Sweet! - Obama Proposes Changing Bankruptcy Laws!

[Median Democrat]

Here is a change that I think is overdue since the bankruptcy reform that so many Democrats caved in to under Bush. Obama voted against the "reform" bill that passed, and now he is proposing to amend the bankruptcy law to serve the purpose they were originally designed for, which is to allow over-extended Americans a chance to start over, rather than serving as a means to ensure that creditors are protected from extending credit that Americans can't afford. I recommend reading Harvard Law Professor Elizabeth Warren's book, "The Two Income Trap" to gain some background on this issue.

http://www.msnbc.msn.com/id/25586249/

POWDER SPRINGS, Georgia - Barack Obama on Tuesday proposed changing bankruptcy laws to fast-track the process for military families, help seniors keep their homes, and protect people recovering from natural disasters.

* * *
Obama's new proposals supplement his broader — and previously announced — bankruptcy reform agenda that includes changes intended to help people in financial distress because of medical bills and allow homeowners going through the bankruptcy process to renegotiates terms of their mortgages.

* * *

(Obama) Aides noted that McCain, an Arizona senator, voted for a bankruptcy reform bill three years ago that critics say favored big business while Obama opposed it.

[nc4bo]

1. Cleaning bush's shit piles from these United States one turd at a time.!! GObama!! n/t

[redqueen]

2. Thanks for posting this.

:thumbsup:

[HiFructosePronSyrup]

3. No surprise.

Obama voted against the bankruptcy bill, and supports the credit card bill of rights.

[Median Democrat]

6. Yes, I Was Hoping For These Proposals

Since I knew that Obama voted against the pro-creditor BK bill. The new BK bill was just in time to protect creditors prior to the mortgage meltdown. Now, it is much tougher for Americans to recover. Worse, perhaps due to the new BK Bill, perhaps creditors believed that they could extend credit with impunity.

[shagsak]

4. K & R

[blondeatlast]

5. Excellent--Senator McSame, your response?

Yes, he really is sleeping.

[flpoljunkie]

7. Sweet, indeed!

[DJ13]

8. I hoped he was in favor of repealing ALL the restrictions the BK bill imposed

Im a little disappointed that he is more in favor of targeting specific groups for repeal instead.

[Median Democrat]

9. Hillary Would Oppose This - Total Repeal Is Dead

Hillary voted in favor of the original BK reform bill, then declined to vote on the final version of the bill that was passed. Elizabeth Warren in her book, "The Two Income Trap" notes that after initially indicating that she would oppose the BK reform bill, Hillary supported the reform in order obtain the support of the banking industry, which is heavily based in New York. So, I think it is smart for Obama not to pick a fight with Hillary Clinton on a total repeal of the bankruptcy reform bill.

[depakid]

13. The version of the bill that Hillary supported had a poison pill provision in it

re: abortion that was designed to keep Republicans from passing it in the early 2000's. and in fact this procedure worked.

She did not support the version of the bill that eventually passed, though wasn't present for the key vote, because she was with Bill in the hospital after his open heart surgery.

Elizabeth Warren needs to get her facts straight....

[Median Democrat]

17. Obama Must Not Pick A Fight With Hillary On A Repeal of Bankruptcy Reform

I think pushing for a total repeal of bankruptcy reform undermines efforts to unify the party.

The reference to Elizabeth Warren's discussion with Hillary Clinton is only in the preface of the book. Whether you believe Warren's recollection of events or not, the rest of the book is a great discussion of how many middle class Americans are overe-extended due in part to changes in the lending industry, which no longer extends credit based on the ability to pay, rather credit is extended to those who are most vulnerable.

Elizabeth Warren is a Harvard Law professor who specializes in the area of bankruptcy law.

Here is Hillary Clinton's statement from the floor on Bankruptcy Reform:

Clinton said, “Bankruptcy reform is important. I grew up with a father who worked hard to avoid having debts. In recent weeks, I have heard form many small credit unions throughout New York, hard working small lenders whose entire membership suffers when the credit union is faced with covering bankruptcy losses. <…> Reform is needed. The right kind of reform is necessary. We're on our way toward that goal, and I hope we can achieve final passage of a good bankruptcy reform bill this year.”

Here is Mother Jones story on the issue:

http://www.motherjones.com/washington_dispatch/2007/07/campaign_contributions_credit_card_companies-2.html

Hillary Clinton, who receives large sums of money from banks and investment companies, has waffled on the issue. In the The Two Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke, Harvard law professor Elizabeth Warren recounts a 1998 meeting with Clinton, who was then First Lady. Clinton wanted to know more about credit cards and how they affected women and Warren, a leading critic of credit card company practices, gave her a short lecture over lunch, focusing on the drawbacks in an earlier version of the new bankruptcy legislation (which Bill Clinton and the White House staff were quietly supporting in hopes of wooing the banking industry). Warren writes that after their talk, Hillary promised to do what she could to stop the "awful bill." And, by the time the legislation passed Congress in 2000, Bill Clinton had changed his position and vetoed it. An aide later told Warren, "A couple of days after Mrs. Clinton met with you, we changed sides so fast that you could see skid marks in the hallways of the White House."

But a year later, Clinton, then a freshman senator, voted for virtually the same bill when it was refloated by Bush. "Campaigns cost money," Warren writes, "and that money wasn't coming from families in financial trouble. Senator Clinton received $140,000 in campaign contributions from banking industry executives in a single year, making her one of the top two recipients in the Senate."

Despite his 2001 yes vote on the bankruptcy legislation, John Edwards is now one of the only candidates now taking up the issue of consumer debt—relying, in large part, on Elizabeth Warren's analysis and ideas. In a speech on his campaign theme of "the two Americas" at Cooper Union in New York City last month, Edwards proposed "setting up a new consumer commission to be called the Family Savings and Credit Commission … deal with all financial services—credit cards, mortgages, car loans, check-cashers, payday loans, investment accounts, and more. It will ban the most abusive terms and make sure consumers understand the others." Edwards has also more directly pledged to "pass strong national laws protecting us against the worst abuses in credit markets." (On that front, of course, Congress would have to cooperate.)

[greguganus]

12. Michael Vick just filed bankruptcy since he's been imprisoned for dogfighting.

I don't think he should get any relief.

[depakid]

14. So you support a "dogfighting exception?"

[HiFructosePronSyrup]

18. Well that's just about the dumbest thing I've ever heard.

Not the dumbest, but you certainly deserve a ribbon.

[Orsino]

10. This may be how you get shit done.

I'm getting a whiff of...progressivism? Could it be? Will it catch on?

[Overseas]

11. Glad to see his support for leniency on medical bankruptcies

I'm glad Obama wants to provide less stringent terms for those who suffer bankruptcy due to medical expenses. It was heart wrenching seeing so many esteemed legislators showing no mercy for people who went bankrupt due to medical emergencies. It seemed especially cruel when we still do not have national health insurance.

[high density]

15. What about help for people that aren't in bankruptcy?

There's a huge load being placed on the people who are somewhere between bankruptcy and the top 10% of this country. If Obama introduces something where people can negotiate their mortgage terms, it should apply to all people, not just to those who are in or near bankruptcy for whatever reason. People who are responsible with their finances always seem to get ignored. Medical bankruptcies should not be happening in this country, period.

[nc4bo]

16. I think that in Obama's Blueprint for Change there might be something close to...

this but you'll have to check it out for yourself to see.

Sec1:14 (18 of 64) under Create Fund to Help Homewoners Avoid Foreclosures and says this:

"Obama will create a fund to help people refinance their mortgages and provide comprehensive support to innocent homeowners. The fund will be partially paid for by Obama's increase penalties on lenders who act irresponsibly or commit fraud."

It does not give specific examples but maybe you can drop his camp a note and ask them about particular situations.

[Median Democrat]

19. Obama's proposal to give power to BK courts to revise loan terms does this...

Otherwise, folks lack leverage with mortgage companies. If a borrower can threaten bankruptcy, and the court can modify the terms of a loan, then a lender is more apt to work with the borrower to avoid BK.

This proposal has been raised in Congress already, but it is dead so long as the GOP retains control of the presidency.