There are different 'kinds' of bankruptcy, and consumers/employees should be vetted as individuals, not as a number.
At a time when Wall Street and Fanny Mae conspired to ruin the housing and finance sectors, culminating in the loss of millions of jobs and a 10% unemployment rate, it's hard to blame Joe Consumer when he had to declare bankruptcy after he hasn't worked for a year, or two.
Our economy is built on, and requires, a population that is willing to spend its paychecks down to the last dollar. We often have a negative savings rate, as a people, and even when we have a "good" savings rate we're at 3%. While it may be stupid to operate on so little savings, if the American consumer took a view of savings that resembled the more "responsible" consumers of other nations, then the world economy would crash and we'd all be screwed.
There are certainly people who take on more debt than they can possibly service and declare bankruptcy as a matter of expedience. That's certainly immoral and unethical, but to lump those people in with others for whom bankruptcy was the only way out of a situation that wasn't of their own making is myopic and more than a little judgmental.
We allow bankruptcy in this country because we want to encourage risk-taking. Our economic preeminence requires consumers who will spend to their last dime, and entrepreneurs who will risk financial ruin on a hunch. We could certainly adopt a more European view of personal bankruptcy, but then we'd better be prepared to accept a more European view of 10% unemployment as normal, and of a huge welfare state that helps people avoid the consequences of long-term unemployment and weak economic growth.
At a time when Wall Street and Fanny Mae conspired to ruin the housing and finance sectors, culminating in the loss of millions of jobs and a 10% unemployment rate, it's hard to blame Joe Consumer when he had to declare bankruptcy after he hasn't worked for a year, or two.
Our economy is built on, and requires, a population that is willing to spend its paychecks down to the last dollar. We often have a negative savings rate, as a people, and even when we have a "good" savings rate we're at 3%. While it may be stupid to operate on so little savings, if the American consumer took a view of savings that resembled the more "responsible" consumers of other nations, then the world economy would crash and we'd all be screwed.
There are certainly people who take on more debt than they can possibly service and declare bankruptcy as a matter of expedience. That's certainly immoral and unethical, but to lump those people in with others for whom bankruptcy was the only way out of a situation that wasn't of their own making is myopic and more than a little judgmental.
We allow bankruptcy in this country because we want to encourage risk-taking. Our economic preeminence requires consumers who will spend to their last dime, and entrepreneurs who will risk financial ruin on a hunch. We could certainly adopt a more European view of personal bankruptcy, but then we'd better be prepared to accept a more European view of 10% unemployment as normal, and of a huge welfare state that helps people avoid the consequences of long-term unemployment and weak economic growth.
