Senate defeats $140B asbestos bail out

February 18th, 2006

A Senate bill that would have created a $140 billion trust fund to compensate victims of asbestos exposure was defeated by a bipartisan coalition opposed to its provisions. Known as the Fairness in Asbestos Injury Resolution (FAIR) Act, the bill would have closed all civil asbestos and mesothelioma lawsuits and administered payments to victims from the fund.

Critics of the bill called it a bailout of large corporations that would inadequately compensate victims for their suffering. Other opponents charged that the fund would not be enough to compensate all of the victims and would eventually require additional funding from businesses or taxpayers.

Sen. Harry Reid of Nevada, who led the opposition to the bill, observed that its real purpose seemed to be getting asbestos and mesothelioma lawsuits out of the courts, rather than helping victims. “The problem seems to be that the so-called FAIR Act places the needs of a few large companies with asbestos liability above the needs of those suffering from asbestos-related illnesses,” he says.

Nevada Sen. John Ensign raised the budget technicality issue that defeated the bill. The Senate requires 60 votes for any bill that will cost more than $5 billion over ten years. Although the trust fund would have been created from contributions by businesses and insurance companies, a recent Congressional Budget Report estimated that the bill would fall $10 billion short of meeting victims’ needs.

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