Bankruptcies drastically fall down in 2006. So what’s the fuss about? You can get your money back!

By Sujin, Priya, Ziad

Most people tend to see government regulation as a negative; however, we found the 2005’s bankruptcy reform legislation to be effective. The legislation makes it harder for someone to simply renounce their debts by declaring bankruptcy. For basic information check out http://mahalanobis.twoday.net/stories/3194683/.


Some people think the legislation is unfair to the poor because most rules are broken disproportionately by the poor. There are more poor and also the reasons that revolve around the poor are correlated. But the legislation helps companies and corporations while enforcing contracts. In our opinion, the government’s decision to enforce this legislation has more benefits than costs.

Craig Newmark, an associate professor of Econ at North Carolina State University, writes in his online blog that one of his sources strongly agrees with the 2005 bankruptcy reform legislation. He states “the bottom line is that most of those prevented from declaring bankruptcy by the new law weren’t sympathetic, they were simple scofflaws, and are better off for having to pay their debts like responsible adults”. To read more view http://newmarksdoor.typepad.com/mainblog/.

Similarly, the article states “you can’t have a prosperous society without having prosperous companies”. Encouraging bourgeois virtues like temperance, diligence, thrift, and keeping one’s word can only help our society. So what’s the problem with the government encouraging people to keep their word and to pay their debts!