The Senate decided on Tuesday night to all but kill legislation to create a $140 billion fund to compensate victims of asbestos poisoning.
Supporters of the measure, led by Senator Arlen Specter, Republican of Pennsylvania, fell just short of the 60 votes needed to waive a budget objection raised about the legislation. The final vote was 58 to 41, and with powerful interests on both sides it did not break down along party lines.
The vote meant that the courts were likely to remain the primary forum for processing thousands of asbestos cases in the foreseeable future.
President Bush has made changes in the treatment of asbestos claims a legislative priority, and the Senate action was a major setback for the White House.
The bill, more than two years in the making, became a casualty of powerful business interests opposed to it, as well as of a forceful coalition of conservative and liberal senators. The conservatives argued that the measure could lead to a new and expensive federal entitlement program. The liberals maintained that the asbestos fund was not large enough to compensate victims and was a bailout for asbestos companies and their insurers.
Supporters said the bill was needed to compensate victims and their families, alleviate a crisis among manufacturers and deal with a growing number of cases in the courts.
An estimated 10,000 people die each year from exposure to asbestos, primarily in the workplace. Dozens of companies have sought bankruptcy protection to control their asbestos-related legal costs.
And by many estimates, about 60 percent of the money available to compensate victims is going to lawyers for the plaintiffs or the companies. The courts, facing growing numbers of asbestos cases, have repeatedly called on Congress for a legislative solution.
The measure failed in large part because of opposition from some asbestos makers and insurers, as well as from trial lawyers and labour unions. Some companies opposed to the legislation declared that they were being forced to pay too much into a new compensation fund, while the unions and trial lawyers saw the bill as a bailout without enough money for the victims.
Asbestos has been widely used as an insulation and construction material, and exposure to it in the workplace may not manifest itself in harmful ways until decades later. It can cause illnesses ranging in severity from relatively mild to lethal.
A study issued in May by the Rand Institute for Civil Justice found that more than 730,000 people in the United States had filed compensation claims for asbestos-related injuries from the early 1970's through the end of 2002, costing businesses and insurance companies more than $70 billion.
The legislation shunted aside on Tuesday night had been intended to replace the current civil court approach to compensating victims with a no-fault program financed by manufacturers and their insurers and run by a new compensation office at the Labor Department.
The bill would restrict asbestos victims in bringing their claims to court and limit the liability of manufacturers and insurers, but require them to make contributions to the fund.
It would set up a schedule of payments, based on the severity of the illness, ranging from $25,000 for breathing impairments to as much as $1.1 million for victims of mesothelioma, an often fatal cancer of the lungs.  Fees for lawyers would be limited to 5 percent of final awards.
Source: NY Times