Treasury secretary visits Maine Snow says trial lawyers, lawsuits slowing down economy

PORTLAND – Days after Sen. John Kerry named Sen. John Edwards, a former trial lawyer, as his running mate, Treasury Secretary John Snow said lawyers and lawsuits are slowing the growth of the U.S. economy.

“Abusive lawsuits have far-reaching consequences for businesses and for workers,” Snow said Thursday. “If you talk to businesspeople in the U.S., the thing they are most worried about is that unforeseen, unpredictable jury verdict that wipes out the net worth of their enterprise.”

The way the U.S. legal system works encourages businesses to make investments overseas and hurts business growth in America, he added.

Snow also blamed lawyers for what he described as an overreaction to the 2002 Sarbanes-Oxley Act, which sought to prevent corporate fraud. Companies are taking too much care adhering to the letter of the law, he said, instead of its substance.

“The law basically, simply says ‘behave ethically,'” Snow said. “I hope that boards and management will get back to the business of running companies well.”

In contrast, Snow told the Greater Portland Chamber of Commerce, tax cuts promoted by President Bush have helped the U.S. economy.

“At the national level, because of the president’s tax cuts, people across the country find themselves with more money in their pockets,” Snow said. “Nice things happen when people spend.”

Snow’s visit was not billed as a campaign stop, but his remarks included positive assessments of Bush administration tax cuts and other proposals that were disputed by opponents in the Kerry campaign.

“There’s no question that the economy had some bad breaks, but the president’s economic strategy has been a dramatic failure,” said Jason Furman, the Kerry campaign’s economic director. “Today the economy is in far worse shape than what Secretary Snow and other officials in the Bush administration have predicted in the past.”