Bankruptcy is a Dirty Word

Published Wednesday, April 1st, 2026 by Attorney Dave Falvey - 143 views

BANKRUPTCY is a ‘dirty word’ by many people who do not understand the purpose of bankruptcy. It can be called ‘the poor man’s bail out’ because life is difficult and people have since the time of the Bible fallen into debt and become ‘debt slaves’.

Most people do not know why America enacted the 13th Amendment to the Constitution. It reads, “Neither slavery nor involuntary servitude shall exist in the United States unless you are in jail.” This was added to our Bill of Rights after the Civil War to put the nail in the coffin of slavery.’

People forget that white women and black women could not vote and the injustice and cruelty of the years after the Civil War.

But the Chinese students in 1989 revolted against the government in Tiananmen Square. The students erected the Goddess of Liberty on the face of Mao Zadon. The students were not armed and they were peaceful. The Communist Party went ballistic. The students gave a petition as to what they wanted, namely Freedom of Speech, Freedom of the Press, Freedom of Assembly, transparency as to what politicians were being paid.

They were reciting the American Bill of Rights!! To suppress this uprising, the government killed 4,000 students. You must research this to find it. This was not presented in our mainstream news. We just saw an unarmed student trying to stop a tank.

I have told many of my clients that America has many sins and many faults, but we have one bright star which is our FREEDOMS. Granted they are under serious attack.

And I have said that ‘slavery’ has two pillars, you cannot vote and you cannot get out of debt.’

In 1894, America changed bankruptcy laws. Creditors who were not paid, would and could petition you into bankruptcy for not paying your debts, which was a crime and you could be sentenced to jail until you paid your debts. The creditor could take your clothes off your back and go to your home and break the walls open and dig up your cellar, take your furniture, and take anything of value.

You could be sentenced to debtor’s prison and since you did not pay your debts, the state had no obligation to feed you. So, if your friends or relatives did not bring you food, or you could not fight with other prisoners who were criminals and received food from the state, it was so sad, too bad, you died.

Robert Morris was the richest man in the colonies, and he lost his fortune supporting the Continental Army (the rebel patriots) and when America got its freedom, he was in debtor’s prison. George Washington visited him in debtor’s prison and went to Congress to free Robert Morris and award him a very modest pension.

Connecticut abolished Debtor’s Prison in 1812 and in 1897 amended the bankruptcy law to allow honest debtors to go to court and have their debts cancelled. Europe was shocked by this law and was highly critical. America shot back: “We were tossed out, thrown out, and kicked out of Europe. This is our country and everyone is entitled to a ‘fresh start.’ So, buzz off.’

What America did was really found in the Book of Deuteronomy, Chapter 15 and the Book of Leviticus which has the Jubilee. And it was discovered not only humane, but it jump started the economy and gave America a dynamic economy. We must remember that when Henry Ford allowed people to buy a car on credit, he was accused of being a ‘communist.’ (They had to pay it off within 12 months.)

During the Civil War, Longfellow wrote a poem and Winston Churchill recited a portion of it to FDR:

‘Sail on, sail on, oh ship of state

Sail on, sail on, oh Union strong and great.

Humanity with all its fears,

With all hope for future years,

Hangs breathless on thy fate.’

Regarding Tiananmen Square, I have attached two photos to prove my research.

See, also, https://en.wikipedia.org/wiki/Tiananmen_Square and no one has compared the Freedom Marches in American with the

Chinese students: See: https://en.wikipedia.org/wiki/Selma_to_Montgomery_marches

SEE: Republic of Debtors ; Bruce Mann