In responding to mouser, I over extended myself again. Another comment that has become a post. It also dovetails nicely with Antisthenes’s previous post.
Not only nobody wants to solve the problem, but almost nobody is game enough to define it, since that could lead to a specific finger-pointing.
In The Closing of the American Mind, Allan Bloom argued that the greatest Marxist triumph was destroying the public’s ability to define things, whole words even, for what they actually were. If you allow me; They sort of split reality, there are two stories here. One is real and the other is merely fiction, a spun web of memes than cannot be defined.
To define them is to destroy them.
Kyle Bass, in the video below, used the interesting word of ‘optics’. The real story is that most OECD nations are insolvent. Any one running a business like these governments would be defined as bankrupt by any man on the street.
There are ‘optics’, the memes, distorting the majority of the populaces ability to be able to asses insolvency. The majority still cling to the story that governments are different than corporations or persons when it comes to finance. They can print money, as if that is a viable solution. They can increase taxes, that is if capital and labour don’t flee first.
Reinhart and Rogoff, explained that this is simply not true, governments regularly go bankrupt through out history it was common even to have corporate debt trading at far higher premiums than government debt. Yet it is sovereign debt that trades at the premium today. Even worse banks use it as high grade collateral to extend loans and lever themselves up. That is the Euro Crisis.
There is a severe normalcy bias.
Eventually reality will assert itself at the margin as Bass says.