Setting the Record Straight: a Sur-reply to Professors Lawless Et Al
Publication year | 2009 |
Citation | Vol. 33 No. 01 |
I. Introduction
I have recently engaged in a scholarly exchange with Professors Robert M. Lawless, Angela K. Littwin, Katherine M. Porter, John A. E. Pottow, Deborah K. Thorne, and Elizabeth Warren regarding the conclusions they have drawn in their first report from the 2007 Consumer Bankruptcy Project (the "First Report")-(fn1) I wrote my critique in the spirit of academically vigorous exchange with the hope of providing constructive commentary that would assist the First Report's authors with their ongoing project. I did not, and do not, intend the critique to be a personal attack, and I made every effort in writing the commentary to set forth my arguments convincingly without being strident.
Unfortunately, the reply of Professors Lawless et al. to my critique mischaracterizes, misinterprets, and does not fully engage with the constructive commentary that I suggested. In their conclusion, Professors Lawless et al. write the following:
The manner in which the tone of the exchange has devolved is unfortunate, particularly because my goal has been for fruitful scholarly exchange that will sharpen future analyses of the effects of BAPCPA by motivating new research approaches.(fn3) For this reason, I am writing a sur-reply to clarify the misperceptions and mischaracterizations of my commentary by Professors Lawless et al. and to demonstrate that my arguments not only are grounded in a compelling theory of the operation of the bankruptcy system and an understanding of the First Report's data, but also offer useful ideas for exploring available empirical data.
This sur-reply will identify three of the main substantive points made in my critique that Professors Lawless et al. misinterpret and/or mischaracterize and will clarify why these original points are valid.
II. Questioning the Assumed Income Profile of the2007 Nonfiling Population
My critique of the First Report posits that one of the questionable assumptions upon which the Report is based is the assumption that the combined income profile of the 800,000 debtors who were deterred from filing for bankruptcy in 2007 (the "2007 deterred population") and those who actually filed in 2007 (the "2007 filing population") is similar to the income profile of debtors who filed in 2001 (the "2001 filing population").(fn4) In reply, Professors Lawless et al. recast their assumption as one of "assuming that the incomes of deterred filers are indistinguishable from actual filers."(fn5) It is at this point that they misinterpret and mischaracterize one of the arguments that I offered to suggest that the assumption is questionable:
Professors Lawless et al. misinterpret my argument. In suggesting the theory that debtors deterred from filing in 2007 due to the increase in attorneys' fees (the "2007 fee-deterred population") would "be lower than that of the group of debtors deterred by the means test"(fn7) (the "2007 means-test-deterred population"), I did not hypothesize about the extent by which the income of the means-test-deterred population would exceed that of the fee-deterred population. I did, however, argue that the exclusion of a group like the fee-deterred population from the 2007 deterred population could alter the income distribution of the combined population of the 2007 deterred population and the 2007 filing population.(fn8) The following example suggests one possibility that undercuts the First Report's conclusion.
The data from the First Report indicate that the average income of bankruptcy filers was $30,743 in 2001 and $30,863 in 2007, a difference that is statistically insignificant.(fn9) Imagine that, in 2007, there were 200,000 fee-deterred debtors and that the annual income of each debtor in that group was $18,200. Also imagine that, in 2007, there were 600,000 means-test-deterred debtors and that the annual income of each debtor in that group was $35,000. Under these facts, the average income for the 2007 deterred population is $30,800-virtually the same as the 2001 filing population. If, however, one excludes the fee-deterred debtors from the 2007 deterred population, the average income of the means-test-deterred debtors is $35,000, a figure that is higher than the average income of the 2007 filing population. Thus, here is one possibility where the average incomes of the 2001 and 2007 filing populations are the same, but where the average income of the subpopulation deterred by the means test is higher than the 2007 filing population. Hopefully, this example (1) clarifies why I originally had doubts about their assumption and (2) corrects the mischaracterization made by Professors Lawless et al. that the assumption "is actually somewhat consistent with predictions Professor Pardo himself makes elsewhere in his critique."(fn10)
III. Framing the Appropriate Research Question
Yet another ground on which I critique the First Report is the manner in which it framed its research question for answering whether BAPCPA's means...
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