Hydride is a poor leaving group so a hydride shift should not take place and instead the attacking hydroxyl should leave the carbonyl group. I don’t understand why this doesn’t happen?

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    $\begingroup$ Well if the hydroxyl group just falls off then you have no reaction, right? $\endgroup$ – orthocresol Jan 14 '17 at 11:20
  • $\begingroup$ Right but what about the poor leaving hydride group $\endgroup$ – Sahil Gupta Jan 14 '17 at 12:08
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    $\begingroup$ A discrete hydride ion may not form. An intermolecular hydride transfer takes place instead. Just compare it with normal hydride reagent reduction (like LiAlH4). $\endgroup$ – RBW Jan 14 '17 at 13:17

You are correct that a hydride ion is a terrible leaving group and that it can under no circumstances be eliminated in e.g. an $\mathrm{S_N2}$ reaction. However, there are quite a few reactions where hydride does leave one atom and subsequently attaches to another; Wagner-Meerwein rearrangements jump to mind as one of the most prominent examples.

The feature of a Cannizzaro reaction is that it is not actually a leaving hydride. Rather, the reactivity can be explained in a cyclic transition state as shown in scheme 1 below.

mechanism of a Cannizzaro reaction
Scheme 1: Transition state and products of a Cannizzaro reaction.

Instead of seeing the reaction as a displaced hydride that subsequently attacks another atom, we can see it as a type of pseudo-electrocyclic reaction. Breaking and forming the bonds will happen almost simultaneously. At no point in the mechanism do we actually have a ‘free’ hydride anywhere.

Note, by the way, that the Cannizzaro reaction is not the only one that features a hydride shift in a cyclic transition state; you may, for example, also be interested in the Evans-Tishchenko asymmetric reduction.

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    $\begingroup$ I guess, going by their formal definitions, it would not be an electrocyclic reaction (goldbook.iupac.org/E01948.html), but rather a group transfer reaction. Not that it matters. $\endgroup$ – orthocresol Jan 14 '17 at 20:30
  • $\begingroup$ @orthocresol Hence pseudo ;) $\endgroup$ – Jan Jan 14 '17 at 20:33

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