Are we encouraging companies to turn to the government? GM is going to save more than $12 billion in tax breaks .... If it ever becomes a viable company again. But these new tax rules don't apply to companies that don't turn to the government for help but are taken over by other private companies. Chrysler, for example, could lose the value of its tax write-offs if it merges with Fiat.

The AP explains:

U.S. taxpayers are about to become majority shareholders in GM, acquiring more than 70 percent of the company in exchange for billions of dollars in aid. Under ordinary circumstances, an ownership change like that would trigger a big tax hit for a money-losing corporation like GM, severely limiting its ability to use current losses to lower future tax bills.

But these are far from ordinary times. The Treasury Department has, in effect, suspended long-standing tax rules for companies that receive bailout money, providing benefits not available to firms that don't receive government help. New Treasury rules could provide GM billions in tax breaks once it becomes profitable and starts paying taxes again, which could be years away.

The value of those savings, however, would be dramatically reduced if GM is taken over by another company. Decades ago, Congress severely restricted the ability of money-losing companies to cash in on the tax breaks if they are taken over by other companies.

The goal was to discourage corporate takeovers for the principle purpose of avoiding taxes, Willens said.

The government, however, doesn't want to penalize firms for taking part in the taxpayer-financed bailout, so the Treasury Department has issued several notices in recent months creating exceptions for firms that receive bailout money. Under the new rules, corporations can keep their tax breaks if the government becomes a majority owner.

OK ... let's put this in language that even the purposely dumbed-down government educated myrmidons in this country can understand. If you are running a substantial private business and if you decide that it is your responsibility to weather this economic storm and keep your business viable without using taxpayer's money and submitting to more authoritarian government control, you will then have to pay your taxes just like everyone else. Wait ... NOT like everyone else. That would be because if you decide that you can't make it on your own, and government intervention with taxpayer's money would be helpful, you will be rewarded with corporate tax breaks. Got it on your own, no help. Play footsie with government control, financial benefits await. Not the way to run a free enterprise economy.