In the late 1980s, when the upsurge in bankruptcies had just begun and folks were searching for explanations, cries of a decline in stigma rang out. Interestingly, despite an essential absence of data from debtors themselves, this explanation was long-lived. Indeed, it was cited frequently during the Congressional debates that preceded BAPCPA. But as any sociologist would tell you, a decline in stigma as an explanation just doesn’t make sense. Rates of bankruptcy filings are cyclical; stigma does not wax and wane in that way.

Just last month, Sociological Focus published my article, "Managing the Stigma of Personal Bankruptcy" (co-authored with Dr. Leon Anderson), in which I provide evidence that the stigma associated with filing is alive and well. For those unable to access the article, allow me to summarize. Although the sample was small, 95 percent of the debtors reported that they felt stigmatized by their bankruptcies. For example, a retired mail carrier stated: "I thought of it as a mark against my name . . . It was too embarrassing . . . I feel like I failed. You know, to go bankrupt, that’s a sign of failure."

Not only did the debtors vocalize their feelings of stigma, but they also managed it in ways that are classic among other stigmatized groups. For example, they tried to conceal their bankruptcies, especially from their parents. One man, a father of two young boys, reacted in the following way when he was asked if his mom knew he had filed: "OH HELL NO!!! No, no, no, no way, no way. Nope. And she won’t ever know. Never! Never. . . . She’d be like, ‘Argh, you piece of shit. Why did you do that?" Debtors also practiced avoidance, whereby they avoided situations that might expose them. An example of this was described by a woman who said that she would never again take her kids to their family dentist because debts to him had been discharged. Rather than risk the potential embarrassment, she concluded that they would have to find a new dentist. Finally, the debtors went to great lengths to differentiate themselves from all those other "deadbeats" out there who supposedly abuse the system. They insisted that their own bankruptcies were bankruptcies "of necessity," not extravagance or abuse. And finally, three-quarters of them insisted that under no circumstances whatsoever would they set foot in bankruptcy court again. One man, who blamed his wife for their bankruptcy, said that he would divorce her first. Another said that he’d kill himself before he’d file again. This is probably an exaggeration, but it demonstrates the power of the stigma of bankruptcy.

I have no doubt that there are folks out there who file without feeling a shred of remorse or stigma. But my research suggests that they are the minority. For centuries, bankruptcy has been highly stigmatized. And, I would argue, it still is.

Update: We have opened the comments for this posting.