The Tort Liability Index: Another Reason Why You Should Feel Free to Ignore It
As I discussed in my recent post "The Tort Liability Index: Why You Should Feel Free to Ignore It," the Pacific Research Institute recently published a misleading report titled "Tort Liability Index: 2006." This report purports to show that "a [robust] civil-justice system lowers the standard of living for ordinary citizens" and that "meaningful legal reform on the other hand pays dividends in the form of stronger economic growth and higher personal income." The index then ranks states from 1-50 according to their anti-civil justice reforms and purported litigiousness.
My previous posting goes into detail about - bluntly - why you should ignore the index. In short, the index uses misleading numbers and data to the extent that it even refuses to release them for peer review. I guess this means that we should just trust their own internal fact checking - just because. The authors of the primary research on which the index bases its primary findings have also plainly admitted that "the costs tabulated in this study are not a reflection of the legal system," even though they have attempted to portray their data as reflecting exactly that.
However, in looking at a different civil justice issue, I was forced to disregard my own mantra, and re-check the report's assertions in order to figure out the best way to explain why it was wrong.
Luckily, in revisiting the report that I told you all to ignore, I uncovered - and no surprises here - yet another reason why you should feel free to ignore it.
The primary thrust of the index's argument is that a robust civil justice system that results in judgments against corporations hurts a state's businesses, which ultimately hurts employees, which ultimately drives businesses to other states.
Looking at the index I thought to myself: could it be that there's an even more obvious reason than those I've already given to ignore this index?
Indeed there is.
Keep in mind that the index terms the "best" or most highly ranked states as those that have most limited and restricted their civil justice system to victims.
I looked at the states that the index ranks as the "top ten". These are the states that it sees as being the best "reformers," or in other words having the most restrictive civil justice system. In practice, this means that they are the states that have enacted the most anti-civil justice legislation. I then looked at the states that the index ranked as the worst ten, or in other words, the states with the most robust and accessible civil justice systems.
The results once again demonstrate why you should ignore this index.
The ten states that the index ranked in its top ten "tort reform" states had an average per capita personal income that was $4,021 less than the states that the index listed as the ten worst "reformers." In the index's top ten "tort reform" states the average per capita income is $32,836 while in the index's worst ten it is $36,857. Indeed, Connecticut, the state with the highest per capita income of all states, was ranked by the liability index as #44.
If the argument being put forward by the report is that a robust civil justice system hurts corporations, which hurts the state's economy and reduces jobs, which in turn hurts the employees, why do the states that the index describes as the vanguard of tort reform on average make $4021 less than the "worst" ten?
Clearly, an interest in helping the average working man or woman maintain or increase their income is not the goal of the authors of the index or the anti-civil justice movement.
If it was, the most highly ranked states would correlate more highly with the actual income of the people who lived there.
Whatever your view of lawyers, the civil justice system, corporations, or anything, I think that we can all agree that we would prefer to have $4021 dollars more in income a year than - to not. If you agree, I would advise that you move to one of the index's ten "worst" states as soon as possible, before everybody else gets the word.
Some might say that a better measure of real living conditions is per capita gross state product. Even if you use this number, the "best" highest ranked tort reform states on average have $1247 less than the "worst." GSP also measures the overall economic output of the state, not the amount of income that individuals in that state actually gain from said output.
It is disappointing to me that I didn't notice this additional reason why you should ignore the index in my first read of it, and have now forced you to read a second entire blog post about why you can ignore something that you probably haven't even read because of my first post.
However, this was such a glaring and fundamental reason that I had to post about it again.
My only hope is that reading my both of my posts on this was far less horrible than reading an 89 page index that - as I think I've mentioned before - you should feel free to ignore.
To read a recently released report on the Tillinghast data by the Center for Justice and Democracy click here.
If you or your organization is interested in learning more about or working on these types of civil justice issues, please feel free to contact me at email@example.com.
Senior Fellow in Civil Justice
Drum Major Institute for Public Policy