This week Democratic presidential hopeful Senator Barack Obama announced Delaware Senator Joe Biden as his vice presidential candidate. Senator Obama and Senator Biden may agree on many issues, but they differ on their ideas on bankruptcy reform laws.
Senator Obama has complained about the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), suggesting that an overhaul is needed for the 2005 bankruptcy bill.
“While I was opposing the credit-card industry’s bankruptcy bill that made it harder for working families to climb out of debt, [McCain] was supporting it — and he even opposed helping families who were only in bankruptcy because of medical bills they couldn’t pay,” Senator Obama said in July.
The presidential candidate said that he would like to see bankruptcy restrictions, such as the means testing and credit counseling requirements, eliminated. He would also like to see families with certain hardships such as medical expenses have a greater chance to keep their homes.
Senator Biden, however, supported the BAPCPA and voted with Senator John McCain (See how McCain and Obama compare) and other Senate republicans. Senator Biden was also a top recipient of campaign cash from the credit card industry and critics contended his move was to cater to Delaware’s large credit card industry by making it harder for individuals to file for Chapter 7 Bankruptcy.
Senator Biden argued before the bankruptcy bill vote on the Senate floor that “a vote against this bill is a vote in favor of the current broken system.”
His supporters argue that Senator Biden supported the changes to bankruptcy law to protect child support and alimony payments by making these payments a priority in front of other creditor payments.
Senator Biden was not alone in his bankruptcy bill vote. He voted with 74 other Senators in a bi-partisan effort to reform bankruptcy law. The proponents of the 2005 BAPCPA felt that it was a fair step toward personal responsibility. Senator Joe Biden may have his work cut out for him to convince Senator Obama that this is true.
