Congress Is About To Gut A Depression-Era Law To Help Wall Street

Congressional negotiators are considering gutting a Depression-era financial law in order to help private equity firms overpower pension funds and other investors in major bankruptcy cases. The item is being discussed as a potential policy rider for a spending bill to avert a government shutdown, according to sources familiar with the talks.
The change would allow investors who own a majority of a troubled company’s debt to implement a new payment plan without input from a federal bankruptcy judge. As a result, big-ticket bondholders could extract punishing financial concessions from other investors — including pension funds — without government supervision.
“This is about screwing pension funds to help private equity firms,” said one Democratic aide.

via Congress Is About To Gut A Depression-Era Law To Help Wall Street.

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