Subject: Letters to the Editor: Law Missionaries Made Hayek Weep
Date: Published: 9/10/92 (72 lines)
Source: Wall Street Journal. Copyright Dow Jones & Co. Inc.

    Letters to the Editor:
    Law Missionaries Made Hayek Weep

    I was amused to see myself given equal billing alongside the vice
 president of the U. S. as America's other proponent of "abolishing
 the tort system."  ("Torts:  The Best Defense Against Regulation,"
 Mark F. Grady, Counterpoint, Sept 3).  While I have supported
 proposals for modest legislation, I have argued at length in two
 books and numerous articles that reform of our tort system must
 occur principally in the common-law courts themselves.  And despite
 many strong words of advice that I have handed out quite freely, I
 have never yet dared invite judges to abolish themselves entirely.
    I was even more amused by Mr. Grady's suggestion that the great
 Friedrich Hayek secretly admired the trial lawyers of America.
 America's liability rules are not founded on industry custom or
 traditional consumer expectation, still less on private contract or
 other ordinary market mechanisms.  A courtroom is not a market;
 jurors don't have their own money on the table when they vote
 against you; what arrives next at your doorstep is the sheriff, not
 a catalogue from Land's End.
    The liability rules in effect in our courts today are not even
 founded on longstanding legal tradition.  Mr. Grady mentions
 negligence law of the 1870s, but omits any discussion of strict
 product liability that displaced the negligence standard in the
 1960s.  In fact, the tort-reforming judges of the 1960s were not
 interested in any tried-and-true body of common law -- they wanted
 to create uncommonly new law, and that is precisely what they did.
 They had (in Mr. Grady's words) a grand, public mission of
 "reduction of accident costs for society."  Missions like that always
 made Freidrich Hayek weep.
    Mr. Grady states that a "society whose affairs are governed by
 truly liberal ideals must always prefer judge-made law to
 legislation...."  He is wrong.  When judges repudiate the market
 and take decision-making power away from the private pilot, bungee
 jumper or patient in desperate search of AIDS medication,
 legislation may be needed to reaffirm the principle of private
 contract and individual choice.  Mr. Grady, like many other lawyers,
 just can't imagine that when offered the help of lawyers in the
 legislature or lawyers in the courtroom, many consumers might prefer
 none of the above.
    Peter Huber
    Bethlehem, N. H. 
    ---
    Mr. Grady's defense of the current civil justice mess is straight
 out of the "name-your-poison" school of public policy.  At bottom he
 contends that Americans must either swallow what he calls the
 "negligence explosion" in tort liability or accept the equally grim
 alternative of "more safety regulations of the type associated with
 the FDA, the Consumer Product Safety Commission and OSHA.  "
    But regulation and litigation are not on opposite ends of a
 seesaw.  Reducing one does not inevitably lead to increases in the
 other.  Indeed, if the past four years are any guide, greater
 regulation appears to go hand-in-hand with greater litigation.
    Corporate capitalism is both a ruthless and an efficient form of
 economic organization.  I had thought one of the goals of a modern
 mixed economy was the mitigation of the ruthlessness and the
 maintenance, to the maximum extent possible, of the efficiency.  That
 means making the tort system function less like "Wheel of Fortune"
 and creating a regulatory regime in which benefits and costs are
 rationally weighed.
    John Endean
    Vice President
    American Business Conference
    Washington

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