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In 1978, Congress made it illegal for government employers to deny employment to, terminate the employment of, or discriminate with respect to employment against a person who has filed bankruptcy. In 1984, Congress extended this prohibition to private employers by making it illegal for such employers to terminate the employment of, or discriminate with respect to employment against a person who has filed bankruptcy. Under the law as it currently exists, private employers can refuse to hire a person who has filed bankruptcy solely because that person has filed for bankruptcy. Meanwhile, employers have substantially increased their use of credit history checks as a pre-employment screening device. Credit history checks will disclose bankruptcy filings, and because blacks and Latinos are overrepresented among bankruptcy filers, these groups are disproportionately affected by bankruptcy discrimination. This disparate impact probably violates Title VII of the Civil Rights Act of 1964. Moreover, there is scant empirical support for the proposition that creditworthiness is a reliable proxy for workplace performance or employee trustworthiness. Relying on bankruptcy status simpliciter is antithetical to a core purpose of the bankruptcy system, which is to give debtors a fresh start. Employers' prerogatives to operate according to whatever employment policies and practices they want should be balanced against employees' and potential employees' right to participate in the labor market in an environment free of irrational discrimination. It is irrational to deny employment to a person who is or was a debtor if the person is otherwise qualified, and the job can be successfully performed regardless of bankruptcy status. To allow such discrimination makes the bankruptcy system's promise of a fresh start illusory.

This article begins from a simple observation: Chapter 11 of the United States Bankruptcy Code is the global standard for corporate restructuring, but at the same time it is a far more complex procedure than most jurisdictions seem to require. This observation begs the question what parts of a bankruptcy system are 'essential'. We argue that two elements are essential because they cannot be achieved by contracting alone: asset stabilisation and asset separation. Stabilisation ensures that the firm's options are maintained. Asset separation ensures that the assets underlying these options can be separated from liabilities that are attached to them by law or contract. Both these elements drive much of the rules that are necessary to resolve distress but also show that parts of Chapter 11 are 'unessential' – for example, rules regarding reorganisation plans. Our goal is not to doubt the 'richness and elasticity' of corporate bankruptcy, particularly in the United States, but to find the essential elements. Beyond asset stabilisation and asset separation, features of the system are a matter of policy and politics. Understanding this helps in structuring insolvency systems and shows that Chapter 11 need not be the standard against which all other laws are measured.

The author analyzes what he terms the Republican intellectual bankruptcy, adding that the polls reveal that the public is fed up with right-wing moralizers, has no interest in tax cuts, & fears that the Republicans are undermining popular universal entitlements. Under a Democratic administration, US capitalism is booming, the Dow is bounding well above 10,000, unemployment is down, the federal budget has a surplus, & welfare is under control, leaving the economic conservatives without much political traction. Their ideas for tax cuts are less attractive since Social Security & Medicare need strengthening. The author concludes that if the Republicans are intellectually bankrupt, the Democrats have barely begun to invest in their intellectual future. Yet, such efforts, as the Third Way, have been sporadic & ambiguous. Democrats must make those intellectual investments, or the Republican's current intellectual breakdown may be a squandered opportunity. L. A. Hoffman

This report reviews many of the core consumer bankruptcy features that have been common to most versions of bankruptcy reform legislation.