[Congressional Record Volume 147, Number 29 (Wednesday, March 7, 2001)]
[Extensions of Remarks]
[Page E305]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT OF 2001

                                 ______
                                 

                               speech of

                           HON. JIM LANGEVIN

                            of rhode island

                    in the house of representatives

                        Thursday, March 1, 2001

       The House in Committee of the Whole House on the State of 
     the Union had under consideration the bill (H.R. 333) to 
     amend title 11, United States Code, and for other purposes.

  Mr. LANGEVIN. Mr. Chairman, I rise in support of H.R. 333, the 
Bankruptcy Abuse Prevention and Consumer Protection Act. I have spent a 
great deal of time examining the public debate surrounding bankruptcy 
reform and looking for assurances that H.R. 333 will reduce the number 
of abusive bankruptcy filings by holding debtors responsible for 
repaying their debts.
  Although bankruptcy filings continued to decrease this past year from 
the record 1.4 million consumer bankruptcy petitions filed in 1998, 
they still remain six percent higher than five years ago, when filings 
first passed the one million mark. Last year, the number of personal 
bankruptcy filings in Rhode Island decreased by 12 percent from the 
previous year, but that number is still too high, as the number of 
personal filings in the state has more than doubled in the last decade. 
Unfortunately, hardworking consumers shoulder much of the economic 
burden of these bankruptcies.
  While there are many factors contributing to the increased number of 
bankruptcy filings, statistics have shown that a significant number of 
individuals are permitted to walk away from their debt by filing under 
Chapter 7 when they have the ability to repay most, if not all, of 
their debt. Our bankruptcy system should direct filers to the chapter 
that best matches their needs and allow them to pay off as much debt as 
possible.
  H.R. 333 will help reestablish a degree of personal responsibility by 
utilizing a needs-based test to identify debtors making over the median 
income who have an ability to repay at least a portion of their debts. 
However, this legislation is by no means perfect and it fails to hold 
credit card companies accountable for the credit they issue. An 
increasing number of individuals who have experienced events such as 
illness, job loss or a recent divorce and have no financial recourse 
other than bankruptcy are being overwhelmed with misleading and abusive 
marketing strategies of the credit industry. As a result, too many 
consumers are prone to predatory lending practices after filing for 
bankruptcy and are never truly granted a fresh start by the system.
  It is for these reasons that I will support the amendment offered by 
my colleague from Texas, Ms. Jackson-Lee, and the motion to recommit 
offered by the Ranking Member of the Judiciary Committee, Mr. Conyers, 
during consideration of the bill. These provisions would strengthen the 
bill and address credit card company practices that have contributed to 
the increasing level of consumer debt and the rise in consumer 
bankruptcies. Specifically, the Jackson-Lee amendment seeks to modify 
the means test to allow more flexibility in determining a debtor's 
expenses, including health insurance premiums, other medical expenses, 
and the costs relating to the care of foster children, and extend the 
deadline for filing and confirmation of reorganization plans by small 
businesses. The motion to recommit would prohibit credit card companies 
from issuing credit to individuals under the age of 21 unless there is 
written parental consent or the individual can demonstrate an 
independent source to pay the debt.
  Nonetheless, even if these modifications are not approved, I do 
intend to support the underlying bill because I believe Congress must 
do something to address the current state of abuse and overuse of our 
bankruptcy system. However, Congress should also continue to pursue 
common-sense reforms that will not only cut down on fraud within the 
system but also hold credit issuers accountable for their actions while 
protecting the vulnerable consumer. I would strongly urge the Senate to 
keep these arguments in mind as it continues to debate its version of 
the bankruptcy reform bill.

                          ____________________