Last Sunday on Last Week Tonight with John Oliver, comedian John Oliver gave us his hot take on the status of personal bankruptcy in America. In his characteristic form of enraged humor, the HBO host highlights some of the benefits and shortcomings of America’s consumer bankruptcy laws while dispelling one of the biggest myths surrounding bankruptcy.
As Oliver puts it “Very basic, bankruptcy is a legal procedure by which those who are deeply weighted down by debts, can get out from underneath them, and then give them a chance to start anew. Which is good!” This is precisely what consumer bankruptcy is intended to do. He goes on to identify what are considered the two biggest negatives to filing bankruptcy: the effect on your credit and the supposed social stigma that is attached with filing bankruptcy. He goes on to play a clip of Kevin O’Leary, of the television show Shark Tank, humiliating a contestant for having previously filed bankruptcy, calling him “toxic” and “radioactive” and shouting at another judge “no they should never go bankrupt” After taking O’Leary to task for his misguided advice, Oliver explains that, in many cases, the decision to file bankruptcy isn’t the result of bad decisions, but bad luck. This is entirely consistent with my experience as a bankruptcy attorney. Cases of the spendthrifts who irresponsibly run up debt with no plan to pay for it are few and far between. More often than not, people choose to file bankruptcy after experiencing hardship such as a job loss, illness, divorce or “you know, a once-in-a-lifetime pandemic.” and their previously manageable expenses suddenly become unmanageable. Bankruptcy is an essential part of the social safety net, designed to help those who have fallen on hard times and need relief from creditors, and no one should feel guilty, or have any stigma attached for the decision to seek a public benefit when they need it. The mistaken belief that one will become “toxic” or “radioactive” often prevents people who would otherwise greatly benefit from filing doing so. The reality is that most people who file for bankruptcy can begin rebuilding their credit soon after filing and, other than their creditors, no one will ever know of the decision to file. Ultimately, the decision to file bankruptcy is deeply personally and should not be made based on the advice of TV show hosts. View the YouTube video below to view the full segment. If you are struggling to pay your debts, contact Lipton Law Group today for a free case evaluation.