[Public Papers of the Presidents of the United States: George W. Bush (2005, Book I)]
[April 20, 2005]
[Pages 639-640]
[From the U.S. Government Publishing Office www.gpo.gov]



Remarks on Signing the Bankruptcy Abuse Prevention and Consumer 
Protection Act of 2005
April 20, 2005

    Thank you all. Please be seated. Welcome. Thank you very much for 
coming today. Today we take an important action to strengthen--to 
continue strengthening our Nation's economy. The bipartisan bill I'm 
about to sign makes commonsense reforms to our bankruptcy laws. By 
restoring integrity to the bankruptcy process, this law will make our 
financial system stronger and better. By making the system fairer for 
creditors and debtors, we will ensure that more Americans can get access 
to affordable credit.
    I'm pleased to be joined today by the Attorney General Al 
Gonzales. I want to thank the bill 
sponsors in the House and the Senate. Senator Chuck Grassley of the Senate--I think you told me you'd been 
working on this bill for 9 years. That's a long time. [Laughter] I 
appreciate Congressman Jim Sensenbrenner from the House for being the sponsor in the House. Thank 
you.
    I want to thank the Speaker. 
Yesterday, the Speaker and I, by the way, had the honor of opening the 
Lincoln Library in Springfield, Illinois. I know he'd be pleased to hear 
me say, ``If you're looking for something to do this summer''--
[laughter].
    I thank Senator Mitch McConnell, Senator Orrin Hatch, 
Senator Jeff Sessions, and 
Senator Tom Carper. I appreciate the 
Members of the House who are here, Mike Oxley, Rick Boucher, 
Bob Goodlatte, Steve Chabot. Thank you all for coming, and thanks for working on 
this piece of legislation.
    Our bankruptcy laws are an important part of the safety net of 
America. They give those who cannot pay their debts a fresh start. Yet 
bankruptcy should always be a last resort in our legal system. If 
someone does not pay his or her debts, the rest of society ends up 
paying them. In recent years, too many people have abused the bankruptcy 
laws. They've walked away from debts even when they had the ability to 
repay them. This has made credit less affordable and less accessible, 
especially for low-income workers who already face financial obstacles.
    The bill I sign today helps address this problem. Under the new law, 
Americans who have the ability to pay will be required to pay back at 
least a portion of their debts. Those who fall behind their State's 
median income will not be required to pay back their debts. This 
practical reform will help ensure that debtors make a good-faith effort 
to repay as much as they can afford. This new law will help make credit 
more affordable, because when bankruptcy is less common, credit can be 
extended to more people at better rates.
    The new law will also require credit card companies to let card 
holders know up front what they are expected to pay and what the 
penalties they will face if they are late on a payment. When people get 
a credit card, they should not be trapped by a provision in the fine 
print.
    To make the system more fair, the new law will also make it more 
difficult for serial filers to abuse the most generous bankruptcy 
protections. Debtors seeking to

[[Page 640]]

erase all debts will now have to wait 8 years from their last bankruptcy 
before they can file again. The law will also allow us to clamp down on 
bankruptcy mills that make their money by advising abusers on how to 
game the system.
    America is a nation of personal responsibility, where people are 
expected to meet their obligations. We're also a nation of fairness and 
compassion where those who need it most are afforded a fresh start. The 
act of Congress I sign today will protect those who legitimately need 
help, stop those who try to commit fraud, and bring greater stability 
and fairness to our financial system. I'm honored to join the Members of 
Congress to sign the Bankruptcy Abuse Prevention and Consumer Protection 
Act.

Note: The President spoke at 2:42 p.m. in Room 350 of the Dwight D. 
Eisenhower Executive Office Building. S. 256, approved April 20, was 
assigned Public Law No. 109-8.