by David Sisler

Americans filed for personal bankruptcy at a record pace in 1996 as more than one million individuals petitioned the courts to stay debt collection under either Chapter 7 or Chapter 13 of the federal bankruptcy code.

Critics of the current state of affairs in bankruptcy legislation argue that Chapter 7, which provides for a total discharge of debt, is a relic of the last century, when most credit was secured by tangible assets. They point out that today's consumer-based economy is built on unsecured, revolving credit, and most debtors have a steady stream of income from jobs or other sources. Troubling for some is the fact that bankruptcy courts often do not consider whether the debtor has practical alternatives to bankruptcy, nor is there any independent review of debtors' assets, income or ability to make future payments.

Would-be reformers maintain that Chapter 7 often gives more relief than is necessary, because the vast majority of debtors have jobs and incomes. A case-by- case review is suggested, targeting those who are able to make at least some repayment. Unable to meet obligations in a timely fashion, debtors are asking for all of their debts to be canceled. Some see this as a free ride which penalizes all consumers with resulting high prices.

One provision of the bankruptcy code comes under particular scrutiny from Diana Culp Bork, a former Justice Department attorney. Ms. Bork says that a provision which is supposed to prevent prebankruptcy spending sprees by creating "nondischargeability" for certain consumer debts of more than $1,000 for luxury items or cash advances incurred within 60 days of bankruptcy filings, is written in such a way as to have little effect.

Writing in The Wall Street Journal, Ms. Bork's feelings about current bankruptcy laws may be summed up in her statement, "It [is] too easy to walk away from debt."

William C. Whitford, professor of bankruptcy law at the Wisconsin Law School counters, "A right to an immediate discharge in bankruptcy, called a ‘fresh start' has been a feature of American law continuously since 1898."

Bankruptcy laws have been "on the books" for thousands of years, as well as laws which protect debtors. Notably, the early Hebrew culture had specific rules for the treatment of debtors. "If you lend money to one of my people among you who is needy," declares the writer of Exodus, "do not be like a moneylender; charge him no interest. If you take your neighbor's cloak as a pledge, return it to him by sunset, because his cloak is the only covering he has for his body. What else will he sleep in?" Ezekiel condemned a man who charged excessive interest on a debt as an extortioner, worthy of the death penalty. The means of a person's livelihood could not be attached as security for a debt, specifically a mill stone, or a widow's ox.

But regardless of the debt incurred, Jewish law guaranteed full release of debt every seventh and fiftieth years: "Every creditor shall cancel the loan he has made to his fellow Israelite. He shall not require payment from his fellow Israelite or brother, because the Lord's time for canceling debts has been proclaimed" (Deuteronomy 15:2). Honest bankruptcy is a scriptural principle.

The Bible also records the story of what must be the largest single personal debt ever discharged through any legal action or proceeding.

"A king wanted to settle accounts with his servants. As he began the settlement," Jesus said, "a man who owed him ten thousand talents was brought to him. Since he was not able to pay, the master ordered that he and his wife and his children and all that he had be sold to repay the debt. The servant fell on his knees before him. ‘Be patient with me,' he begged, ‘and I will pay back everything.' The servant's master took pity on him, canceled the debt and let him go."

A talent was a piece of money, a precious metal with distinct value, equal in modern value to about 60 pounds of gold or silver, most probably gold. It would have taken an average working man 1,000 weeks — almost twenty years — to earn one gold talent. Or ten thousand men would have worked twenty years to earn the total amount owed to the king. To illustrate it another way, if 10,000 talents were distributed in 60 pound sacks to men who were standing one yard apart, the line would stretch out five miles. At $400 an ounce, that much gold would cancel out our national debt.

How could one man pay back so much money? The truth is, he could not, and that was the point of Jesus' story. When the man asked for forgiveness, for the cancellation of a staggering debt, the king to whom he was in debt, simply forgave the debt. The debtor asked for time to repay, but his creditor, giving a new meaning to generosity, canceled the debt. God is the forgiver, Jesus taught. With debts of sin too great to calculate and with no way to pay, we are the ones who need debt cancellation. Our liberation from the burden was provided at Calvary and is offered to anyone who will, in faith, receive it.

"It is too easy to walk away from debt," Diana Culp Bork said. Jesus says, "It is even easier than that."


Published in the Augusta Chronicle 3/1/97

Copyright 1997 by David Sisler. All Rights Reserved.

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