GM bond holders win by losing?

The Truth About Cars website has an item today on how outstanding credit default swaps off-set $34 billion in debt with a net profit of $2.4 billion. The item states that the CDS losses are insured or off-set by guarantees given by the federal government to the banks who hold them.

My point is that, once government intereferes in financial transactions, those transactions lose their ability to reflect reality. Mistakes are always possible but government interference makes realistic behavior impossible (except by mistake or coincidence).

The link is here: http://www.thetruthaboutcars.com/credit-default-swaps-sink-gm/ .