This should be interesting! Perhaps the Supreme Court should review the Constitutionality of this law that will cause citizens to be more responsible? And, they could see how Europe, Africa and Asia deal with the issue of irresponsibility before allowing a democratically elected group to decide law? EDITED OUT INFLAMMATORY COMMENTARY

Imagine this concept that people with funds capable of repaying a debtor might actually have to repay a debt that is within their ability to repay! How un-American can that Republican gang be to insist on such measures?

Here is a fairly unbalanced view of the situation regarding the change of law on bankruptcy: Yahoo News Article Subject Kill (the Bankruptcy) Bill
http://story.news.yahoo.com/news?tmpl=stor...henation/132232

My view on the issue is no one forces a US citizen to use credit. If someone is poor and too stupid to understand credit is a trap then perhaps the government should make it illegal for stupid citizens to acquire credit prior to passing an extensive test on amortization and responsibilities? If someone is poor they cannot afford credit so why should they use credit, perhaps laws should be passed to allow credit only to those with equal savings to secure the credit advance as collateral from a financial institution?
I can see no advantage for citizens having credit without responsibility to repay it. Credit is spending before you earn it. Only rich people can afford credit so how could a poor person require bankruptcy?

I have an acquaintance that filed bankruptcy and he said he ran up his credit cards to the max along with every department store plastic and hid the stuff. Then he filed, erased his debts and his mailbox was full of credit card applications the next week.

Here are the questions for debate:

Do you agree that persons with ability to repay debts should be required by the government to repay them?

Do you think creditors should eat the debt since they encourage people to spend beyond their means?

Come on Ol Sarge, I can't even believe that you buy that. Credit is essential to virtually everything in life. If you have ever taken out a student loan, a small business loan, bought a home, bought a car or signed up for a credit card then you have used credit. Having good credit is also essential for all of those things and the only way you can build that credit is by using credit. Heck good credit is sometimes required for things like signing up for cable TV, getting insurance, even signing up for a cell phone or other utilities.

You can't tell me that "poor" people just drop $100K on the table for a home out of pocket or $15K - $20K for a new car (or even a few thousand for a used one). If you believe that only "rich" people use and need credit you are 100% wrong.

So with that in mind, lets examine why "poor" people might need credit, or even why middle or upper middle class people might need credit. Here is a website that explains what bankruptcy is and I would seriously suggest you read through it since you have quite a few misconceptions - link. From this page the top 5 reasons for bankruptcy are:


You'll notice that yes spending too much is in there, but it is only one of the 5 reasons and it is listed as #3. The most common reason is due to unemployment. I don't know if you have ever been unemployed Ol Sarge but in recent years it has been a pretty common thing for a lot of Americans in various industries. The amount you get paid from the government is hardly sufficient for most people to even pay their bills and rent, much less live off of. That means that you are going to be charging your bills to credit cards just to stay afloat. If you are unemployed for a few months and you are the primary breadwinner in your home surely you can see how that adds up pretty fast.

Secondly people often incur very high medical expenses. It is a fact that 43 million Americans do not have health insurance. There are probably many more than that who are under-insured. So let's say you get something like cancer or require some kind of major surgery. Do you have any idea how much the doctors and hospital fees are for something like that? It gets into the six figures quickly. What is your answer here - just drop dead if you aren't rich? Please. People charge these expenses because they can't otherwise pay for them and they aren't going to just say "man I shouldn't incur any debt, I'd rather just die".

Finally, the other big one - marital problems. You have any idea how much marriage counseling runs these days, how about a good divorce lawyer, what about alimony or child support payments you are required to make and can't afford? All of these things effect these "poor" (and middle class) people you seem to despise so much. They have to pay these expenses or risk legal action, bigger fines and possibly jail. So they pay them either by charging them or charging their bills to make up the difference.

What happens when all of this becomes too much to bear is bankruptcy.

I don't know where you got the impression that bankruptcy is some cake walk that everyone should seriously consider Ol Sarge. You can of course read more about it in the link I supplied, but it is not fun.

Most people file for chapter 7 bankruptcy which requires you to liquidate all non-protected assets to pay off your debts as best you can which varies depending on your state but can include your car and house. Once those assets are liquidated and creditors are paid your remaining debts are absolved.

But, it isn't over quite yet. You credit is basically hosed for 10 years Ol Sarge. As we covered previously credit is far more than you think it is. You can't even apply for a mortgage for two years, any credit cards you get will have to be secured (meaning you have to back them with assets - which you won't have since you liquidated everything) if credit card companies even give you a card (which will certainly be at an astronomical rate - think 18% plus). Try imagining what it is like to not be able to buy anything unless you have cash, no credit cards - pretty hard huh? All of this hangs around for 10 years, and will effect every aspect of your life from signing up for utilities to buying a house to buying a car to opening a bank account. You are going to get hasseled by everyone and increased rates for everything.

So, you are sorely mistaken about bankruptcy being a desirable alternative for people. In fact it is better for creditors than anything else. If you are an individual then the creditors get some of their money back by liquidating your assets and they don't really lose the money because they get to write it off as bad debt on their taxes giving them a nice tax break from uncle sam.

Now on to the actual issue and truth about this bill. This bill is a handout by Republicans to the Rich (who they like for obvious reasons) and money lenders (who all contribute heavily republican each election - this article cites over $100 million) and it seriously works over the poor and the middle class by removing this option or making it harder to use.

This isn't about people spending too much because that is only one of the reasons people file for bankruptcy and it isn't even close to the biggest one. It is about the Republicans giving political payback to the companies that finance their candidates. This is what money and politics is all about. It is also absolutely vile and I have a hard time believing that anyone here except the blindest followers could support this.

Your position represents a fundamental misunderstanding of what bankruptcy even is and I would have a hard time believing you'd be against the "evil democrats" for supporting this bill. If you are - well I hope you never lose your job, get divorced, or get cancer. If you do you'll be wishing these "evil democrats" blocked this bill and I'll wish you the best of luck as your creditors garnish your wages and repossess all of your hard earned assets leaving you homeless and in the poorhouse and still dealing with the problems that got you there in the first place.

Now on to your questions:
Do you agree that persons with ability to repay debts should be required by the government to repay them?
They are, it is called bankruptcy law. There are 2 types used by individuals - chapter 7 and chapter 13. There is one type used by corporations called Chapter 11 which keeps creditors at bay while a business reorganizes and works out a debt repayment plan.

So, I don't know what your point is here because we already have well established laws with long histories. In fact these laws benefit the creditors far more than they benefit the people declaring bankruptcy, although I guess they eventually pay off their debts in other ways.

Do you think creditors should eat the debt since they encourage people to spend beyond their means?
Completely irrelevant question. Creditors by their very nature are taking a risk by lending you money whether it is for a new house, a car, a wedding ring, that new suit from the Men's Warehouse, that new Stereo from Sharper Image or even that stick of gum at the grocery store. That is the business they choose to be in and all of them expect to incur some level of bad debt. You find me a credit company that doesn't expect some percentage of bad debt and I might just rethink things, but I know you won't.

They compensate for that risk by charging you an interest rate in accordance with your relative risk to others.

Creditors have plenty of ways to get their money back in the end and I have already discussed some of them. Bankruptcy is not a dirty word for creditors because in a lot of states they get significant funds back by liquidating your assets. As I also mentioned previously they get to write the loss off as bad debt which in accounting speak means that they get a tax break by reducing their tax liability.

CJ, excellent description of bankruptcy.

OS, every now and then some politicians try to bring back poor houses and debtors' prisons. Each and every time they are pushed back because working people in the free markets know what it is like to go months, even years, without employment due to the business cycle. They know what it is like to sell everything of value, ring up credit card debt, hopefully find employment, and spend years paying off that debt -- only to get laid off again.

This of course never happens in the military. When was the last time the military had layoffs? Never happens because it is not a free-market system. It is a taxpayer-supported system, like any other government program.

So here you have free markets. Marketing comes up with the idea of unsecured credit to buy stuff like computers, ipods, books, music -- and some of this stuff actually retains value after purchase. Not much of it, mind you. Most of it is junk that becomes worthless quickly. But hey, that's the free market thing.

There are no caps on the interest charged for unsecured debt. When the prime rate runs in the fractions of a percent, usecured debt interest rates can still exceed 20%. Pretty sweet deal there, eh? That's why unsecured credit is pushed, and pushed, and pushed, and . . . well, if it wasn't a sweet deal, no pushing would occur. What is the term for this? Oh yes, usury. It makes tons of dough.

A relatively small percentage of unsecured credit customers have to default. An even smaller number of these try to use the system to make a profit on the deal, kind of like a capitalistic shark. These are usually very rich people themselves who attempt to retain a bajillion dollar estate home after all is said and done, and the best state to do this in is . . .

Florida.

No limit on the value of a real estate property retained after bankruptcy. Lovely, eh?

The worst state is:

Alabama.

You won't even get to keep the barrel after bankruptcy.

Most states (all that I know of) have harsh penalties for those caught trying to defraud the system -- hard jail time. Also, at least in Colorado, personal accounts are monitored very closely to detect possible fraud for a period after bankruptcy. If big money shows up, expect a visit from the police.

Anyway, sure, let's make all credit only available if you don't need the money (only secured debt). That way, we'll all be unemployed and there won't be any money to support a massive military. China will waltz in and make Mandarin the official language. We'll end up working for pennies an hour to buy our rice as we make Wallmart clothes for the Chinese.

I don't think so. Too much money to lose on this one, very little to gain.

One last thing -- a bankruptcy lawyer I know has observed that his clients tend to do much better after bankruptcy, not because they've retained stuff of great value, but that 1) can't use bankruptcy for a period of time, six years here and 2) it's such a painful process that credit isn't used as much, if at all.

Other parts of the Colorado system that discourages bankruptcy: Landlords check credit backgrounds and can refuse renters with bankruptcy in the reports; employers check backgrounds and can refuse employment.

It is odd how credit card companies pursue recent bankruptcy filers, also auto credit outfits. Must be money to be made, eh?

CJ tax, SS Medicaid take half of your income leaving the other half to use for food, shelter, transportation, entertainment, education, healthcare and the rest of lives mandatory requirements. How can you argue if you are poor giving 20% of the remaining 50% to a guy in an air-conditioned bank is a smart thing to do? CJ please provide me one example other than a home of how using credit could improve my standard of living?

Yes I have bought a car, had a small business, bought several homes and have credit cards and excellent credit without credit debt with the exception of the home. A poor person should only use credit for home purchase since the purchase satisfies a basic requirement of shelter. A home is also a form of savings since in most cases homes appreciate and reduce the amount of tax required to be paid.

If you are poor then take a PELL grant for college, join the military to receive a generous college package or work and save for college; if you are poor you shouldn’t have cable TV or a cell phone. Yes developing credit is necessary to purchase a home but going in credit debt is not necessary to develop credit. Apply for a credit card and pay it off completely as each payment comes due and you will have excellent credit. In fact I do just that because it is the easiest way to buy stuff like food, gas and cleaning supplies. The bank keeps reducing my APR and increasing my purchase limit and I keep paying it off as it comes due.
I don’t buy anything on credit but a house that results in me paying a guy in a bank one penny since I’m not rich, to do so would make me poorer and be illogical? If I don’t have cash for a new car then I can’t afford it and must buy a used car for cash and save if I desire and can afford a new one.

Marital problems, whoa, been there - done that - and am on my third wife. The first got 150K (property), the second $50K cash in installments and you guessed it I didn’t go belly up and they were a bargain! Using sound money practices I have now recovered without use of your money or any crutches.

Medical expenses are a problem responsible people must face. If you are poor then you go to County General, welfare or the like. If you manage your income you buy insurance to allow you choice of proper medical care for those you love and yourself. CJ I pay tax on less than $36K and have Aflac, Humana and TRI-CARE, I have home insurance, car insurance and a nice savings and retirement package. With use of credit none of these things would be possible so I don’t know how you can imply I should help pay for those who misuse credit. I have no problem with responsible people who have bad luck with employment but when employment returns pay for the food and shelter you ate and lived in.




Well that would be a good thing now wouldn’t it? Guess it should be for a lifetime and you would have an additional 20% of your income to spend?


I never said all bankruptcy is bad, I just said the liberals are crying because the Repubs want to require folks to pay for stuff they purchased.

Excellent response, CJ.

However, your information on a few points is flawed (although, not fatally).

First off, it is very easy to get a bankruptcy discharge. Too easy. Search the web for bankruptcy lawyers, there are literally thousands of them. You pay them a fee and disclose your debts and assets and that's about it. You set up a court date with your creditors (who rarely show up) go before a judge and you are "discharged" of your debt. It is very painless.

Second, there is a shrinking amount of stigma attached to someone who has declared bankruptcy. No longer is it an automatic "DENIED" on a credit application simply because you have declared bankruptcy.

Third, most states do not liquidate your assets. To do so would cost more than they would recoup. You keep your house and your car (as long as you can make the payments) and all of your personal belongings (including stereos, clothes, and other non-essential items). Again, check the websites of the lawyers who do bankruptcies, all of this information if plainly available.

Now, all that being said, I still think that bankruptcy needs to remain an option. There are many situations in which not allowing a person to "start over" credit-wise is simply a poor decision. Bankruptcy, for creditors, allows them to write off bad accounts. They need to make an effort to collect these funds, but at what point can they write it off? Bankruptcy gives them a point at which to say "enough is enough, we aren't getting this money back".

Also, the law is fairly strict about hiding assets or making fraudulent purchases that you know you can't repay (Sarge's "run up the cards and then declare bankruptcy"). This can be prosecuted as fraud and can be used to deny someone's claim to bankruptcy. In practical terms, however, these things are rarely enforced. The circumstances of any individual purchase and the intentions to repay are simply too nebulous for a court to determine intent, in most cases.


On to the actual questions for debate:

Do you agree that persons with ability to repay debts should be required by the government to repay them?
Yes, but what's that got to do with this law? The rhetoric surrounding this issue on both sides is terrible. Tightening the bankruptcy laws will drop people into poverty? Certainly bankruptcy abuses exist and tightening the circumstances where bankruptcy can be declared will harm some people. I don't quite understand why the Democrats are against a means test for bankruptcy, although such a means test seems more than a little arbitrary.

The root of the current legislation is medical bills and credit card disclosures. One Harvard study says that 40% of bankruptcies are due to medical bills. Some Senators disagree, citing a study where medical bills only account for 5% of debt and that over 50% of bankruptcies include absolutely no medical debt.

Here is a sight that includes the latest proposals, with little commentary either way: PENDING CHANGES TO THE BANKRUPTCY CODE

There are certainly abuses in the system. However, the sheer number of bankruptcies (around 2 million last year) makes investigating these cases by the courts very costly. Something should be done to decrease the numbers. The combination of the ease of declaring bankruptcy, the low degree of stigma attached, and the benefits of being debt free are simply too much to pass over versus the difficulties of actually paying the debts back. The law should be tightened up by some means, not necessarily the exact means being proposed today.

Do you think creditors should eat the debt since they encourage people to spend beyond their means?
Yes, they should. The percentages at which credit card companies lend to people reflect the risks of never collecting their money back.

Actually, bankruptcy is very hard on the little guy, makes no difference whatsoever to a corporation, in fact, it is an advantage! K-mart bought Sears for 11 billion dollars WHILE IN BANKRUPTCY! The largest bankruptcy filings, which usually gives only pennies on the dollars to creditors, favors super large debtors anyway. If there is any need to tighten bankruptcy laws, it is at the top, NOT the bottom!

Though unemployment is the number 1 reason for bankruptcy, it is not as devestating as the medical bill bankruptcy on personal finances usually.

OS- you really couldn't have it more wrong- the majority of bankruptcy cases are by poeple that did not abuse the system, and had things happen beyond thier control.

I almost had to declare bankruptcy after my divorce. We were well within our means when we were married, but after the divorce, the loss of half of our income, plus the increase of maintaining a new household on my own nearly broke me.

Bankruptcy is not only NOT broken, it needs MORE protection for the medical expense/unemployment types. Those that just run thier credit cards through the roof need a new type of bankruptcy, something like "chapter duh- I am stupid"- and they don't deserve the usual protections.

That’s funny that you should mention K-Mart. My filthy rich neighbor from OK stopped by and I was talking about this debate with him and he made the same point. He said when K-mart dropped to $5. a share he bought 5,000 shares and his broker called him when it fell to $2.50 and he decided to hold. Then K-mart went bankrupt and then bought Sears and the price soared and Ol Jonnie calls the broker to sell at $50. and the broker says you are at $0.0 after the bankruptcy. The big business has the two parties locked up tight! One with business and one with union’s pensions security and both parties share equally in the pot of money to stay in office and they will not kill the hen that lays the golden egg.

CruisingRam Philosopher Epitetus wrote:

This dude died a little over 1,950 years ago and may be out of style in his thinking but it works for me.

Most Americans probably think I should be committed for not riding around in a new SUV instead of my 93 Mitsubishi 4-door. Why spend the car payment on the kid’s school tuition in a private school? I pass on the diamond earrings, tattoos, stylish clothes, cell phones and don’t spend money on stupid holidays that celebrate capitalism until after the herd leaves. All things in life must be prioritized and to me it is food, shelter, health, education, security, clothing and everything else is optional and only obtained within abilities to properly fund after the former are totally secured. Persons who move on to attaining “slavish” desires before securing basic needs have no pity form me. My father didn’t follow Epitetus but he shared his values, the value of the ant verses the values of the grasshopper.



How about tax-free medical savings accounts and insurance before the SUV’s, toys and shiny stuff?

First of all I don't know what relevance your Medicaid blurb has on this debate so I'll ignore it. As for the last sentence in the first paragraph here - did you not read my response? I know for a fact you did because in the very next sentence you said you have bought a car, owned a small business, and have credit cards.

So let's get off this "poor" people thing then. First of all this law will apply to the middle class too. If you are going to try to tell me they don't use credit I really don't know what else to say to you other than you are wrong. Despite what you may think "poor" people don't have everything provided to them by the government. Many of them have homes, many have cars, and many of them certainly try to send their kids to college. Not all of them qualify for grants from the government and many of them still get student loans.

My wife's parents are immigrants and they both work service oriented blue collar jobs in Alabama. They would probably meet your definition of "poor" and yet they have and use credit. They don't use it irresponsibly (and sometimes they are more responsible than I am), but they have it nonetheless disproving whatever point it was you were trying to make.


I don't know why you think that you pay for that Ol Sarge because you don't. Credit card companies don't raise your rates because someone else goes belly up. You are assigned a rate based on how much of a risk they think you are. And I'd have to say I think you are pretty heartless if you are going to say that someone who comes down with cancer and starts owing into the six figures in medical bills is just "out of luck" and can't ever get back on their feet. You don't believe it happens? Go google it.


Agreed, it isn't difficult to file for bankruptcy, and I don't think it should be. This law is trying to make it more difficult which will tend to put those from the middle of the income scale on down at a disadvantage. I think the penalties for declaring bankruptcy (again depending on the state you live in) are severe enough that it shouldn't be entered in to lightly.

Bankruptcy fraud is a problem but it should be handled by our courts (and it currently is). Making it harder for those that need that protection and way back on their feet to start the process just to catch some people defrauding the system is like tearing down the side of a house to fix a window. It just doesn't make sense.


Also true, however I would suggest that this is the result of the actions of credit companies and not consumers. Credit companies are hungry for customers and some of them choose to play in riskier markets than others. I would call it paying on those that are vulnerable and usury, but some would probably say it is good ol' free market capitalism at work.

It is important to note here that even though people can get credit it is at much higher rates of interest and often you have to provide assets to back your credit line. If I offered you a credit card with 22% interest you'd probably laugh me out the door, but when a credit card company offers this to someone who can't get credit they might just take it.


Again that is true, there are a lot of states which have strong homestead laws which protect certain things like your house and your car. However there are still quite a few states that don't have those laws. If you are unfortunate enough to live in one of those states then you are at risk.

Credit card companies of course make a decision before they move forward with liquidating your assets. They weigh the amount of debt you have, how much they can write off and the value of your assets. If all you have to your name is a Stereo from JC Penney then they aren't going tp pursue it. But if you lived in a state that didn't protect your assets they could very well go after your home and your car and that happens with enough frequency to be a risk.


I'd suggest first start by looking at the credit card companies, that industry has some very unsavory practices. There was a special on PBS Frontline sometime late last year called "The History of the Credit Card".

Just to give you an idea of some of the shady stuff that goes one, several years ago credit card companies hired consultants that figured out that if you lowered the percentage of the minimum payment from 5% to 2% then psychologically people would think they didn't owe much, only pay the minimum payment and keep spending. Believe it or not most people don't know that only paying the minimum payment will take you forever to pay off. Sen Dodd tried to pass legislation requiring credit card companies to put a line on billing statements telling people how long it would take to pay their balance if they only made the minimum payment. The credit companies of course defeated this because that would mean a cut in their profits.

Also, there is an agreement in the fine print of all cards, particularly MBNA (which is about as evil as Wal-Mart), that if you are late on any bill even something completely unrelated to that credit card (like your utilities or another card) they can shoot your interest rate through the roof.

As I'm sure all of you know credit companies (again MBNA is particularly guilty here) do everything in their power to hook college students (the people who really shouldn't have cards). They give away free t-shirts if you sign up, offer cards with the school logo, etc and of course when you get it the interest rate is something ridiculous like 18%. So that beer you put on the card quickly becomes double what you paid for it.

These companies are not eithical and they do everything in their power to play on your psychology and keep you spending so they continue to make money. They are predatory on the younger generations even moreso that cigarette companies ever were. Now they even have these pre-paid Visa cards for kids to get them using credit cards even earlier than they can consent to them. Of course most of these kids don't ever get properly educated about cards and they learn from an earlier age that if you want something you just need to charge it.

So if you want to do something about the increasing number of bankruptcies the solution isn't to make them harder to do. I have two solutions for you - take a hard look at the credit industry and we need to decide if some of these practices are really good for the country and two start pushing credit education in schools and to the younger folks so they don't get hooked.

As I have stated some of the other big causes for bankruptcy aren't due to over-consumption. One of the biggest is medical bills and gee, wouldn't it be nice if those 43 Million Americans that didn't have health insurance had something they could use? Hmmm. It all ties in together.

In the spirit of starting this anew per Jaime's note - it is very important to note that America is founded upon the ideals of starting over and getting a second chance. Every single person that first settled America was either running from something or they wanted a better life. The majority of the immigrants that passed through the doors of Ellis Island came here hoping to start over because of various problems they had in their home countries. Even those that lived in America and decided to head out west were frequently looking for a new start or to escape problems.

This concept of getting a second chance and being able to make a fresh start is firmly entrenched in our history. One of the things that has grown out of that is bankruptcy.

As Amlord stated previously there are cases of fraudulent bankruptcy in our country today. However, the vast majority of bankruptcies are genuine and valid. In fact more than 50% of them are due to incredible health care costs which should probably make you re-examine your position on health care. Our legal system is adequately equipped to deal with bankruptcy fraud, there is nothing to suggest that this problem is out of control and worthy of new legislation to handle it.

So let's look at the real motivations behind this bill. First off the basic premise of this bill is that it will make Chapter 7 and Chapter 13 bankruptcy harder to acquire and it will remove protections enjoyed today. You should note that it does not effect Chapter 11 bankruptcy used by corporations.

Here are the political contribution trends from Open Secrets for the finance and credit industry alone. I'll let those graphs speak for themselves. Furthermore, The President and CEO and the Chief Administrative officer of MBNA were Bush Rangers for the last election cycle. Rangers are an elite designation meaning these people raised $200,000 or more for his campaign.

So far I'm not seeing that anything about the motivations or language of this bill has the interests of the American people at heart. Let's look at some of the amendments proposed by Democrats last week that were voted down in straight party line votes by Republicans.

Amendment 42 - Sponsored by Senator Schumer, it is described thusly: "To limit the exemption for asset protection trusts." Status: REJECTED

Asset protection trusts allow the wealthy to hide millions of dollars in assets in trusts which are protected from bankruptcy. This is specifically how many of the CEOs who have been collossal failures over the past decade or so aren't living on welfare today after bankruptcy - the bulk of their assets were safely tucked away when they filed. I'll let you draw your own conclusions as to who the Republicans are protecting here, keep in mind part of the reason for this bill is to combat bankruptcy fraud, yet this is a major loop hole.

Amendment 49: Durbin Amdt. No. 49; To protect employees and retirees from corporate practices that deprive them of their earnings and retirement savings when a business files for bankruptcy. Status: REJECTED

I think this one speaks for itself.

Amendment 38: Durbin Amdt. No. 38; To discourage predatory lending practices. Status: REJECTED

One might assume that if you are passing a bill because of bankruptcy being such a problem you might be interested in stopping some of the practices that lead to it in the first place. Well, in this case you'd be wrong. Probably one of the most guilty companies here is MBNA with their penchant for setting up shop in college campuses all over the country to hand out free t-shirts if you sign up for a credit card or getting you to sign up because the card has your school logo on it, all at ridiculous rates of 18% or higher. They do this knowing full well college students do not have steady income and they'll have to let interest build on purchases.

Amendment 37
Nelson (FL) Amdt. No. 37; To exempt debtors from means testing if their financial problems were caused by identity theft. Status: REJECTED

I think this one speaks for itself.

Amendment 32
Corzine Amdt. No. 32; To preserve existing bankruptcy protections for individuals experiencing economic distress as caregivers to ill or disabled family members. Status: REJECTED

Yep, that's right. Let's say your husband gets in a car accident, ends up a paraplegic, can no longer work and the medical bills are going through the roof. Right now you have a way out of that, a way to start over.

Amendment 29
Kennedy Amdt. No. 29; To provide protection for medical debt homeowners. Status: REJECTED
I think this speaks for itself.

Amendment 28
Kennedy Amdt. No. 28.; To exempt debtors whose financial problems were caused by serious medical problems from means testing. Status: REJECTED
Pretty much the same thing as the one above, worded differently. I think it speaks for itself.

Amendment 15
Akaka Amdt. No. 15; To require enhanced disclosure to consumers regarding the consequences of making only minimum required payments in the repayment of credit card debt, and for other purposes. Status: REJECTED

There was a special on PBS Frontline late last year about credit cards which can be found here. Credit companies used to have the minimum payment set at 5% and then they paid some behavioral psychology consultants that determined that if they lowered the minimum payment to 2% people would spend more money and pay less allowing interest to accumulate. Some companies set that minimum less than 2% now.

Of course we wouldn't want to force credit card companies to tell consumers about this little behavioral trick being played on them, that would cause them to lose money. It would be in all consumer's best interests to know that making only the minimum payment on a credit card is going to take a long time to pay off.

Amendment 17
Feingold Amdt. No. 17.; To provide a homestead floor for the elderly. Status: REJECTED

I'll let Feingold speak for himself on this:


Amendment 16
Durbin Amdt. No. 16, As Modified.; To protect service members and veterans from means testing in bankruptcy, to disallow certain claims by lenders charging usurious interest rates to servicemembers, and to allow servicemembers to exempt property based on the law of the State of their premilitary residence. Status: REJECTED

The fact that this was rejected is particularly unbelievable. The majority of the people that have served or are serving in Aghanistan or Iraq are reservists. That means that before they got shipped out they had real jobs, most of them probably paying more than the military does. So if something happens while they are over there because they are making less income, there will be no protections for them at home.

In all the democrats proposed some 40 odd amendments to this bill attempting to soften the blow to those it will hurt the most. The Republicans were having none of that, their eyes firmly set on appeasing their constituents in the credit industry. If there was any doubt they actually cared about their constituents who actually voted for them (some of the very people hurt by this bill) we might have seen some compromise on this bill, but I think all that doubt is now alleviated.

I have little to add to what Cube has posted in terms of the transparency of what is behind this bill, but it is now abundantly clear (as if it hadn't been already) that the Republicans in Congress don't give a damn about the elderly, those facing medical emergencies, the military, or anyone who is financially vulnerable.

Of course, their real concern is with credit gougers, right? I mean, it's all those people who live in anecdotes who run up massive credit card debts in Vegas who are the cause of all this, right? This is only about personal responsibility, right?

Wrong.

According to a recent study by Health Affairs, while personal bankruptcies rose by 360 percent over the past twenty years, those caused by medical debts rose by 2200 percent. From their report:
That's half of all bankruptcies due to health care costs. The only greater contributing factor to bankruptcy is job loss, which slightly leads medical crisis.

The Harvard study also shows that in the two years before filing for bankruptcy, 19 percent of families went without food, 40 percent had their phone service shut off, 43 percent could not fill a doctor's prescription and 53 percent went without important medical care. And 90 percent of them were middle class. And these are the people who are going to suffer even worse due to this legislation. God forbid any of our servicemen and women should come home from Afghanistan or Iraq with an injury - especially reservists who may not be coming home to a job. They will be on the street, thanks to our Republican Congress.

Elizabeth Warren, a Harvard law professor, testified before Congress that the bill assumes everyone is bankrupt because they're spendthrifts, but this legislation makes no ditinctions whatsoever:
Actually, I misspoke: the Republican Party does make some distinctions. In fact, we can all breathe a sigh of relief: the Republicans do care, after all. Apart from campaign contributors like credit card companies who have essentially bought this legislation, they seriously care about another minority: the inordinately rich. This legislation also, interestingly, leaves open the loophole that lets wealthy people protect substantial assets from creditors even after filing for bankruptcy, according to the New York Times financial pages - asset protection trusts.

So while the Republicans in Congress are willing to let the elderly go without proper medical care, while they are willing to let students be shamelessly exploited by amoral creditors who commit extortionate usury (once considered once of the most grievous possible sins, at least by Christians), while they are willing - yet again - to turn their backs on the military and let our soldiers and their families go homeless, while they are willing to let people die rather than use so much as a penny which is owed to the Party's sponsors on food or rent or utility bills or overpriced hospitalization or overpriced doctor's visits or overpriced prescriptions, they are at least still keeping the world safe for Paris Hilton.

I'll sleep much better tonight knowing that. I hope the rest of you can, too.

Health care is not the responsibility of the government! Health care is a personal responsibility. The primary increase of health care cost is directly attributed to liberal civil frivolous lawsuits raising insurance prices for health care providers. Social culture also contributes to health care costs and in America almost everyone thinks they need some pills every day or to be checked by a doctor to see if they need some pills. Doctors make people sick practicing medicine to protect against lawsuits. Almost every unnecessary treatment to protect against a lawsuit not only cost the users but also results in damage to other organs requiring future medication. I have a relative in medical school and he clearly states the treatment of one illness almost always leads to the cause of another required visit to another doctor for the damage the cure to the first caused. Now couple the litigation to malpractice requiring doctors to cover all bases and the future illnesses are compounded.

Most American families are overweight, don’t exercise and run to the doctor rather than take any responsibility for their causes for illness. I bet if I took a survey and people answered honestly participants couldn’t honestly say the last date the family sat down together for a prepared meal at the dining room table for a meal unless it was Christmas or a significant date. If they go to the gym they circle it fifteen times looking for a parking spot near the entrance. Americans are just lazy fat butts waiting for diabetes to attack them along with heart disease and other associated illnesses related to just being plain lazy couch potatoes. Reality TV was invented because the reality of the mirror tells them life is a spectator sport and I have little pity for lazy poor or middle class people who don’t care for their health.

The only thing changing is now you have to call the police before filing chapter 7 and report you were robbed and they stole that brand new 42 inch plasma screen you just bought yesterday along with numerous other toys and, yes they can have the car back to sell since it never worked well without monthly maintenance other than gas. What the hay when debt free I can get a nicer one.

No one forces anyone to use credit! If you use credit and you are poor it is because you are stupid and poor and the democrats have failed to warn you of the evil of credit. There have been many years where the Dems were in the majority to correct such shake downs of the poor. Hey they could even have required schools teach credit and its affect in school. Rather, they prefer to blame creditors for abusing poor people as if a creditor was like the government coming into their house to take 25% of their pay. If credit is bad then why doesn’t liberal government say so? If big business abuse of the system is bad then why bail out with bankruptcy the airline industry after 9-11? Why, because the pensions were guaranteed by the government thanks to liberal lawmakers and if they weren’t bailed out the pensions would be paid by the other taxpayers along with the unemployment costs associated with big business.

The only thing in the language is a means test to require fraudulent applicant to call 911 to report a robbery of the stuff they just bought where in the past no one would ask where the stuff is they just charged on the CC.

All amendments proposed to the basic bill were known to be DOA because the Repubs in the House of Reps sent it to the Senate that way, the only way it would be approved. Likewise the Dems should have done the same during all of those years when they were in majority. The wasted days were just talk by parties knowing the rules and today was a testiment to what I say, both parties offered an increase to the minimum wage and both parties agreed to require a 60 vote passage guaranteeing failure and resulting in just talk or posturing if you like.

You care to back that up with some actual facts? It has been proven on this board time and time again that is pure poppycock- unless you have some new information?

Thanks CJ for that great info!! I have to admit, on many of these I was quite surprized that anyone would reject them.

I edited out the medical based amendments, not because I disagree with them, but because I think that they are likely to draw this discussion too far off topic.

Is there abuse in Bankruptcy? yes. Should it be addressed? Yes. However, the largest abuse of all is the very first item in the quote above, and those in charge decided we didn't need to address that abuse. The second worse abuse of the system is the second item listed. For some reason those who would reform bankruptcy see no reason to address that one either.

Then of course there is the fastest growing crime in America: Identity Theft. Reasonably, should we not take the fact that someone is victimized by this crime into account? Apparently not. The Creditors even took this into account, although home many do you think still will if this Bankruptcy reform is passed?

Amendments to require better education of consumers? No need, Amendments to protect the military? Nope, to protect the elderly? Nope.

Seems the authors only wish to protect the creditors, unless of course those abusing the system are the wealthy or corporate America, then they can keep right on abusing the system.

This is not reform, it is patronage. If they truly wanted to reform bankruptcy law they would have addressed all of the abuses, and not ignore the abuses most likely to benefit their political friends.

As a former Republican I am disgusted on the highest level at this payback disguised as reform. I am however, reminded once again why I now use the word FORMER in reference to the Grand Old [Boy's Network] Party.

Ok let's look at the newest here.

I said:


Wertz Said:


You said:

So um, Ol Sarge, why exactly are you jumping on the favorite conservative talking point of frivolous lawsuits? I said the buzzwords Health Care but I'm sorry to tell you that frivolous lawsuits have absolutely nothing to do with this.

It is a fact that 43 Million Americans are not insured. It is a fact that millions more are under-insured. The kind of medical expenses we are talking about here are things like heart disease, cancer, paralysis, things like that. If you don't have insurance the cost for these illnesses gets into the low six figures pretty quickly. If you are under-insured you could easily owe tens of thousands of dollars once your coverage stops.

Whether or not health care should or should not be the responsibility of the government is completely irrelevant here. The facts prove that the majority of people go bankrupt today because they are dealing with medical expenses.

This bill will make it harder for people to file for bankruptcy due to those medical expenses, you know those very same people the Republicans claim they care about. The proof that they don't care about them comes in the form of several amendments to this bill specifically dealing with medical debt that were outright rejected by every Republican in congress.



It seems your rebuttal to pretty much everything is evil Democrats this, evil liberals that - take a look at those rejected amendments and see what party that adjective should be applied to. First of all, as I explained in my first post it is actually pretty much impossible to avoid using credit. You continue to narrowly define credit as "credit cards" and you are incorrect and will continue to be incorrect no matter how many times it is repeated. That tactic may work for the Bush administration, it doesn't work here.

The democrats have repeatedly tried to pass credit reform legislation and they get shot down every time. If you had read that PBS Frontline article that I linked you would have seen that, even some attempts as recently as the last session of Congress. The credit industry has an extremely powerful lobby and they have the Republican party firmly in their pockets. Heck I even read an article on Fox News that admits this is a concession for the credit and banking industry.


Sorry that isn't what it says and you continue to assume that people only file bankruptcy because they have bought things they can't pay for.

Once again, medical bills and losing one's job remain the biggest contributors to bankruptcy. The bill also doesn't cut any slack for people who are victims of identity theft.

If you can't get by your bias that poor people are worthless and the only people that go bankrupt are those that spend beyond their means when presented overwhelming evidence to the contrary I'm afraid that debate will not be possible.

TRUE bankruptcy reform would be to legislate the use of currently available government agencies to investigate possible fraudulent abuse of the system, and prosecute the offenders.

This, so called reform, does nothing but insolate the creditors from losses, that in some causes they basically brought on themselves.

But what is worse, far worse, is the selective way reform is addressed here. If a US Serviceman's or Retirees home should not be fully protected from bankruptcy ten why in the heck should a 10 million dollar trust fund?

Why is it, this reform seems to suggest that the losses of the creditors who sell computer supplies to a company are more important then the pension benefits of those who retired from that company?

Heres a thought, if we are going to make it that much harder for people to file bankruptcy, then can we at least reform the system to make it easier for the poor to get a loan at a reasonable interest rate? After all, the argument that has always been used is that the interest rate is based of the likelihood of default. Since default becomes far more difficult, shouldn't we at least make it so more people can have access to home loans, business loans, etc so that maybe they will be able to get ahead?

This is simply a disgrace. Though if it does one thing, it truly illustrates just how corrupt the government has become. Now, if only we could get the majority of Americans to think for themselves again, rather then limit their information to extremely partisan sources (on both sides) maybe we could get to the business of reforming the government that was once "Of the people, for the people, and by the people". Now it seems, that this statement is only accurate if you substitute the word lobbyist, for the word people.

Why is Health Care so expensive in comparison to other times in our nations history that brought about this problem? Likewise, how does the percentage of insured, under-insured and uninsured compare to times when bankruptcy wasn’t a problem to be addressed?

My point of health care not being the job of the federal government is simply that. If you are fat then exercise, if your family has a history of heart, kidney or other ailment then invest a large portion of your income in the “tax free” health savings account before you get sick and by doing so lower your income to lessen the impact on tax on your income. Buy stuff with cash instead of credit, use credit only to finance a home and pay cash for everything else. Take the 25% of your income you give to the guy in the bank and invest it in an excellent health plan, tax-free health savings plan. If you become ill then use the money from the tax free savings to pay the health co-pay, if the bill is very expensive then perhaps you will have to cancel a vacation but filing for bankruptcy wouldn’t be an option. You just pay the amount you can afford for the medical and if you die owing money then that is that.

Poor people do not NEED credit. Poor people need not to pay tax and by using the tax-free option to save for medical expenses they can avoid almost all taxes. Pay the damned house off and if you become critically ill then sell it for a dollar to your son or daughter and rent it from them at whatever rate would preclude you being evicted.

I just don’t see my or my family’s health issues a problem of the government. I see no way they could become a problem of the government… If medical expenses exceed my income then the Medicaid will help that was taxed from income. Why would I ever need to file bankruptcy if I owe no creditors?

I know what you said about unemployment trapping people but unemployment traps people overspending and not saving. Hey Hewlett Packard just fired their CEO and 700 people were laid off in my neighborhood. All have new cars being financed, homes for the most part being financed and carrying $5 to $8 thousand on credit card debts. Why didn’t they buy a car for cash, pay cash for everything they need, save for medical expenses and only have their food, house payment and car gas to worry about now? I don’t feel sorry for them and I’m sorry but I just don’t! If my wife would lose her job today it would not impact us enough to run to the government because we plan for such problems.

Do you agree that persons with ability to repay debts should be required by the government to repay them?

Do you think creditors should eat the debt since they encourage people to spend beyond their means?

I think Cube Jockey did a masterful job of debunking these two meaningless questions. I can do no better. However, I do find it ironic that someone who suckled on the government teat now criticizes those who can’t “make it on their own”. How ironic that those who believe in “less government” now want the government to butt in and act as bill collector?

Bankruptcy is like anything else - it can be abused. But to categorize all people who declare bankruptcy as “irresponsible and stupid” is just, well, irresponsible and stupid. Not to mention narrow-minded and cold. Why is it OK for our GOVERNMENT to run up credit debt at an alarming rate, but when it comes to John Q. Public whose company moved overseas and laid him off, whose wife got cancer, and who had to finally declare bankruptcy it is some kind of crime?

Bankruptcy is a path of last resort; no one I know goes into it lightly. It is devastating for someone who has always been responsible, has always paid their way and done all the right things, and suddenly finds themselves on the brink of financial ruin and/or homelessness. The emotional and self-esteem costs are enormous.

To discount all of that by lumping all people who declare bankruptcy as “stupid” shows an astounding lack of compassion. I have more respect for the financially bankrupt than the emotionally bankrupt.

A little hypocrisy and a chance to beat this bill - story in the NY Times


The Democrats have killed this bankruptcy bill in the past by getting an amendment in that doesn't allow anti-abortion activists to declare bankruptcy because of the court costs and fines they incur. It only takes 51 votes to pass and the Democrats think they have a good chance of passing it again this year - they have 47 and 5 undecided (more analysis in the article).

If they do pass this amendment then the bill will of course die because the Republicans love their anti-abortion special interest group much more than they love the credit industry. I have to say that makes me chuckle just a little bit.

It'll be an interesting day filled with hypocrisy. The Republicans say they want to crack down on bankruptcy fraud yet they have already flatly rejected the biggest abuse of the system, asset trusts, and they are now prepared to reject another - escaping court costs.

So much to debunk, so little time....


You keep assuming, 'Ol Sarge, that bankruptcy is nothing but a way to scam the credit companies and avoid paying, and that nobody really needs it. You keep repeating this in the face of all of the evidence presented to the contrary. So, except for the antecdotal evidence of your "friend" who did this, what other proof do you have that contradicts all of the evidence people like Cube Jockey, OverlandSailor and Wertz have offered?

And the conservative Republicans have been in control of the House and Senate for about a decade now, and could have done the same thing. Believe it or not, 'Ol Sarge, this isn't about liberal-vs-conservative, it's about the power of lobbyists funneling money into a bought and paid for congress, on both sides of the aisle.

Umm, I know this will come as a surprise to you "ol Sarge, but amemndments are offered and added to bills all the time, even those already passed by the House and forwarded to the Senate. Then the bill goes back to the House, to try and reconcile the differences. The Dems didn't have to make any amendments or changes to the bankrupcy laws earlier, because for the most part, they were working well. Again, this isn't about Rep-vs-Dem or liberal-vs-conservative. It's about Congress listening to those who line their pockets and campaign coffers, instead of working for the good of the people.

Now, let me give you a little antecdotal evidence to counter yours. A friend a few miles down the road from me. An older neighborhood, he and his wife have been in their double wide mobile home for close to twenty years. They have about $10,000 left to pay off. They have never been "rich" but not poor, either. The combined income from both was around $50,000. They had an older car (early 1990's) until about four years ago, when they bought their first new car, ever - a small Suzuki wagon for about $15,000, I'd guess. They never had much in the way on credit, maybe $2,000 or $3,000 total, but also some medical bills from an accident he sustained a few years prior. Very fiscally conservative, and hard working. He managed a small computer franchise in town for a guy who owned several in the state. The job included health insurance. They were able to make the payments they had without too much trouble, send a son to college, and prepare to send a daughter the next year.

In 2003, about six months after I had open heart surgery, he had a major heart attack, and bypass surgery. This guy was not "fat and lazy", as you might suggest. He and his wife walked around the neighborhood every evening, and he played in a softball and volleyball league through his work and church.

His surgery didn't go as well as mine, and although his insurance paid for much of it, the part that the insurance didn't pay was around $40,000. The payments the hospital wanted from him was in excess of his mortgage and car payment combined, every month. He told them he couldn't pay that much, and after discussing what he could pay, and making what he thought were adequate arrangements with the hospital, someone higher up thought he should pay more (a lot more) and tried to have his wages garnished. When that didn't work, they turned the account over to an attorney for collections.

Also, about a month after his return to work, the owner of his store advised him he was closing it due to increased competition in the area, and that everyone had a month to find new work. He looked for another position that paid what he was making, but due to the high unemployment in the area, ended up taking a job delivering pizzas, for about half of what he was making, just to have some kind of income coming in. Bankruptcy was almost inevitable in his situation, and they filed this past summer.

Go ahead and tell me that this guy was stupid, lazy, and gaming the system. I don't buy it. Go ahead and tell me that under the new law, he should have to lose his car and sell his house. His car is what keeps him employed, and the rent on even a small apartment in this area would now be more than the mortgage on his house. But since it's a mobile home, they can't get a home-equity loan to pay the bills he owes. Go ahead and tell me that he can always go on medicaid for the medications he needs. Oh, wait, he can't. Between his wifes wages, and his, and the "house" they own, he makes too much.

The fact is, there are many, many more out there like him, that aren't gaming the system, and really need a second chance. This new law kills almost any chance of that at all.

But, hey, as long as those rich CEOs can protect their assets inside a trust fund, I guess it's all okay.

NiteGuy
No the guy isn’t stupid or lazy. You had me crying crocodile tears reading that short story. I really don’t get the point of where the changes place this guy in jeopardy. You say he made arrangements to pay the bill but the higher ups at the hospital management said he needed to pay more. Well who should be the judge? Take a look at this link and tell me if the guy you describe can still survive after the new law? Probably qualifies for a Chapter 7 or does he need to repay the $40K according to court order? Now keep in mind that no court is going to be as greedy as the hospital management and you did say he was willing to pay the $40K over time so I don’t see the problem. http://www.bankruptcyaction.com/bankreform.htm

You see to me the new law, and it’s just a matter of whining before the ink dries now, http://www.bankruptcyfinder.com/bankruptcyreformnews.html is still very generous. Answer yes or no to some parameters and whala you have a life again with dignity. I don’t know the age of the guy you picture but I’m guessing he is nearing my age and I’m here to tell you he hasn’t made a lot of correct decisions in his life if you describe him correctly. Don’t get me wrong he sounds like a very nice person but there had to be a time in his life as his wife was changing dirty diapers, cooking and cleaning that he had to say “hey, we can’t afford to send these two kids to college living like this so let’s do something about it.” I mean really, there are jobs away from where you guys live, great paying jobs that can be reached by Greyhound maybe in Dallas-Ft. Worth or Las Vegas where the guy could have left for a summer and made enough money to pay off the trailer or make the down payment on a real home where his investment would appreciate. A young man could travel to Connecticut and work the beach for one summer on two shifts and make a $50K in one summer and shower in the YMCA and sleep in a sleeping bag in the churchyard. We live in the land of opportunity and you just can’t make babies and hope for the best! Look at the “yes” and “no” choices on the link and I’m sure your neighbor would be protected just fine under the new law, like going through a divorce the court will always leave you enough to survive and above that requires a little imagination.

I don’t care if the entire population goes bankrupt if they have to repay their bills if they can!

Daffy Girl you are a sweetheart and I like you a lot but I hope you really didn’t mean what you said about me sucking on the government’s teat, did you? Are those in Iraq in camouflage sucking your tax dollars through the government teat? I know I’m a hard sell but I just don’t see the government as being repressive when it asks for people to pay for just debts. I don’t agree the government should suck up to big business either and be it a BB CEO or OJ Simpson deemed to pay they should pay and I will not apologize for a party that excuses such behavior. Likewise I don’t excuse the left passing federal law to protect union pensions of airlines allowing them to force the airline to pay and benefit increases knowing when the airline reports earnings it has to file bankruptcy and the government then has to pick up the pay raise or the pension. Both ways of extortion are just that extortion for a select few.

Aw, Sarge, ain't you just a silver-tongued devil? Sure, the language is harsh, but military personnel have many benefits the rest of us civilian shmoes don’t; housing assistance, free health care, no federal taxes, education assistance, retirement (without employee contributions), various discounts, free travel in some cases, insurance, etc. etc. ad nauseum. And wouldn’t you know it, military families suffer the same financial woes as the rest of us. Huh, how 'bout that.
(and this report is based on 1999 data - prior to the Iraq mess; I'm sure it's worse now)

Military personnel declaring bankruptcy don’t even have the excuse of employment loss or huge medical expenses. PLUS, the government is ready to help those poor souls out with their financial difficulties; something the rest of us have to find on our own. Now, would you call these folks poor, irresponsible and/or stupid?

Edited to add:
Looks like the double standard is alive and well. Old people, no, military people yes.

Guess I will put my 2 cents in on this one.
I agree with Old Sarge on this one, for the most part.
I am almost 59, and I can safely say that ALL the people who I know who have declared bankruptcy are those with poor spending/savings habits. I have sympathy for those whose situations occur outside their control, but there are not as many of those as you might think.
I could tell a lot of stories about the people I know who failed to plan for the future and whatever might happen, but that would take a long time.
To answer the questions, I think the courts should look at each case and decide the end results based on the participants contribution to the situation.
Creditors should most definitely get stuck with the bill when they knowingly suck in the unsophisticated consumers, and then use subterfuge to increase rates based on their inability to pay. We should not have to read the fine print, the rules should be short, simple, and to the point. And the companies should remember where the money comes from. It is the consumer that pays the fees, but in a dispute, the card companies tend to side with the vendor before the consumer. I dropped one card because they would not help me deal with a scam. I eventually got the money back, thanks to Attorneys General in 2 states, but there was no help from Discover Card.
On the other hand, those young, and often dumb, consumers who think they have to have everything right now and abuse their credit rating to get everything right now need to be treated to some real world reality. It is very common for young married couples to have to have everything their parents have, even tho their parents spent a long time getting those things. Those are the ones I have a lot of experience with, and they just won't listen when somene suggests that they don't need two NEW cars, even if both of them are working. If my wife and I can get by with a 5 year old car and 10 year old truck, they can as well. And they don't need a jacked up 3/4 ton 4x4 heavy duty truck, luxury car, or any expensive vehicle just to get back and forth to work. Too many of us thing we just can't be happy without the expensive toys. I prefer to have less toys and more savings and investments.
Certainly losing a job should be given consideration by the courts, as well as unexpected medical expenses. We should not have to lose everything based on situations beyond our control. But, if we plan properly, those situations need not occur as often. Proper risk management is essential in our daily lives, and we should be taught that in our High Schools, along with the harsh realities of personal economics.
The local schools here do some of that, and it comes as a great shock when the kids find out what it costs to be on their own. But those kinds of lessons need to be reinforced a lot.
"Reality" on TV might be entertaining, but reality in real life is far from it.

Note to Daffy girl,
no federal taxes? only during a war and stationed in a war zone. I did 12 years active and 10 years reserve, and have one year tax free while in Vietnam. But the pay for enlisteds really stinks, so the govt. didn't lose much on the deal.

*edited out belittling commentary*

You may consider this just a "story", 'Ol Sarge, but I assure you that my friend, and his situation are very real. I took a look at the link, and not knowing his entire situation, I don't know whether or not he would qualify, but if so I imagine it wouldn't be until the final test question, number 3.

You're kidding, right? I don't know everything about this guys employment history, of course, but I do know that, at one point early on he was working on a career track of some kind. How likely do you think it would have been that his employer would have been sympathetic towards his taking off for three or four months to "work the beaches in Connecticut", and still hold his job for him when he got back? I imagine that he was much more worried about hanging on to a decent paying job, with some benefits, like insurance to make sure his wife and kids were covered. And I imagine his wife wouldn't have been to fond of that option, either, considering she was most likely working full time as well. Who would have helped with the kids?



All direct quotes of yours, 'Ol Sarge. So let me ask a few questions of you?

If you truly believe your first quote, why aren't you as outraged as the rest of us over the fact that once again, the corporations and the wealthy get off practically scott free, while middle and lower income people get dumped on here? Why is it that the Republicans aren't requiring the rich, the corporate officers, and the abortion clinic terrorists to pay for their debts, when they clearly have the ability to repay?

As to quotes number two and three, I'll kindly remind you that the Republicans have been in the majority in Congress for nearly a decade. Where were they, when it came to the warnings, or to correcting these injustices? Oh, yeah. No need for warnings or correcting the injustices, as long as your friends are making a killing, right?

'Ol Sarge, considering all of your railing against "stupid, poor" people that get credit when they supposedly don't need it, and the "evil" Democrats, who don't disuade lower income folks from getting credit, I found this quote by the White House yesterday rather telling:

"The administration supports the passage of bankruptcy reform because ultimately this will lead to more accessibility to credit for more Americans, particularly lower-income workers," said Trent D. Duffy, a deputy White House spokesman.

If it's the politicians job to make sure that lower income people don't use credit, or at least educate them on the use of credit, as you suggest, I'd say the White House and the Republican congress sent America exactly the wrong message yesterday. But then, you really don't believe all that, do you?

Otherwise, you'd also be raising hell about some of the amendments that didn't pass - like capping interest rates at (a still usurious) 30 percent. Like preventing these companies from unfairly raising rates for things unrelated to their particular account in a customers credit report. Like ending the asset protection trusts for the very wealthy. Why is it you aren't complaining about any of that, 'Ol Sarge? Why is it ok to get every drop of blood we can from the poor, but allow the rich to hide millions when filing for bankruptcy? Does "personal responsibility" only apply to the lower income folk?

That a Republican administration and Senate, which came to power as the defenders of "morals and values", would be acting on behalf of companies that are already able to profit on their bad debt, at levels that far exceed any standard of decency, is disgusting.

The banks and credit card companies that lobbied for this law, make sure that they can charge rates that would have had them thrown in prison as loan-sharks, even fifty short years ago. Even then, bad debt can be written off as a tax break. But they want even more. Personal responsibility, indeed.

Where is the decency? Where is the protection for the average citizen? Where is the supposed "Christianity" which the Republicans have wrapped themselves in to win two elections? Where is the compassionate part of "compassionate conservative" in this new bill?

The blatant buying of our "Congressional leaders" by special interests has got to stop. It's not enough that they already have the cards in the deck marked. No, they have to buy off the dealer too, so that if the little guy in the game seems to be winning a few hands, the big guys can have the dealer cheat them out of their winnings.

Congress isn't going to stop working for the corporations and PACs in this country, and start working for the average citizen again, until one of two things happens. We end the flow of money into politicians pockets by corporations, PACs, and any other organization, and restrict it to reasonable limits by actual, human beings of voting age. Either that, or we hold another revolution. Since politicians are not going to vote against their own self-interest, I don't hold out much hope for the first option.

Bill, I can respect your personal experience but the statistics here prove that you are wrong. The big causes for bankruptcy have been cited several times by numerous posters. The biggest reason for bankruptcy from all sources is due to medical bills, the second biggest reason is due to unemployment. Over spending is a reason, but if we were to rely solely on your personal anecdotes as well as Ol Sarge's one would believe it is the only reason which isn't correct.

If you take a few minutes to re-read the thread you will see that this evidence has been cited.

The system is just fine as it stands right now, this bill does nothing to solve the problems leading to bankruptcy it simply hurts consumers in favor of credit companies. Even Fox News of all places admits this bill is a give away to the credit industry.

And on preview -
It is still important to note this isn't a rich vs. poor thing like you are trying to paint it Ol Sarge. It is an poor AND Middle class thing vs. the rich AND corporations. Your bias against poor people here is completely blinding you to the issue and what you don't realize is that this effects the majority of people in America, even those that you may not despise for being poor.

Like I said, the courts need to look at the reasons for the problem, and how much the creditors may have contributed to the problem.
I have read the thread, and acknowledged that there are situations outside our individual control. However, the fact remains, that even those who lose their jobs or have expensive medical bills are often guilty as well of poor planning.
Evidence can be slanted, and facts can be distorted. But even if it is 100% true, that in no way excuses poor judgement. Some members of my family, siblings, are poor, and have never had to file bankruptcy. One brother has to rely on VA medical care, and a sister has to have help from her grown children. Neither of them would even consider bankruptcy, and neither of them have overspent to get into that situation.
If you don't have the means to pay the bill, do not incur the debt. That is a basic principle of economics. And if you don't have adequate medical insurance, do what is needed to get it. I am currently paying only $150 per month for interim coverage at Blue Cross/Blue Shield, with $5000 annual deductible. That is cigarette or bar money to some of us. It is a few DVD's or a Cable TV/Internet connection to others. If I could not pay the medical, I would cancel my Cable TV/Internet first.
When I hear about these "sad stories", I am reminded of the time a co-worker's wife got a $2000 grant to go to college, based on their income and expenses. They had no children, but were paying to board a horse and had a new car payment, and a lot of credit card debt to boot.
My wife decided to apply for the same grant, and got turned down, as I warned her that she would. We had no horse, but 2 kids to support, a used paid for car, no debt, and $4000 in savings. She thought it was unfair, and it is. Why should those of us who live frugally and plan ahead pay for the spender's bad habits?
The system at that time encouraged people to live off the government's teat, and in some ways it still does. That has to stop. The government, which is us, cannot afford to pay for frivolous living when there is so much real need to consider.

A misconception, the government in no way pays for bankruptcy. Bankruptcy is as I described earlier a legal way to resolve debt between debtors and creditors. The government is actually not in any way involved or invested here other than setting the rules of the game.

Those rules have been set and if anything reform needs to come in the form of not allowing the wealthy to protect their assets during bankruptcy filings and making provisions for some of the things presented in these amendments like identity theft.

In fact, as I have also said bankruptcy isn't even that rough of a deal for credit companies. First of all they can and do liquidate assets you might have to get their money back. Secondly, they get to write off any losses due to bankruptcy as bad debt thereby saving big bucks on their taxes. Finally, they count on a certain percentage of bankruptcy which is factored in to their rates.

This bill is a handout to the credit industry courtesy of our congressional Republicans. Period. There is absolutely nothing in it that does anything to benefit the people that voted them in to office, everything benefits the people that financed their election.