The American Revolution and Bankruptcy in Indiana – Two Kinds of Debt Consolidation

July 3, 2012 11:09 am Published by

 Celebrating Independence Day has a way of making us all reflect on what it means to live in the United States of America. As a debt consolidation lawyer and lawyer for bankruptcy in Indianapolis, Indiana, U.S.A., I’ve been focused on the ways our laws about debt and debtors have changed and how that’s had an influence on our American way of life.

“As many as two out of every three Europeans who came to the American colonies were debtors on arrival,” explains a wonderful article in the New Yorker magazine. “By the seventeen-sixties, sympathy for debtors had attached itself to the patriot cause.” 

(This next part is really interesting, and I wanted to share with my Bankruptcy in Indiana readers: )  “The American Revolution, some historians have argued, was itself a form of debt relief.” The idea the authors are stressing is basically what’s behind the new bankruptcy laws of Indiana. 

Of course, back in the 1770’s and 1780’s, the terms “bankruptcy Chapter 7” or “Chapter 13 bankruptcy law” hadn’t been coined. The concept our Founding Fathers wanted to embed in the new country’s system, though, is the same one that motivates and inspires all the good bankruptcy attorneys in Indiana who work in the Mark Zuckerberg bankruptcy law offices today. 

Here’s  the way the New Yorker explains the thinking in the early days of our independence:

“The idea that debt is necessary for trade, and has to be forgiven, is consequent to the rise of a market economy. Americans fought to provide the same debt relief to everyone because we believe in equality and because bankruptcy protection makes taking risks less risky. Our willingness to forgive debt lies behind a good part of our prosperity.”

One of our Columbus bankruptcy lawyers shared a second article, this one from as reinforcement of that concept: “The concept of debt as a moral issue has played a central part in the formation of laws, public opinion, and personal conduct throughout American history. It still does.”

I think that in our state of Indiana we may have a very special appreciation of that statement. As anyone providing Indiana small business bankruptcy services knows, Indiana is home to almost three quarters of a million small businesses. What an  Indiana Business Review study found is that firms with under 100 employees made up less than 3% of total business, those firms created 2 ½ time more jobs in our state. Largely due to the new bankruptcy laws of Indiana,  many of those small businesses who suffered financial difficulties were able to restructure their debt and continue doing business and paying wages.

The July Fourth holiday is a time for celebration and for reflection, and this year, this longtime Indiana lawyer for bankruptcy has been doing a bit of both!


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