Bad debt

Bad debt is a grievous fiscal problem affecting the United States. When people do non pay their debts, the economy suffers because the banks, credit card companies, doctors, utility companies, and other businesses miss money. The same applies to when businesses fail to pay their financial obligations to other businesses. However, personal deleterious debt and corporate bad debt is viewed differently by the government ( loser FAQ for small business. ) incorporate bad debt is easier to file bankruptcy upon than when a private person loses money.This seems to be simply because allowing corporations to do business aboveboard without threat of losing their personal financial security is an important ideal to keep the economy going. A companionship getting rid of their bad debt through bankruptcy all only destroys their ability to stay in business. Personal bad debt, however, is treated stricter because in that location be by appearance more controllable factors. People are expe cted to feed their families and stay in a home without exploitation credit and to not borrow more than they can afford.In addition, the companies and government likely fear that if people who dont pay their bills can repeatedly file bankruptcy and keep everything they bought, there will be no incentive for them to do the right thing and live within their means. Those who honestly cannot pay their bills will not go to jail, but in the compositors case of a business will likely lose their company and in a persons case lose any homes or other property owned (Bankruptcy Courts. ) Otherwise, the economy would be in make up worse shape if people and businesses could just run up bills, shape not to pay them, and not have any additional financial consequences.The governments position seems to remain that businesses have a break away right and need for credit to help the economy than individual households, and this is tall(a) to change anytime soon. References Bankruptcy Basics. (2006 ). Retrieved March 25, 2009 from U. S. Courts http//www. uscourts. gov/bankruptcycourts. html. Bankruptcy FAQ for small business. (2009). Retrieved March 25, 2009 from Bankruptcy in Brief http//www. moranlaw. net/business-bankruptcy-faqs. htm.