[eli_gottlieb]

Yeah, but the point is, once the debt is cleared, by being paid or by bankruptcy, the private sector steadily regains its ability to plan rationally and pass information around in price signals. That's why fairly "easy" bankruptcy laws are usually considered more pro-business, while "moralizing" bankruptcy laws, as more often found in Europe, are actually considered to depress the economy (by simultaneously mobilizing vast machinery to pay out on "bad bets" and heavily penalizing business failure, thus increasing the risk-up-front of entrepreneurship and investment).