How American Airlines will use bankruptcy to cut costs | Michael Paarlberg

Far from signalling failure, American's Chapter 11 filing enables a carefully crafted restructuring - at its employees' expensePeople used to talk about bankruptcy like it was a bad thing. For you and me, it still is. For the airline industry, it's a way of life. And American Airlines, whose parent company filed for bankruptcy Tuesday, may yet elevate it to an art form.The question for industry watchers isn't "what happened?" but "what took them so long?" Every other major airline, as well as many mid-sized and regional carriers, has gone bankrupt, some of them multiple times. Some really did go under for good - Eastern in 1989, Pan Am in 1991 - but many survived, and American will, too. Far from a death knell, American's announcement highlights how much bankruptcy can be a deliberate corporate strategy; something CEOs can embrace, while putting the squeeze on workers.Airlines were once averse to bankruptcy, believing it would scare off customers. That changed in 1983, when Continental