Thursday, December 17, 2020

Champerty, the Triumph of Libertarianism - and the Downfall of Civilization

A lot has changed in America in my lifetime - not all of it for the better.

Libertarians are an interesting breed. They claim we live in a "Nanny State" and our freedoms are being oppressed by evil Democrats.   Most are young and have no idea what life was like in America, even 20-30 years ago, when either they were children, or before they were born.  To them, the world today is closing in, and their freedoms are under attack.  To me, we have more freedom than ever, and it hasn't resulted in a better society, but rather one far worse, in many regards.

I've mentioned before - many times - about how many ruinous financial instruments were illegal back when I was a kid.  They called it "usury" if interest rates were over 15% or so - today, that is considered a "good" credit card rate by many people, and we wonder why people are drowning in debt.  Payday loans, buy-here-pay-here used cars, rent-to-own furniture - all that sort of stuff simply didn't exist, legally.  If you wanted to ruin yourself financially, you'd have to resort to a loan shark.   Today, Citibank or Bank of America is keen to help you out.

And I've noted time and time again that stupid self-destructive things like gambling were illegal back in the day.  There was Las Vegas and... nothing.  You wanted to gamble, you had to make a trip to do it, or again, see your local mobster who would take your horse-racing bets or let you "play the numbers".   Today, if you want to play the numbers, the local 7-11 will sell you a lottery ticket.

Drugs were just starting to become a problem when I was a youth.  But for the most part, it was hippies smoking pot and maybe dropping a little acid. There was little or no coke, crack had yet to be invented, and the only people dealing in meth were Hell's Angels (hence the term, "crank").  People back then dreamed of the day when pot would be legalized - and that day has come.  Still convinced we are living under "oppression"?

With freedom, however, comes responsibility.  If you are allowed to take drugs, well, you also are allowed to ruin your life with them - just as you can with alcohol.  And yea, we tried to outlaw alcohol (hard to believe, in retrospect. Back then we had more "freedom" - right?) and that didn't work either.

But today, you are "free" to ruin yourself financially, by signing student loan documents, payday loans, or gambling at a casino.   These are all free choices, not mandates.  And there is no reason to pay off someone's student loans anymore than the government needs to pay off people's gambling debts.  Onerous financial burdens, freely taken on, are the responsibility of the debtor, not society.  But that's not a popular opinion right now.

We have more "freedom" in nearly every sense these days, yet Libertarians claim we are still oppressed.  Frankly, I think most people are oppressed by their own freedom - they get into trouble "doing their own thing" and then want the government to bail them out.  But I digress.

Lawyer advertising was outlawed when I was a kid - and even when I was a young adult.   The thinking was, a lawsuit was a serious business, and advertising a lawyer and encouraging people to sue would only serve to create frivolous lawsuits brought simply for their nuisance value.  Advertising lawyers?  That would be about as wrong as, well, advertising prescription drugs.  I mean, if we did that, people would start diagnosing themselves with illnesses and badgering doctors to give them a prescription - which would enrich the big pharmaceutical companies and cause the cost of medical care to skyrocket!

Oh, wait....  Gee, "freedom" is really swell, ain't it?  Thank God the "nanny state" isn't holding us back.  Funny thing, these things the "Libertarians" pine for often favor special interests - lawyers and big corporations.  But again, I digress.

Champerty is a legal term referring to the financing of lawsuits.  Again, back in the day, this was illegal.  Again, the idea being that if someone paid you to litigate a case, with the idea of it being an "investment" that many more frivolous lawsuits would be brought.  Oh, wait... we're there already.  So much freedom!  I'm getting tired of winning!

Most people aren't inclined to sue, unless the outcome potentially exceeds the expense.  You get ripped-off for $5000 from some scam artist, it isn't worth suing.   Sounds bad, but if every single wrong in the world was litigated, our courts would be more overcrowded than they already are.  America is a funny place.  In most other countries, lawsuits are settled by a Judge or Special Master, or in Arbitration, and only criminal matters require a jury to decide.  But an early Supreme Court decision decided that civil cases are entitled to a jury trial, and the result has been that litigation is very costly - and any lawsuit has a nuisance value in the thousands, or tens of thousands of dollars.

Lawyer advertising encourages people to bring suits that are probably better settled directly with the insurance company.  It also encourages people to bring frivolous suits and even fake accidents or bring false claims - on the hope of scoring a quick settlement.  Most "personal injury" attorneys are hit-and-run litigators, in that they file a generic complaint and then settle the case before trial for a nominal amount, take more than half of this, and hand over a pittance to the complainant.

Champerty makes things even worse, by allowing people, or investment firms, or corporations to invest in a lawsuit - a lawsuit that might not have otherwise been brought or would have been settled early on.  Some argue this is a good thing, as it allows cases to be heard where individuals are unable to sue due to lack of resources, and contingency-fee attorneys don't have the deep pockets to "float" the costs of litigation until trial or settlement. Perhaps this is true.  On the other hand, it also encourages a lot of suits that never should have been brought in the first place, and turns a legal matter into a speculative investment.  It turns the court into a casino - place your bets, ladies and gentlemen - before we spin the wheel of justice!

The problem with the argument that Champerty "helps the little guy" is that in addition to the attorney eating up half the judgment as a reward, along with court costs, expert witness fees, and so on - we have the "investor" to satisfy, who wants his money back, plus a lot of interest. Given that litigation is so speculative, investors want a huge return on their investment to make the thing worthwhile. They invest in a number of cases, and many lose - and a few win.  The net result is, the litigant - you know, the guy we were trying to help - gets a smaller and smaller portion of the pie.

What brought this to mind was a recent trip to Florida.  We went down to Tomoka State Park and went kayaking.  Well, that is, until we saw an alligator as big as our kayak slide into the water, not ten feet from it.  I never knew I could paddle so fast.  We stayed in the main channel after that.

But driving through Florida, you will see lots and lots of billboards for personal injury attorneys.  "Dewey, Screwem & Howe got me $500,000!" one proclaims.  It seems odd to me, because I remember when "lawyer advertising" was carefully monitored by the State Bar, and the most you could do was put out a business card in the yellow pages.   Claiming a desired result or dollar amount was considered verboten.  Today, the lawyers dress up as superheros, and make an implied promise to make you a millionaire, overnight.

Of course, the billboard showing the smiling guy claiming he "won" a half-million doesn't show him from the waist down - where he lost both legs in an accident.  And the billboard doesn't mention that a half-million was the initial offer from the insurance company, and that with legal fees and expenses, the poor sap was lucky to go home with $200,000 - which ain't worth losing a leg over, much less two.

But aside from that, these billboards feed the "something-for-nothing" mentality in America.  Hey, that guy on the billboard got a half-mil for an infected hangnail, surely my stubbed toe is worth a hundred grand, at least, right?  That is the attitude we are fostering - for all of us to become passive victims in society, waiting for the superhero lawyer to make us fantastically rich, because everyone else is, right?  That's how it's really done - how you really get ahead in life.   You have to work the system, run the con, do the scam.  All that "hard work and save your money" crap is for losers, right?

Welcome to Libertarian America 2020.   How I miss the Nanny State.   I recalled before how "back in the day" the big corporations didn't try to screw you out of every last cent.  In fact, they took care of you, cradle-to-grave, in what I call "corporate socialism".   I was lucky enough to see the last dying gasps of that era, by attending General Motors Institute - a college paid for and run by a corporation.  Not only was tuition cheap, we were paid to attend, as salaried employees of the company.

That era is not entirely gone, however.   The school still exists, as Kettering Institute, but the corporate sponsors have changed. And other companies still sponsor "co-op" students, just not those majoring in art, psychology, or agitation studies.

But yea, back in the day of all that "oppression" you could get a job with IBM and be set for life.  You might not become a dot-com billionaire, but you would have a steady paycheck, steady work, and a nice pension and retirement.  Today, you have the opportunity to become fantastically rich in the computer world, or be a peon exploited by the fantastically rich guy.  You can be Jeff Bezos, or work in his warehouse.   So much freedom, I just can't stand it!   Please, Rand Paul, liberate us some more!

The death of the corporate socialism era was perhaps preordained.   Back then, even working men made good money - at union jobs - and those same working men voted for Trump in 2016 (and some even in 2020) hoping to bring that era back.   But the Arab Oil embargo kicked the supports out of our booming post-war economy, which was built on a house of cards called cheap oil.  Throw in foreign competition, and well, corporate socialism was unaffordable.  GM closed all its parts divisions and non-auto assets, and that included its homegrown college.  We lived in an era now of "I've got mine, you get yours, jack!" and shareholders didn't want shitty little dividends, they wanted huge spikes in share price.  And by "shareholders" that included executives paid in stock options.   Welcome to our Libertarian era!

So much freedom!  So much!  But again, I digress.

Getting back to Champerty, it isn't just one thing that caused us to be where we are today.  And indeed, there is much today that is better than in the past.  These same Libertarians and "Strict Interpretationalists" of the Constitution brought us legalized gay marriage (even when many of us weren't asking for it) because, hey, if it doesn't say you can't, that means you can - or have to.  What a weird time to be alive, when right-wing conservatives legalize gay marriage at the Supreme Court, while liberal Democratic legislators are too afraid to support such a thing.   I would be happy, but like anything that is "too good to be true" it worries me.

Is Champerty enough to bring on the end times?  Not by itself, but it illustrates how "more freedom" often creates more problems, as one person's freedom often intersects another's.   While the personal injury attorneys think that lawyer advertising and Champerty are swell tools to have in their toolbox, the person on the receiving end of such lawsuits may think otherwise.  And if you have an insurance policy, on your home, your car, or whatever, odds are, you are paying for this "freedom" not by much, but a little here and a little there.  Even if you have no insurance, you are paying, in terms of higher prices at the supermarket chain, which has to settle untold "slip and fall" cases every year, most of which are pretty specious in nature.   You also have to pay for those security cameras they now put in the stores to document your fake slip-and-fall case, and it goes without saying, your privacy rights are eroded just a little bit more.

I just can't stand anymore freedom!  Make it stop!

Now granted, many things in the "good old days" weren't all that good.  Maybe cradle-to-grave corporate socialism was a good thing - if you were white and male.  And yea, maybe back then, if some rich guy ran you over, and you were poor, the odds of you collecting anything were not very good.  Or if a big corporation dumped toxic waste in your backyard, there wasn't much you could do.  Well, there were some lawsuits, and some folks did get paid out.   Today, this is a little easier, but then again, as I have noted time and time again, in these class-action deals, the lawyers make out the best, and the rest of us get only a pittance in many cases.

But I can't help but think that somewhere along the way, we lost our way.  In the name of "freedom" we have sacrificed so much.   We stopped taking care of one another - looking out for each other - in the name of "freedom" to exploit our fellow man.  I met a couple once who ran a small chain of payday loan stores and pawn shops.   I found what they did to be distasteful, but yet, in this modern era, you can't really call them out as being unethical, as we've moved the bar as to what is "ethical" far downfield.  Oddly enough, they didn't seem to be all that wealthy, even though they exploited people with 300% interest rates in "stacked" loans.   While there were wild profits to be made, there were also an awful lot of defaults.  It makes me wonder what the point of it all is - making hundreds, if not thousands of people miserable in life, so that one couple could have a middle-class existence.

And I guess that pretty much sums it up for me.  You see, we did all these things in the name of "freedom" - and loosened the reins on our society over the years.  But an odd thing happened.   Instead of feeling more free, people today feel more oppressed than ever before - mostly because when left to their own devices, they make horrendous life choices.  They are protesting against infringements on their freedom, but what their real problem is, freedom didn't work out very well for them, as they bit on a lot of raw deals in life, or this "freedom" to do what you want meant that their factory closed, they are upside-down on their mortgage, or some freedom-loving Wall Street investment firm pump-and-dumped their stock portfolio down to zilch.   Thank God (and Trump - same thing!) we got rid of all those pesky regulations "holding back" Wall Street!

Maybe we need a little Nanny-State now and then - to protect us from ourselves.  Failing that, there should be a law saying that freedom advocates can't go around protesting and rioting because they have too much freedom.   You want to be free to make bad choices?  You have to live with them.