Cause-and-Effect, Lawyers, and Mass Murder (Part One)
-- by Neil H. Buchanan
Amidst the ongoing wave of unrelentingly horrifying news on all fronts, I will take a mental health break by writing about ... wait for it, and please do not click away ... homeowners' insurance! There is a story coming out of Florida that is not about Don't Say Gay, punishing "woke" corporations, forbidding businesses from responding to COVID-19, stopping educators from talking about "divisive" racial issues that might cause "anguish" for a few of our apparently thin-skinned students, or even about a naked Florida Man driving a riding mower down the interstate while high on meth and bath salts.
This story is especially interesting to those of us with law degrees, as it involves the usual lawyer-hating that conservatives love to stoke. It is also a not-made-up problem (unlike the non-problems that turned into the various pieces of real legislation that I referenced above), which makes it particularly unusual in my home state. The question is this: Why is Florida's homeowners' insurance market a complete mess, with spiraling premiums and threats of insurers shutting down entirely?
The answer, as they say, may surprise you. And fair warning: The mental health break ends about two-thirds of the way through this column, because I will turn my attention to the most recent mass shooting (the one in Uvalde, Texas, which for all I know will have been superseded by something even worse by the time I hit "publish" on this column). There turns out to be a logical similarity between the arguments about Florida's insurance mess and Texas's (and this country's) orgy of violence.
Having moved to Gainesville almost exactly three years ago, I have now paid annual homeowners' insurance premiums three times, and this year's renewal notice arrived a few weeks ago. My first premium, covering a year starting from May 25, 2019, was $1260.00. The previous year, I had paid a premium of $1315.00 on a house in suburban DC (in Maryland), which had a fair-market value that was more than double that of the Gainesville house (even though the new house is bigger and nicer); but even though I had expected the rate to be lower in Florida, I knew that there were differences across states that made such simple comparisons unreliable. I went with the flow.
In any case, my renewal premium the following year was $1426.00, an increase of $166.00 in one year, or 13.2 percent. Surprised, I called my insurance agent, who immediately -- but very nicely -- told me that the problem is that Florida's lawyers are too greedy. She said that Florida's legislature is notoriously subservient to the plaintiffs' bar, and they were screwing over the public. Although I was very skeptical, I decided not to engage, and after she promised to double-check for better rates (which of course did not exist), we hung up.
Before getting into the substance of the blame-the-lawyers argument, I will provide two further data points. My renewal premium in 2021 was $1972.67, an increase of 38.3 percent from the previous year. In 2022, I will pay $2661.00, an increase of 34.9 percent from last year. From 2019 to 2022, the premium has more than doubled (a total increase of 111.2 percent). In only the most recent year was the overall inflation rate at all a possible factor, and at 8 percent, that hardly explains the leap in premiums. In any event, they now have my attention.
I asked a colleague at UF who grew up in South Florida about this, and she said that there is a longstanding corrupt relationship between insurers and state legislators, the latter group making sure that there is no effective regulation of the former. She mentioned that in the 1990's, after one of the major hurricanes blew through Miami, owners of modest single-family homes in some cases saw their premiums increase from $1200 to $6000 in one year. Apparently, the insurance industry used the opportunity of the disaster to push through extreme rate increases, and the state's regulators did not see fit to stop them.
But what about the lawyers? It is true that plaintiffs' attorneys are a big presence in the Sunshine State. The first time I drove from Gainesville to Tampa (a 130-mile drive), I was stunned to see that the highway was lined with billboards touting various plaintiffs' attorneys, some of them buying dozens of signs dotted along the entire stretch of Interstate 75, as well as the I-275 spur into Tampa. (On that drive, there was nary a lawn mower in sight on the highway. Must have been a slow day for Florida Man.) My own university has major law firms' names (not BigLaw) on athletics scoreboards and other naming opportunities. I have no doubt that part of my compensation could be convincingly tied to donations from some of those firms.
Much of the advertising on billboards is specifically aimed at slip-and-fall claims -- explicitly using that term, to the point that it is mildly surprising that no one has proudly claimed in print to be "Your Ambulance Chasers." They differentiate themselves in various ways, with one guy highlighting on his billboards that he is "A Harvard Law Graduate," while another notes that he is a former University of Florida Gators football star. (The latter carries much more cachet here, without a doubt.)
So my insurance agent was right, right? When this year's premiums were announced, I even received an email from her corporate main office with the subject line: "Our Last Chance To Combat Skyrocketing Premiums." The email noted that the state legislature is meeting in special session this month, adding an urgent request: "Please sign this petition today – it is pre-populated with information that asks your specific legislators to support meaningful property insurance reform."
Intrigued and skeptical, I clicked on the link, only to discover two notable facts. First, the linked page did not in fact provide the content of the petition -- but it was indeed pre-populated with the information that they wanted me to include, meaning that they were telling the truth when they said that "[t]he petition takes 10 seconds to fill out." Second, the linked page was generated by a group called Floridians for Lawsuit Reform, with a URL that includes <fltortreform.com> as a domain.
Ah, tort reform! Even before I decided to change careers and go to law school in 1999, I had been aware of the tort reform crowd and their deep dishonesty. They are an extremely well funded arm of the anti-regulatory corporate right that has for decades funded bogus studies from seemingly respectable academics, pushing an agenda that included caps on damages, forced arbitration, all but eliminating class actions, and so on. The U.S. Supreme Court, long before John Roberts became Chief Justice, had over time blessed the entire unholy scheme.
The academic work that has pushed back against "tort reform," from both economists and legal scholars, notes that the "explosion" in civil litigation that started this ball rolling in the 1970's was a statistical illusion driven by the asbestos crisis. Taking out the data from that enormous human and economic tragedy, there simply was no meaningful change in lawsuit-related costs that would justify making the kinds of changes that the anti-lawsuit crowd successfully pushed through in state after state. It was purely a matter of announcing that there was a crisis and then pretending to solve it by making it more difficult (and in many cases impossible) for people to receive compensation from the businesses that had harmed them. The infamous McDonald's Hot Coffee Case was a big part of that public-relations assault, even though the facts of that case in no way support the anti-lawyer tropes for which it has been used.
Unsurprisingly, then, I did not sign the petition. Even so, it is true that (a) Floridians' homeowners' insurance rates are skyrocketing, and (b) there is a large and prosperous plaintiffs' bar in the state. Again, does this not prove that my insurance agent was correct? No. No, it does not.
This is a classic case of blaming something new on something that has not changed. Florida has had a politically influential plaintiff's bar for decades, but the rates have doubled in only the past three years. An unchanged explanatory variable cannot be the cause of a changed dependent variable -- at least not without some other facts to connect them, as I will explain below.
This logical error is identical to one that I recall seeing a generation ago in the sports context, when a cohort of great female and male tennis stars from the US -- Chris Evert, Jimmy Connors, and so on -- had retired, and there were no younger American players taking their places. Asked why the United States could no longer produce world-class tennis stars, a commentator said that, well gee, athletically talented American kids have a lot of alternatives to choose from: football, baseball, basketball, and so on. Sweden, which then dominated the international tennis rankings with a population only 2 percent as large as the US's, pushed all of their kids into tennis. See? QED.
Leaving aside that the factual assertion was simply wrong -- plenty of Swedish kids are drawn to major winter sports, most obviously hockey -- the problem is that there had been no change in the availability or attractiveness of alternative sports for rising stars in either country. "Sweden dominates the US in tennis because American kids have more alternatives" sounds initially plausible, but to the extent that the purported explanation is true at all, it is a long-established background fact, which cannot explain a change in the relative success of the two countries in professional tennis.
Conservative politicians sometimes understand this, when it suits their purposes. (My promised/warned transition to discussing gun violence begins here.) Earlier this week, at one of his many nauseating news conferences following the heartbreaking mass murder in Uvalde, we saw Texas's craven governor, Greg Abbott, try to make this logical move. He pointed out that Texas has had almost nonexistent gun laws for about sixty years (which just happened to coincide with the White backlash against the end of Jim Crow, but I digress), yet the mass shootings have only happened in the last few years. Thus, Abbott said, the loose gun laws cannot explain the shootings.
There is nothing about the underlying logic -- changes in outcomes cannot be explained by unchanged explanatory variables -- that is inherently liberal or conservative, so Abbott could in fact have been onto something. Even so, one commentator noted that Texas did, in fact, see a mass shooting very shortly after they changed their gun laws in the 1960's. In fact, it is a mass shooting that many people still remember more than a half-century later: the clock-tower shooting at the University of Texas in 1966, when a man killed 13 people. (The dead included a pregnant woman, causing the Wikipedia page to claim that the shooter "killed 14 people, including an unborn child." Apparently, Sam Alito is now editing Wikipedia in his spare time.)
Beyond the factual error, however, Abbott misunderstands the point by implying that nothing else that has changed in the last few years could combine with Texas's laws to have caused the increase in gun violence. The federal assault weapons ban expired in 2004, for example, and assault weapons have become much more widely available -- as well as now being popular among the relevant portion of the US population -- only recently. More to the point, the increasingly open racism and nod-and-wink (at best) relationship between politicians like Abbott (who mirrors pretty much the entire Republican Party at this point) and White supremacists has also made it easy to see how lax-to-nonexistent gun control has paved the way to shootings in Uvalde, in Buffalo, and in the other 200 places in which the US has seen mass shootings since the beginning of 2022.
As a non-American commentator on MSNBC noted earlier this week, the US had 288 school shootings from 2009 through 2018, while the second-place country on that unenviable list is Mexico, which had 8. Eight! If that does not make a strong case that the US's gun-glorifying culture and lax gun laws are combining to deadly effect, is there any evidence that could satisfy a skeptic?
The point is that the lack of effective gun laws in Texas and elsewhere in the US makes it possible for other changes in society to cause murderers to pick up high-powered weapons and kill large numbers of innocents in mere minutes. For most of human history, there were no gun control laws, because there were no guns. That some places decided not to have laws limiting guns after guns came into existence does not mean that the lack of such laws is unrelated to the soaring violence. Two jurisdictions, one with strict gun control laws (which I shall call NotAmerica), the other with no such laws (America), see different outcomes when other variables change, because those variables' effects are mediated through the countries' regulation or non-regulation of guns.
One thing that is true is that NotAmerica and America both have insane people -- and the difference between the two jurisdictions could be explained if the number of potential murderously crazy monsters has increased here more than elsewhere. Even then, that would not mean that American laxity on gun control was not a major explanation, but it would make the cause-and-effect a bit more complicated. But as I noted above, the only competing explanation on this score is that America's potential murderers are seeing increasingly mainstream acceptance by Republican politicians and pundits of things like "replacement theory." Even there, however, it is not as though there are not militant neo-fascist racist politicians roiling the waters in countries like, say, France. Yet the gun violence and death tolls elsewhere are nothing like what we see here.
The logical assertion that Abbott makes -- that "our gun laws have been the same, so our guns laws cannot explain changes in gun violence" -- is demonstrably erroneous because it ignores the fact that other places have changed their laws, and we have seen different outcomes in those places than in Texas. A weak-to-nonexistent law can be the cause of a problem if the violence is enabled by that legal vacuum.
All of which brings me awkwardly back to homeowners' insurance rates in Florida. Is there something that explains how a non-change in Florida -- the ongoing existence of an aggressive and prosperous plaintiffs' bar -- can indirectly explain the recent explosion in rates? Next week, I will write Part Two of this two-part column, in which I will try to answer that question. Moreover, Florida's legislature began its special session to address the crisis this week, so I will include in Part Two a report about what came of that scrum. Stay tuned.