerning Americans being the most litigious in the world - Maybe the citizens of other countries have just given up. Maybe they''ve learned to just take it. Maybe they don''t sue because that right has been taken away from them. Maybe preemption is a way of life for them.

Granted there are exploitive law suits but not to the degree that industries would like us to believe. Total elimination of lawsuits is not the answer.

About other countries coming in and taking over the American pharmaceutical industry. Well, we have a good example of that. Look at automotive. Americans will not pay for high priced, low quality product regardless of who produces it. If China or India can do it better we only have ourselves to blame.