George Selgin: Bailouts occur when spending collapses and costs cannot be recovered

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Ivan Andriyenko

04.06.2026

George Selgin: Bailouts occur when spending collapses and costs cannot be recovered — Bailouts arise when spending collapses

George Selgin challenges the notion of market fundamentalism by stating that whenever spending collapses to the point where producers are unable to recover their production costs, any measures taken to counter these failures should be seen as bailouts.

He questions whether similar support, or bailouts, should be extended to households, and calls this approach to market principles "stupid."

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Selgin has previously argued that central banks gained currency-issuing privileges through legislation rather than natural market evolution, according to a recent article. He has also commented that comparing New Deal deficits to the gap between actual and potential GDP offers a clearer view of their impact, as noted in earlier analysis. These positions frame his ongoing critique of market responses to economic downturns.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.

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