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UC Law Journal

Abstract

While Americans historically have supported efforts to provide financial assistance to the truly needy members of our society, we have a fear that giving cash or other forms of economic assistance to the unemployed but able-bodied is morally corrupting and fosters economic dependency. Recent efforts to overhaul welfare and bankruptcy laws resulted from the public's perception that too many people failed to become economically self-sufficient despite an extended peacetime period of economic prosperity.

This Article examines our society's uneasy relationship with the working poor and our hesitancy to provide economic relief to ablebodied people who appear to have contributed to their inability to support themselves economically. Using the recent legislative efforts to solve both the welfare and bankruptcy crises as a backdrop, the author argues that attempts to reform bankruptcy laws have been, and will always be, controversial because society has never been willing to admit that some employed (or employable) able-bodied people may need ongoing public economic support.

The Article argues that it is unfair to vilify and demonize people whose main fault seems to be that they find themselves unable to move from the ranks of the working poor. Relying principally on current labor indicators, this Article suggests that many people are unable to move from the ranks of the economically dependent working poor into the ranks of the economically sufficient due to non-credit-based social factors, including an unraveling manufacturing economy, inadequate health care, increased divorce rates (and the corresponding increase in single-family households), and inefficient child support collection mechanisms. The Article concludes by arguing that any potential debtor who can establish that external factors prevent him from being able to support himself (or his family) financially should be deemed deserving of bankruptcy relief even if providing the relief appears to redistribute income from able-bodied economically sufficient workers to the able-bodied, but economically dependent, working poor.

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