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Iraqis have a chance to do it right

By Keith D. Cummings
web posted March 15, 2004

Last week marked a major victory in the wars on terror and totalitarianism. The Iraqi governing council was able to transcend its differences and sign an interim constitution. The sticking point over the weekend was the Shia's objections to the veto power granted to the Kurd's over the final Constitution, which should be completed sometime in 2005, if current estimates hold.

Mohammed Bahr Al-Ulloum, the current President of the Iraqi Governing Council, is helped as he signs the new Iraqi interim constitution during a historic signing ceremony on March 8
Mohammed Bahr Al-Ulloum, the current President of the Iraqi Governing Council, is helped as he signs the new Iraqi interim constitution during a historic signing ceremony on March 8

That a federal constitution has been signed and sealed in a part of the world where liberals tell us "the people aren't capable of democracy" is a miracle in itself. That the Shia majority was able to understand the importance of protecting the rights of the ethic minorities is a testament to the greatness of both the Iraqi leaders and the American people who have so long shown the way to those nations that seek free, independent people.

Now is a great moment for the Iraqi people. They have, with the help of good friends around the world, ousted a brutal dictator and embraced the future. They have taken the first step to a peaceful and prosperous nation. And now is the time for the Iraqis to learn the biggest lesson of the American experiment: What not to do.

The first the Iraqi nation must do is to codify, in their final constitution, strong property rights. The 13th Amendment to the US Constitution is the greatest injustice ever done in this country, and Iraq should make it next to impossible for the federal or regional governments to impose putative taxes on her people. The importance of property rights, safe from the greedy hands of governmental bureaucracies and welfare states, are the key to economic growth and success. Should Iraq fail to ensure that a democratic capitalism is safe and sound from even super-majorities of her people, she faces the danger of rapid decline into socialism.

Once Iraq has protected the rights of her people to own and be safe in their property, she needs to turn her eye to her judiciary. The American judicial system is rife with corruption. The American Bar Association and the American Trial Lawyers Association have members of the Senate relying on their approval to select judges. These organizations, both of which believe that judges and lawyers "make law" in the courtroom are a growing drag on the American economy.

To encourage judicial restraint, the Iraqi people would be well served to select a hybrid system of judicial appointment. The executive branch should appoint federal judges, but removal of activist judges should be easier, and left to the people. States like Colorado, for example, have the equivalent of a popular "no confidence" vote for state Supreme Court judges. Iraq should consider having a similar construction, where every four to six years the people vote on whether to allow the members of the federal judiciary to keep their position on the bench.

To avoid the growth in power of organizations like the Trial Lawyers Association in America, the Iraqi people should take a lesson from the more civilized nations of the world. That's right, for once I am suggesting that European nations have us beat at something, that something is a "loser pays" system of justice. Trial Lawyers in America oppose this because such a system eliminates the ability to file lawsuits en masse, hoping for a huge settlement along the way. With loser pays, frivolous lawsuits are reduced to a minimum by removing the incentives that exists in the USA.

Along with loser pays systems, Iraq should also eliminate the concept of contingency fees for lawyers. These fees, which sometimes exceed 50 per cent, encourage large lawsuits and have a negative impact on the economy and property rights. In the tobacco cases of the 1990s, some lawyers received in excess of $40,000 per hour on the case. In a nation where people are outraged by doctors making $500,000 a year, where is the outrage at lawyers taking home three times this amount for a single standard workweek?

The Iraqi Constitution should cap all settlements in any civil case to a compensatory damage and three to five times compensatory damages in putative damages. No one is served when a corporation is made to pay millions of billions of dollars in a negligence case. Even a million dollar judgment sends a message to corporations, and wholesale negligence (like the Ford Pinto in the 1970s) can yield sufficient financial damage on a company to send a message. Larger settlements simply take money out of the economy and place it in the pockets of alleged victims.

The founding fathers in the United States couldn't have predicted the degree to which the judiciary, considered to be the weakest branch of government, would run rampant and ignore the very document that created it on a regular basis. The Iraqi people and the governing council have a tremendous opportunity to learn from America's mistakes and build a better government using the lessons the greatest democracy on earth can give. With luck, Iraq will become a beacon to the Middle East and the world. If the Iraqi's do this right, America may even learn a few things.

Keith D. Cummings is the author of Opening Bell, a political / financial thriller. His website is http://www.keith-cummings.com.

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