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The federal bankruptcy laws illustrate the folly of do-good [#permalink]
12 Jun 2004, 20:07
0% (00:00) correct
100% (01:29) wrong based on 1 sessions
The federal bankruptcy laws illustrate the folly of do-good protectionism at its most extreme. At the debtor's own request, the judge will list all of his debts; take what money the debtor has, which will be very little; and divide that small amount among his creditors. Then the judge declares that those debts are thereby satisfied, and the debtor is free from those creditors. Why, a person could take his credit card and buy a car, a stereo, and a new wardrobe and then declare himself bankrupt!t, he will have conned his creditors into giving him all those things for nothing.
Which of the following adages best describes the author's attitude about a bankrupt debtor?
A) "a penny saved is a penny earned"
B) "you've made your bed, now lie in it"
C) "absolute power corrupts absolutely"
D) "he that governs least govers best"
E) "millions for defense, but not one cent for tribute"
OA is B
One of the key words here is "folly". Author says government is foolish to limit individuals' debts to their residual asset value in instances of bankruptcy: consumers will load up their debt, go bankrupt and leave very little available assets to creditors. Hence, it is the government's own loss to protect individuals (do-good protectionism).
B says exactly that.
You've made your bed (you created your own problems)
now lie in it (now live with it)