Moral bankruptcy (cont'd.)

Kevin Drum offers a rundown of the proposed Democratic amendments to the Senate version of the bankruptcy bill -- all of which got shot down by the Republican majority. They're things like improved disclosure of credit card fees, efforts to prevent seniors from losing their homes or to protect veterans from the most punitive measures of the bill.

None of these amendments would have lessened the bill's purported effect of preventing bankruptcy "abuse," so Kevin asks a pertinent question: "If stopping abuse were truly your primary goal, why would you vote against amendments like these?"

Jonathan Chait opts for the simplest, most obvious answer: because the bill has nothing to do with stopping bankruptcy "abuse" -- it's really just a means of helping the credit card banks to confiscate even more of the income and assets of their "customers." Here's Chait's summary of the bill, in an L.A. Times piece titled "When Democrats Join the Dark Side":

This is one of those abysmal pieces of legislation that exists only because businesses with a vested interest in it have lobbied hard for its passage and that would have no chance of success if more than a tiny fraction of the public were aware of its existence.

Bankruptcy filings have risen slightly in recent years. Credit card companies argue that it's because people are gaming the system, going on irresponsible spending binges and then using bankruptcy to stick their creditors with the bill.

The more likely explanation is that the rise in health insurance costs has driven more people into bankruptcy. A recent Harvard study found that half of Americans who declared bankruptcy did so because of illness or medical bills. Regardless of why you go bankrupt, though, the new bill would make it easier for creditors to seize your assets. Nice, huh?

This isn't to say there aren't abuses in the bankruptcy system. There are. The bill simply does nothing to stop them.

The title of Chait's piece refers to the support this odious legislation is getting from some Democrats, including Joe Biden, D-MBNA. The credit card lender, MBNA, is the largest private employer in Biden's off-shore home state of Delaware.

I would imagine that many Republicans don't like Chait's title. If you are a Republican, and you don't like people referring to your party as "the Dark Side" -- as in the evil side, as in the Bad Guys -- then your next step is simple: stop supporting evil legislation like this predatory bankruptcy bill. That's a lot easier than trying to defend whorish little favors for donors like this, especially when the effect of this bill will be real, serious harm and hardship for many Republican constituents.

Is "evil" too strong a word? Consider another failed amendment to the bill. The title of this AP report (via Dr. Alterman) puts it plainly: "Senate refuses to limit interest rates at 30%."

30 percent! That's not even a cap, that's a stratosphere. Yet supporters of this bill thought that was too restrictive for the credit card industry. Peter G. Gosselin has more details in another L.A. Times article:

Debate about the bill continued Thursday, with the Republican-controlled Senate refusing to limit consumer interest rates to 30 percent. The vote was a bipartisan 74 to 24 to kill a proposed amendment by Sen. Mark Dayton (D-Minn.). Senate passage of the bill is expected next week.

Pop quiz: Name all the major religions, cultures and/or civilizations that have condoned the charging of 30 percent or greater interest on loans.

Give up? Me too. Yet here we have 74 U.S. senators disagreeing with, well, all of human history and embracing blatant, egregious usury. Is "evil" too strong a word? Here's a case study from Gosselin's article which, by the way, is titled "Credit Card Firms Won as Users Lost: They ... make money even on people who went bankrupt."

In Cleveland, a municipal court judge tossed out a case that Discover Bank brought against one of its cardholders after examining the woman's credit card bill.

According to court papers, Ruth M. Owens, a 53-year-old disabled woman, paid the company $3,492 over six years on a $1,963 debt only to find that late fees and finance charges had more than doubled the size of her remaining balance to $5,564. ...

Judge Robert Triozzi ruled that Owens didn't have to pay, saying she had "clearly been the victim of [Discover's] unreasonable, unconscionable and unjust business practices."

Now 74 senators have sided against Judge Triozzi. They want to make it easier for Discover and MBNA and all their ilk to continue these "unreasonable, unconscionable and unjust business practices." They want to make sure that these creditors will not only be able to collect $10,000 on a $1,963 loan, but also be able to repossess the disabled debtor's house.

Evil is not too strong a word.

Comments

[Riggsveda]

Read it and weep. 30% is a pittance. If it can be done, it will be done, and you know that old Yankee knowhow and national pride is not going to let a bunch of Limey poofters beat us at what we do best---picking the pockets of the poor in the name of free enterprise.
As Firesign Theatre said: "Forward, into the past!"

[eRobin]

Here, here. But now what? The bill will pass the Senate next week - not only with all its evil intact, but probably will an amendment from Man-on-Dog that's going to destroy the 40-hour work week. We needed to have people in the street over this and we didn't get it done.

[Marley]

Evil is not too strong a word. It is precisely the word to use about this and many other things emanating from Washington.

[Chris_uk]

Over here if your declared bankrupt you'll be left with :-

1 Bed
1 Chair
1 TV
1 Cooker
1 Fridge
food
and your house

... well unless you put your house up as insurance (such as in a mortgage.)... and even then the government will often step in to help with payments.

I think this is not only fair to the person, but sensible.

If you throw someone out on the streets then they'll be an unemployable burden on society forever more, by not being so hideously evil and giving the person a chance to redeem themselves your actually saving society money in the long term.

[drieux just drieux]

Well it is good to see that the current legislation has come out of the closet and decided to 'not support the troops' to support the president.

But does that really mean that we are 'Not @war' any more? Or simply that congress no longer needs the pretense of the 'support of the troops'???

In light of the government's openness about rendering 'enemies of the state' overseas to the off shore torture chambers - will they carry through on that policy when the list of official 'enemies of the state' include 'poor people' who are a threat to the national mellow???

Hum...

What if americans had elected a president committed to restoring the dignity to the white house...

[Gus]

Jesus, Fred,

I knew these people were corrupt, but every day they give a new meaning to the word. And that British 70%-rate credit card Riggsveda mentions couldn't have had a better name, could it: "Vanquis(h)." These people really ARE trying to drive people into debt peonage.

I'm really glad I don't have a credit card and have never had one.

[norbizness]

To paraphrase David Bowie in Diamond Dogs: this ain't class warfare, this is genocide!

[Chris_uk]

It would be very interesting to have a look at those Republican Campaign funds to see how much money has just been put in by the Finance companies, and who's recently been promised a lucrative position as a director of a major finance company upon retirement?

Are these published anywhere? ( I genuinely be interesting in reading them.)

Things like that just arn't allowed over here - it would comes under the category of bribery - Fortunately though the US senate has passed laws that say giving money to US senators in this way is infact not bribery.

Oh what an enlightened democratic society

[Gus]

Hi, Chris-uk,

It IS absolutely bribery, but more critical is the fact our Supreme Court years ago determined that corporations are "people" and therefore have the right to pump money into politics. Those corps have managed to convince a fairly large %age of the voters that doing this is good for them, largely b/c they make no distinction in their propaganda between SMALL business and BIG business. That's where the big problem lies -- an unending money stream with no individuals accountable for it.

The figures are published somewhere -- all campaigns, etc., have to keep such records -- but the corps have become pretty sneaky at hiding where the $$$ is actually coming from.

[edm]

opensecrets.org - should be required reading for all voters.

[edm]

Of course, I screwed the link up... try again : opensecrets.org

[Mike Meredith]

The following Democrat or Independent senators voted in favor of S.256.

We should have been able to expect them to oppose a huge windfall for the banking lobby at the expense of those of their constituents who are struggling financially.

They should be ashamed of themselves.

I hope their moral lapse will haunt them on election day.

I also hope they will hear screams from thousands of good-hearted Americans.

Baucus (D-MT) baucus@senate.gov
Bayh (D-IN) bayh@senate.gov
Biden (D-DE) biden@senate.gov
Bingaman (D-NM) bingaman@senate.gov
Byrd (D-WV) byrd@senate.gov
Carper (D-DE) carper@senate.gov
Conrad (D-ND) conrad@senate.gov
Inouye (D-HI) inouye@senate.gov
Jeffords (I-VT) jeffords@senate.gov
Johnson (D-SD) johnson@senate.gov
Kohl (D-WI) kohl@senate.gov
Landrieu (D-LA) landrieu@senate.gov
Lincoln (D-AR) lincoln@senate.gov
Nelson (D-FL) billnelson@senate.gov
Nelson (D-NE) bennelson@senate.gov
Pryor (D-AR) pryor@senate.gov
Reid (D-NV) reid@senate.gov
Salazar (D-CO) salazar@senate.gov
Stabenow (D-MI) stabenow@senate.gov