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Ideology, Self-Interest Stand in the Way of Political Compromise on Asbestos Claims

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Times Staff Writer

It is a quest that challenges Congress to its very core.

For almost three decades, a political answer to the barrage of claims arising from exposure to cancer-causing asbestos has eluded lawmakers. Meanwhile, the longest-running legal brawl over a workplace hazard in U.S. history grinds on with no end in sight.

In the latest chapter, the Senate last month rejected a plan to create a $140-billion trust fund to compensate asbestos victims. Compromise has proved elusive because the issue pits Republican allies of big business against Democratic allies of trial lawyers -- central constituencies to each party that have vastly different ideas about the conflict.

But asbestos has also pitted Republican against Republican and divided Democrats as well. And it has set loose an army of lobbyists whose corporate clients are equally polarized over the best way to end the fight.

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“This vote is about more than asbestos,” Sen. Orrin G. Hatch (R-Utah) recently told colleagues during debate on the plan. “It may well signal the last chance that this body will have to be productive, to break free of our respective orthodoxies and legislate for the public good.”

Even discounting for hyperbole, Hatch was pointing to a stubborn reality of asbestos politics: Over and over, issues of ideology and self-interest have combined to make compromise impossible and preserve the status quo.

Just getting the bill through the Senate Judiciary Committee was like “steering a ship through a minefield during a hurricane,” said Sen. Patrick J. Leahy (D-Vt.).

The latest push would be to settle asbestos claims through a no-fault process administered by the Labor Department. The idea is to shift the means of redress out of the crowded and unpredictable courts to a more orderly procedure that would compensate victims with set amounts based on their illnesses. Companies and their insurers would pay for the fund.

“Is it not possible to protect victims and not bankrupt companies and have a no-fault system whereby medical people can make the judgments and people can be paid a fair sum?” asked Sen. Dianne Feinstein (D-Calif.). “That is what this legislation is all about.”

Opponents, however, worried that the fund would prove too restrictive, freezing out some claimants altogether.

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Asbestos, a fire retardant, had many industrial uses in the 20th century, including brake linings, insulation and roofing products. Although its tiny fibers were long believed to be harmful, millions of workers were exposed, and its widespread use was little regulated until the 1970s. At that time, claims began to spiral for ailments including nonfatal lung problems and a cancer known as mesothelioma.

Also at that time, Congress began to wrestle with the issue -- the first bill was introduced in August 1977 -- but lawmakers have never settled on a solution.

By some estimates, 200,000 Americans have died from asbestos exposure, and the death rate continues at 10,000 a year, according to the Environmental Working Group, an association of public-interest scholars.

Claims appear to have slowed down in the last couple of years, said Deborah R. Hensler, coauthor of a 2005 Rand Corp. study on the financial effect of asbestos claims. Moreover, there is no central repository of data -- making it even harder for companies to anticipate trends.

“This is a moving target, and exactly what is going on now is not clear,” said Hensler, a professor at Stanford Law School.

Lawmakers and other interested parties do not even agree on the problem they are trying to solve.

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To some the issue largely is one of over-the-top litigation. Claims have totaled more than $70 billion, and more than 70 defendant companies have filed for bankruptcy protection, according to Rand, the Santa Monica-based think tank. In recent years, lawyers have aimed lawsuits beyond asbestos producers to include companies that exposed workers who manufactured textiles, paper, glass and other products.

The trust fund was designed to end the courtroom battles. According to the payment schedule, victims of mesothelioma would get just under $1.1 million, whereas those suffering less grave lung impairments might get $25,000. Lawyers’ fees would be capped at 5%.

Supporters of a fund say the current system has been exploited by lawyers, who have ended up with more than half the money paid out, according to researchers.

Critics of the lawsuits also point out that 90% of recent claimants did not have cancer, according to Rand, and many were not ill. Victims’ advocates note that asbestos ailments may stay latent for 30 years or more, creating pressure to put claims on the record now.

Workers who are ill would have top priority under the proposed fund. “What we’ve got here is a scandalous abuse of the American legal system to exact from usually innocent defendants huge amounts of money to compensate people who haven’t actually been injured,” said Michael E. Baroody, executive vice president of the National Assn. of Manufacturers.

Though such arguments have won over many Republicans, the fund proposal also stirred up a competing sentiment within the GOP. The notion of a new bureaucracy revolted fiscal conservatives, who feared it could come back to haunt taxpayers if claims exceeded $140 billion. Long-term costs are uncertain, with some analysts projecting they could exceed $200 billion.

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In mid-February, Sen. John Ensign (R-Nev.) invoked a new Senate rule making it easier to stop any bill on budgetary grounds. It takes 60 votes to derail such a budget challenge, and members who wanted to keep the effort alive could muster only 59. Senate Majority Leader Bill Frist (R-Tenn.) ultimately changed his vote for parliamentary reasons, leading to an official tally of 58 to 41, with 10 Republicans among the fund’s foes.

“There is a real fiscal battle going on for the heart and soul of the Republican Party, and this was one of the first shots across the bow,” said Michael Franc, a vice president of the Heritage Foundation, a conservative think tank.

To some degree, the asbestos fight also reveals fissures inside the Democratic Party, with 30 voting to kill the bill and 13 trying to keep it alive. Most Democrats sided with their influential constituency of trial lawyers, a group that opposed the bill and has directed almost all of its $3.6 million in donations to Democrats going back to the 2004 election cycle, according to the Center for Responsive Politics.

They also assailed the secrecy surrounding the fund. The Senate Judiciary Committee has allowed members to look at companies’ projected liability and payments to the fund but has not released it to the public.

Companies are believed to fear such disclosure, because they do not want trial lawyers to see their private estimates of liability. Backers of the fund also fear that releasing all the information might lead some firms to conclude that they were not being treated fairly and could undermine support for a joint fund.

“They’re keeping the list secret because they don’t want anyone to know this is a windfall for the big companies,” said Chris Mather, spokeswoman for the Assn. of Trial Lawyers of America. “This is a bailout for them.”

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The fund’s prospects are uncertain, but the fight may not be over. Sen. Arlen Specter (R-Pa.), the Judiciary Committee chairman, insisted last week that the votes were in reach and advocates would continue to fine-tune their plan.

“Asbestos is in the wings,” he said.

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