Copyright 1999 The Tribune Co. Publishes The Tampa Tribune
The Tampa Tribune
November 28, 1999, Sunday, FINAL EDITION
SECTION: COMMENTARY, Pg. 2
LENGTH: 646 words
HEADLINE:
Congress should act early next year to reform nation's
bankruptcy laws;
BODY:
For five decades and through multiple congresses, federal lawmakers
have debated bankruptcy laws, trying always to decide
which debtors deserve to escape their financial obligations.
A second
chance and fresh start are the policies at the core of these laws. We need for
people to pay their debts, but we don't want to see debtors ruined
forever. That no one would see debtors so strapped by their obligations
that they could not recover is the reason our forefathers gave
bankruptcy constitutional prominence. The last truly
meaningful reform of the bankruptcy code in this country
occurred 21 years ago, but in the past two congressional sessions major
reform efforts have come from both sides of the aisle.
Nevertheless, though lawmakers have passed bills, no new legislation has been
adopted.
SENATORS ONCE AGAIN bogged down despite our hope last summer
that Congress would pass needed reforms after the House
voted overwhelmingly for change, and despite strong bipartisan support in
the Senate this year.
Interestingly, they approved 31 of some 300
amendments added to the initial legislation. But after two weeks of
debate, 14 amendments, including two politically driven and contentious
Democratic proposals involving guns and abortion, were
still on the table as the 1999 session drew to a close.
Trent
Lott, the majority leader, has decided to close debate Jan. 25, and the measure
may not be brought up again until then. Some Democrats and consumer
organizations have decried his decision to stop the discussions, but Lott
was right to call a halt to the debate.
An amendment that would
effectively prevent bankruptcies by gun manufacturers who are
now the the targets of civil lawsuits, as well as another that would make
sure abortion clinic protesters who are sued and lose
cannot discharge debts associated with their beliefs, are politically
inspired and irrelevant to any meaningful discussion about
bankruptcy protection.
Besides, neither of these
amendments could pass even a voice vote in the Senate.
As we have been
saying for a long time, bankruptcy reform is desperately
needed. More than 1.4 million Americans filed for
bankruptcy last year, costing consumers and businesses $ 45
billion. Every time a debt is wiped away, someone else loses money.
Some, and we suspect the majority, of these debtors have no way out.
They will never be able to pay their debts. But others have learned to
manipulate the system. They have no sense of moral obligation and would
simply walk away.
There are enough of those deadbeats out there to
justify the contemplated reforms, and both the House and
Senate proposals insist that people who can repay a portion of their debts
should.
The point of bankruptcy reform, as Iowa Sen.
Charles Grassley said, is to limit Chapter 7, which discharges debts, to
those who legitimately cannot pay. Those people who can pay a portion of their
debts would do so under a Chapter 13 repayment plan. Every person who has
the means must pay unless a judge or trustee decides the debtor will not
be able to meet that obligation.
Such a plan seems to us eminently fair.
It encourages personal responsibility while making it more difficult to
erase debt.
No longer would wealthy individuals like Burt Reynolds be
able to sidestep their debts and keep their multimillion-dollar homes
because the legislation places a cap on the amount of protected property.
NO LONGER WOULD deadbeat parents be able to avoid their child support
and alimony obligations by filing for bankruptcy.
If the goal of the bankruptcy system is to match
bankruptcy relief to debtor need, then Chapter 13
repayment plans accomplish this objective. We urge the Senate to pass its bill
early next year and reconcile it with the House version. Real
reform is needed now.
NOTES:
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