The Polite Liberal

A rant-free discussion of liberal philosophy and policies.


The Polite Liberal is the pseudonym of a "nontraditional" graduate student in mathematics (for nonacademics, "nontraditional," is a polite way of saying, "older than 25.") The Polite Liberal is an attempt to spur real policy debate, instead of partisan insults and conspiracy theories. Conservatives (and liberals, of course!) are welcome.

Friday, March 04, 2005

Can someone explain this?

I really, really try not to be cynical. I tend to think that a cynical pose is both unhelpful and unfairly dismissive of other points of view.

That said, can anyone please explain to me why it's good public policy to block chapter 7 bankruptcy protection for people bankrupted by medical expenses? We're not talking about people going berserk with plastic, here--we're talking "that heart surgury just wasn't covered by your insurance policy." That sort of situation seems to me to be exactly why we have chapter 7 bankruptcy protection in the first place, but apparently every singe Republican senator and a handful of Democrats disagree--they shot down an amendment that would have protected homeowners who get wiped out by medical debt.

How can this possibly be good public policy? For that matter, how can this possibly be morally right?


Blogger Walt said...

As somebody coming from the other end of the political spectrum but who also teaches bankruptcy law, I can say it flat isn't good public policy. In other words, you are right. Further, the proposed amendments aren't being pushed by doctors who don't get paid. The push is coming from the plastic industry in search of ever-increasing interest and penalty charges so they can make money to buy more banks.

Empire building.

As proof of the proposition that it isn't good policy, witness that the proposal has been killed off for one silly reason after another in successive congresses. But, too many of us on the right are beholden to the plastic robber barons to blow it off altogether.

My suggestion would be to make the price of a a means test for Chapter 7 part of a political quid pro quo. We'll go ahead with the means test, but then we will only let revolving credit charges participate in the Chapter 13 payout for the amount of the actual purchase and cash advance charges in the 12 months preceding the bankruptcy. In other words, principal only. The fact is, with the compounding of excessive interest and penalty charges, the plastic industry is collecting a whole lot more of their actual debt than other creditors, who can't legally use all the "add-ons" to gross up their debt. I say, screw 'em.

And as for your question about the morality of the issue, you do know this is Congress you are talking about, right?


8:05 AM  
Blogger The Polite Liberal said...


This particular pile of legislation has been bothering me, and it's nice to see that folks on the other side of politics feel the same way. With most legislation, I don't see "good Democrats valiantly fighting evil Republicans," but rather, "good people with wildly divergent views of the world trying to make good public policy." Granted, I disagree vehemently with the usual right-wing viewpoint, but that doesn't mean that I think people holding it are being disingenuous; I just think they're wrong. This bill, though, looks more like the world as seen by left-wing radio.

Your suggestion is basically not a bad one--but I'd also like to put back the amendments protecting soldiers (particularly reserves, who couldn't predict the sudden change in their income), people bankrupted by medical bills, and the like.

I'd also want to provide some sort of legal assistance to folks facing the means test--as the legislation stands now, you have people recovering from major surgury facing high legal bills if a hospital disputes their income.

8:41 AM  
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