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9/11 Fund: Once Was Enough

By Kenneth R. Feinberg
Thursday, September 11, 2008

As we reflect on the awful events that took place seven years ago today, it is inevitable that we will think about the aftermath of the terrorist attacks. Congress passed the act creating the September 11th Victim Compensation Fund just 11 days after the attacks, and President Bush quickly signed it into law. This bipartisan statute was the first of its kind, providing generous tax-free public compensation to the physically injured and to the families of the dead.

Over the next 33 months, the fund paid out more than $7 billion to 5,560 people; the average award for a death claim was just over $2 million, and the average award for a physical injury claim was more than $400,000. (Sadly, there were few injury claims resulting from the attacks; people either escaped from the World Trade Center towers or the Pentagon, or they didn't.) Never before in American history has there been an example of such taxpayer generosity.

Participation in the fund was voluntary. Congress hoped that in offering this compensation it would persuade victims and their families to forgo lawsuits against the airlines, the World Trade Center's owners and other potential defendants. This proved true. Only 94 lawsuits were filed; everyone else chose the fund. (As of today, 90 of those lawsuits have been settled.) The fund expired on Dec. 22, 2003; those who did not file in a timely fashion were denied compensation.

I believe establishing the 9/11 Fund was sound public policy and the right thing to do. Lawmakers sought to protect the airline industry, the World Trade Center's owners and others from protracted, uncertain litigation. They could have done this without paying millions of tax dollars to each family, but they also wanted to show the world that, in the face of such an unprecedented attack, the American people would rally around the victims. Like the Marshall Plan that rescued Europe after World War II, the 9/11 Fund was a demonstration of American resolve in the wake of tragedy. The nation would stand as one.

Despite its success, the fund has not set a precedent. Congress has not authorized similar compensation for the thousands of victims of Hurricane Katrina, for those injured by other natural disasters or for the families of those killed in such tragedies. Families of firefighters and police officers killed in the line of duty do not receive $2 million tax-free. Nor has Congress exhibited such generosity toward U.S. soldiers wounded, or the families of those killed, in Iraq and Afghanistan.

The same is true of victims of terrorist attacks that took place before Sept. 11, 2001. The Navy personnel who died in the suicide attack on the USS Cole and the victims of the Oklahoma City bombing received no such public compensation. Even the victims of the first terrorist attack on the World Trade Center, in 1993, were denied.

Cold though it may sound, this is as it should be.

Bad things happen to good people every day; Congress does not come to their financial rescue with generous, tax-free checks. In our free society, based on notions of limited government and equal protection of the laws, we simply do not expect the government to step in whenever misfortune strikes. This is not out of concern about bankrupting the Treasury. It is because our heritage teaches that we all must take our chances in life. Private insurance is available to guard against uncertainties. So is private charity, and it is notable that the American people donated $2.5 billion to help victims of the Sept. 11 attacks.

Meanwhile, government provides a modest safety net in the form of Social Security, Medicare, Medicaid and various other public compensation programs.

The fund should be viewed historically as a unique response to a national tragedy rivaled only by the Civil War, Pearl Harbor and the assassination of President John F. Kennedy. It can best be understood not from the perspective of the victims -- my attempts to explain to Oklahoma City families why such compensation was not available to them sounded hollow and unconvincing -- but from the perspective of the nation. We needed to do something for the victims of this shocking attack to demonstrate our empathy and support as a country.

We have been warned that terrorists may strike again on American soil to test a new administration and to once again challenge the resolve of the American people. If such an event occurs, Congress is unlikely to respond again with such public generosity. Yet no less than it did after the 2001 attacks, our nation would stand as one.

Kenneth R. Feinberg, a Washington lawyer, was the administrator of the September 11th Victim Compensation Fund.

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