Health Care Reform and Bankruptcy: Let's wind up the way-back machine and have a look

[TayTay]

Back in March, 2005 the US Senate passed one of the most regressive bills in American history. It's purpose was to "reform" bankruptcy law so that those poor banks were not taken advantage of by people who were welching out on their debts by going out and getting cancer and other medical problems and then not paying their bills. (I mean seriously, did the Great Unwashed think that Bankruptcy Law was supposed to supply merciful relief from bills that no one could be reasonably expected to pay? What were they smoking. Bankruptcy law is supposed to protect creditors and banks, no matter what.)

Anyway, certain warrior guardians of wealth, like Sen. Judd Gregg of New Hampshire, voted against http://senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=109&session=1&vote=00016">Amendment 28 & http://senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=109&session=1&vote=00017">Amendment 29 of the Bankruptcy Reform bill that would have granted (liberal) protections for people who face bankruptcy because of things like getting cancer and running up expenses outside of insurance coverage of $35,000 and so. The argument advanced was that allowing people relief from debts, even medical ones, is a "moral hazard" that would lead to all sorts of moral slippage. (If you can use medical expenses as an excuse, what's next, relief from predatory interest?)

Sen. Ted Kennedy, on the Senate floor on http://thomas.loc.gov/r109/r109.html">March 2, 2005, phrased his support for Amendments 28 & 29 as such:

The Senator from Massachusetts.

AMENDMENTS NOS. 28 AND 29

Mr. KENNEDY. Mr. President, I yield myself 4 minutes.

Mr. President, in America, we believe that if you work hard, meet your family responsibilities, then you should be able to provide for your family. You should be able to afford a decent home for your family in a safe neighborhood. You should be able to send your children to college so they can enjoy lives of opportunity and happiness. You should be able to save for a comfortable retirement after years of disciplined saving and careful planning. That is the American dream. It is a dream of opportunity, of fairness, of infinite hope for the future.

But in recent times, average Americans have had to work harder and harder to fulfill their hopes and dreams. In just the past 4 years, housing prices are up 33 percent, college tuition is up 35 percent, and health care costs are up 59 percent. Families are counting their pennies. And now this Republican Congress wants to make it even harder with this bankruptcy bill.

Corporate CEOs can force their companies into bankruptcy and enrich themselves, but they are not held accountable. This bill ignores their irresponsible actions. But an average American facing cancer can lose everything under this bill: their home, their savings, their hopes, their dreams. They get no second chance.

One day, you are doing well. You have done all the right things. Your family is healthy and happy. And the next day, you discover that you have cancer, and even though you have health insurance, you are left with $35,000 in medical bills. You cash in your savings. You sell your second car. You sell your mother's wedding ring. You take out a second mortgage on your home. But it still is not enough. Half the Americans in bankruptcy face this exact situation. Their illness was bad enough, but now their medical bills are destroying their lives, and this bill adds further injury to their pain.

CEOs can get away with it. They are not held responsible for their companies' bankruptcies. Look at Enron, WorldCom, and Polaroid. But this bill requires average citizens to pay and pay and pay and pay, even when you do not have a dime to your name. And who is first in line to get your money? The credit card companies. They do not care if you are sick. They demand your money--with interest.

My amendments would give those facing illness a real second chance. One amendment says, if you are sick, you do not have to lose your home. It says that if illness forces you into bankruptcy, at least $150,000 of equity that you have built up in your home is yours--no matter what. Fat cats who go into bankruptcy do not lose their mansions. They can build palaces in Florida and Texas, and the bankruptcy courts cannot touch them. So my amendment says, if you get sick, you should at least get some protection for your home, too.

My other amendment says that if your medical bills force you into bankruptcy and they exceed 25 percent of your income, you are not subject to this bill's harsh provisions. You are not penalized under its so-called means test, which would require you to keep paying down on your bills even when you cannot afford it.

Let's give our fellow Americans a chance. They will do their part to rebuild their lives. We should help them, not hurt them.

I urge my colleagues to support these amendments.

The following still-sitting Senators voted against Kennedy's Amendments:
"NAYs ---58
Alexander (R-TN)
Bennett (R-UT)
Bond (R-MO)
Brownback (R-KS)
Bunning (R-KY)
Burr (R-NC)
Carper (D-DE)
Chambliss (R-GA)
Coburn (R-OK)
Cochran (R-MS)
Collins (R-ME)
Cornyn (R-TX)
Crapo (R-ID)
DeMint (R-SC)
Ensign (R-NV)
Enzi (R-WY)
Graham (R-SC)
Grassley (R-IA)
Gregg (R-NH)
Hatch (R-UT)
Hutchison (R-TX)
Inhofe (R-OK)
Isakson (R-GA)
Johnson (D-SD)
Kyl (R-AZ)
Lugar (R-IN)
Martinez (R-FL)
McCain (R-AZ)
McConnell (R-KY)
Murkowski (R-AK)
Nelson (D-NE)
Roberts (R-KS)
Sessions (R-AL)
Shelby (R-AL)
Snowe (R-ME)
Specter (R-PA)
Thune (R-SD)
Vitter (R-LA)
Voinovich (R-OH)

[YvonneCa]

1. Thanks for the' trip down memory...

...lane', sad as it is. This Bush Administration decision is just one more, of the many, reasons I was so against that horrible administration. I know someone...in my family...who filed bankruptcy after taking on major medical expenses. The very idea that they wanted to strip Americans of bankruptcy protection and line the pockets of big business was part of the pattern.

I am SO glad they are gone...even though it will take years to make things right again.

[karynnj]

2. Very nice catch - I remember how valiant your senior Senator was the days

those amendments were being fought. He was eloquent and righteous, but everyone in turn failed. As the recent election was so close, it had to hurt all the more seeing that hateful legislation pass. Kennedy really was the lion of the Senate at least on the day I watched.