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Bankruptcy, especially as described by bankruptcy lawyers, promises “a fresh start in your debts,” John Oliver said on Sunday. Last week tonight. Between 800,000 and 1.5 million Americans file for bankruptcy each year, “and many fear that once the current pandemic assistance ends, more and more people will need the kind of help.” offers bankruptcy. The process gives people a chance to get out of under a mountain of debt, but it affects your credit score, and it carries a “completely wrong” social stigma, he said.

“Bankruptcy isn’t just caused by bad decisions, it’s often caused by bad luck – inevitable challenges like job loss, divorce, surprise medical bills, or maybe even, you know, a global pandemic that occurs once in a century, ”said Oliver. . But absurdly, “a lot of people can’t afford to go bankrupt,” literally.

“Our modern bankruptcy code was enacted in 1978 – interestingly, around the same time the credit card industry began to benefit from a period of constant deregulation,” Oliver said. It “worked really well for them, as they marketed themselves aggressively, and during that time consumer debt started to rise sharply. And what the industry clearly wanted was for people to be stuck. in a lucrative cycle of minimum payments, late fees and rising interest. What they didn’t want to spoil was the people shortening the bankruptcy cycle. “

The credit card industry has put aggressive pressure on Congress, and a 2005 law made it harder and more expensive to file for personal bankruptcy, Oliver said. He explained the two types of personal bankruptcy, Chapter 7 and Chapter 13, and noted that many lawyers direct their clients to the more expensive option, Chapter 13 – especially if their clients are black. “Even bankruptcy discriminates against blacks,” Oliver sighed. He explained why people might have to file for bankruptcy twice – not, as Suze Orman suggests, “recklessness” or “moral failure” – and blamed “much of what’s wrong with our system current bankruptcy ‘to the 2005 overhaul.

If you’ve been paying attention to the 2020 Democratic primaries, you already know that President Biden was a big supporter of the 2005 law and clashed with Senator Elizabeth Warren (D-Mass.) About it – and if you did not pay attention. Oliver offered a recap. Warren now has a review bill that Biden broadly supports, but it is unlikely to pass if 10 Republicans are to sign to thwart a filibuster, he said. Oliver concluded with a lively NSFW wrap-up of his argument that pillories are also mandatory when it comes to credit counseling. Take a look below.

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