Airline Relief Legislation Needs Scrutiny

In the wake of the horrific events of Sept. 11, the nation looked to our country’s leaders for support and guidance in dealing with the thousands of victims and the rippling effect on the economy.

Congressional leaders felt they had to take immediate action to aid the airline industry that had been hit and that represents a driving force for our lifestyles and the economy. Congress approved in short order a $15 billion financial relief package called the Airline Destabilization Act. It also was intended to aid those families who lost loved ones at the four commercial airline crash sites, as well as carry some of the financial burden the airline industry is sure to bear.

The new law offers the thousands of victims and their families compensation through an administrative system without going through the courts. Instead, the law calls for a special master to be appointed to determine, not liability, but economic and non-economic losses. Such legislation would be retroactive to that fateful day.

The legislation was passed with little debate and much grandstanding. While the intent may have been laudable and represents a concept that I support in theory, its implementation will be hotly debated. In Congress’ haste to offer help, this law may prove to have many unintended consequences.

Questions are raised about the constitutionality of retroactive legislation. Given the importance of the rule of law and the notion that citizens are governed by established rules and clearly defined legal obligations, such a law needs scrutiny.

Congress has passed such retroactive legislation in a civil context in the past only when reasonable and pressing social and economic conditions have dictated that a great societal purpose must be met.

With that standard, a trend of policy-based retroactive civil legislation – from tax laws to pension plans and hazardous waste cleanup, from health benefits to small aircraft safety laws – indicates a growing tolerance for changing the established rule of law.

Perhaps the most celebrated case legislating retroactive civil liability involved the Iranian crisis in the early 1980s. Terrorists had taken 52 American embassy personnel as hostages on a jet at the Tehran airport and headed for West Germany. After more than 14 months, the terrorists freed the Americans but not until the U.S. government had agreed to give the Iranian government millions of dollars.

An American firm challenged the constitutionality of one of its provisions that nullified prejudgment attachments against Iran. Dames & Moore v. Regan, 453 U.S. 654 (1981). The U.S. Supreme Court ruled the agreement constitutional, even thought he rights of certain American creditors were directly impacted ex post facto.

Challenges to such retroactive legislation have been waged under various constitutional provisions, including the Fifth Amendment, which provides that private property will not be taken without just compensation and due process.

But, courts have dismissed such arguments and held that "legislative Acts adjusting the burdens and benefits of economic life come to the Court with a presumption of constitutionality, and... the burden is on one complaining of a due process violation to establish that the legislature has acted in an arbitrary and irrational way." Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15 (1976).

The Court held this rule applied even if the legislation "upsets otherwise settled expectations... [or] impose[s] a new duty or liability based on past acts." Id., at 16.

Legislators must tread carefully and not overreach in trying to achieve relief for the victims as well as restore confidence in flying, all at the same time.

Spreading the loss of victim compensation is laudable, but risk distribution should be given much thought.

Attempting to close legal loopholes is commendable, but sponsoring new legislation every 20 minutes is not the answer.

Sen. Peter Fitzgerald, R-Ill., was a profile in courage when he was the lone "nay" vote in the Senate to the relief bill. He sponsored a significant amendment that allows the Treasury Department to negotiate an equity stake in any airline that taps into the $10 billion in loan guarantees.

Now is the time for calm heads to prevail and think things through in a steadied, measured fashion. The rights of all Americans must be taken into account, and we should not be quick to compromise the rule of law for what may prove to be short-sighted, inadequate relief.