Inflation has crushed small businesses and families these last few years, and the higher prices can be blamed on a litany of factors: Washington’s runaway spending, the post-pandemic recovery, wars overseas. But there is a lesser known and acknowledged driver of inflation that gets little attention. That is abuse of the legal system.
Governor Brian Kemp has identified this problem and has vowed to fix it. The Governor calls it the “tort tax”, and it costs families thousands of dollars a year. Independent studies have shown that the costs associated with excessive litigation amounted to 2.1% of the U.S. GDP last year, and it’s only getting higher. What’s worse, is that Georgia has one of the highest tort tax burdens on families in the country. According to the Institute for Legal Reform, the costs associated with excessive litigation equate to over $5,000 a year for Georgia households.
It’s not hard to see why. Every frivolous lawsuit forces businesses to raise prices, cut jobs, and pay higher insurance premiums. That means everything—food, gas, clothing, and medical care—gets more expensive for consumers. We’re all paying for this broken system.
Now is the time to reform Georgia’s legal system to protect honest businesses and families from unnecessary legal costs. We can allow legitimate claims while stopping the lawsuit abuse that’s driving up the cost of living for everyone. Governor Kemp’s legislation is a step in the right direction to lower costs for Georgia families.
Clay Cox, small business owner and Former State Representative
https://instituteforlegalreform.com/wp-content/uploads/2024/11/2024_ILR_USTorts-CostStudy-FINAL.pdf
Continuing with a few more things come to mind with tort reform.
4. Never trust a Chamber of Commerce at any level (municipal, county, state, or federal) to advocate for consumers. Some will sell constituent souls for the sake of increasing opportunities to improve commerce. That’s why they exist.
5. Governor Kemp’s tort reform efforts are not helping consumers or Georgia residents as much as it is to profit businesses under the auspices of a “trickle-down effect.” I think the trickle-down effect has proved not to be economically affective at the micro or macro levels of perspective. The rich get richer and the poor get poorer.
6. The State legislature has the authority to allow judges to assess criminal penalties for willful misconduct where a business is held liable to a greater degree of mismanagement than gross negligence and thus reduce the frequency and amount of financial penalties to demonstrate the needs for business to act in accordance with law and good will.
7. The State Bar Association has the authority to regulate admissions and retention of members of the bar. If attorneys file, argue, or otherwise press for greater liabilities than normally exist with losses, then the bar association can hold those attorneys responsible for not upholding the legal intents of the law. This will require focus on education, communication, and ethical (needing more refined legal definition) integrity.
I may get into this more deeply as time allows, but I see a pattern developing again where our State is reinforcing its governmental hold on power through financial manipulation of who will contribute to their campaigns.
1. Start with qualifications for entering the bar.
2. Elect/appoint judges meeting high standards.
3. If necessary to change tort law, provide judges flexibility to interpret the law.
I’m all for tort reform – – “ambulance chasing” lawyers are a real problem – – but the devil is in the details. How do you propose to cull the frivolous from the rightful redress of a wrong?
You are absolutely right, Penny. Making this distinction between frivolous and rightful redress is not always easy on a macro level.