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Dear Senator,

March 8, 2005

I am writing to urge you to vote against the bankruptcy bill (S-256). This bill will harm working class people struggling to make ends meet, allow predatory lenders to continue their practice with impunity, and fail to address the leading cause of bankruptcy: medical costs.

The argument for bankruptcy reform usually boils down to the idea that debtors make poor choices and need to take responsibility for their own actions. The banks, credit card companies and retailers that support this bill, to the limited extent that they are actually affected by this issue, should instead take responsibility for the risks they take in extending credit to people who might not be able to pay.

According to a study, in the journal Health Affairs, half of the bankruptcies filed in the US are due to large medical bills. In fact, less than one percent of bankruptcies are actually due to credit card debt. Most people struggling with medical debt are working class people with health insurance. So it would seem, that the biggest part of the bankruptcy problem is not due to poor personal financial decisions by debtors so much as a symptom of high medical costs.

Filing for bankruptcy carries a huge penalty both financially and emotionally. It is not something that is taken lightly by people who see it as a last resort. Perhaps a better first step to solving the bankruptcy problem is to help people who can’t afford catastrophic health costs so they don’t have to resort to the nuclear option of bankruptcy.

Again, I urge you not to take away this protection that helps working people struggling with debt who are, for the most part, victims of circumstances rather than poor personal choices.

3 Comments
  1. Mavourneen Thompson permalink
    March 8, 2005 1:04 PM

    I urge you to vote against the bankruptcy bill (s-256).

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