| Well, this was a one in a million thing. Nobody could have predicted the world to just shut down for six months, and it's not productive to plan for it. It's far more reasonable to do business as usual and then take loans if things go south. As Matt Levine put it: the dividends they gave since the GFC come to $15 billion, and their equity comes to $12 billion. So it's not even given it would have been the appropriate thing. > How about all the employees who just had all the blood sucked out of their job security and future livelihood? Right. It's like banks. How do we handle it? Insurance: if you want to be a FDIC-insured bank, you must pay the FDIC insurance, and in return they will backstop your creditors up to a certain limit if they go bankrupt. Why couldn't we do the same for employees? If you're an employer of systemic importance, you must have employee bankruptcy insurance: if you go tits-up, your employees get their salary paid up to a maximum limit of $X/yr until they find a new job. The insurance premiums are set by the free market, purely capitalist. |
How can a business take out loans when things go south if it already leveraged itself in good times? Why would new investors buy into a company saddled with debt used to pay the old investors?