Donald Trump Proves What's Wrong With Bankruptcy Laws in America | Robert Reich

[davidpdx]

In the opening day of Trump Plaza in Atlantic City in 1984, Donald Trump stood in a dark topcoat on the casino floor celebrating his new investment as the “finest building in the city and possibly the nation.” Thirty years later, the Trump Plaza folded, leaving some 1,000 employees without jobs. Trump, meanwhile, was on Twitter claiming he had “nothing to do with Atlantic City,” and praising himself for his “great timing” in getting out of the investment.

In America, people with lots of money can easily avoid the consequences of bad bets and big losses by cashing out at the first sign of trouble. Bankruptcy laws protect them. But workers who move to a place like Atlantic City for a job, invest in a home there, and build their skills have no such protection. Jobs vanish, skills are suddenly irrelevant and home values plummet. They’re stuck with the mess. Bankruptcy was designed so people could start over. But these days, the only ones starting over are big corporations, wealthy moguls and Wall Street bankers, who have had enough political clout to shape bankruptcy laws (like many other laws) to their needs.
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One of the most basic of all economic issues is what to do when someone can’t pay what they owe. The U.S. Constitution (Article I, Section 8, Clause 4) authorizes Congress to enact “uniform Laws on the subject of Bankruptcies throughout the United States,” and Congress has done so repeatedly. In the last few decades, these changes have reflected the demands of giant corporations, Wall Street banks, big developers and major credit card companies who wanted to make it harder for average people to declare bankruptcy but easier for themselves to do the same.

The granddaddy of all failures to repay what was owed occurred in September 2008 when Lehman Brothers went into the largest bankruptcy in history, with more than $691 billion of assets and far more in liabilities. Some commentators (including yours truly) urged then that the rest of Wall Street be forced to grapple with their problems in bankruptcy as well. But Lehman’s bankruptcy so shook the Street that Henry Paulson, Jr., George W. Bush’s outgoing secretary of the treasury, and, before that, head of Goldman Sachs, persuaded Congress to authorize several hundred billion dollars of funding to protect the other big banks from going bankrupt. Paulson didn’t explicitly state that big banks were too big to fail. They were, rather, too big to be reorganized under bankruptcy—which would, in Paulson’s view, have threatened the entire financial system.

http://www.politico.com/magazine/story/2015/09/donald-trump-bankruptcy-laws-213190#ixzz3n7lMmr2e

Four paragraphs is not enough to give this article its due. I urge you to read the entire article. THIS is what we are fighting for. If we continue to let the corporations run the nation, we are fucked people.

[Blus4u]

1. KnR for exposure

There should be a required reading list for prospective voters and this article should be on it!

Peace

[erpowers]

2. If People Could Declare Bankruptcy on Their Primary Home

What would happen if people were able to declare bankruptcy on their primary home?

[erpowers]

3. Public Financing of Campaigns

The information in this article provides one of the best arguments for public financing of campaigns. Reading the article one could see how money impacts politics. Trump wanted a 40 year tax abatement, he paid a large amount of money to the politicians who decided that issue. Later he was given his abatement. A member of Congress attempts to change bankruptcy laws concerning student loans the financial industry, which had given large amounts of money to the Senate committee that was over that issue, complained about the change and that change did not happen. The same thing has happened on many occasion concerning many issues. It is beginning to seem that the only way to stop this from happening is to make all campaigns publicly financed.