In today’s American, I discuss the costs of the U.S. tort system, a summary of my congressional testimony on the subject, where I show that these run to the tune of hundreds of billions of dollars of wealth destruction a year.
One of the unfortunate downsides of Sotomayor replacing Souter is that it is quite likely that the fragile coalition on the Court for protecting defendants from runaway punitive damages awards will dissolve, adding uncertainty to our tort system, and raising its costs all the more. I certainly share with Justices Scalia and Thomas skepticism that “substantive due process” was the constitutional solution to this problem (I’d find such awards a violation of the dormant commerce clause myself), but at least those justices recognized the public policy consequences of arbitrarily huge awards.