Letter to the Editor published in the American Bankruptcy Institute Journal regarding the proposed 1998 Bankruptcy Reform Act.

[The act finally passed in congress but was vetoed by President Clinton at the very end of his term of office. Unfortunately the bill was reintroduced after the change of administration and signed into law by President George W. Bush, effective October 17, 2005.]

Dear Editor,

A recent Washington Post front-page article on record bankruptcy filings begins: "Despite a booming economy..." but then fails to state the obvious. The gulf between the haves and the have-nots has widened to such an unmanageable extent that the incongruous is the norm.

The business news is bubbly and optimistic. Corporation X fires 6,000 employees and the stock goes up 20 percent in one day. The credit card companies are fanning the flames but the advertising community has also made the "acquisition of stuff" an expectation if not a birthright.

Bankruptcy offers a "fresh start" once every seven years (Deuteronomy 15:1-2) for those people holding the wrong end of the stick. These "profligates" are also the victims of a society that seduces them to spend money they do not have and then acts surprised and angry when full payment with high interest cannot be made. Regulate the credit industry, fix the economic disparity and the consumer bankruptcy filing will recede quickly.

Yes, there is a small percentage of fraud that requires policing, but that is true in many things (medicare, welfare, farm subsidies, etc.). The vast majority of consumer bankruptcy filings involve honest people that have lost control of their lives through little or no fault of their own.

Sincerely yours,

Paul D. Pearlstein
Paul D. Pearlstein & Associates, Washington, DC