I'm guessing you were being facetious, but in case you were not, certainly, it's better to let individual companies fail over time at the expense of localized loss/capital rather than decimate the system just to see who survives. For one, you might be killing companies with actual promise in their infancy. Second, when only one among many fails, it may be slower to identify losers but there are landings for those who suddenly find themselves out of job. And even when things are good, finding yourself without a job is still traumatic.