Here's the good news: Congress will probably revise those bad bankruptcy laws enacted during the Bush years. People are starting to understand that they may not have been such a hot idea.
“The environment has become more hostile,” says Miller, who has worked on many of the largest and most important Chapter 11 cases. He says the balance between debtor companies and their creditors has shifted in favor of creditors, with disastrous results for distressed businesses.(Harvey Miller is a big deal bankruptcy lawyer.) In other words, if not for that harsh rewrite of the bankruptcy laws, more people might have kept their jobs. They would have had money in their pockets to pay mortgages and to buy crap made by other companies on the brink.
The big problem, he says, is that companies are so afraid of bankruptcy that they’re waiting too long to file, entering Chapter 11 protection when it’s no longer an effective restructuring tool. Companies need time and cash to pull off a successful Chapter 11 reorganization but are waiting until they have neither. Circuit City, to use the example of the day, could have had a fighting chance if it had sought court protection earlier, Miller says.
3 comments:
Does the revision include persoal bankruptcies? The law changing the rules for personal bankruptcies was another swipe at the safety net for us ordinary mortals.
My family was having a discussion at dinner last night. My son and dil were over for dinner. As an older mother with a single daughter in her 40s out of work, and my long memory of my parents experience in the Great Depression and my memories of its aftermath, my deep concern is not only the quality of my older years (after years of working), but the future my children and grandchildren face.
It bothers me - and I'm sure it must bother a lot of ordinary citizens - that, with all the bailout money thrown at the financial markets, most of the crooks who destroyed our economy are being left in charge of the financial institutions that they decimated. In short, there seems to be no justice done either for the victims of these crimes, ordinary people, or for our democracy at large.
I think our government is being short-sighted in not understanding that "the people" need to see some justice being done. And all it seems like we're getting is a backhanded smack in the chops. Fixing the bankruptcy issues for individual taxpayers is one of the justice issues we need addressed.
Just remember that Senator (now VEEP) MBNA Biden was the primary push behind that rewrite.
Can you not do something about the ads overlapping our posts over there on the right?
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