Copyright 2000 Plain Dealer Publishing Co.
The
Plain Dealer
February 3, 2000 Thursday, FINAL / ALL
SECTION: NATIONAL; Pg. 1A
LENGTH: 709 words
HEADLINE:
BANKRUPTCY OVERHAUL APPROVED BY SENATE
BYLINE: By HELEN
DEWAR and KATHLEEN DAY; WASHINGTON POST
DATELINE:
WASHINGTON
BODY:
The Senate yesterday
overwhelmingly approved legislation that would make it harder for people to wipe
out their debts in a major overhaul of the nation's bankruptcy system that was
sought by the credit card industry but decried by consumer groups as unfair.
The bill also includes a proposal to raise the hourly minimum wage by $1
to $6.15 over three years and cut an array of business taxes by $76 billion over
the next decade to help employers defray the costs of increased wages. Passage
of the bill, on an 83-14 vote, came on a day of high-level political
gamesmanship that drew Vice President Al Gore off the campaign trail in case he
was needed to break a Senate tie on a controversial amendment to block violent
demonstrators at abortion clinics from using
bankruptcy laws to evade fines and damages.
With some
counts showing a tie was likely, Republicans abruptly decided not to oppose the
amendment and let it pass rather than give Gore any more big headlines on a
high-profile campaign issue. Gore broke a tie on gun control last year.
"With this amendment accepted, nobody will be able to politically
demogogue this issue in the context of true bankruptcy reform," said Senate
Judiciary Committee Chairman Orrin G. Hatch, Republican of Utah.
The
bill itself would make it harder for consumers to wipe out their debts by
forcing more people who file for bankruptcy to do so under provisions requiring
them to repay some debts instead of erasing all their obligations after they've
liquidated their assets.
Despite yesterday's lopsided vote, the future
of the bankruptcy bill is uncertain. The House has already approved similar
legislation without any minimum wage and tax provisions. There are also
differences over bankruptcy that need to be ironed out, and a veto is possible.
The Clinton adminis- tration has criticized some of the bankruptcy provisions,
arguing that the tax cuts are too big, and wants the minimum wage put into
effect in two rather than three years.
The vote on the clinic issue was
80 to 17, with 35 Republicans joining all Democrats in support of the proposal.
But Republicans made clear they would try to change or drop the proposal
in conference. "We will in good faith in conference correct the amendment and
... resolve any problems at that time," Hatch said.
Republicans had
complained Democrats and Gore were engaging in political "theater" and insisted
that existing law already bars bankruptcies to escape the consequences of
"wilfull and malicious" actions.
But Democrats said existing law is
inadequate, pointing to recent cases in which anti-abortion
protestors have filed for bankruptcy after being fined or
ordered to pay damages for violence they were alleged to have caused. They cited
bankruptcy actions by Operation Rescue's Randall Terry after a court awarded
$1.6 million to people who sued him and by individuals in an Oregon group called
"Nuremberg Files" that faces $109 million in damages.
"This issue is not
about theater," said Sen. Patty Murray, Democrat of Washington. "It is about the
very real issue of violence against women," and "violent extremists" should not
be allowed to exploit the bankruptcy code to carry out their agenda, she said.
Democrats also tried to attach an amendment to the bankruptcy bill on
guns but lost. The proposal, sponsored by Sen. Carl Levin, Democrat of Michigan,
would have barred gun makers and dealers from escaping court judgments by
declaring bankruptcy. It was defeated, 29 to 68. Several gun manufacturers have
declared bankruptcy to avoid liability resulting from product liability suits.
Credit card companies and other proponents of the bill contend that
legislative changes are needed to keep people who can afford to repay debt from
exploiting loopholes in current law to escape their liabilities. Creditors say
they must charge higher fees to people who do pay off their debt to cover the
costs of those who don't.
Consumer groups and many Democrats say
lenders' liberal credit policies and aggressive sales practices have been
equally responsible for putting many Americans over their heads in debt. They
say any legislation also should force credit companies to be more responsible by
providing more consumer information.
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February 4, 2000 
