Republican Bankruptcy Laws: "Compassionless Conservatism"

artwork by Diane Fenster.

The United States Senate moved ahead with legislation to make it more difficult for working-class Americans to use bankruptcy protection to get out of overwhelming debt.

Changes are needed because as bill sponsor, Senator Charles Grassley (R-Iowa) states, the current law:

"a convenient financial planning tool where deadbeats can get out of paying their debt scot-free while honest Americans who play by the rules have to foot the bill."

Deadbeats? Not so fast Senator Grassley! A recent Harvard University study looked at 1,771 bankruptcies from five states filed in 2001, including California. According to a report on the study:

Almost half of those filers -- 46.2 percent -- cited illness and medical bills as a major cause of bankruptcy. More than three- quarters had insurance at the onset of illness.

And the problem gets worse if people cannot even afford health insurance and prescription drugs. A lot of Americans do not even carry insurance. As reported:

"The bigger issue for the uninsured and underinsured are day-to-day health-care needs and chronic-disease management," he said.

An estimated 15 percent of the total U.S. population, or 44 million people, lack basic health insurance, Retchin said. Yet most of the uninsured do work.

They make too much to qualify for public assistance but too little to afford private health insurance, said Denise C. Daly, executive director of REACH, or Richmond Enhancing Access to Community Healthcare.

"Some uninsured persons face heartbreaking decisions -- to provide for their families or seek health care -- as if the two are mutually exclusive," Daly said.

"Filling prescriptions or buying groceries. Seeing a specialist or buying school clothes for the kids."

And have the Republicans made drugs more affordable under President Bush? Not at all. In February, 2005, President Bush appointed Lester Crawford to be permanent head of the FDA. Mr. Crawford "...has stated he opposes legalizing the reimportation of prescription drugs from foreign nations." Reimportation would lower drug costs.

And what about the Medicare drug benefit? Isn't the U.S. Government doing everything it can do to keep prices low for America's seniors? Not really.

As has been reported:

Some Democratic and Republican lawmakers who support the drug benefit are moving ahead with bills to let Medicare negotiate bulk discounts for drugs and lift restrictions on importing lower-cost drugs from Canada and other industrialized nations.

But the President won't allow anything as outrageous as negotiating with drug companies for lower prices. He trusts drug companies just like he trusts credit card companies to do right by Americans! The report continues:

The administration opposes both bills. It says private plans would be more efficient than Medicare at negotiating discounts, a conclusion shared by the nonpartisan Congressional Budget Office. And the president has said he is concerned about the safety of drugs from abroad.

And what about just raising the income of the lowest-earning Americans? What about just raising the minimum wage to reduce the need for resorting to bankruptcy protection?

The President and his Republican Congressional members oppose such a raise.

On Monday, March 7, 2005, an Amendment to the bankruptcy legislation sponsored by Republican lawmakers, was made by Senator Edward Kennedy (D-Mass). As reported:

An amendment offered by Sen. Edward M. Kennedy (D-Mass.) would have raised the federal minimum wage from $5.15 to $7.25 an hour over two years. It was defeated, 49-46.

The GOP-controlled Congress has blocked all such Democratic-backed efforts to increase the minimum wage in recent years. And Senate Republicans were especially determined to keep the Kennedy amendment off the bankruptcy bill because the House GOP leadership has promised to act quickly on the measure only if it remains largely unchanged.

Kennedy argued:

...the federal minimum wage has not been increased for eight years.

"For minimum-wage workers, prices have increased every year since 1997, but their paychecks have remained exactly the same," Kennedy said. "With few savings, and little safety net, minimum-wage workers are one pink slip or one medical emergency away from bankruptcy."

But the Republicans know who butters their bread. While cracking down on so-called "deadbeats", the working poor, Republicans have acted to protect the wealthy once again. In so-called "Asset Trusts", in which wealthy individuals can protect millions in assets in offshore trusts exempt from bankruptcy action.

These are the "deadbeat" wealthy. And the Republicans didn't do anything about them! In fact Amendments to change these Asset Trusts were beaten back by Republicans.

When will the average American see what is happening in Washington? When will America realize that putting faith in big Pharma to protect us and befriending Credit Card Companies in the guise of "reform" is just phoney rhetoric?

Senator Kerry, America calls out to you to provide the leadership in worker protection, bankruptcy law, and truly representative leadership in Washington!
Keep that door open for 2008! America is depending on you!

Bob