this sounds like it was dreamt up by a bunch of lawyers trying to get themselves more work. there's a lot more paperwork and bullshit involved in going into bankruptcy than just being bought out.
little fish companies will be less likely to go out of business, and the economy will be more agile when they do if we stop allowing these big fat catfish to swallow everything in their pond.
Not necessarily.
In fact, based on my experience I'd wager that in the bulk of the cases a bankruptcy would be far simpler from a paperwork perspective (but harder on the creditors).