Elizabeth Warren’s Really Stupid Bankruptcy Bill
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Elizabeth Warren, I guess she’s an attorney, right? And she taught at Harvard. She is a wealth of really, really stupid ideas. Well, she is now planning to propose legislation that will completely overhaul federal bankruptcy system and make the process, as she’s saying, less costly and complicated.
for the more than 480,000 individuals who seek court sanction relief from debt repayment each year. And there’s a quote, people typically file for bankruptcy for one of three reasons, a job loss, a medical problem, or a family breakup. And when they do, they’re faced with an expensive and complicated system. My bill would simplify and modernize a consumer bankruptcy system to make it easier and less expensive for people to get relief. The Consumer Bankruptcy Reform Act
Again, she put this forward back in 2020 with Jerry Nadler, would simplify and modernize bankruptcy proceedings and provide consumers with more options. Yes, kumbaya, my lord, kumbaya. Yep, bankruptcies are up by more than 16%. 481,350 non-business filings. This is for the year.
through September, 2024. Warren’s legislation aims to streamline this process. She wants a single unified system and she wants to make sure that filers can take care of themselves and their families during the process, avoiding eviction if they rent and safeguarding homes and cars.
Okay, again, there’s two sides to every equation. This is one of the big ones, this is one of the big ones which is awful for you and I, the taxpayer. She wants to individuals struggling with student loans to be able to discharge the debt through bankruptcy.
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Okay. I have no problem with that. If if the taxpayers not providing the loan.
Because you see, anybody who wants to get a loan can get a loan via the government, fill out the damn FAFSA form, they’re gonna give you money. It’s even greater if you’re a grad student. Grad students, they’ll give you money for anything. They’ll give you money for housing, whatever you want. It’s like a massive party. You can go out and can borrow hundreds of thousands of dollars to get a degree in basic basket weaving, gender studies, or studies of the alphabet people, the LGBTQs.
But anyway, neither here nor there. If a bank wants to go ahead, again, get the taxpayer out of it. Bank wants to go ahead and loan that money out. That’s up to them. But again, let’s use our brains. Let’s use our brains. Do you think that a bank is going to lend out hundreds of thousands of dollars for some nonsensical degree?
Maybe if the interest rate is 25%, let’s remember that a student loan is a non-recourse loan. What are you gonna do? You’re gonna repossess the diploma? What exactly are you going to do? What is a non-recourse loan? Well, that’s a credit card loan.
What are credit card interest rates? That would put interest rates for student loans up at credit card rates. Again, I don’t care. Actually, I suggested this year’s I think that would be just fine. Because why? People wouldn’t take out the loans. Nobody in their right mind would take out those loans, forcing colleges and universities to actually price their product based upon what people could actually afford to pay.
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That’s not gonna happen. You see what’s gonna happen is this is an end around. This is an end around.
Hey, will you say? You know what? I’m going to do it. I mean it’d be a you know, I’m gonna go to College I’m gonna borrow a ton of money. I’m gonna go to a private school on direct. You know what? I’m gonna I’m gonna go on I’m gonna go to medical school I’m gonna go on I’m gonna be a surgeon and you’re gonna have hundreds of thousands of dollars in debt Hundreds of thousands of dollars in debt and you’re gonna you’re gonna come out. not your income
right off the bat, ain’t gonna be that high. You’re not gonna have any assets. What do you do?
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Hey, she just made it easy. You can discharge all of that in bankruptcy.
Smart move.
It would be the smart move. And most certainly, that’s what’s gonna happen. That’s what’s gonna happen. who’s gonna pay? Taxpayer, because we’re the ones loaning the money. We’re the ones loaning the money. This is some sneaky crap Elizabeth Warren is playing right now. Anyway, this bill of hers is gonna replace the existing chapter seven and chapter 13 with a new chapter 10.
which would give individuals with debt of less than 7.5 million two routes for filing bankruptcy. Again, this is personal bankruptcy, $7.5 million in debt.
Anyway, the first option would allow consumers to surrender assets, including cars.
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which says the ledger says could lead to debt being discharged without payment assets, cars, stuff. It’s not going to even come close to covering this if this is personal. Consumers who lack assets could seek bankruptcy on some debts as long as they adhere to a debt specific payment plan.
Again, there’s gonna be a limited proceeding that’s gonna go through. It would eliminate a means test which would take into account income and expenses when determining eligibility for chapter seven. And again, it would also allow, and this is interesting, it allow the opportunity to pay attorney fees over time.
How many lawyers are going to get into being a bankruptcy attorney if they’re not going to be paid up front? Your client is bankrupt. I don’t see that being a very promising career. also allows some… The current law requires renters to pay all back rent to keep their apartment or rental residence. This would require courts to treat
back rent like any other unsecured debt so it could be discharged.
It’s gonna be great for landlords. If it’s not hard enough already to kick people out when they stop paying, now they can stop paying, they can go to bankruptcy court, they can stay in and not pay you back. Again, you could just rinse and repeat. She’s serious about this. Again, there’s no.
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way in hell something this stupid is gonna pass. I certainly hope not. I don’t know. They’ve passed a lot of really dumb things in Washington DC, so who knows? Watchdog on wallstreet.com.
