The American system isn't "terrifying" it's just different. You can't look at the European system without understanding that a lawsuit means a lot more in Europe than it does here. Many of the things that Europe does through administrative processes, the US does through litigation. It's easy to fixate on the costs of litigation, but realize that other systems don't necessarily eliminate those costs, but move them around by organizing things differently.

If a suit is truly meritless, it will be dismissed very early in the litigation process (summary judgment) before costs have piled up. The American legal system tries very hard to be "lazy" (in the CS sense), backloading costs as much as possible. Yes, it can cost millions of dollars to defend a suit at trial, but if a suit has made it that far it means that it was not a meritless suit. Why should the loser pay if he brings a meritorious case in good faith? Remember, in the US a lawsuit is usually the process through which the facts underlying a dispute are discovered. It often happens that someone legitimately thinks he has been wronged, but the process of litigation uncovers facts that show otherwise.

Loser pays systems chill litigation against big corporations. People focus on the situations in which they perceive there to be too much litigation, but in many areas there is not enough litigation. Litigation is the process through which citizens force corporations to fix unsafe products or clean up polluted land and water. Individuals are already at a huge disadvantage in these situations, and the threat of a corporation running up the bill in a loser pays system would do great injustice. Europe gets away with it because it has far more active government oversight and prosecution of such things.

I don't know if you sleep on a mattress filled with hundred dollar bills, but even engaging a lawyer to fend of a possible lawsuit can cost thousands with costs escalating quickly from there if you need to do more prep-work before you even show up at court.

Even getting a case dismissed can cost a small firm more money than it can afford. A fifty thousand dollar dent in the cash-flow of a small business is not an easy thing to weather. Good luck collecting on damages from a wrongful suit, too.

You say it chills litigation against big corporations? It tempers it. Where you cite examples of lawsuits against companies promoting the greater good, I see ambulance chasers trying to siphon extraordinary class-action settlements. Very little of that money goes towards consumers and instead of making companies more responsible it simply paralyzes them with paranoia.

It may sound rather peculiar, but in some countries the government plays the role of advocate for the voters. It doesn't necessitate suing anyone and everyone to send a message. Too many things that used to be taken for granted have been completely eliminated because one individual decided to press ahead with a lawsuit over something that, in many cases, was either a random act of bad luck or a case of irresponsible behavior that can be blamed on another on a technicality.

> You say it chills litigation against big corporations? It tempers it. Where you cite examples of lawsuits against companies promoting the greater good, I see ambulance chasers trying to siphon extraordinary class-action settlements.

Read up on the economics of externalities. In the US, the legal system is pretty much the only thing we have to deal with companies trying to externalize costs. And the amount of these externalized costs is huge. $500 billion or so for the coal industry alone (http://wvgazette.com/static/coal%20tattoo/HarvardCoalReportS...).

The narrative popularized by corporate America is the ambulance chasers just looking for a quick settlement, and while that no doubt exist the truth is that lawyers are the only thing that stand between the big corporations and everyone else.