Bankruptcy Reform - Good For Banks, Bad for People

The Republican-controlled Senate is close to passing landmark bankruptcy reform that would make it harder for people to file for bankruptcy. In theory, this makes sense. After all, why should some people be able to escape financial accountability by declaring bankruptcy? Isn’t it better to tighten up the system, to prevent abuse? Well, yes, in theory. However, there are always gray areas

Banks, credit card issuers and retailers have pushed for years for bankruptcy revisions that would force more people to repay at least part of their debt. Well, that would mean the Republicans in the Senate are pushing a law that is pro-business. No surprise there. An earlier version was defeated in 2002 when abortion clinics somehow were brought into it. Somehow, anti-abortion types seem to drag the practice into everything.

A recent Harvard University study found that costly illnesses led to about half of all personal bankruptcies (CNN). It is also true that many single mothers, often with sky-high debt, rely on child support payments that do not come. A single mother working three jobs who cannot afford to pay her bills is presumably not the kind of person the lawmakers have in mind. Or maybe she is.

As George W. Bush has consistently refused to acknowledge, there are gray areas to everything. Democrats have tried to address some of them here, with amendments to the bill that would provide for some exceptions. Those amendments were defeated along party lines. So, could Republicans be pushing legislation that is good for business and bad for people, at least potentially? Nah, that can’t be it…