When the bankruptcy of Lehman Brothers Holdings Inc. detonated on Wall Street in September 2008, the shockwaves threatened to topple the foundation that the U.S. economy is built on. Thousands of employees lost jobs, investors took a bath and a platoon of bankruptcy lawyers received a bonanza of fees for negotiating the complex deal. The Lehman website now hosts a message informing visitors of the bankruptcy and directing them to various companies for more information.

Likewise, when General Motors filed for bankruptcy protection in June, the company shed thousands of jobs, cost investors millions and – again – lawyers walked off with wads of cash for restructuring the troubled company. But a visit to the GM website paints a far different picture. The site posts photos of a shiny new Cadillac along with tabs showing new car deals, financing options and an explanation of the company’s new marketing strategy, a 60-day money back guarantee.

So in the wake of billion dollar bankruptcies that rank first and third largest of all time, why is Lehman a name of the past and GM the new home of ubiquitous pitchman Howie Long and his “cop hair?”

“GM employed 200,000 people directly and they indirectly employ over one million, and then you have all the intellectual capital and skilled labor," said Sheldon Stone, head of the corporate restructuring arm of Amherst Partners. "If they were to have gone under and collapsed in the same fashion as Lehman did it would have sent tremendous shock waves through economy that we would have not have recovered from for a long, long time.”

The government is on the hook for some $15 billion in bailout funds with GM, a lifeline that then Treasury Secretary Hank Paulson and the Bush Administration refused to extend to Lehman.

Timing is another crucial piece to the puzzle, said Scott Stuart,  executive director of bankruptcy management services for Donlin, Recano & Company, Inc. Stuart said lessons learned in the aftermath of the Lehman bankruptcy were revisited when GM foundered eight months later.

“The government deemed one was worthy of being saved and one was not,” he said. “It all ties into the argument of what was too big to fail and the systemic financial risk. The determination in the GM instance was it was too big to fail and needed to be saved. The decision on Lehman was that it wasn’t too big to fail.”

Take the government out of the equation and there are two factors that determine if a company lives or dies upon entering bankruptcy, said University of Chicago Law School Professor Douglas Baird.

First is positive cash flow. “The reality is cash is king,” Baird said. “If a company is not cash flow positive they die. Typically a good candidate for chapter 11 is cash flow positive on an operating basis.”

Second, Baird said, is the ongoing viability of the company. Some companies go under because their financial structure is damaged though the underlying business model is sound. Others, such as former electronics giant Circuit City, which was liquidated earlier this year when a buyer could not be found, die because they simply cannot compete. “Circuit City failed in the marketplace,” he said. “What bankruptcy can do is solve financial distress, it cannot solve economic distress.”

In the case of Lehman Brothers, its broker-dealer operations were its most valuable asset and that piece was sold off to Barclays. Investment banks such as Morgan Stanley (MS) and Goldman Sachs (GS) were more than happy to pick up the slack. But for manufacturing companies like GM and Chrysler, which also filed for bankruptcy this year, it’s a far different story.

“With an investment bank like Lehman there are a dozen other companies to pick up the slack, but if General Motors is gone, who will produce that four or five million cars each year? It’s not like someone can just step in and make that up.”

As was the case with CIT Group (CITGQ) earlier this month, some bankruptcies make little immediate splash because creditors enter into an agreement ahead of time to reduce debt. Known as pre-packaged bankruptcies, they have picked up steam in the last two years, Stuart said, because of an absence of credit for a true reorganization.

The benefit to a pre-pack is speed, said law professor Jack Williams of Georgia State University College of Law. Chrysler filed for pre-packaged bankruptcy on May 1 and emerged from Chapter 11 one month later.

The current financial crisis has taken its toll on large companies. Of the 20 largest bankruptcy filings since 1980, nine occurred during the latest recession. Among the big names that entered into Chapter 11 during that time are GM, CIT, Lehman Brothers, Washington Mutual Inc. and IndyMac Bancorp Inc.