[ethbr1]

There is no guarantee that a country has to have a leading-edge aircraft manufacturer. On either the civilian or military side.

If companies lose too much money and don't receive bailouts, they simply cease to exist.

And you can't magic a new one on demand, given the specialized expertise and subcontractor requirements for something this complex.

So the reality is the government is stuck with a multi-variable optimization problem -- what combination of price, competition, and sustained R&D/production capability is best?

There is no easy answer. The modern, less-competitive, merged market is a deliberate consequence of the US refusing the spend Cold War levels of money to keep a larger number of manufacturers afloat.