It is not a bad thing as such. The main problem comes when a business is stripped of all its assets and/or weighed down with more debt than it can repay and fails as a consequence, leaving employees out of a job and communities without a formerly productive enterprise.

Well, business people take risks, and sometimes those risks turn out badly.

It is more that it tends to beat raw deal for the purple who lose their jobs for no good reason. The Twitter people will likely mostly land on their feet but most leveraged buyouts aren't affecting highly compensated employees with highly in-demand skills.

do they though?

what if the debt is sliced up and repackaged and rated AAA fraudulently?

The problem there is with whatever rules that make AAA ratings magic.