Last night, CSPAN had an interview with Ken Feinberg who administered the 9/11 reimbursement fund, the Virginia Shooting fund, the pay for the top twenty-five people for seven institutions that received extensive bail outs under TARP. He is now beginning administering his payment of the escrow funds for the BP oil disaster. Earlier, he acted as Special Master for Agent Orange and asbestos litigation.
He began his speech by saying that every so often, government has a problem that calls for out-of-the-box thinking--where we have to try something new and conventional thinking won't get the job done. He has awarded the funding. He is designing a plan for the BP oil disaster. He is setting rules and procedures for common classes of victims: shrimpers, crabbers, motel owners, restaurant owners on the Gulf. He has exclusive authority to design the plan. Thus, he does not have to individually decide each claim.
(I was intrigued that people can receive an emergency payment representing six months without giving up their right to sue. Some time in the next thirty months, they can file for an extensive payment. They can decide whether to accept the amount after it has been calculated or can then decided to leave that amount and sue. If they do accept the funds, it WILL close off their right to sue, and they can weight until they know what the damages will be. Mr. Feinberg said that with the oil gusher finally stopped, people can assess what it cost them. And Mr. Feinberg said that BP promised that they would pay additional funds if the claims added up to more than twenty billion dollars. That is just what is in escrow.
Could the same thing happen in a participatory democracy? Is this the new thing that would work. The claimants would still come. Since jurors are cheap, it would not be necessary to have a lump sum payment. People can come each month with their business losses for that month. As long as the money is there, or BP keeps paying, they can charge. The same problem was with the 9/11 respiratory claims. Some people did know how severely their lungs were injured and how much it would cost for their medical treatment. Courts are geared to closing cases, making a final settlement even if it is a structured settlement. Thus people are caught between the Scylla of not getting enough for their reasonable expenses or the Charybdis of getting money for possible health problems that may simply never occur. Particpatory democracies would take the companie's income each month or year and allocate it to tort victims as they have medical bills, etc. The challenge is drawing lines of what will fund. What about a restaurant owner in boston that features Gulf Coast Shrimp? What about a golf course fifty miles from the gulf that can document a decline in their users compared to last year? Can the participatory democracy juror do a better job than Mr. Feinberg? And what about the person who had a cash business but was not reporting same to the Internal Revenue Service? I wrote on handling immigration decisions with participatory democracy. I wrote on handling taxes with participatory democracy. In both cases, the demos has an option. Assign a variety of cases to each jury, or specialize jury panels. In the Gulf Coast claims, one could have one jury panel for shrimpers, one for crabbers, one for restaurants. Or one juror could be dealing with a mix.
One of the problems that Mr. Feinberg had with the 9/11 was the speed that Congress passed the legislation and he got started. "Mr. Feinberg, you are coming here to offer me two million dollars and my husband has not even been recovered from the 9/11 disaster."
Citibank and Citibank Financial borrowed money to repay the taxpayer "to get out from under my thumb" (Mr. Feinberg on pay.) Mr. Feinberg said that other parts of administration are concerned with executive pay across the board.