The Little Guy Takes It On The Chin -- And In The Wallet

While visiting friends in Aspen last week, I had a close encounter of the disgraced CEO kind: I spotted Kenny Lay, garbed in a spiffy jogging suit, getting in a little morning cardio not far from one of the two multimillion dollar vacation homes he keeps there. I guess that second-hand shop his wife opened to sell off some of their booty has been doing brisk business.

Truth be told, such scoundrel sightings are not as unusual as they should be. Despite the well-deserved roasting they’re currently getting over the media spit, many of the most notorious boardroom bad guys are continuing to live the high-life to which they became accustomed while plundering their companies' coffers.

Even Adelphia's John Rigas, who was forced to do the newly-trendy EPW (Executive Perp Walk) following his arrest, had enough spare change on hand to cover his $10 million bail -- and was back home in plenty of time for a nice family dinner with his indicted sons. You know what they say: the family that eats together, cheats together.

The victims of corporate pillage, meanwhile, are not having it so easy. Faced with scrambled nest eggs, sinking pension plans, shaky health coverage and a gloomy job market, record numbers of average Americans are taking it on the chin -- and in the wallet.

A key indicator of just how bad things have gotten for the little guy is the record number of Americans -- 1.5 million -- who filed for personal bankruptcy in the year ending March 31st. That's one out of every 69 U.S. households.

And since bankruptcies invariably lag behind current economic conditions -- they are the fiscal equivalent of those guys in the circus who follow after the elephants with a shovel, trying to deal with the mess the parade has left behind -- the odds are high that 2002 will be an even better year for bankruptcy attorneys. The first quarter of this year has already seen a record 369,237 filings.

And it's important to note that only 3% of these filings are by people who abuse the system by living extravagant lifestyles and then leaving their creditors holding the bag. The majority are actually low to middle class people who can't pay their bills because they've lost their jobs or been hit with crippling medical bills or been enticed into running up unmanageable credit card balances by easy-credit come-ons and here-today-gone-tomorrow "teaser" interest rates.

Nevertheless, Congress is on the verge of passing legislation that will make it harder for people to start afresh after they declare bankruptcy while, not coincidentally, adding billions of dollars to the bottom line of banks and credit card companies.

And why are our elected representatives so eager to add to the burden of consumers struggling to rebuild their lives amidst tough economic times? Perhaps it has something to do with the $27.5 million the finance and credit industries have contributed to political campaigns since 1990 -- including $3,518,966 so far in the 2002 election cycle.