Juriscribe was kind enough to email us a guest post on the topic of forced arbitration and mediation and the brewing scandal in the for profit mediation industry that has finally attracted the attention of Congress. When I think of mediation I think of the MID post Katrina mediation program which was effectively controlled by the insurers and was described by most of the policyholder particiapants I know as demeaning:
“People get worn out,” he says. “They get tired of fighting and give up. Eventually, they take whatever they are offered.”
Hunter’s assertion is perfectly illustrated by the story of Pam Collins and Joy Panks, co-owners of the Twin Lights gift shop in Old Town Bay St. Louis.
“Our insurance company owed us $172,000,” Panks says. The last time she and Collins drove to Hattiesburg for mediation, a representative from their insurance company met them with a check for $55,000. The check was physically placed on the negotiating table, and the two women were given three chances to accept it. “The fourth time, they said they were going to pick it up,” Panks says.
“We were begging,” Collins confesses, thinking back over all the company’s previous offers. The bargaining started at $30,000, then went up to $40,000. “They said $55,000 was the last offer.”
FORCED MEDIATION AND ARBITRATION: GENUINE IDEA OR CORPORATIONS JUST HIJACKING THE PUBLIC SECTOR AGAIN
“Privatization” is a euphemism for big, for-profit corporations in the private sector capturing the right to sell and operate traditional government services from the public sector, and billing it all back to us at grossly profitable rates. Used to be corporations had to keep their greedy-assed tentacles off government services, cause that’s what we pay taxes for. The idea of Wall Street running prisons . . . unthinkable! Not so fast, Bush hadn’t run yet. When Dubya got in, for-profits went on an 8 year privatization binge, grabbing every government service they could get their French-cuffed arms around. Privatization was just one of the profit plays opened up by the Chaney-Bush-Rove triumvirate, and was of course payback for Bush pay-to-play donations, a/k/a political bribes. Today, for-profits own and/or manage federal and state prisons (CCA and Wackenhut); run and control FEMA (CSC); own and control city water systems; and are pushing to get interstate roads and highways in the bag. The sales pitch: private business can do it cheaper and better. (Right, let’s contract out our next war to Blackwater and KBR).
What’s all this got to do with arbitration and mediation? Well, for many years an outfit called American Arbitration Association (AAA) has been greasing political palms, hoping to privatize the justice and court system and turn into a billing bonanza, like the prison thing. They got a good sales pitch too: “folks, if you’re pro-business, we gotta stop the lawyers, courts and juries, and we gotta get mandatory mediation-arbitration clauses in every kind of contract, and even where we don’t have one, we gotta get the courts to first push everybody through mediation-arbitration.” First thing the insurance companies love about this AAA tune is the melodic line “bye-bye constitutional right to jury trial.” Second, “how sweet it is” that people gotta pay twice. They’ve already paid to build the courthouse and salary the judge and staff to work there, now they gotta pay AAA’s exorbitant hourly rates for all this stuff again. That ought’a teach ’em to screw with big business! (Incidentally, in Mississippi some of these same folks are right now pushing to invent a new court, God forbid, the so-called “business court”).
Some of you will remember that our local federal court partnered-up with AAA in Katrina, and made everybody use and pay for AAA (or another mediator-arbitrator), whether they wanted to or not.
This is called judicial “outsourcing,” and AAA is hoping they can inject this virus into the court system, just like CCA managed to hijack prison operation and turn it into a profit machine. (I’m sorry, I meant to say “the corrections industry.” Betcha these folks ain’t cheering McGruff to “take a bite out of crime” though).
Well I’m not sure judicial outsourcing is even constitutional, but let’s not rush this one up to the twin Ediths, (Edith Jones, Inc. or Edith Clements, Inc.), for an answer just yet. I just wonder though . . . how much of this AAA Katrina deal was brokered through our friends the good neighbors and good hands people, you know, the ones who are always on our side? And, did Mr. Dale help here . . . or how about some of those lifers in the DOI office at the time; everyday ex parte chatmates with the rat’s nest of law clerks working Katrina. Or, maybe someone in the federal court system prompted Dale or his lifers to start the ball rolling. Katrina “insureds” – a misnomer for sure – should’ve ask: “since when does Dale or some federal court minion get to say when and how we can use a constitutionally created United States Article III Tribunal, which we fund and pay for as US citizens?”
During the Bush reign, forced arbitration-mediation was endemic. Privatization of the whole justice system was certain to happen as emboldened corporate lobbyists worked feverishly to deconstruct the last vestiges of court access, and finally do away with trial by jury.
Here’s the good news. With Dubya gone, lawyers began to expose the corrupt arbitration movement that had flourished in his reign. Recently, Minnesota AG Lori Swanson disemboweled one of largest arbitration fraud factories, the co-called “National Arbitration Forum”. The settlement effectively put NAF out of business forever and Congress is now conducting investigative hearings on forced arbitration abuse and corruption. Next we hear – and this is ominously related to the NAF scandal – Bank of America has suddenly stopped forcing arbitration under existing consumer contracts.
No corporation, especially not an Orwellian colossus like BOA ever gives up a bribe-earned advantage like forced arbitration unless there’s some serious blowback waiting at the other end. Stay tuned. If you’ve got a AAA horror story to tell, now’s the time to shout it out.
I’m not one for “write your congressman.” Sorry, I’m wandering somewhere south of Argentina on that one, but, on the other hand, assuming the time is right, you might calmly mention to family around the dinner table . . . or subtly to friends you run into on the street: “WTF!!! WE GOTTA GET RID OF THESE F’ING VAMPIRE ARBITRATION COMPANIES, NOW!”