CEO says US should let companies owned by billionaires get 'wiped out' during the coronavirus crisis

https://www.businessinsider.com/us-should-let-billionaires-companies-fail-no-bailouts-chamath-palihapitiya-2020-4

Jessica Snouwaert
April 10, 2020

Social Capital CEO Chamath Palihapitiya told CNBC that poor-performing billionaires, hedge funds, and massive companies — including airlines — deserved to be "wiped out" during the coronavirus pandemic.

During the interview, Palihapitiya said "zombie" companies run by billionaires that aren't performing well shouldn't be propped up during the public-health crisis. They should be exposed to the market forces at play, he added.

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"On Main Street today, people are getting wiped out. And right now, rich CEOs are not. Boards that have horrible governance are not. Hedge funds are not. People are," Palihapitiya said. "It's happening today to individual Americans, and what we've done is disproportionately prop up and protect poor-performing CEOs' companies and boards. And you have to wash these people out."

But Palihapitiya said the employees of these companies would not be at risk if the companies went under — instead, speculators and the wealthy would take the hit.

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"When a company fails, it does not fire their employees, it goes through a packaged bankruptcy," Palihapitiya said. "If anything, what happens is the people who have pensions inside those companies, the employees of these companies, end up owning more of the company."

"Just to be clear, who are we talking about? We're talking about a hedge fund that serves a bunch of billionaire family offices?" he said. "Who cares? Let them get wiped out. Who cares? They don't get to summer in the Hamptons? Who cares?"

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