Anytime that irresponsibility isn't punished with natural consequences, responsibility is punished.

My parents were in the same boat. My grandfather worked for GM for years, and passed on his stock. My mom tells a story of going to watch him work when she was a girl, and he had on a welder's mask, and sparks were flying everywhere, some burning him. And for what?

I am not sure that this is a false choice. We will never know the answer because they were bailed out. Had they been forced toward bankruptcy they have had the necessary power to force union concessions. There likely would have still some losses to bond holders but it may have been resolved without total loss. As I said we will never know, well at least not until it happens again because they did not get the ship back on the correct course.

Exactly!

Yes, in the case of GM, GM, the shareholders, bond holders, and the customers would have been better off with a regular bankruptcy.

Yes. ALL businesses should be allowed to grow or die according to their policy decisions and how well they fulfill their customers' expectations in the market.

Think about WHY these companies failed in the first place. It was because the government took upon itself liability that should have fallen to the business. With that kind of safety net, there was no threat of bankruptcy to check the managerial decisions to purchase bad loans en mass.

I blame government for causing the problem in the first place. They create the problem first by deciding they need to regulate industry and micro-manage it, but we have a long litany of things the government has screwed up when it has tried them because they have very little impetus to succeed and zero risk if they fail.

Without failure, there can be no success.

absolutely

Yes, this is how business is supposed to work. If you are failing, you figure out what is wrong and change it, not sit on your rear and wait for the government to bail out your poor process.

Yep. If they have bad management and make poor decisions (look at one of the other carmakers decades ago - Studebaker - that died of mismanagement) they should close their doors and let someone else reboot in their place - or not.

Sure, if I was an idiot CEO and ran a company that either made and/or engineered a notably poor product, or made supremely bad management decisions (or worse, allowed others to make them for me) or a financial company that engaged in practices that were known to both sink us into the morass of insolvency or cheat our customers so blatantly (while singing them a sweet sweet song of advertising schlock) then I'd also be the dishonest looter type that would want a sugar daddy to come in, slap my hand as if I were 3 years old, and say "Here you are, sweetie, daddy Biggov (Russian? Nyet!) and Auntie Mae will make it all right, we'll let you have a mulligan" and pour undeserved money glommed and stolen from the American Taxpayer...

Pligging Disgusting behavior, both by industry (as if the industrialists were Wesley Mouch and Orrin Boyle) and the power seeking government looking to own our Industries a'la the USSR and, for the most part, China.

We're not talking small business loans and the like - we're talking about using *our* treasure, talent, and time to support s#!t workmanship and mooch-based thievery.

Let them crash and burn. Maybe the entire "system" will come back a bit more honest, a bit more resilient, and a lot less dependent.

Moral Consequence! The problem with chrony capitalism is it takes failure out of the process and allows mediocre to rise to the top.

Had AIG, GM, and Goldman-Sacks been allowed to fail their assets would have been sold at market price to the second tier players in their field. Those successful 2nd tier companies would have brought the methods and systems to the marketplace that made them successful. With a wink and a nod the chronies bring us the same failed systems they rose to power with. In this case, it makes certain the possibility of similar failure in the future. Competition always refines. Sometimes refining requires creative destruction.

It's for 'the greater good.'
(As sung by Oprahma and the Socialists.)

Were there any firms big enough to buy AIG? And did anyone really want to take on their toxic assets?

Tell me about it. My parents were financially raped. My parents and I should have kept the threatening letter. You would have expected something like it from the Soviet Union.

I'm very sorry to hear that! Not to add insult to injury, but our Dear Leader essentially took the monies that were rightfully and contractually owed to your parents and other bond holders and reassigned it to the unions, who now own a very significant stake in GM.

In a heartbeat. Bad decisions - both in life and in business - have consequences.

Yes. Taking risk comes with reaping just reward. I should know, my business succeeded for 5 years and then failed.

Yea, they never expected that the government would not bail them out like it did other institutions.
Really easy to do stupid risky things when you think a bailout is assured if you fail.

It is not about allowing it to fail. It is about preventing them from failing, by initiating the threats of force and violating individual rights at a massive scale.
Bailing out failure this way leads, and did lead, to increased failures down the road.

Like Lehman Brothers?

Absolutely they should have been allowed to fail. There is no such thing as too big to fail.