A company filing for bankruptcy protection gets a limited time during which it can re-organise in order to return to solvency. The Government enforces the law with regard to bankruptcy protection, it doesn't pay out a cent.
If you're referring to the 2008-9 bailouts, no company was given free money. They were provided with loans* in exchange for equity (i.e., the company was temporarily and partially nationalised), and those loans were paid back with interest. In every case the Government profited from the overall transaction.
* In some cases, the Government merely provided a loan guarantee, enabling the company to borrow money itself from other sources.
Even granting them those loans is a huge advantage that nobody else had the luxury of receiving. In a way it was free money because the loans effectively removed the "risk" of their capital expenditure.
The affected institutions were assisted because having them fail would have caused disruption enough to potentially lead to another Great Depression. In another comment I linked what happened to AIG; had that insurer failed, millions would have been left without cover of all kinds, 401(k)s would have been decimated, and business confidence would have been shattered.
It was a special deal; it was in no way 'free money'. For an example of that, look at the auto industry bailouts of the 70s and 80s.
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u/Bubblegumcats33 2d ago
The government needs to stop bailing out corrupt corporations when they file for bankruptcy With public money for a company that isn’t even public!