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PROFILE:
Kenneth Feinberg on Compensating 9/11 Victims
September 2, 2005    Episode no. 901
Read This Week's November 7, 2008
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BOB ABERNETHY, anchor: The tragedy of Hurricane Katrina came just before next Friday's anniversary of September 11 and all the anger and suffering that attack caused. Also, the 9/11 anniversary recalls the country's extraordinary generosity then to the victims. There were private charitable donations of $2.7 billion and, on top of that, more than $7 billion from the U.S. government.

Congress wanted to express the country's sympathy for the bereaved, and also to protect the airlines and others from what probably would have been huge damage claims, so it guaranteed large payments to the families of the victims if they would agree not to sue. The man who administered the 9/11 Compensation Fund and made key decisions about what was fair is Kenneth Feinberg, a lawyer who has a book just out about that experience, called WHAT IS LIFE WORTH?

Following Congress's directive, Feinberg based his awards on what each victim might have earned in a lifetime had he or she lived. That meant big differences in the size of the awards, and that produced a lot of controversy. In his office in New York, we asked Feinberg how much money in all was paid out.

Photo of KENNETH FEINBERG KENNETH FEINBERG (Author, WHAT IS LIFE WORTH?): A little over $7 billion of the taxpayers' money. About 5,300 people were compensated. The average death claim was about $2 million, tax-free. The average physical injury claim was about $400,000, tax-free. The largest award we rendered was about $8.6 million to a burn victim who survived the World Trade Center with third-degree burns over 85 percent of his body. The least amount we gave out was about $500 for a broken finger at the World Trade Center.

ABERNETHY: Feinberg held hundreds of meetings with the families of 9/11 victims to try to explain his award formulas, but discussion of numbers often gave way to outrage.

Photo of 9/11 Mr. FEINBERG: I would meet with families and start discussing this very generous program, and occasionally I would get a response like, "Mr. Feinberg you're here talking about money. They haven't even returned my wife's body yet. Mr. Feinberg, you're here telling me that I'm going to receive $2 million. Yesterday, the New York City Medical Examiner provided me a left arm of my wife. That's all that is left." I did not anticipate the degree of anger, invective, frustration at life's unfairness: "I've lost my wife, I've lost my son." Frustration: "Why me, Mr. Feinberg? My wife was a saint. She was a wonderful woman. Why did God take her? Why? Why? Explain it to me."

Photo of 9/11 missing poster Then there was anger directed at me as the visible representative of the United States: "Mr. Feinberg, you're here to give me a check. That is hush money. The fact is that your government is responsible for what happened. It could have been prevented, and now you are here to quiet me and prevent me from suing."

ABERNETHY: What did the people who you heard from at the public hearings and in private tell you about what the events of 9/11 did to their faith in God?

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Mr. FEINBERG: I'd say half the families would explain to me how this reinforced their belief in God. The other half came to me and in various ways articulated the view that they would never set foot in a church again, that there is no God. No deity could ever allow some horror like this to happen.

ABERNETHY: And what were the effects of the fact that the remains of 1,100 of the victims were never identified?

Photo of Twin Towers wreckage Mr. FEINBERG: I was stunned by this. The single greatest source of grief among the surviving families occurred in situations where the family came to me sobbing that there was no body. There were not remains to be buried.

ABERNETHY: Over the nearly three years it took to decide who was eligible for awards and how much each family would receive, the biggest problem became fairness. For instance, the young widow of a stockbroker -- because of how much her husband might have earned had he lived -- received far more than the widow of a firefighter or policeman. And even among families in the same circumstances, there could be differences.

Photo of Firehouse Mr. FEINBERG: It was very divisive. One fireman's widow would say, "I'm getting $825,000, and my next door neighbor, a widow of a fireman, is getting $1.2 million. You're denigrating the memory of my husband. Why?" I'd try and explain that under the statute, I was required to deduct from an award life insurance, pension, 401(k)s, but it didn't sit well with victims.

ABERNETHY: If there should ever be another massive terrorist attack, Feinberg now thinks Congress should not re-create a 9/11-type compensation program.

Mr. FEINBERG: I think a better way would be simply to give every eligible claimant a flat, same amount and not ask one person to play Solomon and try to figure out different amounts for different victims -- to avoid divisiveness among the very people you are trying to help. People may be not at all to blame for life's tragedies, but I don't think that part of the American heritage is that when a person is a victim, through no fault of her own, that limited government somehow should step in and provide that person $2 million, tax-free. I mean, where does it stop? If the government suddenly becomes an insurer, why limit it to 9/11? What about Oklahoma City? And why stop with terrorism? The victim of a hit-and-run accident, the fireman's widow -- why aren't all of those people entitled to public compensation?

ABERNETHY: How did that whole process -- over 33 months, you've said -- how did that change you, your attitudes, your priorities?

Photo of 9/11 memorial Mr. FEINBERG: You become much more empathetic to the downtrodden, the victims of an unforeseen misfortune. I'm a much better listener; I'm much more fatalistic. I must say, one thing I learned about 9/11, when these families came to see me: be careful about planning too far in the future. Life has a way of throwing curve balls at everybody, and I don't think I'll plan much beyond two weeks going forward, because you never know.

ABERNETHY: Feinberg says after the experience of playing Solomon he decided to practice law less and teach more, now at no fewer than five law schools.

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