New Visions Commentary

The National Leadership Network of Conservative African-Americans

 

Often for Better and Sometimes for Worse, Lawyers Played Key Role in Black History

By Council Nedd

A New Visions Commentary paper published March 2001 by The National Center
for Public Policy Research * 501 Capitol Ct., N.E., Washington, DC 20002, 202/543-4110, Fax 202-543-5975, E-Mail [email protected], Web http://www.nationalcenter.org.
Reprints permitted provided source is credited.

Even though Black History Month just passed, let's pause for a moment and reflect on the notable role lawyers have played in championing - and, in some cases - blocking the progress of African-Americans.

Lawyers have been involved in many memorable cases affecting the black community. Some have been wonderfully inspiring and others tragically depressing. Among the most notable:

Yet, sadly, the fight between good and bad lawyers continues today.

All too often, this struggle goes unpublicized in the black community because it has moved outside of the civil rights venue and into the marketplace.

For instance, the vast majority of Americans are hurt by lawsuit abuse where greedy personal injury lawyers annually make billions of dollars by pursuing frivolous lawsuits that drive up consumer prices.

Yet even here, minorities tend to be whacked harder by price increases because, on average, their income is less than that earned by their white counterparts.

Cynically, personal injury lawyers heavily recruit class-action plaintiffs in minority areas with promises of a big-bucks payoff. When the awards come in, however, the lawyers walk away with millions of dollars, while minority plaintiffs' average less than $150 for their cameo roles in successful class-action lawsuits.

Class-action lawsuits undoubtedly are a serious scam perpetrated on African-American communities. In their wake, insurance premiums and health care costs skyrocket, the price of basic consumer goods soars and well-paying jobs depart for cheap-labor lands. The impact of the latter is especially negative for black Americans, who tend to be lower on the seniority ladder and more likely to be laid off. Increasingly, class-action lawsuits seem to be less about protecting innocent victims and more about padding personal injury lawyers' Swiss bank accounts. Take the example of class action lawsuits against the managed care industry. Whatever gripes we have with our HMOs, one thing is clear - lawsuits that drive up patient premiums won't fix anything. More likely, they'll force HMOs out of business and deprive poor neighborhoods - already suffering doctor shortages - of any medical care.

This is an issue of critical importance to the African-American community. Right now, roughly 40% of America's African-American population of more than 36 million people - some 14 million - are without health insurance, according to U.S. Census Bureau statistics. That's a tragic situation, but more lawsuits are only going to increase the ranks of the uninsured.

According to the Journal of Health Economics, every 10% increase in the cost of insurance creates a three to four percent decrease in the number of people who can afford to purchase coverage. In addition to class actions lawsuits, frivolous litigation in the housing market hits minorities hard by limiting the number of affordable homes.

In California, for instance, frivolous environmental and construction defect lawsuits make one of the most expensive housing markets in the world even harder for minorities to call home. Construction defect lawsuits have had a devastating effect on the state's condominium construction, which has screeched to a near halt in the past few years. Now, only 2,400 new units are built per year, dropping down from 25,000 in the mid-1990s. Condos and townhouses are the only affordable options for many people in California, since the median house price is now almost $250,000. The California Supreme Court stepped in to help fix the state's housing crisis last year by prohibiting construction defect lawsuits for single-family homes and condominiums if there is no actual building damage. But each time the state legislature tries to enact meaningful reform to make homes more affordable, the powerful personal injury lawyer lobby steps in and prevents any change.

As we reflect on all the factors that limit the economic opportunities for black Americans, let us not forget the effects of frivolous lawsuits filed by personal injury lawyers. These lawsuits provide little or no benefit to consumers, but raise prices and limit economic opportunities just the same.


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(Council Nedd is a member of Project 21's National Advisory Board and the president of the Covering Your Assets Coalition. He can be reached at [email protected].)


Note: New Visions Commentaries reflect the views of their author, and not necessarily those of Project 21.


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