It isn’t every day that one’s academic research is the subject of a front-page story in the New York Times, but that is precisely what happened with a new study co-authored by Professor Bob Lawless on Monday, August 6th.
The article, “‘Too Little Too Late’: Bankruptcy Booms Among Older Americans,” tells a story that is borne out by data in the study, which finds that there has been a dramatic increase in bankruptcy filings among the elderly since 1991. The study suggests that the shift in financial risk from government and employers to individuals, along with the continued constriction of the social safety net are driving this trend.
Since the publication of the story by the Times, Lawless and his colleagues have been overwhelmed by the response and have spoken to journalists at the Wall Street Journal, NPR, Marketplace Morning Report, the LA Times, Bloomberg Law, C-SPAN Washington Journal, and more. The Times story itself garnered over 1,000 comments within 24 hours of publication and was one of the top e-mailed stories of the day.
“The New York Times story is a great example of how journalism and research can work together. The profiles of real people who have had to file bankruptcy puts a humanizing face on all of the data,” said Lawless.
The data in the study are from the newest iteration of the Consumer Bankruptcy Project (CBP), which is an ongoing, multi-researcher study on bankruptcy trends in the United States.
Since Lawless began conducting research for the Consumer Bankruptcy Project several years ago, he has employed about fifteen different students, and usually has at least three working as research assistants at any given time.
The students are tasked with reading bankruptcy filings and coding various pieces of information to be analyzed for trends later.
“This is a great experience for them,” Lawless said. “They have their hands in real court cases and it’s a great supplement to what’s going on in the classroom. Many of my students that have worked with me on this project have gone on to practice bankruptcy law or do bankruptcy clerkships.”
Alex Schnepf ’19 and Jake Andreasen ’19 have worked with Professor Lawless and would whole-heartedly recommend the experience to their peers.
“The implications that this project can discover makes my work feel valued, and that is certainly what I enjoy most about it. Professor Lawless is always responsive and willing to answer questions, and he has been great to work with,” said Schnepf, who recently accepted an offer to be an associate at Katten Muchin Rosenman LLP in Chicago (October 2019).
Andreasen mentioned that the opportunity would be beneficial to anyone interested in bankruptcy because the CBP is such a well-known project by people in the field.
He will be serving in a judicial clerkship for Judge Deborah L. Thorne of the Northern District of Illinois, U.S. Bankruptcy Court.
“I was interviewing to work in Judge Thorne’s chambers and her eyes lit up when I mentioned I’m a research assistant for the CBP,” he said.
Lawless likes to refer to the Consumer Bankruptcy Project as an “early warning system.” Does he hope or expect that the research will influence lawmakers or the Courts enough to make policy changes?
“I hope this spurs more research into what is going on, the causal mechanisms. I also hope it changes the conversation a bit about who is filing bankruptcy,” he said.
In addition to his work for the Consumer Bankruptcy Project, Lawless is also the reporter for the ABI Commission on Consumer Bankruptcy. He and a group of 21 other commissioners meet every other week, and they are tasked with recommending reforms to the bankruptcy system within the existing structure.
The group is slated to deliver a final report in the spring of 2019, which will address such topics as student loans, how people access the consumer bankruptcy system, the issue of attorney’s fees, homeowner issues, and more.
“We are looking at how to make things better for both consumers and creditors, and are also considering changes that can be implemented without the approval of Congress,” said Lawless.
Abstract and full study are available at SSRN:
"Graying of U.S. Bankruptcy: Fallout from Life in a Risk Society"