What: All Issues : Justice for All: Civil and Criminal : Equal Access to Justice : S. 256. Bankruptcy/Vote on Final Passage of Republican-Sponsored Bill to Alter Federal Bankruptcy Laws.
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S. 256. Bankruptcy/Vote on Final Passage of Republican-Sponsored Bill to Alter Federal Bankruptcy Laws.
senate Roll Call 44     Mar 10, 2005
Y = Conservative
N = Progressive
Winning Side:
Conservative

In this vote, the Senate passed S. 256, a Republican-sponsored bill to alter federal bankruptcy laws. The bill would introduce into the bankruptcy system a "means test" based on the median incomes of individual states. This means that individuals who are determined to have sufficient means-assets-would be ordered to repay all debts, while those deemed to have insufficient means would have their debts erased after certain assets are seized. The bill also specified that certain debts, like alimony and some luxury purchases, would have to be repaid, and that the amount of equity in some personal homes that could be protected would be limited to $125,000. Other provisions would seek to limit repeat bankruptcy-filers, better inform consumers about the bankruptcy process and about the consequences of credit-card use and repayment, and make special requirements for small businesses filing for bankruptcy. Republicans hailed this legislation as a tough measure designed to limit abuse of the bankruptcy system, in part by requiring people filing for bankruptcy to repay debts that they could afford to pay. Progressives strongly opposed it and sought to limit its scope, because they viewed S. 256 as benefiting large corporations, such as credit card companies, at the expense of middle and lower-class Americans. They maintained that S. 256 would actually require individuals who deserve full protection in bankruptcy to overcome additional barriers to get out of debt, like higher attorneys' fees and more paperwork. Republicans defeated most Progressive and Democratic-backed amendments during deliberation of the bill, not only on substantive grounds but also because they were anxious to keep the bill "clean," meaning free from most amendments, because the House had already indicated it would not accept a bankruptcy bill laden with amendment language. The bill passed the Senate by a vote of 74 to 25; thus sending to the House a bill that would significantly alter the bankruptcy laws of the United States, and which, according to Progressives, would tilt the whole process very much in favor of credit card companies and large corporations at the expense of consumers and some small businesses.

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