Wednesday, March 09, 2005


What About the Families?

Bankruptcy Bill Punishes Families

You'd think with the fervor that the GOP screamed about protecting families in last year's presidential election, that maybe, just maybe, they'd do something to actually protect families. But, hell, nothing gets you free press like gay cartoon characters or rabbits visiting lesbians on a farm. The truth about the new bankruptcy bill is that it will hurt families and potentially stifle small businesses, who may rely on credit to get their operations up and running.

One of the reasons we have relatively 'liberal' bankruptcy laws in the United States is that they encourage innovation by limiting the downside risk for starting or operating a business. Corporations enjoy some of the most permissive bankruptcy laws in the world. Companies like Enron, United and others get out from enormous debt loads through the bankruptcy process, and in turn, pass on financial liability for things like employee pensions to the federal government. So why can't individuals and families enjoy the same benefits afforded to big bushiness?

A look at bankruptcy statistics shows that a vast majority of personal bankruptcies are triggered by two factors 1). Medical bills and 2) Failure of a small business. Not the typical story of some schlep getting four or five charge cards and going out on a spree, then declaring bankruptcy (Not that this doesn't happen). Individuals should be entitled to similar protections enjoyed by corporations...but sadly, the party of individuals and families decided to side with the credit card industry on this one.

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