Tort reform goes international

Dubya intends to veto the National Defense Authorization Act to protect the Iraqi government from liability from lawsuits for actions taken under Saddam.

If enacted, Section 1083 would permit plaintiffs’ lawyers immediately to freeze Iraqi funds and would expose Iraq to massive liability in lawsuits concerning the misdeeds of the Saddam Hussein regime. The new democratic government of Iraq, during this crucial period of reconstruction, cannot afford to have its funds entangled in such lawsuits in the United States. Once in place, the restrictions on Iraq’s funds that could result from the bill could take months to lift, and thus Section 1083 cannot become law even for a short period of time.

Now I think they have a point to some extent, clearly as we have seen in Palestine, that money is crucial to a functioning government. As the Council on Foreign Relations reported just a few years ago,

The Hamas-led Palestinian Authority (PA) is broke and deeply in debt. Almost all funding for the Authority’s operating budget, about $1.5 billion to $1.7 billion annually, came from foreign aid, primarily from the United States and Europe. With those sources cut off—and Israel withholding monthly customs duties that had been paid to the PA before Hamas took charge—the Authority has almost no sources of funding. In addition, the PA is saddled with $1.7 billion in debt.

The PA says it needs some $170 million per month to meet its financial obligations, including $115 million to pay the salaries of thousands of government employees. These include teachers, police, and members of the bloated Palestinian security forces, which have been plagued by cronyism and corruption. The PA collects only about $34 million per month from taxes and other charges.

Wait, when a democratically elected government, Hamas in Palestine, is not to our liking, then we will undermine them financially. But when it is a country whose leadership we support, and some consider beholden to the US, we will fight tooth and nail to ensure that they have financially stable. But wait, there’s more.

Israel controls a significant portion of the PA economy both directly and indirectly. Israel collects duties on foreign imports headed for the Palestinian territories and charges value added tax (VAT) on Israeli goods and services headed for those areas. These totaled about $75 million per month in 2005, according to the Israeli Ministry of Finance. Out of this figure, Israel withholds money to pay the PA’s water and electricity bills, which Palestinians have refused to pay for years to protest Israeli occupation. Israel withholds about $15 million each month to cover these bills. That leaves about $60 million that Israel would normally pass along to the PA; however, since the Hamas government was elected, Israel has been withholding this revenue.In addition to withholding tax money, Israeli roadblocks and other restrictions have prevented thousands of Palestinians from working in Israel. Before the second intifada began in 2000, 22 percent of employed Palestinians worked in Israel or Israeli settlements. By 2005, that figure had dropped to 10 percent of employed Palestinians, who earned 12 percent of all Palestinian income. Security restrictions have put these incomes in jeopardy, adding to the territory’s dire straits: The PA has 22 percent unemployment, 43 percent poverty, and 15 percent ‘deep poverty,’ where people cannot meet their subsistence needs, according to Elizabeth Young of the Washington Institute for Near East Policy.

So not only did we cut off our aid, which is our right, to support the government of Palestine, but we allowed Israel to withhold the taxes they collected on behalf of that government. Maybe we should made our aid to Israel contingent on them passing along the taxes they collect on behalf of Palestine.

But back to the intent to veto, I think that is a continuation of the neo-liberal economic policy in the US to roll back the rights of consumers to sue corporations for damages.

Further, it is ironic that they don’t want liability for lawsuits for Saddam’s actions, but we don’t forgive the debt that was run up under his leadership. This economic servitude of debt that happens in many developing countries with corrupt governments, are used as a tool to impose economic policy that may be contrary to the best interest of these same countries.

Update: According to the Air Force Times, Bush has vetoed in the bill.  Their concern is the holding up of funds for re-enlistment bonuses, but they do mention one other thing about who might sue the Iraqi government.

The veto had nothing to with bonuses. Bush vetoed the bill over concerns that a provision in the spending plan made it easier for people to file claims against Iraq’s current government for actions during Saddam Hussein’s reign. Among the people expected to seek a financial claim against Iraq were former U.S. servicemen held as prisoners of war during Desert Storm in 1991.

In checking CBS News, it isn’t entirely clear if this is truly a veto, or a pocket veto.

 According to the Constitution, if a bill sent to the president is not acted upon (signed or vetoed) within 10 days, it becomes law. The only exception is if Congress is adjourned when the 10 days expires.

The White House said that Mr. Bush’s return of the unsigned bill amounts to a “pocket veto” and thereby precludes it from becoming law. A 1929 ruling in The “Pocket Veto” Case is cited as the legal basis for claiming that returning a bill to an adjourned Congress, unable to override a President’s veto, means the veto is absolute and cannot be overridden.

Of course the Bush administration is known for their tortured legal opinions, but the point is still the same, that limiting liability to the Iraqi government is part of a neo-liberal economic policy.  That it is very different to the efforts by the west to undermine other middle east democracies in the form of Palestine.