And while I’m at it, United Airlines’ impending bankruptcy prompts me to post a link to this commentary on airline bailout proposals that I wrote in November 2001. An excerpt:
But at its core, the reason why we should not bail out either the airlines or the insurance industry is simple – we benefit from encouraging dynamic, entrepreneurial behavior in our business leaders. Bailouts circumvent that relationship and undermine the incentives of companies to manage their risks. Put another way, companies that survive such disasters are stronger and deliver better goods and services more efficiently and cost-effectively to their customers. Companies that do not survive fail because they cannot turn the lemons of disaster into lemonade. And they should fail.