Bankruptcy Tutor
Kill (the Bankruptcy) Bill
Wed Mar 2,10:54 AM ET Op/Ed - The Nation
Ari Berman
With virtually no public debate, the Senate Judiciary Committee (news - web sites) easily passed the "Bankruptcy Abuse Prevention and Consumer Protection Act" a few weeks ago. Three Democrats--Joe Biden, Dianne Feinstein and Herb Kohl--assisted Republicans in shuttling through the anti-consumer, pro-debt giveaway to the credit card lobby.
Under the guise of reform, the bankruptcy bill makes it harder for poor people, women, the elderly and service members to pay off their debts. (See Katrina vanden Heuvel's recent dissection of the bill's numerous flaws.) To solidify the bill's success, big credit gave $101 million to political candidates and party committees over the last six years, the most of any lobby. Republicans accepted 64 percent; Democrats 36 percent.
Despite their financial indebtedness, Democrats have managed to block the bankruptcy bill twice before in the past seven years, through a Bill Clinton (news - web sites) pocket veto in 2000 and an amendment by Charles Schumer in 2002. The Schumer amendment corrected an absurd loophole that allowed anti-abortion activists to avoid paying court fees incurred while illegally blocking abortion clinics by filing for bankruptcy.
Now the bankruptcy bill is back on the Senate floor, with debate ongoing this week and possibly next. Opposition Democrats plan to offer a slew of amendments, including Schumer's"poison pill"--as dubbed by social conservatives--aimed at either killing the bill or making it more equitable.
Yesterday Republicans defeated an effort by Senate Minority Whip Dick Durbin to exempt all members of the military from a new "means test" by card companies that would measure income and assets to determine whether owners must repay their debts or have them canceled in bankruptcy, a decision previously relegated to the courts. Durbin's amendment would have also protected the assets of soldiers called for duty in Iraq (news - web sites) and Afghanistan (news - web sites). The Senate instead passed a proposal by conservative Republican Jeff Sessions that would accomodate only active-duty service members, low-income veterans and those with serious medical conditions.
Still, Democrats may fight in other ways. The bill's leading opponent, Ted Kennedy, wants to give courts more authority to limit the amount of money corporate executives could receive in bonuses and severance pay if their company files for bankruptcy. Kennedy will also introduce amendments expanding safeguards for the two million Americans who filed for bankruptcy due to illness or rising healthcare costs, protect employees of bankrupt companies, and shield low-income Americans from the costly means test. An amendment to raise the mininum wage could also be a possibility.
If necessary, Schumer has vowed to filibuster the bill. Based on the previous judiciary vote, however, Republicans will likely have the Democratic support needed to override any filibuster attempt. The bill's sponsor, Chuck Grassley, predicts an 80-20 final tally. As the Senate begins debate, click here to tell your Democratic Senator to stop this bill's drastic affront to consumer rights.
Wed Mar 2,10:54 AM ET Op/Ed - The Nation
Ari Berman
With virtually no public debate, the Senate Judiciary Committee (news - web sites) easily passed the "Bankruptcy Abuse Prevention and Consumer Protection Act" a few weeks ago. Three Democrats--Joe Biden, Dianne Feinstein and Herb Kohl--assisted Republicans in shuttling through the anti-consumer, pro-debt giveaway to the credit card lobby.
Under the guise of reform, the bankruptcy bill makes it harder for poor people, women, the elderly and service members to pay off their debts. (See Katrina vanden Heuvel's recent dissection of the bill's numerous flaws.) To solidify the bill's success, big credit gave $101 million to political candidates and party committees over the last six years, the most of any lobby. Republicans accepted 64 percent; Democrats 36 percent.
Despite their financial indebtedness, Democrats have managed to block the bankruptcy bill twice before in the past seven years, through a Bill Clinton (news - web sites) pocket veto in 2000 and an amendment by Charles Schumer in 2002. The Schumer amendment corrected an absurd loophole that allowed anti-abortion activists to avoid paying court fees incurred while illegally blocking abortion clinics by filing for bankruptcy.
Now the bankruptcy bill is back on the Senate floor, with debate ongoing this week and possibly next. Opposition Democrats plan to offer a slew of amendments, including Schumer's"poison pill"--as dubbed by social conservatives--aimed at either killing the bill or making it more equitable.
Yesterday Republicans defeated an effort by Senate Minority Whip Dick Durbin to exempt all members of the military from a new "means test" by card companies that would measure income and assets to determine whether owners must repay their debts or have them canceled in bankruptcy, a decision previously relegated to the courts. Durbin's amendment would have also protected the assets of soldiers called for duty in Iraq (news - web sites) and Afghanistan (news - web sites). The Senate instead passed a proposal by conservative Republican Jeff Sessions that would accomodate only active-duty service members, low-income veterans and those with serious medical conditions.
Still, Democrats may fight in other ways. The bill's leading opponent, Ted Kennedy, wants to give courts more authority to limit the amount of money corporate executives could receive in bonuses and severance pay if their company files for bankruptcy. Kennedy will also introduce amendments expanding safeguards for the two million Americans who filed for bankruptcy due to illness or rising healthcare costs, protect employees of bankrupt companies, and shield low-income Americans from the costly means test. An amendment to raise the mininum wage could also be a possibility.
If necessary, Schumer has vowed to filibuster the bill. Based on the previous judiciary vote, however, Republicans will likely have the Democratic support needed to override any filibuster attempt. The bill's sponsor, Chuck Grassley, predicts an 80-20 final tally. As the Senate begins debate, click here to tell your Democratic Senator to stop this bill's drastic affront to consumer rights.
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