American Airlines' Bankruptcy May Cost You

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As part of its bankruptcy reorganization, American Airlines could announce plans next week to lay off more than 13,000 workers and eliminate pension plans, or, warns one analyst, the end of the airline could be near. "American made promises to pilots" about "pay, benefits, retirement and employment," that in many cases "are not going to be kept," according to Glenn MacDonald, an economics professor at Olin Business School at Washington University, St. Louis. MacDonald believes the airline is not positioned to compete and generate sufficient profits to sustain operations without "significant reduction" in what it provides to employees. According to MacDonald, without those reductions, American "will soon be gone, not just reorganized," with pieces bought up by competitors. Whether that proves prescient or propagandist, pilots' pensions appear to be in the crosshairs and, you (the taxpayer) may be on the hook for something.

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