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# The federal bankruptcy laws illustrate the folly of do-good

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The federal bankruptcy laws illustrate the folly of do-good [#permalink]

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12 Jun 2004, 20:07
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0% (00:00) correct 100% (01:29) wrong based on 3 sessions

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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"
C) "absolute power corrupts absolutely"
D) "he that governs least govers best"
E) "millions for defense, but not one cent for tribute"
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Paul

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12 Jun 2004, 21:20
what a weird CR.

I like (E) but cannot explain it confidently.

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13 Jun 2004, 01:21
B is my FA

the author suggests that the debitor does not have any remorse - and infact misutilises the loop hole

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13 Jun 2004, 03:56
I think that the answer is C.

The author talks about smth being extreme, and the example he uses is a bit extreme, so I'll choose an adage that's a bit extreme as well.

PS. Can somebody explain, in general terms what does the expression 'you've made your bed, now lay in it' means? I've never heard it before... Just to further my education
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Last edited by SmashingGrace on 13 Jun 2004, 13:20, edited 1 time in total.

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13 Jun 2004, 05:16
C for me too, same reasoning as SmashingG.......!

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13 Jun 2004, 11:09
I think it should be B...

The author wants the debtor to pay back for all the things he/she buys and not just get away by declaring bankruptcy.

Vivek.
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"Start By Doing What Is Necessary ,Then What Is Possible & Suddenly You Will Realise That You Are Doing The Impossible"

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13 Jun 2004, 21:11
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.
now lie in it (now live with it)
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Best Regards,

Paul

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13 Jun 2004, 21:11
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# The federal bankruptcy laws illustrate the folly of do-good

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