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Thomas Jefferson and Bankruptcy

Anyone can struggle with debt, including famous presidents.

Reprinted from California Bankruptcy Attorney, Erik Clark, 10/25/2012.

A California Bankruptcy Trustee, Steven Smith, would start every Meeting of Creditors (the only time the debtor is required to appear in his case) with a story designed to put the bankruptcy process into the proper perspective for those going through it. Several years later Mr. Smith became ill and instead of telling the story verbally he wrote a version of it and started asking each debtor to come forward and take a copy of the printed version prior to meeting with him.

Here is the speech as written by Mr. Smith:

Each of you is probably carrying around a nickel, on which appears the picture of a great American, Thomas Jefferson. I personally hope that you will not hold one in your hand in the near future without contemplating what it is that connects you with this great American.

In 1776, at the age of 35, Thomas Jefferson was selected to be the author of the Declaration of Independence. In time he was elected to be our third President. During his two terms, the size of our country was doubled. Besides being a statesman, Jefferson was also an esteemed scientist. He had a huge library, which he later donated to found the Library of Congress, which is now the largest collection of written and printed material in the world. Historians today are unanimous in acclaiming Jefferson as a genius. Jefferson was also an inventor, many of whose inventions are still in use today. He was a talented architect and designed his own home, Monticello, whose picture is on the back of the nickel. He also designed the original buildings of the University of Virginia, which he founded.

During his time in office, President John F. Kennedy hosted a dinner in the White House honoring all of the Americans who had won a Nobel Prize. He stood and said: “This is probably the largest concentration of genius ever to sit down for dinner at the White House- - with the possible exception of when Thomas Jefferson dined alone.”

Yet for all of his genius, Jefferson suffered from one personal problem which confronted him all his long life—THOMAS JEFFERSON WAS ALWAYS IN DEBT! He always owed some friend or some neighbor. He spent a lot of time trying to work his way out of debt- - never with any success.

Thomas Jefferson died on the fiftieth anniversary of the Declaration of Independence- - July 4, 1826. When he died, his heirs found that he owed more than $100,000.00 in debts- - a colossal sum in those days and more than his estate could pay.

The moral of this story is this: If a genius like Thomas Jefferson had to suffer with personal debts for all of his 85 years of life, it should come as no great surprise that someone in this room could also experience personal anguish from indebtedness.

BANKRUPTCY IS NOT A DISGRACE! It is simply a legal remedy devised by Congress to give the honest

debtor a fresh start free of the results of past mistakes or circumstances beyond your control. It says nothing about your character or intelligence.

The fresh start is at the heart of our bankruptcy laws. Our bankruptcy courts, in their written and published decisions, have repeatedly referred to the “fresh start” as the foremost principle of American Bankruptcy Law.

So you’ve been given a “Fresh Start,” don’t let this bankruptcy hang over you like a dark cloud. SO MY ADVICE TO YOU IS THIS, WHEN YOU LEAVE THE ROOM TODAY JUST TURN THE PAGE.

To put things in perspective, when you are facing difficult financial times remember Jefferson. The history of our great nation has been written by many famous Americans who filed bankruptcy, including Walt Disney, Henry Ford, and Debbie Reynolds. They, just like all of us, found themselves facing financial hardships. Fortunately, the bankruptcy process has allowed them to obtain a fresh start and rebuild their future just as you can too.

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