This is a bit out of date, but with Kodak about to do something very similar, it's topical again.
The AA bankruptcy deal is a great example of "No Credit Risk" in action. Their bondholders will generally have to accept lower rates of return, but given that any leveraged bondholder probably as access to near-zero interest loans, that's not really a big deal. Anyone holding tons of AA stock without a diverse portfolio is pretty dumb, and the recent move by central banks to flood markets with cash have probably offset most investors' equity losses. Customers won't get stranded, or even bothered, by the deal. With the exception of stock options, this won't even touch executive pay.
So, who gets hurt? AA's union workers, retirees and small cities. This is very bad, and makes very clear that managers are welcome to negotiate in bad faith with unions and municipalities because current bankruptcy law protects their personal assets and even their compensation, while their counter-parties have no recourse but to accept further reduced pay and services. The union's primary recourse, striking, is effectively against the law and they cannot go to court to petition for redress because the institution that's harming them is under the judicial branch's protection. In other words, there is no legal redress except to quit, and unless there is a substantial upturn in employment, that option exposes its takers to legal liability for negligence in the care of their families and at a minimum places their own assets at risk to their creditors. Small municipalities often rely on one or two major carriers to provide their business community with access to the outside world, and a major factor in the location of new factories, call centers and offices is airport access. This type of consolidation further reduces the geographic distribution of opportunity to locales near major cities that are more expensive, further decreasing the profitability of labor-intensive manufacturing jobs and requiring that they be done in places with higher cost of living, further increasing workers' reliance on credit cards thus perpetuating the cycle of wealth concentration.
Your pie maker is not opposed to large profits, only to sustained economic profits or those obtained by ignoring their externalities. This is not an obscure question of justice, it is a question of which enforcement mechanism we want to endure under the immutable "Law of Zero Long-term Economic Profits." If there is an industry that is inherently more profitable than any other, a market economy guarantees that people will move into it until it is no longer more profitable than its next-most-profitable competitor unless there are sizable barriers to entry or coercive restrictions that protect the current beneficiaries. In that case, the non-benefiting set must either develop cultural norms that allow them to accept a permanent lower status or pursue efforts to erode the barriers to entry, legal or otherwise. The first is antithetical to idea of an American Dream, and the second explains a lot about the TEA Party and Occupy protests, since the major banks can only hire so many people.
So how do we get from here to what National Academies Sustainability Forum participants refer to as "small 's' sustainability"? The President has offered his Clintonian vision of higher taxes on wealthy households to fund infrastructure spending, and thus increase the velocity of money and explicitly redistribute income. It is generally true that US infrastructure needs help, and that a large number of the unemployed are in the construction trade, so this idea has some merit. However, past experience with substantial increases in government funding [[stimulus]] is that they do not pay for physical infrastructure but instead ship money to preserve existing government contracts with service workers, and so it's hard to call this campaign promise credible. Indeed, attempts at social engineering through the tax code, whether inspired by Robin Hood or Ayn Rand, typically incentivize unexpected behaviors and lead to calls for greater regulatory intervention that creates employment for lawyers and accountants, at least until those markets saturate because there isn't enough economic activity to merit further regulation. The GOP vision of protecting "job creators" from tax liability is laughable on its face, as the main product of their last serious effort to do that is a massive oversupply of unsustainable housing, Depression-level private debt and the highest unemployment rate since WWII.
According to most business owners, customers create jobs. Rich people make the best customers if they feel they can get more out of buying something than they can out of Investing it. Put another way, the best way to create jobs is to convince rich people (i.e. those with disposable income) that the best return on an increasing percentage of their money is to pay someone to do something tangible instead of depositing it with an investment firm. In economics-speak, this means increasing the marginal product of labor relative to capital (in the Basel-III sense, not Adam Smith's). For that, redistribution from wealthy to poor is only marginally effective today as much of the income will simply flow from the industrial executive to the financial investor, often enough the same person, after a finance executive takes a cut. Instead, think of ways to reward people for making and maintaining stuff, for providing services in person that improve quality of life and reduce cost of living.
