From The Washington Examiner and The Institute For Legal Reform:
David Freddoso: Trial lawyers will still have their best friend after November
By: David Freddoso
Online Opinion Editor
September 28, 2010 These tiny excerpts from Dylan Loewe's book, "Permanently Blue: How Democrats Can End the Republican Party and Rule the Next Generation" (Three Rivers), reflect the supreme overconfidence Democrats felt when President Obama won in 2008:
"The Obama campaign didn't just build an organization that could win a single election; it built one that could sustain a permanent majority. ... Short of a massively damaging scandal, something so dramatic it might cause him to resign the presidency, Barack Obama is going to win a second term in office."
Things have since changed. Democrats face the possible loss of one or both houses of Congress, a majority of governorships, and control over most of the 2011 redistricting process. Obama's ratings are negative in Illinois. Most Democratic senators won't be seen in the same room with the guy.
We already know who is going to lose this election, even if the GOP falls short of a takeover: The special interest groups that have invested the most money and effort in Obama. They will have fewer friends and less power in Congress next year.
That doesn't mean they'll give up looking for special favors -- it just means they'll be turning directly to the White House from now on.
The Obama administration, enjoying its Democratic majority in Congress, has already been quite generous in helping its friends, especially trial lawyers. The first bill Obama signed effectively repealed the statute of limitations for gender-pay inequity lawsuits.
In May of last year, after several visits to the White House by the trial bar's top lobbyists, Obama signed an obscure memorandum ordering federal regulators to re-examine rules that make it harder for trial lawyers to sue federally regulated businesses in state courts.
He also made certain that when Obamacare passed Congress, it contained no new restraints on the abuse of medical malpractice lawsuits, even though such lawsuits add more to the cost of health care than even Obama claims his bill might save.
Once the trial lawyers lose Congress, they will still be seeking some big favors from the Obama administration. One is a special tax break that would let them deduct immediately the loans they make to cover their clients' costs in contingency fee cases.
It's something no other lender gets to do until a loan goes bad, and it would make long-shot and nuisance lawsuits that much less expensive to file.
At the 2009 convention of the American Association for Justice, the trial lawyer group's top lobbyist outlined a strategy to sneak this $1.6 billion tax break through Congress: "You cannot have a stand-alone bill to help lawyers ... so we have to tuck it into something."
But at this year's convention, their new head lobbyist told a closed-door session that the Obama Treasury Department was on the verge of granting them the tax break administratively, by reinterpreting the tax code in their favor. It hasn't happened yet -- perhaps in part because the disclosure was leaked -- but watch for it on or after Nov. 3.
Another goal for trial lawyers is to start up a multibillion-dollar gravy train that Obama's predecessor shut down. President George W. Bush signed Executive Order 13433, which bars federal agencies from hiring trial lawyers to pursue lucrative contingency cases on behalf of the government.
Such hired-gun lawyers have become overnight millionaires working for various state attorneys general -- most notably in the 1998 tobacco settlement. As of Nov. 3, there will be nothing to stop Obama from rescinding the executive order and effectively handing new legal patronage to his donors.
The short lesson is that even though elections matter, voters must pay attention in the off-season, too. That's when all of the action happens.
David Freddoso is The Examiner's online opinion editor. He can be reached at dfreddoso@washingtonexaminer.com.
More from David Freddoso
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David Freddoso: Trial lawyers will still have their best friend after November
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