“Bankruptcy is like the bank setting you on fire and then pissing all over you to put it out,” I remember a farmer-friend of my dad’s saying when I was a kid.
It was the 1980s and farm families like mine were losing their shirts to bad debt right and left - good families who listened to terrible advice, got in over their heads and lost everything.
But bankruptcy didn’t just devastate families. It tore through the hardware stores, the grocery stores, the schools and churches of little towns like mine throughout the late 1970s to mid-80s. It hollowed out the middle part of America in a way that people who didn’t grow up here don’t understand.
That’s why when I heard about Elizabeth Warren’s history and experience in taking on big banks and the bankruptcy laws they use to rob working families, I knew instantly that she would be the president to take on the structural problems that grind up families just struggling to get by. And I knew without hesitation I would be caucusing for her.
As a law professor, Warren began with a question, “Why are American families going broke?” and set off across the country to sit in bankruptcy courts and listen to legal proceedings. More importantly she listened to the stories of families who lost everything. What she learned shocked her.
Our culture says that bankruptcy only happens to “bad” people who are irresponsible and wasteful. But Warren heard stories from countless families like mine who played by the rules and did everything right but suffered just one or two setbacks that began a spiral that led to loss and shame.
If you’ve never been through bankruptcy, there are many things about it you may not know, like the fact that the deed to your farm will be auctioned off on the steps of the courthouse in front of your whole community. It will be listed in the paper, too, for the whole world to see.
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You’ll have a farm auction where strangers will come and bid pennies on the dollar for your tractors, your tools, your vehicles, your household items, your kid’s playset, even your pets; your whole life splayed out on tables made of plywood for bargain hunters to pick through.
You’ll load up your livestock and take them to the sale barn like you’re loading up all your hopes and dreams and driving them out of your life.
And once all the cars are gone and the livestock and equipment are sold, you’ll notice a sad, lonely silence that settles over your vacant farm. It knocks the wind out of you.
That’s why I so fiercely believe in Elizabeth Warren’s plan for the economic future of this nation. Because she’s held space for heart-wrenching stories of illnesses that have emptied savings accounts and divorces that have exhausted every ounce of available credit and deaths of family members that have made mortgages impossible to service.
She’s not taking her talking points from banks and credit card companies, like other candidates in the race. Her policy comes from the rubber-meets-road place where working-class families confront their survival every day.
Despite Trump’s rosy proclamations about “the economy” (by which he means the stock market and nothing else), farm bankruptcies were up 24 percent in 2019 and at over $416 billion, farm debt is higher than it’s ever been in history - even with nearly $30 billion in government bailouts.
That means more families like the one I grew up in are facing the same devastating path with the lingering impacts like ruined credit scores that make it virtually impossible to start over.
For seven years after we lost our farm, my parents could not qualify for a mortgage, a car loan, a credit card, a student loan or a small business loan. For many jobs, a negative credit score is a disqualification and it can prevent you from being able to establish service with utilities like phone, gas, electric and water.
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In 2016 (the last year for which data are available), one in every 405 households in America filed Chapter 13 bankruptcy. Millions of other families are just one more missed payment away from throwing in the towel. Each one of those represents not just one person or one family impacted by bankruptcy but whole communities that can be drained of resources, capital and residents.
In 2005, a bipartisan Congress sided with big banks and passed changes to bankruptcy law, putting in place means-testing that saddled families with on-going debt obligations that lasted long after the bankruptcy itself had been settled and locking millions of Americans into decades of financial hardship that prevented them from saving for college, putting away money for retirement or building up a safety net to prevent bankruptcy from happening again.
While she was still a professor at Harvard, Warren testified before a bipartisan committee to warn them that the changes they planned to make to bankruptcy law would make the process even more harmful to families struggling to start over. Some members of that committee saw it as an opportunity to crack jokes but Elizabeth Warren was standing up for families like mine and she will continue to stand for the working families of America as our next President.
Amber Gustafson of Ankeny was a 2018 candidate for Iowa Senate.