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Unused and Probably Unusable

-- a linguistically inclined blawg

Mea culpa: a post dedicated to Ted and Walter of Overlawyered
I owe an apology


Posted by Eh Nonymous on Wednesday August 17, 2005 at 9:07pm
shell:
I've skimmed through the comments - as you've said, emotions ran high and some commentators resorted to (quite unfairly) ad hominem tactics - though would have considered yours as among those that were more restrained than some of the more prominent attacks (or is it defense?)

Nevertheless, I applaud your ability (not to mention willingness) to do some introspection (particularly after moments such as this), and in my humble opinion, it's a desirable trait that has become woefully lacking within the legal community.

I'm also a subscriber to Overlawyered - and although I'm certainly not a lawyer yet (not for at least three years) - I'm most certainly aware of OL's weight in the legal community. Ted Olsons' expamples serve as warnings to the legal community, written from an outsider's (policy analyst's) perspective on blatant abuses committed by commoners, companies, and politicians/patricians - all with the help of legal experts/executioners.
8.17.2005 11:37pm
Eh Nonymous (mail) (www):
Shell:

Interesting response, thanks. I may not have been the worst perpetrator, but as in torture allegations or electoral manipulation, "I wasn't doing it as much as those other dudes were" is no excuse at all, none.

I aspire to be a

1 polite commenter
2 thoughtful critic
3 ethical blogger
4 decent and respectful human
5 honest and fair advocate and opponent.

(not necessarily in that order of importance)

To the extent that blind rage makes me discourteous, I am risking 1, 2, maybe 3, possibly 4, and certainly 5.

I will have more to say on the blawg proper about blog etiquette, blawgospheric standards of behavior (that is, the universally applicable informal rules and the formally imposed private rules), and what I expect and demand from commenters here. It's relevant; we're a totally self-regulating and in my opinion rather different form of "mass" media, floating as do all others in a sea of law and social norms.

As to OL's role in the legal community: well, in a sense they're assailing it. If the criticism is fair, great. Ditto the calls for reform. People disagree about whether this really is an outsider's position. Groups like Tillinghast (Towers Perrin) come under fire for earnestly adding up the "costs of the tort system"("$246 billion") without, say...

- disclosing that this includes the transfer of wealth for compensatory damages, which does not "cost" anybody anything in a certain abstract sense, since it merely returns the value of damages inflicted to the person involuntarily deprived of that amount; it's redistributive, but not a "cost" in the economic sense

- admitting that there are _valued goods_ produced by the tort system, such as accountability, public respect for law, sometimes justice, recourse for victims, a Day in Court for both plaintiff and defendant, and other process-type values, none of which are accounted for (added up on the other side of the ledger) in their analysis

- revealing that some of the costs are "costs," in the sense of fees, and other times when an efficient solution would eliminate that payment; and that others are costs of discovery and of investigation, which may in fact be the kind of thing that you can't do without.

On this last point: After an oil tanker runs into a berg in the icy waters, somebody's got to do something. There are externalized costs being imposed on everyone (harm to nature, harm to the environment, harm to individuals nearby, etc.) which should be shifted in whole or in part back onto the responsible individuals and companies. There are the necessary costs of investigation into why it happened, and necessary costs of attempting to prevent it from happening again. There's got to be some effort made to bring the relevant parties to the table, whichever table that is, and meet their concerns.

This stuff is part of the cost of doing business, and the cost of negotiating solutions to problems. It's not a "cost of the tort system" per se, unless it actually is.

Also, about your metaphor: Executioners?
8.18.2005 9:49am
Ted (www):
Thanks for the apology. To your commenter, NB that Ted Olson is a different human being than the duo of Walter Olson and Ted Frank.

I don't think my statistical argument was "pro-defendant"; I think it's the only relevant statistical argument, and it just happens to lead to a pro-defendant result. There are certainly other circumstances where the same argument would lead to a pro-plaintiff result, such as a Mount Everest tour that foolishly or mendaciously guaranteed a safe ascent but failed to provide it.

The TTP study also doesn't account for the second-order costs of the tort system, such as jobs lost, innovation foregone, or wasteful defensive practices (such as defensive medicine). All in all, these omissions more than make up for what it overcounts, and the TTP number is likely an underestimate of the true cost to the economy. I wouldn't use the TTP study to account for the tort system's cost to society to a three-digit level of accuracy, but I'm comfortable using it for an apples-to-apples comparison of how fast the problem is growing over time, or saying that the magnitude of the problem is in the hundreds of billions of dollars.
8.18.2005 11:29am
Eh Nonymous (mail) (www):
Ted,

Thanks for accepting said apology.

The TTP study, as you indicate, is incomplete.

I believe it has been so thoroughly debunked, and the debunkers themselves debunked, that I can't hope to add to the debate over it. You are more knowledgeable about it than I am, and for good reason; you have spent time and effort understanding it and what it means.

I would diffidently suggest a few things, though:

1) it may be poorly named
2) it may be a carefully researched and minutely careful quantitative study for a metric not related to the real "problem"
3) it is a hot item, and well worth thinking about.

I also want to discuss what it is "the problem" really is. On OL's masthead and sidebar, there are some very carefully crafted statements. It does talk about cost, but the motto is exceedingly good, as I quote it in the main post. "too often," etc.

That motto does not attempt to rigorously quantify the problem, only listing some behavioral contributions to "the problem."

I'd like to analyze and discuss on this blawg, in the future, what precisely that problem is.

If you say that the problem consists of "too many lawyers, too many claims, too high damages and too much regulation," then I'll call foul. May be true, maybe not, but it's controversial.

If you instead say that the problem involves the predictable costs of allowing a mostly unregulated industry of hungry professionals to govern themselves, with concommittant costs to all of society, I will immediately sign on. Further, I would set aside space, time, and effort at this blawg to prove you right. In fact, I think I'll do that anyway.

You and I may wind up disagreeing as to the proper measurement, assessment, and causes, let alone solutions, to the "problem," whatever it may turn out to be.

Let me suggest, then, that the identification of this Problem implicates

1) the normative (Shell: I mean, "proper, ought-to-be") function of Law
2) the proper function of Courts and Lawyers
3) the appropriate balancing to be made between the interests of business, society, and the legal system, which have interests in common but which are not perfectly aligned
4) whether and how much the global interests of
- justice
- efficiency of adjudication of disputes
- predictability via uniformity of outcomes in order to guide and inform norms of conduct
- punishment of bad actors (which is part of justice, but not all of it)
- compensation for legally cognizable injuries, and
- less drag on business

can and should be reconciled.

Again, thanks for continuing this discussion here; I look forward our exchanges and hope to continue them in the future, here or elsewhere.

Regards,

Eh N.
8.18.2005 12:14pm
shell (www):
Apologies to Ted (I tend to jumble names/words/numbers together - and most of the time I write my comments during a literary drunken state, as Eh Nonymous could/would/should attest.)

Executioner - Just a little play on words, for those who executes the law, and of course, those who do what you think they do. Why? Because law could be so ominous at times.

Confused? As am I.
8.18.2005 11:27pm
Deoxy (mail):
First, wow, that's a really great apology. I admire that.

Second, regarding the TTP study, I agree that we need to define "the problem" and that many of the bendits (and as Ted said, the costs) are not included (probably because they are nearly impossible to value objectively), but I disagree with a lot of this:

"-disclosing that this includes the transfer of wealth for compensatory damages, which does not "cost" anybody anything in a certain abstract sense, since it merely returns the value of damages inflicted to the person involuntarily deprived of that amount; it's redistributive, but not a "cost" in the economic sense

What is "compensatory damages" in name and in actuality obviously differs (see OL for egregious examples of this.)

"- admitting that there are _valued goods_ produced by the tort system, such as accountability, public respect for law, sometimes justice, recourse for victims, a Day in Court for both plaintiff and defendant, and other process-type values, none of which are accounted for (added up on the other side of the ledger) in their analysis"

The problem here is that those "valued goods" are regularly not only NOT produced but actively hindred by the legal system - "public respect for law" being an obvious example. "sometimes justice" as you even said...

"- revealing that some of the costs are "costs," in the sense of fees, and other times when an efficient solution would eliminate that payment; and that others are costs of discovery and of investigation, which may in fact be the kind of thing that you can't do without."

That is true, but, IMHO, the percentage of costs that you can't reasonably do without is so low as to be nearly negligible.
8.22.2005 10:06am
Eh Nonymous (mail) (www):
Deoxy, thanks for commenting.

Here's my (intended to be quick, in fact ridiculously long) reply:

Again, in the economic sense, redistribution has _no net economic costs or gains_. It has individual costs, and corresponding individual gains. Same as robbery. We don't like robbery (economically speaking) because it has the threat of violence, because it's unfair to the person being robbed, because it has negative externalities, and because we have laws that are violated when robbery (some robbery, anyway) takes place.

But it's not economically inefficient, it's neutral. No wealth is created or destroyed by robbery, just moved. So if you wanna argue fairness, welcome to my home turf. But if you're talking about actual _costs_, we'll have to be on someone else's turf: economics, where I am not at home but where I will defy anyone to identify _real_ problems with jury awards. They may be business-inefficient, but I'd have to be shown figures. And maybe some pretty charts.

Compensatory damages are not given each and every and only on the times when someone was injured and someone else is at fault. If it were, we'd have something closer to workman's comp; a no-fault regime that hopefully tracks actual damages, by putting the costs on those who can bear it and leaving problems of proof largely out of the mix. Then the person who ought to be best able to prevent the injuries (the individual, if they want to not lose a finger or an eye; the company, if it's about purchasing safety equipment and doing proper training), will want to do so. Alignment of interests and costs; fewer externalities.

Active hindrances by the legal system usually come from Interests, as in Moneyed or Entrenched, and their mutual opposition and antagonism is the only hope we've got. Cf. Federalism vs. Strong Central Government in our own and other systems. There's a "third way," which involves respect for individual rights and freedoms and responsibilities, but it's largely powerless. The only way it gets out is if the NRA (chuckle) or ACLU or Fed Soc or Americans United or the Jehovah's Witnesses bring suit, and have a powerful constituency - lawyers - on their side. That implicates the counter-bias of the legal system, which is usually in favor of having no lawsuits and therefore no recourse to justice, by turning it into a respected and therefore reasonable and therefore cognizable claim. But it's all power.

The % of costs that we can't do without is negligible?

I don't know what you mean, exactly, but I suspect I disagree. :) Clarify?

"Costs" - like, the costs of doing business? Insurance is the business of spreading risk. Plaintiff's lawyers are in the business of redistributing wealth - often, in the exact opposite way that the defendants are. That's not to say that business "create" and plaintiffs "destroy" - because after all, when a victim is injured, something (health or financial wellbeing) was destroyed or harmed, and the external cost needs to be shifted back. Put that way, plaintiffs' lawyers are (or should be) in the business of justice... which would mean defense lawyers are in the business of injustice. :)

Hopefully, justice does in fact lie somewhere between their positions.

Negligible costs, though. That's a very weird phrase. I've seldom heard of those. Storage space is now effectively free; Mark Liberman at Language Log calculated the cost to almost precisely $0.00 per byte, which is accurate to about four or five or fifteen (I totally forget which) decimal places. Heck, Gmail gives me 2.5 Gigabytes for free. Multiply that a few dozen times, and you start to talk real storage space.

But in the Real World, almost no costs are free. All markets are inefficient. All data is chained, either because of real search costs or because of artificial barriers to knowledge: ignorance, meta-ignorance (not knowing you don't know), lack of tools, lack of skill with the tools, lack of training, lack of communication.

I'm interested in the prospect of drastically lowering those costs. Google lowered one type of "search cost" while bringing up the quality of the results; bless you, Google.

But in Real Life, you have to pay, for example, an architect to survey, and pay again for a second opinion.

Work takes brains and skill takes money; figuring out how to prevent the next Exxon Valdez is _not_ trivial.

It should, of course, be cheaper to _prevent_ an accident than it is to:

- suffer the loss (to property, to reputation, etc.) and then defend the case and then pay any resulting award or settlement, or

- get the law changed to shift the cost back onto the public. Buying legislators isn't cheap these days...

But as I love to point out, businesses are _wildly_ inefficient, in that they fail to recognize and account for not only externalized costs (costs on us, the rest of the world; that's fine, it's not their job) but they also don't even recognize likely _internal_ costs, if it requires imagination or mathematical rigor or common sense to predict them.

Why would you fail to avoid a highly expensive, ruinously reputation-smearing accident by some simple expedient (firing the alcoholics, installing better radios, whatever)? Because you (the corporate defendant) are made of humans, and have accountants not visionaries in control, and because even when you have accountants you usually don't listen.

I'll have more on this (believe it or not) in future posts.

Thanks again for reading and commenting.
8.22.2005 11:17am

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