July 4th and Bankruptcy Revisited
The July 4th holiday is a time for celebration. Please stay safe and enjoy the festivities responsibly.
This time of year, we think a lot about the founding of the United States of America and the signing of the Declaration of Independence on July 4, 1776. The last sentence of the Declaration of Independence ends with “…we mutually pledge to each other our Lives, our Fortunes, and our sacred Honor.” Nine of the signers lost their lives for the cause of Independence, and seventeen (or 1 out of every 3) lost every penny they had and all of their property. It’s not surprising that during the immediate period following the revolutionary war the issue of bankruptcy and debtor/creditor rights was often discussed. So, the right to bankruptcy has been there since the inception of our country.
Article 1, section 8 of the original U.S. Constitution, ratified in 1789, provides for the powers of Congress. Among the enumerated powers, Congress “…shall have Power…to establish uniform Laws on the subject of Bankruptcies throughout the United States.” And right above that, also in Article 1, section 8, is the commerce clause, Congress “…shall have Power…to regulate commerce with foreign nations, and among the several states, and with the Indian Tribes.” The Founding Fathers determined that uniform laws on bankruptcy were necessary for a growing commercial republic.
The public policy of our country is that Americans do not want people to suffer. Elected officials, on the federal and state levels, have repeatedly passed laws that protect the income resources and property of citizens. It’s healthy for an economy if individuals and families have access to a fresh financial start to be more productive, instead of mired in old debt. Bankruptcy is a part of our economy that is expected and planned for in our laws.
I found in 26 years of representing bankruptcy trustees (“the other side”) that many people harbor tremendous guilt resulting from their decision to get out of debt. I also found they were not the cause of their bankruptcy. Usually, it was a job loss, medical problems, accidents resulting in personal injuries, divorce, economic collapse, or just bad luck that led to the result they lost the means to pay their debt.
Any individual, from any job or profession, across any income level, files for bankruptcy daily in the United States. Did you know that four U.S. Presidents filed personal bankruptcy cases during their lifetime (Thomas Jefferson, Abraham Lincoln, Ulysses S. Grant, and William McKinley); top business leaders and captains of industry (Charles Goodyear, Henry Ford, Henry John Heinz, Milton Hersey, Walt Disney, P.T. Barnum); famous authors (Mark Twain, Oscar Wilde); and many actors, entertainers and athletes (Larry King, Kim Basinger, Mickey Rooney, Debbie Reynolds, Johnny Unitas, Mike Tyson, Curt Schilling, Jerry Lee Lewis, Burt Reynolds, Tom Petty, Marvin Gaye, Francis Ford Coppola).
None of this suggests that one should file bankruptcy just for bankruptcy’s sake. But too many people carry with them too much guilt over the decision to file for bankruptcy. My lifetime motto is to “Press on Regardless!” Each person must press on regardless to do the right thing, guilt-free, for themselves and their family. Call us today at 813-308-9045
