>All that an inclusion of these new companies would accomplish is a bailout of their stockholders by pension funds and ETFs where millions of regular people shoulder all the downside risk.

The purpose of an index is to provide a benchmark of the market, not to build funds that follow the index.

> The purpose of an index is to provide a benchmark of the market

Usually a subset of the market based on specific criteria. Total market indexes and funds exist, maybe there is a reason S&P 500 despite its "strict" inclusion criteria is more popular than them?