One of the wisest people I have met on the internet: Jack Ayer: The Best Books on Bankruptcy: "If you see bankruptcy as a creditor’s remedy, you can understand the history of the word. There’s a founding legend—I’m not sure I believe it—that it comes from the Italian, ‘banca rotta’ which means a ‘broken bench.’ The theory is that if the debtor couldn’t pay his debts, you destroyed his trading place. It was only later that creditors began to realize that sometimes you could get more out of the debtor by encouraging his cooperation...
...We also now use bankruptcy as a kind of ‘civil parole.’ The court administers a program under which individual debtors pay off part or all their debts over time. Those unsympathetic with this scheme think it looks suspiciously like peonage or indentured servitude, but I think that’s a stretch: as a whole, I suspect debtors get more relief out of it than creditors. In a wholly different dimension, there’s business or corporate bankruptcy, where debtors deploy the courts as a framework in which to 'readjust' (heh!) their debts. Businesses have probably always done this. In the past, white-shoe lawyers didn’t like to think of themselves as doing bankruptcy, but in my lifetime they’ve come to recognize that bankruptcy may be just corporate finance with negative signs. Lately we’ve also begun to discover that the bankruptcy court is a pretty good forum for untangling complex multiparty conflicts that go beyond mere money...
#noted
