> Isn't the whole point of capitalism that failing businesses fail so that new and better businesses can take their place? Yes, and that's why Chapter 7 bankru

> Isn't the whole point of capitalism that failing businesses fail so that new and better businesses can take their place? Yes, and that's why Chapter 7 bankruptcy exists. Not every failing business can opt for Chapter 11. Chapter 11 gives businesses that can still succeed an opportunity to do so, without having to make the time-consuming full round trip through liquidation to startup to scaling to functioning business again. If it works, it benefits employees and customers who depend on the operations of the business, and it benefits the creditors and investors, since a profitable business will generate more money for them over time than a one-time liquidation would.