The Bankruptcy Code at Twenty-Five and the Next Generation of Lawmaking

Abstract:     
This symposium article briefly explores the limits of Bankruptcy Code-based lawmaking and other avenues of reform. Unlike the years preceding enactment of the Bankruptcy Code, members of Congress do not follow the technical and substantive advice of bankruptcy experts and do not seem actively concerned about the functioning of the system and deals negotiated in its shadow. I argue that even if federal legislators had a different attitude, Bankruptcy Code amendment would be an imperfect and incomplete mechanism for system improvement, and thus bankruptcy experts should embrace a more complex picture of system development. After all, not only does the bankruptcy system have many attributes that the Code simply cannot explain, but the system has evolved substantially over the last twenty-five years even as the Code has remained relatively constant. Bankruptcy professionals help change the system even as they engage in case-specific negotiations and transactions. Bankruptcy experts also participate in system change through the appellate process (whether or not they represent parties in interest in those cases), state legislatures, and even the media. In other words, Congress has the power to exclude bankruptcy experts from Bankruptcy Code deliberations but not from bankruptcy system reform.

Keywords: Bankruptcy, Commercial Law, Legislation

JEL Classifications: J19

Accepted Paper Series