National University System Institute for Policy Research

(858) 642-8498 Get Started

What to do about Greece, Puerto Rico

EconoMeter panel susses out the bailout/bankrupty choices


Friday, July 10, 2015

View Article

Kelly Cunningham, National University System
Answer: YES

Vividly exemplifying U.S. indebtedness, creditors must face reality and count the costs to obtain any compensation over collecting anything at all. A point is reached where it is mathematically impossible to entirely repay debt. This is not unique to these two places and signals dysfunction with bailouts further polarizing debtor and creditor governments. Creditors should not be blackmailed into endlessly subsidizing delinquency and justly require system discipline. But forgiveness of over-indebtedness is an inevitable consequence.