Think about a world where you can have all the doughnuts you want. You just might eat a few too many. If a company like G.M. has an extra $5 billion sitting around, the thinking goes, it might decide not to invest wisely in the business or make smart acquisitions but instead simply use the cash less efficiently, like paying higher executive salaries.

Mr. Wilson’s argument for a large stock buyback was based on this conceit. In an interview with CNBC, he said that in the auto industry, when “times are good, they overinvest and make bad acquisitions, they overspend.”

But buybacks can leave a company without needed cash. G.M. had many buybacks before the financial crisis, totaling $20.4 billion from 1986 to 2002. It certainly could have used the cash then. Mr. Wilson is aware of this issue and stated in the CNBC interview, “We have always agreed that the company should have enough cushion” but that it was “enormous.”

And there is always the risk of overpaying for shares, especially now. With zero-interest rates, the stock market is bound to be high, and buying now may not make sense. In fact, most buybacks these days tend to destroy value because of their inflated prices

Other problems can arise with buybacks. Mr. Lazonick has argued that repurchases leave little for “productive investment” and should be banned. The Economist called them “corporate cocaine” and cautioned that some companies may be borrowing too much to pay for them. Companies may also end up using buybacks to manage expectations for earnings per share, especially when large numbers of stock options are outstanding.

Still, the noted valuation expert Aswath Damodaran asserts that much good could come from share buybacks and that banning or regulating buybacks falls “squarely in the feel-good but do-bad economic policy realm.”

The vibrant debate shows the pros and cons of share repurchases, but G.M. was apparently unswayed by the cons.