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Originally Posted by Caliplanner1
...but you forget the imperative....the private sector can disappear when bankrupt...but government/the nation-state won't. BIG DIFFERENCE in terms of sustainability/survival.
Further, the weakness of government in capitalist/free market economies is generally tied to the weakness of its respective private sector. If the business community can't or won't pay taxes then government finances will suffer to the detriment of all.
Finally,...here in North America/Europe etc. governments bail out the private sector when they get into financial trouble/go bankrupt and not the other way around.  |
That's because one of the flaws of a democratic system is people only tend to think 4 years ahead, especially when the USA caps a president's term at 8 years.
Bailouts don't help, they just bandaid the problem for tomorrow. And weak private sectors don't emerge out of nowhere. They happen because of overregulation, overtaxation, monopolization, tarriffs, or artifically low interest rates.
All of which are controlled by government or the central bank.
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...but you forget the imperative....the private sector can disappear when bankrupt...but government/the nation-state won't. BIG DIFFERENCE in terms of sustainability/survival.
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Tell that to every person who survived hyperinflation.
Worst case scenario if the private sector collapses is a Great Depression. Worst case if the public sector collapses is Wiemar Germany and the ensuing war.