Bonds: A Guaranteed way to lose money?

Legislators and well-meaning regulators in various countries push pension funds to increase their allocation to fixed-interest securities. This is based on a narrow definition of investment risk, but one that unfortunately seems to appeal to the lawyers, accountants and actuaries that dominate the discussion.
It is correct to say that bonds are less risky if risk is defined as return of principal, - in nominal terms. The experience of the past 100+ years, however, has demonstrated that loss of purchasing power is a far greater risk to the preservation of capital.