The moral hazard is that companies with many employees think they are "too big to fail". They don't feel the need to keep cash reserves so instead leverage them

The moral hazard is that companies with many employees think they are "too big to fail". They don't feel the need to keep cash reserves so instead leverage themselves up to the eyeballs because when a recession hits the government will just bail them out. This is what everyone means by "privatize profits, socialize losses". Pay back all profits as dividends/buybacks and when losses mount from a recession then get bailed out by the government.