EDITORIAL
Senate bankrupting the bankruptcy law

A bankruptcy bill that cleared the Senate Thursday sends the wrong message.

The Bush administration's proposal erodes government protection for ordinary citizens against misfortune, while protecting big business from the consequences of its own actions.

The banks and credit card companies that helped shape this bill have been trying to see it become law for seven years. President Clinton vetoed it once. Having cleared the Senate, the bill is expected to pass in the House this week.

The bill would make it harder for citizens to dissolve debt, which most often includes medical bills and credit card debt, in bankruptcy. Yet it makes no attempt to restrain banks from so freely handing out credit cards. The banks complain about being unable to collect billions from card-holders, yet they send out literally billions of cards, many entirely unsolicited, each year.

The senators now have moved to make it easier to collect that debt, but refused to rein in the proliferation of credit cards. Nor have they closed any of the loopholes in the bankruptcy statutes through which rich people, including corporate executives found guilty of misleading investors, protect their expensive homes and other assets.

A recent Harvard University study found that, rather than abusing or scamming the bankruptcy laws, about half of all people filing for personal bankruptcy were brought low by medical emergencies. The rest are overwhelmingly the result either of job loss or of divorce.

Despite those sobering statistics, 18 Senate Democrats, including Dan Inouye, joined with Republicans in supporting the bill; they, in particular, should be held accountable because they claim to defend ordinary consumers against Big Business. At least Republicans who say they support Big Business vote accordingly.

It's a shame the Senate approved this pro-bank, anti-consumer bill. Unfortunately, it's part of a steady erosion of the protection the government provides against personal misfortune, even as ordinary families face ever-growing economic insecurity.