In Brief: Needs-Based Bankruptcy Bill Seen Hurting GOP

A former Republican party official warned Monday that any lawmaker who votes for needs-based bankruptcy reform is committing political suicide.

A needs-based bankruptcy bill pending in the House would use a formula to determine if consumers could eliminate all their debts or had to repay some unsecured creditors. The bill would make it tougher for 2,000 constituents a year in each congressional district to seek relief, said Robert R. Weed, a consumer bankruptcy lawyer with close ties to House Speaker Newt Gingrich.

But millionaire businessmen such as Donald Trump will still be able to reorganize under corporate bankruptcy laws without losing their fortunes, he said.

"The unfairness of that will be evident not only to the people who lose their jobs, but to their friends, their neighbors, (and) their brothers-in- law," Mr. Weed said at a Cato Institute conference.

Mr. Weed said Democrats will exploit this, charging that Republicans support one law for the rich and another for the working class. "That almost guarantees that during the next recession Republicans will lose the House of Representatives for a generation," he said.