The idea is to keep people out of debt by letting them know that bankruptcy won't protect them from their own mistakes. Call it tough love for the credit-addicted. This debate is ultimately about an allocation of wealth. Harsher bankruptcy laws won't do much to deter filings because most people don't consider bankruptcy until they have no other choice, Warren adds. Filing for bankruptcy carries both a social stigma and the financial consequence of limited credit for years to come.
Responsibility needs to be shared.
Congress could start by forcing credit card issuers to include information on the terms of what are essentially high-interest loans. Credit card statements should contain that information. Limits on distribution must also be put in place, she and others insist. Credit card companies are arguing for a contradictory and unreasonable privilege. They want an unregulated market for distribution, but they also want the government to act as a collection agent when their customers get into trouble.