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Compensating Victims

February 6, 2002 at 12:00 AM EDT
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MARGARET WARNER: Joining us now is Kenneth Feinberg, the special master for the fund; and Stephen Push, co- founder and treasurer of the Families of September 11, a group representing the families of about 500 victims. His wife, Lisa Raines, died on the plane that struck the Pentagon. Welcome to you both. And Mr. Push, our condolences on the loss of your wife.

STEPHEN PUSH: Thank you.

MARGARET WARNER: You have been critical of this fund and the proposed rules for dividing it up. What is wrong with them?

STEPHEN PUSH: Well, the statute itself is… We have mixed feelings about. It’s wonderful for families who are in dire economic straits and need money quickly, but what it did is it let the airlines off the hook completely, so we can’t hold them accountable for their lax security. And also a lot of families are concerned about the fact that the statute provides for a deduction of life insurance, which seems to penalize people who provided for their families.

MARGARET WARNER: That’s the example of someone like Lisa Laychak.

STEPHEN PUSH: Right. Because her husband provided life insurance, she will end up getting little or nothing from the fund. And many people are like her. The problem with the regulations is they don’t follow the law. The law says that before those deductions take place for life insurance and other collateral payments, the fund is supposed to give us credit for the lost earnings of the deceased person, and also for non-economic damages specifically, 11 categories of pain and suffering, mental anguish, loss of enjoyment of life, and Mr. Feinberg has particularly on the non-economic damages completely ignored the statute and set a level of non- economic damages at $250,000. That doesn’t even begin to compensate people for the non-economic damages that are listed in the statute.

MARGARET WARNER: Mr. Feinberg, your response?

KENNETH FEINBERG: Well, we followed the statute. One can agree or disagree with $250,000 plus $50,000 for each dependent, tax free, plus the computation of economic loss, which could be 2, 3, 4 million dollars tax free. Now it’s true the statute requires offsets for life insurance and pensions and workers compensation. That’s because Congress wanted to make sure that there is a safety net below which nobody would go and find themselves destitute. It they have life insurance, if they have got other sources of income, Congress said we’ll provide sort of a program to make sure that you get this money one way or another. And what we’re trying to do right now as we get ready with the final regulations is maximize to the best that I can, the dollars that will go to the families.

MARGARET WARNER: Is it possible, Mr. Feinberg, that someone like the woman in our piece could end up with absolutely nothing?

KENNETH FEINBERG: Absolutely, it’s possible. But I have publicly stated, and I think the final regulations will reflect that in individual cases that are brought to my attention by these families that net out zero and demonstrate that they are in need and are going to find themselves without resources, I will exercise my discretion and make sure that anybody like that who comes into this program gets a substantial paycheck.

MARGARET WARNER: What is your feeling about that?

STEPHEN PUSH: My feeling is that I disagree with Mr. Feinberg that he is following the law. A few weeks ago, when we raised the issue of $250,000 for non- economic damages, he said, “My hands are tied, there’s nothing I can do. If you want it changed, go to the White House and get the Republicans to change it for you.” It’s very disturbing that someone who is appointed to be an impartial and an independent decision maker is apparently doing what the… What some people in the administration seem to want to be doing, and that is introducing tort reform in through the backdoor. Congress specifically examined the issue of whether non- economic damages should be capped at $250,000. And that was rejected by Congress. And Congress said that we were to be given full payment for a whole list – 11 different non-economic damage categories. And now we have the $250,000 coming back in through the back door. And it’s disturbing that there appear to be some people in the administration who want to play partisan politics with this issue.

KENNETH FEINBERG: If I may, let me respond in two respects. First, I want to make it absolutely clear to Mr. Push and anybody else, any other family, these are my regulations, not the administration. This is a bipartisan program. Mr. Push does himself and the families a grave disservice when he politicizes this. And I hear Mr. Push constantly making this same reiteration over and over again publicly. This is not a political issue. I stand by these regulations. The Attorney General of the United States and this Administration have been absolutely fabulous in supporting this program. And Mr. Push does these families a grave disservice when he consistently makes this argument that this has somehow been politicized. That’s not the case. And I think this that this program is a generous program and will be made even better in the next few weeks when the final regulations are promulgated.

MARGARET WARNER: And Mr. Feinberg, what about the figure of $250,000 for pain and suffering, because a lot of family members, setting aside the political argument, but just on equity, say that is really incredibly low if you compare it to, say, what people might have gotten if they could have sued. Where did that come from?

KENNETH FEINBERG: That’s the rub. If they could have sued and waited seven years to litigate, paid their lawyer 40 percent as a fee, try and get damages and then have those damages upheld on appeal, for every case they cite for pain and suffering awards of $2 million, you can find situations where’s they get zero. This number of $250,000 has a precedent. There are federal statutes currently on the books, Margaret. If a soldier is killed in Afghanistan, it’s $250,000 economic and non-economic. If a firefighter or a policeman are killed in the line of duty, for 30 years, there’s been a statute on the books — $250,000, economic and non-economic. It is not fair to compare this program to what might happen in the roll-of-the-dice casino, in the lottery system that is the courtroom. However, I am determined to make sure that the families who come into this program– and I believe all of them will a very few exceptions — I am determined to make sure that they get the maximum benefits possible under the statute and I’ll work to see that they are fairly compensated.

MARGARET WARNER: Mr. Push, Mr. Feinberg said he thought Congress’ intent here was to provide a safety net below which people wouldn’t fall. And therefore, if their spouse had provided through insurance, the safety net was already there. Is that the way you understand the intent of Congress? If not, how do you?

STEPHEN PUSH: No. Congress’ intent, the way I read the bill, and from the congressional staff that I have talked to, is to provide full economic and non-economic awards as you would find in the tort system minus the collateral payment deductions. It’s very interesting that the number Mr. Feinberg comes up with is $1.6 million on average. When the Federal Aviation Administration does a cost benefit analysis to determine what safety procedures airlines should follow, they use a value of a life saved from one of those procedures at $2.7 million. Why is it that the federal government seems to think that a statistical life is far more valuable than a real life?

MARGARET WARNER: Mr. Feinberg?

KENNETH FEINBERG: This is not the tort system. As long as Mr. Push insists on comparing this program to the tort system, he will never be satisfied. The fact is that under this program, one need not show any fault on the part of the airlines, one need not hire an attorney, although the attorneys are available to work pro bono if a family member so desires, and we’re obligated by the statute to cut a check to every family within 120 days from the time their claim is duly submitted.

MARGARET WARNER: Mr. Feinberg, let me just ask you, how did you calculate, though, to put it crudely, the value of a human life — because I gather the Congress didn’t put any outside limit on the amount of this fund – the gross amount?

KENNETH FEINBERG: That is correct. Nor is there any cap on any compensation that we will provide.

MARGARET WARNER: So how did you come up with this?

KENNETH FEINBERG: We went to the Bureau of Labor Statistics and the Bureau of the Census, and we developed a methodology, which I think is very credible and very fair to the families, and we developed a methodology based on salary, age and number of dependents, came up with presumptive awards — and invite any family that feels that the presumptive award is not fair in their individual case to file an application requesting an appeal, requesting an opportunity to be heard, and we will review any individual application and try as best I can to make sure that the families are fairly compensated.

MARGARET WARNER: Before we end, Mr. Push, let me ask you about this backlash that seems to have arisen recently, and we do see it particularly in Internet e-mail traffic on various sites with people saying, you know, victims of other disasters don’t get anything near this much. How do you respond to that? What would you say to people who think that way?

STEPHEN PUSH: These are people who don’t understand what’s at stake here. What is at stake is not just the compensation for the families who lost loved ones on September 11th; what’s at stake is the safety and security of all of the American people, because if the federal government is allowed to devalue human life, then that FAA cost/benefit analysis that I told you about, analyses that are done for safety and occupational health and safety, for environmental protection, for product safety when companies sit down and decide are they going improve a defective product, or are they simply going to pay out the award that they need to pay out to the families who were killed by their product, this is going to undermine everyone’s safety in this country. I don’t think $2.7 million — I think FAA was right on target. I don’t think $2.7 million is too high a price to pay for the life of an American in the year 2002.

MARGARET WARNER: Mr. Feinberg, a brief, final word from you on this backlash.

KENNETH FEINBERG: I completely agree with Steve on this. This is not greed. I read these – every day these e-mails to me saying that the families are greedy. Believe me, they are not greedy. They are going through a terrible horrific experience and they are trying as best they can to maximize the value of a lost loved one. And for anybody to claim that this is greed, I think those individuals — it’s beneath the dignity of the American people. I don’t believe the American people as a whole think this is greedy. They understand what is going on here.

MARGARET WARNER: All right. Kenneth Feinberg, Stephen Push, thank you both.

STEPHEN PUSH: Thank you.

KENNETH FEINBERG: Thank you.