Senate takes up bankruptcy bill again

[papau]

Let's see - an arbitrary "means" test, which says that those who earn above the median income cannot discharge their debts through bankruptcy, while those below can.

And a safe-haven for violent anti-abortion protestors by allowing them to avoid monetary liability in civil litigation by declaring bankruptcy.

And it does nothing to reform the oft-abused "homestead exemption," which allows wealthy debtors to protect their assets through home ownership - and by homes, we're talking about mansions in Florida, and does not touch the effects of the proliferation of corporate scandals (ENRON/WorldCom).

yep - sounds like a must pass bill.

http://cbs.marketwatch.com/news/story.asp?guid=%7B746B16F7-0B19-4D0C-8DA9-788841DFB83D%7D&siteid=google&dist=google

Senate takes up bankruptcy bill again
"Bankruptcy Abuse Prevention and Consumer Protection Act."
By Lauren Etter, Medill News Service
AM ET Feb. 11, 2005

WASHINGTON -- The Senate Judiciary Committee, in an annual rite in Congress for nearly a decade, began debate on a bill Thursday to reform bankruptcy laws, with supporters decrying "high rollers who game the current system" and opponents arguing that financial disaster, not greed, is behind most bankruptcies.
http://thomas.loc.gov/cgi-bin/query/z?c109:s.256:

It is the fourth bill in eight years that has attempted to reform the bankruptcy system. Critics say the current system encourages abuse and allows too many people to evade paying for their financial mismanagement. About 1.5 million people file for bankruptcy annually.

Sen. Charles Grassley, R-Iowa, introduced a measure last week that would create a so-called "means test," which would provide two separate tracks for consumers who file for bankruptcy: Chapter 7, which would not require all debt to be repaid, or Chapter 13, which would require repayment. Those who earn above the median income would not be allowed to file for Chapter 7.

While Grassley's bill is similar to past bills, there are two key differences. A controversial provision has been removed that denied bankruptcy protection for those antiabortion protesters seeking to avoid paying court fines. An amendment to make Chapter 12 bankruptcy permanent has been added. Read the text of the bill.

"Americans have had enough," said Grassley in his opening statement before the committee. "They are tired of paying for high rollers who game the current system."

The bill is strongly supported by the financial services industry.

Opponents of the reform say that the bill wrongly characterizes debtors as irresponsible. They also say it would make it unduly difficult for those who really need to file bankruptcy.<snip>

Sen. Edward Kennedy, D-Mass., was sympathetic. "I cannot fathom why a person who has high medical bills would not be permitted to file Chapter 7," he said.

Sen. Dianne Feinstein, D-Calif., a member of the committee, said she plans to introduce an "extreme hardship" amendment to address the issue. The amendment would provide debtors with a "rebuttable presumption" by showing that debt is a result of extreme hardship or circumstances beyond their control.

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