The pain of bankruptcy

Recently, Congress took action to tighten federal bankruptcy law to make it more difficult for consumers who allow themselves to get in over their heads to walk away from their debts.
It was an action we applauded because we believe the law had fallen behind the times. The stigma that had for years been attached to bankruptcy and had discouraged people from filing unless they were in anything but the direst of straits had faded. For too many, bankruptcy had become an almost painless option.
What's worse: But if we thought that was bad, we hadn't seen anything yet. Events of recent days and weeks suggest that there's an even more brazen kind of abuse of the bankruptcy law being pursued by people even more shameless than deadbeats.
Last week, Pacific Gas & amp; Electric Co., which has been crippled by the sudden introduction of market forces into California's formerly regulated electricity business, filed for bankruptcy. The deregulation and re-regulation of power suppliers in the state guarantees that this will be one of the most complicated bankruptcy cases ever argued.
What isn't complicated is the blatant attempt by PG & amp;E to feather the nest of some of its employees in the hours before bankruptcy papers were filed.
The day before the filing, PG & amp;E awarded 6,000 managers and other employees more than $50 million in annual bonuses and announced long-delayed merit increases for the same workers. At one point, the company was apparently ready to award $30 million more in bonuses -- most of it to its 25 top officers -- but thought better of it.
Back in Ohio: Closer to home, there was a smaller but equally shameless grab of corporate funds on the eve of a bankruptcy. Documents filed recently with the Securities Exchange Commission show that LTV paid its former chief executive officer more than $1 million just than three weeks before the company filed for bankruptcy.
Peter Kelly, who resigned Nov. 9 under pressure from the board of directors, received a $1.4 million cash severance payment on Dec. 12. The company also agreed to pay Kelly $366,892 more over the next two years.
When thousands of employees are losing their jobs and health benefits due to the bankruptcy of their companies, it is unconscionable for others to be able to reach into the corporate cookie jar and grab millions of dollars on their way out the door.
Bankruptcy is a painful process. That pain should be shared by all the stakeholders. A privileged few should not be immune.