6.21.00
The Power of the Purse

6.09.00
A Big Tax Win — and A Loss

6.07.00
Battle of the Sexes

5.25.00
Goldilocks Was Wrong

5.18.00
Stop That Train!

5.09.00
States of Confusion

5.08.00
Congress Busts the Bank — Again

4.26.00
Soak the Rich: Cut the Capital Gains Tax

4.12.00
How the Other Half Thinks

4.06.00
Taxing Fantasies

have said it before and I will say it again: The greatest single threat to the U.S. economy today is the rapacious trial lawyers. The class-action-lawsuit abuses against tobacco companies, gun manufacturers, drug companies, chemical firms, and any other industry that deigns to make a profit imposes a multi-billion dollar toll on American workers and investors. The litigators seem intent on forging ahead with this assault until the NASDAQ falls to 3,000 and American dominance in manufacturing and high tech is surrendered entirely to the Japanese and Europeans.

The second greatest threat are the "trustbusters" at Janet Reno's Justice Department. Again, the motivation for these lawsuits is to bring first-rate American companies like Microsoft and Intel to their knees. (Again, blame Reno for the decline in your mutual fund.) A few weeks ago Dick Armey quipped that he'd prefer to breakup the Justice Department, not Microsoft. Now it appears that Congress may be gearing up to do just that. To this the only response is: God's speed.

On Monday the House passed a fabulous piece of legislation effectively pulling the plug on the Justice Department's witchhunt against the tobacco companies. How? By cutting off Reno's funding. This should have been done long ago, but better late than never. Under our constitution, Congress has the power of the purse. The Clinton Justice Department regularly thwarts Congress's legislative intent. So fine. Take away the money and forbid the Justice Department from using any funds for the purpose of tobacco litigation.

Ms. Reno has indignantly responded that this tactic will be "a grave disservice to the American taxpayer and the agencies that shoulder the burden of paying to treat those with tobacco-related illnesses." Nonsense. The winners from the tobacco litigation are the trial lawyers, not taxpayers. The lawyers get $25 billion in fees so far from tobacco litigation. In some cases their fees have climbed to more than $100,000 an hour, according to Mike Horowitz of the Hudson Institute. Congress should slap them with a $1,000-an-hour salary cap and use the billions of dollars saved to treat cancer patients.

Now is the time to use a similar budget strategy to end the anti-trust zealotry at Justice. Congress need not look on helplessly as the trustbusters take target practice at our most successful American firms. Defund the antitrust office. This last year the Clintonites requested a 30 percent increase in antitrust enforcement money so that Joel Klein could hire a bevy of new anti-business lawyers. For some inexplicable reason, Congress has in the past accommodated these funding requests, while complaining of the blizzard of economically depressing antitrust activities. But hey, if Joel Klein doesn't have any money, he doesn't have a case.

It's worth noting that one of the first official actions of the Reagan administration in 1981 was to effectively close down the antitrust division in the Justice Department. This was one of the unheralded actions that helped launch the greatest bull market expansion in history. Antitrust is a dinosaur. We don't need to be subsidizing our industries with corporate welfare, but we shouldn't be breaking them up when they succeed either.

The GOP Senate should follow the House lead on defunding Janet Reno and Joel Klein. This could be one the 106th Congress's greatest legacies.

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