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[sgtclub]

Originally posted by Mmmm, Burger (C.J.)
Why have bankruptcy at all, then? You don't get into bankruptcy unless you take on debt, right, so we should never allow it for anyone.

Seriously, the problem here as I see it is mainly one of motivation for the bill, as well as some of the particulars.

There are a number of possible balances one could strike as to how easy/hard bankruptcy should be. Obviously it can't be too easy, because then the lenders disappear. At the same time, it's somewhat desirable to allow it in certain circumstances, because otherwise people will be very reluctant to take on any debt (also a problem for lenders), because of the risk of massive debt problems (which, you need to realize, quite often come from unexpected events, such as massive medical bills or unemployment, not simply lots of HDTV purchases). Getting it right is difficult.

The problem here is that congress decided to alter that balance at the behest of cc cos., who had decided they needed to be stopped before they sinned again. They promoted easy consumer debt, but didn't like the fact that easy consumer debt means a number of uncreditworthy consumers got too much credit and, later, too much debt. So they're trying to bar the door after they screwed up. Maybe making bankruptcy harder is a good thing; maybe a bad thing--it's hard to say. What's easy to say is that the motivation for this bill has nothing to do with whether bankruptcy is too easy or too hard, just that it's too common as a result of cc overindulgence.

Meanwhile, making it worse, congress decided to except from the new restrictions, (for lack of a better word) the rich. Rich people are far better positioned to take advantage of the loopholes; meanwhile, the poor, who are much more likely to need the advantages of chapter 7, are stuck like a canoist in Deliverance. Donald Trump is a bigger abuser of bankruptcy than the average consumer--but what are the chances he won't be able to go through it just the same again?

Let me be clear. I am not supporting or objecting to this particular bill. I'm just objecting to the "credit card companies are evil" "innocent borrowers need protection" bullshit being peddled around here. Frankly, I don't see a need to reform the BK laws. They seem to be working fine as is.