Friday, September 02, 2005

New Orleans and the new Bankruptcy bill

via Atrios:

Rep. John Conyers, Jr., Rep. Mel Watt, Rep. Jerrold Nadler, and Rep. Sheila Jackson Lee announced today that when Congress returns next Tuesday, they will introduce legislation to protect the thousands of families and small businesses financially devastated by Hurricane Katrina from being penalized by anti-debtor provisions contained in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, scheduled to take effect on October 17, 2005. Reps. Conyers, Nadler, and Jackson Lee released the following joint statement:

"We are concerned that just as survivors of Hurricane Katrina are beginning to rebuild their lives, the new bankruptcy law will result in a further and unintended financial whammy. Unfortunately, the new law is likely to have the consequence of preventing devestated families from being able to obtain relief from massive and unexpected new financial obligations they are incurring and by forcing them to repay their debt with income they no longer have, but which is counted by the law.

When the Judiciary Committee considered the Bankruptcy Abuse and Consumer Protection Act earlier this year, Ms. Jackson Lee offered an amendment to protect the victims of natural disaster like those now devastated by Hurricane Katrina. While the amendment was defeated on a party line vote without any debate, we hope that in light of recent events our colleagues will recognize the importance of protecting our most financially vulnerable Americans.

The legislation we plan to introduce will prevent new bankruptcy provisions from having adverse and unintended consequences for the hundreds of thousands now facing financial catastrophe by providing needed flexibility for victims of natural disasters in bankruptcy proceedings.

Our common sense bill will insure that we do not compound a natural disaster with a man made financial disaster. We hope to obtain bipartisan support for expedited consideration of this critical legislation."

It will be interesting to watch this pending political battle play out. Economic Compassion verses the Free Market, Corporations Rock! party in charge.

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