There were a lot of lessons regarding personal bankruptcies in the government shutdown earlier this autumn. As Max Stier, president and CEO at the Partnership for Public service told MSNBC News, “I don’t think there is a full appreciation of the impact of a shutdown on the bottom line of government.” According to CNN Money, the largest one-week rise in unemployment claims since Hurricane Sandy was the week that the government shut down. On the 10th day of the shutdown, nearly 500,000 federal workers were on furlough, according to CNN Money. “They are allowed to file for unemployment benefits, but if Congress grants them their pay retroactively, most states will ask them to repay the money later.”
There are not yet figures as to whether the government shutdown had a direct impact on the number of personal bankruptcy filings in the U.S. The U.S. bankruptcy courts, however, were one of the only federally funded institutions that stayed open throughout the ordeal. Though they remained open for business, according to the Wall Street Journal, “the government shutdown leaves them far from full strength.” The biggest change to bankruptcy courts as a result of the shutdown was the “fewer eyes watchdogging ongoing bankruptcy cases, both consumer and corporate.” This not only slowed down the bankruptcy process for thousands of Americans, but cost them money as well.
As these figures come out regarding the impact of autumn’s shutdown, good news came from Washington in December. According to the Washington Post, in mid-December “House and Senate negotiators unveiled an $85 billion agreement… to fund federal agencies through the fall of 2015, averting another government shutdown and ending the cycle of crisis that has paralyzed Washington for much of the past three years.”
This is great news for any family whose income relies on the federal government, and who experienced near financial insolvency as a result of the shutdown. The plan, however, according to the Washington Post, does not “extend unemployment insurance for the long-term jobless.”
If you or someone you know is considering bankruptcy as a lingering result of the government shutdown or any other reason, don’t go through it alone. Contact an Arizona bankruptcy attorney today.