- The Washington Times - Wednesday, March 16, 2005


Republicans rejected Democrats’ efforts yesterday to make changes to Senate-passed bankruptcy legislation and worked to send the biggest overhaul in a quarter-century to the full House for expected approval.

Democrats on the House Judiciary Committee lost on party-line votes when they proposed amendments to the bill, which would make it more difficult for people to wipe away debts in bankruptcy.

As a result, the legislation was remaining in the form in which it had passed the Senate, by a 74-25 vote, last week.

“The fix is in,” said Rep. Sheila Jackson Lee, Texas Democrat. “This is a prime example of class warfare.”

The legislation would require people with incomes more than a certain level to pay credit-card charges, medical bills and other obligations under a court-ordered bankruptcy plan.

In the current system, bankruptcy judges decide whether people can have their debts dissolved, with certain assets forfeited, or if they must repay them.

Congressional and industry supporters of the legislation, especially banks and credit-card companies, have sought the changes for it for eight years. They have argued that too many people with the ability to repay at least a portion of the money they owe are walking away from all their debts.

“The need for bankruptcy reform is long overdue and crucial to our nation’s economy and the well-being of our citizens,” said Rep. F. James Sensenbrenner Jr., Wisconsin Republican and chairman of the committee.

Opponents say the changes would keep people who are overwhelmed by medical costs or by losing their jobs hopelessly in debt for the rest of their lives.

Committee Democrats said the bill would turn the federal government into a collection agency for credit-card issuers, retailers and other creditors.

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