Posts tagged ‘Kansas City’

Regulation and Innovation

Google has a pilot to offer TV and high-speed Internet service in Kansas City.  Adding phone service would have cost them practically nothing, and presumably would have provided great value to its customers.  But it gave up because even for a company as large as Google, the regulatory start-up burdens were too large.  Many innovative new industries or new approaches to old industries have been started literally in someone's garage.  But no one with a better idea for local telephone service is ever going to make progress against these kinds of regulatory barriers.  Which is exactly what the large incumbents want, and why they secretly support these massive regulatory infrastructures (while publicly whining about them).

A Quick Tort-Related Thought Experiment

Read this story at Overlawyered.com (you are welcome to try the linked article in the KC newspaper, but take my word for it, the registration is a pain with lots of attempted spamming (you might try bugmenot instead).  Here is the gist:

Car veers into truck's lane...and so a jury has ordered the trucking company, Auction Transport Inc., to pay $22.5 million over the resulting injuries to a young passenger in the accident, which occurred at rush hour on Kansas City's I-435. Mary Coleman's car, allegedly sideswiped by a third vehicle, had careened in front of the truck, but attorneys argued that the truck driver had been "driving too fast in congested traffic and not watching the road." The jury found the trucking company responsible for just less than half the fault of the accident -- a greater share of fault than the allegedly sideswiping driver -- and Coleman for hardly any of it.

So, surprisingly enough, three vehicles involved, two with limited resources and one with deep pockets.  Guess who is liable - the deep pockets of course, despite the fact that he was the only driver among the three who stayed in his lane!

Now, here is the thought experiment.  Move the truck with deep pockets into any of the other two roles.  Imagine first that it was the car that nudged the plaintiff into the other lane.  Imagine next that the truck was the one nudged into oncoming traffic and hit the plaintiff.  In these two cases, if they had gone to trial, who would have gotten the blame?  I would bet you that in either case, the truck with the deep pockets would have been given most of the blame in either of these cases.

So where is the fairness?  Why should blame be based on bank account size, and not actual actions?  Is there anything more than coercive wealth transfer going on here?  Does this constitute justice? 

By the way, I continue to say that limiting damages misses the point of what is wrong with the tort system and the malpractice system.  Congress and state legislatures have got to find a way to bring some sanity to the tort process, where legitimately harmed people can still get compensated for damages, however large those damages may be, but otherwise innocent people who happen to have deep pockets and somehow find themselves nearby a legitimate accident don't have to worry about being held at fault.  Babies are sometimes born with birth defects, people sometimes slip on perfectly safe sidewalks, and car accidents are sometimes just that: accidents.  I make this same point over and over here.

Update:  oops, left off the link.  Fixed now