It's Official — The New Administration's Position On Bankruptcy

January 26th, 2009 by Reed Allmand

President Obama and his administration have updated the White House website and included their position on bankruptcy changes.

The site says that President Obama wants to:

• Reform Corporate Bankruptcy Laws to Protect Workers and Retirees: Current bankruptcy laws protect banks before workers. Obama and Biden will protect pensions by putting promises to workers higher on the list of debts that companies cannot shed; ensuring that the bankruptcy courts do not demand more sacrifice from workers than executives; telling companies that they cannot issue executive bonuses while cutting worker pensions; increasing the amount of unpaid wages and benefits workers can claim in court; and limiting the circumstances under which retiree benefits can be reduced.

This is very important. As more companies go bankrupt, workers need to be protected from the fall out as much as possible. Most ordinary workers, unlike shareholders and powerful creditors depend on their paychecks and pensions just to survive month to month. When companies go bankrupt those ordinary workers should be at the top of the list of creditors to be repaid FIRST. We applaud the new administration for this effort. But there was something suspiciously missing from the new website–support of mortgage loan modification in bankruptcy. President Obama spoke so strongly for mortgage loan modification (when he was campaigning) in bankruptcy and now I have combed his site thoroughly and I’m unable to find mention of it. If you support mortgage loan modification in bankruptcy, don’t remain silent. Let President Obama know that you expect him and his administration to fully support mortgage loan modification in bankruptcy by visiting www.whitehouse.gov and letting your voice be heard.