Even in this do-nothing Congress, there are a few good new policy ideas in circulation and ready for legislative action. The U.S. Senate will have an opportunity next week to act on one: "auto choice." Co-sponsored by DLC Chairman Sen. Joe Lieberman (D-CT) and Sen. Mitch McConnell (R-KY), S.625 must overcome a variety of procedural hurdles and a lamentable lack of Democratic support. The House version (H.R. 2021) is co-sponsored by New Democrat Coalition co-chair Rep. Jim Moran (D-VA) and House Majority Leader Dick Armey (R-TX).

The premise of auto choice legislation is simple. Our current system for compensating people suffering bodily injury in auto accidents often requires legal action against the party "at fault." Victims of one-car accidents are often just out of luck. Too many accident victims either never get compensated or wait many months or years for restitution, while the costs of litigation and the occasional huge rewards for "pain and suffering" boost insurance premiums to an unconscionable level, especially in our cities.

Auto choice cuts through this system by requiring that consumers be given the option to buy "first-party" insurance that quickly and more generously compensates victims through their own insurers, without litigation and with much lower premiums (an estimated 45 percent lower on average) for bodily injury coverage. Purchasers of these policies would waive the right to "pain and suffering" recoveries, but in exchange would be given much higher guaranteed coverage levels for actual injuries, including economic loss, even in the case of one-car incidents. Consumers choosing to keep their current "tort-based" policies could do so, and entire states could opt out of auto choice entirely if their insurance regulators determined that the system would not produce average bodily injury savings of 30 percent for those participating.

Auto choice would also help reduce the crushing economic burden the current system places on low-income Americans. In many urban cores, auto premiums are nearly double the rates in the suburbs, and are often becoming more expensive than the cars they insure. For example, in Brooklyn, a 20-year-old male with no driving violations pays an average annual premium of $2,270 per year.

As DLC President Al From pointed out at a briefing for press and congressional staff this week:

Personal mobility is critical to upward mobility. Transportation costs are a major impediment to the efforts of welfare recipients, and low-income Americans generally, to get and keep private-sector jobs offering real opportunity and freedom from dependence on public assistance. Auto choice offers a way to divert dollars now going into the pockets of insurance companies and lawyers into the pockets of those struggling to get into the middle class and those struggling to stay there.

Denver Mayor Wellington Webb and Fulton County (GA) Commissioner Michael Hightower appeared at a Senate Commerce Committee hearing on auto choice this week to emphasize the social consequences of this issue. They also to point out that high auto insurance costs are forcing many urban local governments to reduce services to pay for coverage of public transit vehicles and other public vehicle fleets.

Recent trends in auto insurance litigation make this legislation especially urgent. As Rep. Moran noted at this week's briefing:

According to The Washington Post, the number of car crashes decreased by 12 percent since 1985, but the number of accident-related suits was up 71 percent. While the number of lawsuits has increased, the amount of compensation for those with serious

injuries has not. Overall, the present system offers premiums that are too high, fraudulent claims running rampant, and gross under-compensation of seriously injured accident victims.

Noting that Auto Choice, if fully utilized, could save consumers up to $35 billion a year in reduced premiums, Sen. Lieberman summed up the case:

Auto insurance reform is a bread-and-butter issue that can help every driver. Why not put real dollars back into the pockets of the American people?

Why not indeed? Endorsed by a broad array of business organizations and newspaper editorial boards, auto choice's main opposition comes from trial attorneys, which is not surprising since attorneys now pocket about 28 cents on every dollar paid in premiums under the current system. Trial attorney opposition helps explain why so many congressional Democrats have given auto choice a wide berth: on the brink of a Senate vote, only Daniel Patrick Moynihan (D-NY) has joined Sen. Lieberman as a Democratic co-sponsor.

New Democrats should let Senate Democrats know that a reflexive interest group reaction to this measure is not acceptable. Auto Choice gives Democrats a chance to do the right thing, helping the right people who most need help, and incidentally, making it clear that no interest group can tell Democrats or insurance consumers they have no choice but to toe the line and pay the cost.