[Ed Miliband] will draw a distinction between genuine wealth creators like Rolls Royce - which, he will say, should be championed and encouraged - and "asset-stripping predators" such as Southern Cross care homes. (src)He was also being trailed on Today as going to say that we shouldn't be rewarding companies like Southern Cross. As if market participants haven't drawn a distinction between Rolls, which is a going concern, and Southern Cross, which most emphatically is not. As if going bankrupt is a prize to be attained! Moreover, as the chappie from the replacement company pointed out on this morning's Today, not a penny of taxpayer subsidy went into the reorganisation, and the new business model is far more sustainable. I don't think bankruptcy and the loss of your investment is a reward, is it? I'd hate to see failure, if it is.The truth is that every system will experience failures and problems in some component parts. State control, free market, bureaucratic, you name it, problems will emerge. Corruption, business failure, paperwork bloat: to name but three which are distinctive to each respectively. The acid test is how well the system can cope with its problems.We know the answer for market processes: bankruptcy and loss of investment, followed, normally, by a reorganisation of the assets. Again, the norm is that this is done by those "asset-stripping predators" Miliband so hates. They buy the assets at a distressed price and then put them to better use. In the case of care homes, there's not much you could do to change the use, so the acquirer simply tries to run them better than their predecessor.We have seen the market processes in action quite effectively with Southern Cross. I would hazard to say that, in fact, so far from being a black mark against private-sector care, this is a positive sign, showing responsible error-handling by market participants.One is left to wonder how Ed Miliband's preferred system would cope.