NEWSWEEK’S Jennifer Barrett spoke with Spitzer about the regulations and what he thinks can be done to improve them.
NEWSWEEK: You have called the regulations “unduly restrictive,” “deficient in many ways” and you claim that they subvert the intent of Congress. How so?
Eliot Spitzer: There are two fundamental questions: How much should you give people? And to whom should you give the federal grants? The federal government can eliminate access to several groups of people through the wording of the regulations. For example, someone who worked in the World Trade Center might have walked down 80 flights after the first plane hit and escaped. But she was then caught in the cloud of debris following the collapse, suffered severe respiratory distress and was treated at a triage location then went to see her own doctor the next day. And she is now traumatized and unable to return to work. Yet, she might not be eligible for compensation under these guidelines.
The regulations are unduly restrictive in the descriptions of injuries, and in addressing victims’ partners if they were in a common-law marriage or had a gay or lesbian relationship. There is tremendous ambiguity. I think [Special Master Kenneth Feinberg] should have used financial dependency as the definition. There was no reason to draw the line where he did. They are still dependent even if they are not married. Also, the guidelines effectively exclude undocumented aliens. They will not try to tap into the program because they fear the transfer of information to the INS [Immigration and Naturalization Service]. He needed to articulate that the information would not be transferred.
There are some who might argue that government funds should not go to people who are in this country illegally. How would you respond?
This victim may have been someone who was on the site making a lunch delivery, or it could just be someone who was working full time but was not documented properly–maybe the paperwork was just wrong, or incomplete. They should be included because Congress passed a statute to provide compensation to victims and survivors of victims of the attacks–and the statute did not and should not differentiate between those who are documented and those who are not. It’s also a question of ethics.
Have you spoken to victims’ families? What has their reaction been to the regulations?
I’ve been speaking to many victims and their families and they are very disappointed at the framework that has been created. Also, when victims and victims’ families collect that $50,000 that is being given out immediately when they show up, then they automatically become part of the process. Perhaps that is wonderful, as most would opt in anyway. But it would have been neater to offer them $50,000 on day one but allow them to opt out later by returning the $50,000. Then the $50,000 payment would not be bait for them to participate in a fund that, upon subsequent analysis, they decide is not the best option for them. Some victims and families have protested that it is like a piece of candy to entice people, to force them into the system.
You’ve noted many “flaws” with the guidelines–which is the most serious and how can it be corrected?
I think the most serious flaw is not providing access to the compensation scheme for all of those who are deserving victims and survivors of victims. There are remedies there. I am hoping that if people are vocal enough, then Ken [Feinberg] will fine-tune the guidelines.
You criticized the guidelines’ provisions that even “unconscionably low damage awards” are binding and unappealable. There have been estimates that fund awards may range from a minimum of $300,000 for a single victim to $3.5 million or more for high-income victims who left a family behind. Do you foresee a lot of families at the lower end of that scale becoming very frustrated with the process? How do you fairly determine what a victims’ family deserves?
This is where the issues are diciest because the sense of fairness and equity is perhaps impossible to achieve in the context of this type of tragedy. There is no good answer to this type of question. But, having said that, those on the low end of the totem pole will get damages that are quite low because their economic damage is low and the noneconomic damage awards they can get are capped at $250,000. The capping will be felt most by those that are on the lowest end economically. Someone who was earning enough that the calculation on economic damages is quite high might care a bit less about noneconomic damages. The damage awards for some are certainly going to be lower than what someone can get in a wrongful-death suit.
So having seen these regulations, do you feel it might be in the best interest of some victims or their families to hire a lawyer and file their own lawsuit, as Ellen Mariani [who lost her husband, Louis Mariani, on United Flight 175] did yesterday, seeking unspecified damages from United Airlines for negligence that led to the September 11 hijacking?
This is an area where I’m loathe to be perceived giving advice because it is not my job. But having said that, this [filing a lawsuit] would be a difficult course of action, made more difficult by legislation that has capped or eliminated the liability for some potential parties. That is why Congress cut the deal to exclude certain parties as potential defendants but give an equitable alternative for victims or survivors of victims. The problem is, it [the fund] is not really equivalent, so it’s not fair. There are multibillion-dollar bailouts of industries affected and examples of largess elsewhere. My fear is that the bean counters at the [federal] Office of Management and Budget are once more turning off the spigot to New York. There are loads of pork for all sorts of congressional enactments, and here we have real victims being shortchanged. That is the anguish that the victims feel. They see these reports of other expenditures being authorized and they say, why were they parsimonious with the victims?
You’ve criticized Kenneth Feinberg for saying that charitable donations will not be counted as “collateral source” payments resulting in reductions of awards, but at the same time authorizing himself to determine that charitable payments are collateral sources. What’s the difference? Could this slow down the process of distributing charitable payments to the victims?
I am not sure what he means either, and therein lies the problem. Ambiguity is not good here, not for the charitable organizations. They need clarity there so they can structure the way they distribute aid.
At one point, you indicated that if the Department of Justice “does not make changes to address these severe inadequacies” you might not have a choice but to consider available legal options. Do you think it might come to that?
Let me temper that. I don’t agree with everything [Kenneth Feinberg] has done, but I am not sure that it would merit legal action. I like him tremendously, and he is a very smart guy. I like working with him, and I know he had to make some very difficult choices. But I hope he can fine-tune this over the next 30 days to improve it.
Feinberg says the fund is open today and awards would be paid within four months–could changes to the guidelines hold up the process?
I think they can begin the process now and, if they decide to change the rules, they can make them retroactive.
On a slightly different subject, I understand your office is investigating groups that may be posing as charities collecting money for New York City police and firefighters, or other victims. How did you learn about these groups? What groups have you identified? How much money have they collected and where has that money gone?
We have not disclosed any of these groups publicly. We’re still investigating. It’s not a substantial amount of money, but we still have to squelch this immediately. These things can take a long time to uncover because of the subpoena process.
What can potential donors do to make sure that the money they give goes where they intend for it to go?
Stick to charities that are mainstream or well-known. Or, if you haven’t heard of them, check them out on our site http://www.oag.state.ny.us/home.html or on the Better Business Bureau site or talk to others who have donated to the charity. Do some due-diligence work.
