When companies that have grow "too large to fail" manage to fail anyway the problem is that no one can afford to buy them except other companies that are too large to fail. Literally millions of people rely on them for jobs or the services they provide.
We do indeed have laws, laws that will allow them to reorganize, restructure, possibly to split the giants into smaller and possibly profitable businesses. Bail out money for the giants is sure to be misused, pissed away and gone. Bail out a factory at a time. Retool it to turn out utilitarian, inexpensive, fuel efficient vehicles using available technology. Luxury, power, and speed are all the auto industry can think about, eliminate those maxims and replace them with comfort, reliability and efficiency and I think you might find success in American autos again.

Good coffee, good weed, and time on my hands...