Sacramento — Gov. Arnold Schwarzenegger promised to rid Sacramento of the "old politics" and "be creative." A surprise proposal in his revised state budget keeps half his word.
In attempting to seize 75% of punitive damages that juries award plaintiffs, the governor:
* Continued the old politics of smacking an enemy's allies -- in this case, some of the Democratic Party's principal bankrollers, the trial lawyers.
* Practiced creative budget writing, by "plugging" -- that's what they call it in Sacramento -- an imaginary number into a deficit hole. Schwarzenegger winked and said he'd pick up $450 million annually from the awards grab.
On second thought, call this old-fashioned creative budget-writing. Its aim is to create the fiction of a balanced spending plan. But these tales always end the same, with a deeper deficit.
The background: Civil courts can award two types of damages. One is "compensatory," to make up for a victim's financial loss, plus pain and suffering. The other is "punitive," to punish the defendant and deter future misbehavior.
Buried near the back of the governor's May 13 budget revision was this argument: "Since the award of compensatory damages compensates the complaining party for their loss or injury, the award of punitive damages ... should more appropriately be awarded to the state where it can be used for public good purposes that are consistent with the nature of the award."
Exactly how the money would be spent by Sacramento wasn't spelled out. In reality, it would help plug a multibillion-dollar deficit that lingers as far as any neutral eye can see.
But that phrase "public good purposes" does sound a bit too "big brother" for a Republican administration. Last time I heard, the GOP believed private citizens could spend their money better than the government, and that income redistribution weakened America.
This, of course, is less about public good than corporate good. The idea is to discourage lawsuits and reduce payouts.
"We believe it would reduce the incentive for speculative lawsuits and for lawyers and clients to look for huge jackpot verdicts," says John H. Sullivan, president of the Civil Justice Assn. of California, a business-backed tort reform lobby.
A key provision of the governor's proposal would free a defendant from having to pay more than one punitive judgment. So if an automaker sold cars with defective brakes that crippled hundreds of people, only one victim could collect punitive damages on top of a compensatory award.
