Bankruptcy Bill Closer to Passage

After today’s vote in the U.S. Senate it seems more likely that the bankruptcy bill, which would make it harder for consumers to discharge their debts in bankruptcy, will pass in the Senate.

Two votes in the Senate today pushed the bankruptcy bill closer to passage. First, the Senate voted 46-53 against an amendment that would prevent abortion protestors from filing bankruptcy to escape paying court-ordered fines. The rejection of this amendment is significant since it is said to be the “poison pill” of a similar bankruptcy bill that failed to pass in the last Congress.

The Senate also voted 69-31 today to limit further debate on the bankruptcy bill to 30 hours. Only amendments relating to the bill may be debated. With this limit in effect, the bill will likely reach the House of Representatives essentially unchanged. Leaders in the House of Representatives have stated that they will move the bill quickly if it is not significantly altered.

Senator Charles Grassley, an Iowa Republican and the bill’s chief sponsor, stated that "It is the (Senate Republican) leadership's intention to complete action on this bill during Wednesday's session." The bill is largely supported by credit card companies, retailers and auto lenders. It will require individuals with incomes above their state’s mean to file bankruptcy under Chapter 13 rather than Chapter 7 and repay some of their debt.