Wanna make the problem of underfunded pensions go away?Just put employee pensions ahead of bondholders in the line of who gets claims to assets in a bankruptcy (like most other forms of employee compensation are).This does a couple of things. One it moves the task of evaluating bankruptcy risk away from employees (who are generally ill-equipped to do so) towards professional lenders (whose primary skill is risk evaluation). Secondly, it makes it much harder for executives to make promises they cannot keep and to raid pension funds.
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