One thing me and socialists have in common, I presume, is that government bailouts for corporations seems like a really terrible idea.
26
8
193
Conversation
Replying to
I started reading Principles for Managing Big Debt Crises, and it makes a strong case that despite the moral hazard of supporting failing institutions that made bad calls, it's super important for mitigating financial collapse across the board
1
9
Replying to
I'm unconvinced about the tradeoff though, taking away the ability to fail seems like it would change the incentives inside the company in a bad way
1
1
Replying to
Yeah, if an institution couldn't fail in any circumstance it does seem like they'd do riskier things
If bailouts are conditional on some sort of greater crisis, does that still seem not worth it?
1
Replying to
If it turned out that bailouts were the thing that helped reverse a severe economic downturn, I think I'd take the bad incentives it puts on institutions
2
2
Bailouts should probably be restricted to individuals (like families that temporarily cannot pay rent) and essential businesses that are expensive to rebuild from the ground up (eg airlines)?
1
Show replies
Seems like a resolution could be making a distinction between the company and the infrastructure. Is there a way to make it so that the company (currently) running the port can fail, but the port itself cannot?
2