LEGISLATIVE REPORT
By Maureen Thompson
NACBA Legislative Director
W
e have been reporting for
some time now that the
dysfunctional
Congress
prevents action on a number of major
issues that, in ordinary times, would
result in legislative action.
Despite
this, NACBA has been active both in
Congress and in supporting members
seeking an update in state laws.
Student loans continue to dominate
interest in Congress and members
continue to introduce bills designed
to alleviate the crushing student loan
debt facing Americans of all ages. By
my count, there are no fewer than 19
bills that have been introduced in the
House of Representatives and 11 bills
introduced in the Senate that address
student loan debt in one way or another.
In the House, three of those bills
directly address the student loans and
bankruptcy: H.R. 449, the “Discharge
Student Loans in Bankruptcy Act,”(11
cosponsors, including one Republican)
introduced by Rep. John Daleny
(D-MD), would make all student
loans dischargeable in bankruptcy;
H.R. 1674, the “Private Student
Loan Bankruptcy Fairness Act,”(39
Democratic co-sponsors) introduced
by Rep. Cohen (D-TN) would restore
bankruptcy discharge for private
student loans; and, now H.R. 3451, the
“Student Loan Bankruptcy Parity Act,”
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CONSUMER BANKRUPTCY JOURNAL
introduced in early September by Rep.
Kildee (D-MI), which would all student
loans to be discharged in bankruptcy.
What is interesting about the House
bills is that the broader bills that would
restore bankruptcy protection for all
student loans, including government
loans, were introduced by “moderate”
Democrats. As we know from the
BAPCPA fight, the moderate, more
business friendly Democrats typically
were skeptical of bankruptcy.
So, perhaps we are starting to realize
the beginnings of a fresh look at how
it is that bankruptcy is perceived
by elected officials.
Certainly, we
shouldn’t read too much into it; but
we should use this to chip away at illinformed perceptions of bankruptcy.
As you know, over the last several
years, a primary objective of NACBA’s
advocacy program has been to dispel
the lingering misperceptions about
bankruptcy, bankruptcy attorneys, and
debtors that the credit industry painted
during the years fighting over BAPCPA.
The economic downturn and stubbornly
slow recovery has g