Roger L. Thomas – 4/6/05

This page was last updated on April 9, 2005.

Stop the bankruptcy bill; Roger L. Thomas; Beaver County Times; April 6, 2005.

Below is a detailed critique of the subject letter.

“The proposed new bankruptcy bill assumes that people go bankrupt because they squander their credit cards. This is simply not true.

“The Warren Study details that half of the personal bankruptcies are medical bankruptcies. These reflect the broken medical care system. People who are diagnosed with major medical problems find that their policies only cover part of the treatment, and none of the consequential losses. You have all fallen victim to this, whether or not you’ve experienced personal bankruptcy.

“Once there has been a major illness, the patient is faced with about 20 percent of the medical bill, plus the deductibles and exclusions. Only part of the medication is paid.

“The patient is also unemployed during his care, and possibly for the rest of his life. Usually, some family member is then called upon to attend to the person. They also lose income and employment. This is the major consequential loss.

“To provide medication and meet ordinary living costs, the family drains its savings and begins incurring credit debt. There is limited income, so they can’t pay the credit cards. When credit cards are not paid, the rates and charges increase to as much as 30 percent compound interest.

“Banks are reluctant to make equity loans when there is little revenue, so the loans tend to come from predatory lenders. It’s called the ‘black hole.’

“My point is that the new federal bankruptcy law is designed to protect vendors from credit card abuse. That is not what is happening. We need to stop this bill before even more people lose their bankruptcy safety net and end up charged with bills they thought had been discharged.

“Write to your senators and tell them you object to usury. People do not ask for huge medical bills.”

[RWC] Mr. Thomas writes a nice story, but how is it relevant? Regardless of how a person gets to bankruptcy, he should not be allowed to transfer his debt to someone else. Remember, bankruptcy doesn’t eliminate debt; it only transfers the debt to other people. We pay for transferred bankruptcy debt in the price of nearly every product and service we buy.

Mr. Thomas’ story works against his cause. According to his story, the folks he describes take on debt they know they cannot pay back. I was taught that was stealing.