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We've decided as a society that it is acceptable to have massive oligopolistic too-big-to-fail corporations in control of critical sectors. We have no choice bu
by cultus 7y ago
We've decided as a society that it is acceptable to have massive oligopolistic too-big-to-fail corporations in control of critical sectors. We have no choice but to bail them out.
- olliej 7y agowe can ensure they don't fail by taking ownership - if they're unwilling to raise funds by selling an equity stake, on the market or otherwise, they can declare bankruptcy and be bought then. Many many years ago Air New Zealand essentially went bankrupt (after it had been privatized) so the NZ gov bought it out. Then a few decades later privatized it again at a profit. Which is the evidence that this can be done.
- cultus 7y agoSure, but there's no political will to do that, since the elites in charge are the ones who benefit from these policies.
- jessaustin 7y agoThis seems to contradict your "We've decided..." upthread.
- cultus 7y agoSorry, by "We" I did mean people who make actual decisions, although we all are to blame partially for not pushing back.
- jessaustin 7y agoAt this point the question is the form of the disaster that "pushing back" will entail.
- triceratops 7y ago> We have no choice but to bail them out. Why not though? If they go under, someone will step in to buy the assets and hire the employees back. It's not like air travel will go away forever.
- throwawayjava 7y agoBut it might go away for a year or two, which is enough time to do an incredible amount of economic damage -- far more than what we save by not bailing them out. They don't need to be indispensable. they just need to be critical enough that not bailing them out is much more expensive than bailing them out. The solution is to prevent this scenario from ever happening in the first place, by either requiring sufficient competition, or requiring sufficient capital reserves (see: banking and reinsurance), or just nationalizing the thing.