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Looking for Legal Reform? Look at Texas

Louisiana is in need of legal reform and Texas, once known as the “lawsuit capital of the world,” can serve as a model for progress. This recent article details how Texas has been able to put legal reform to work improve not only their legal system, but their economy as well. Read more about what reform brings—and then encourage our legislators to bring reform to Louisiana!

Legal reform in the Lone Star State; How it works and why Louisiana needs it It is hard to imagine, but not very long ago, Texas was described by the Wall Street Journal as the “lawsuit capital of the world.”

Frivolous lawsuits and settlements were out of control. Plaintiff-friendly laws, judges and juries made it virtually impossible for defendants to get a fair trial. Meanwhile, businesses, doctors, and most importantly, jobs were leaving the state in droves.

Fast-forward from 1994 to today, and we see Texas employment numbers that paint a very different picture. According to Richard Fisher, president of the Federal Reserve Bank of Dallas, four of every 10 new jobs created in the U.S. since the recession ended are in the Lone Star State. That’s a massive share of America’s job growth when you consider that Texas only accounts for about 8% of the nation’s economy.

What’s even more impressive is data from the U.S. Bureau of Labor Statistics that shows Texas has added 732,000 private sector jobs over the past 10 years. That’s seven times more than any other state. And for the seventh year in a row, Texas was ranked by CEO Magazine as the best state in the nation for business.

This transformation happened so fast it may seem like a “Texas miracle,” but in reality it is much more than that.

Over the past two decades, lawmakers in the Lone Star State have made lawsuit reform a top priority—and this is the main reason cited by Fisher for the Texas turnaround. Working together to put payrolls before payouts, they enacted common sense laws to reign in excessive punitive damages for arbitrary claims such as “pain and suffering.” Because of these and many other legal reforms, Texas has become a jobs machine. As Governor Rick Perry recently noted, employers in the Lone Star state “spend less time in court and more time creating jobs.” This has become especially important in the aftermath of the Great Recession.

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