As many of you know, last time the horrible bankruptcy "reform" bill came up for passage, Senator Schumer killed it by adding an amendment that would prohibit protesters from using bankruptcy to avoid paying court fines for blocking abortion clinics if the demonstrators knowingly violated the law. This amendment may well not be allowed this time, but we should should push the democratic leadership to push for other ones.
Each of these poison pills performs three functions: one, as each constitutes good public policy, they demonstrate Democrats' seriousness about reform; two, each draws attention to how Republicans stand with corporate crooks and against the little guy; three, they split the interest groups and the Republicans who serve them, hopefully stripping away enough votes to defeat the bill.
First reform: give tort victims priority in distribution. Certain classes of unsecured creditors get paid before others in bankruptcy (workers, for example), but tort victims are last in line, even though there is absolutely nothing they could have done to protect themselves from exposure. Trade creditors can evaluate the financial soundness of companies they lend to, but tort victims don't get to choose who hurts them. Companies often use bankruptcy precisely in order to avoid compensating tort victims fully.
Second reform: This one is related to the first. Make the provisions governing bankrupt asbestos companies more generous to claimants.
Third reform: Prohibit use of state exemptions in bankruptcy. Bankrupt debtors can exempt some of their property from distribution in property, so they can have a fresh start when it is over. Each state has its own exemptions, and federal law has one, and debtors can choose the federal exemption or the relevant state one. Some states (Texas and Florida, for example) have absurdly generous exemptions, allowing millionaires like Ken Lay to protect their mansions from creditors.
Proposing amendments like this is what opposition parties do. It allows them to use legislative debate to articulate a moral vision, and to distinguish themselves from the opposition. Suggesting real reforms prevents Republicans from seizing the "reform" mantle.
I would urge all of you to contact the following people and urge them to push for these three amendments:
Howard Dean - 202-863-8000
Harry Reid - 202-224-3542
Nancy Pelosi - 202-225-4965
Chuck Schumer - 202-224-6542