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Senate Approves Bankruptcy Reform Bill, Defeats Minimum Wage Increase

On March 10, the Senate approved, 74-25, the Bankruptcy Abuse Prevention and Consumer Protection Act (S. 256). The Senate began its consideration of the bill last week (see The Source, 3/4/05).

During consideration of the bill, Sen. Charles Schumer (D-NY) offered an amendment that would have barred anti-abortion protestors from declaring bankruptcy to avoid paying court-ordered fines. The amendment was defeated, 46-53.

Sen. Schumer explained that the amendment “would end the ability of violent extremists to hide behind bankruptcy laws to escape court-imposed debts. The amendment is very simple: If you use violence or the threat of violence to achieve a goal, a political goal, and you are successfully sued as you should be by the person or persons you have used violence against, you cannot then go back home to a bankruptcy court and say, protect me.” He added, “The bill explicitly protects peaceful protests but not violence or the threat of violence. It doesn’t matter if you are an extremist in the pro-life movement or the animal rights movement or any other movement; if you believe you are so right that you have the ability to take the law into your own hands and threaten others and do violence to others because your knowledge and feelings are superior to everybody else’s, you are wrong. That is not American. Again, you should not be allowed to use the Bankruptcy Code to protect yourself from a rightfully imposed civil remedy.”

Calling the amendment a “poison pill,” Sen. Sam Brownback (R-KS) stated, “Aside from the abortion issue, I am deeply concerned about what I believe to be a lack of fairness and justice embodied in this amendment. There is a fundamental fairness issue involved with this amendment. No one in this Chamber condones violent crime. I am certain that everyone believes violent crime should be prosecuted to the fullest extent of the law. While the pending amendment is presented as a way to address violent crime, it would primarily and inappropriately intimidate and harm peaceful protesters. In fact, were the Schumer amendment to become law, no crime would even be necessary to trigger its sanctions. Merely violating a Federal or State civil statute, such as a minor trespass, would be enough to place a violator in financial jeopardy.”

The Senate also rejected two amendments that would have increased the federal minimum wage. The first amendment, offered by Sen. Ted Kennedy (D-MA), would have raised the minimum wage from $5.15 an hour to $7.25 an hour over two years. Sen. Rick Santorum (R-PA) offered an alternative proposal to raise the minimum wage to $6.25 an hour over 18 months. The Santorum amendment also would have allowed employers and employees to enter into voluntary flextime arrangements, whereby employees could choose to work 80 hours over a two-week period. The amendment also contained a number of small business tax breaks. Both amendments required 60 votes for adoption. The Kennedy amendment was defeated, 46-49, and the Santorum amendment was defeated, 38-61.

Explaining how the minimum wage amendment and the underlying bill would impact women and minorities, Sen. Kennedy stated, “This is not only an economic issue, it is a family issue and women’s issue. Divorced women are 300 percent more likely than single or married women to find themselves in bankruptcy court, often because they are owed child support or alimony and cannot collect it. They are trying to raise their children but they face a daunting challenge. This bill will make it harder for them to meet that challenge.” He also noted that 61 percent of those who would benefit from the minimum wage increase are women and one-third of those women are mothers.

Sen. Santorum argued that his amendment would have a greater impact on women and families by allowing employees to have flextime. He stated, “I happen to believe that flextime is a good thing. We have several employees in my office who job share, who use flextime. Federal employees have been able to use flextime for a long time. It is something that is very popular in the Federal workforce. What we are trying to do is make it available to others outside. Why? I can tell you an example in my own office. The people who job share and have flexible hours are moms who are in the workplace. Obviously, we have seen a dramatic change in the workplace in the United States since the minimum wage laws and the 40-hour workweek was put in place. This entry into the workforce of nontraditional workers…has given rise to a lot of workers seeking to have their hours reflected with their obligations at home. What we are trying to do is have the laws of the Federal Government reflect the changing dynamics in the workplace without forcing anybody into a situation where they are not getting fairly compensated.”