You see it, but you do not see it.
After the Jubilee, everything IS different. Sure, the politicians want to borrow more money, they want to make more promises, and they want to bribe people some more.
But they CAN’T.
Because they just screwed all the lenders. So now it’s “cash on the barrel head” for anything a politician might want to do and in the midst of a crash and the aftermath of the crash, the government is absolutely powerless to do much or to make promises.
You want Limited Government?? That’s pretty darn limited — because everyone will know that the government is good for nothing.
Honestly, I don’t think it will happen like that. Indeed it can’t happen like that because the Government (including the Federal Reserve) owns the printing press. They can continue to print dollars to “meet” their obligations, but those dollars will be worth increasingly less.
Or will they? The farce will keep going for quite some time because, as the author states, ALL the Central Banks are playing the same game: they are buying their own bonds with $$ created out of thin air. But since they are all doing it, the risks are lessened. They are doing it for one reason: to stave off social upheaval.
— For the West (including Japan): Too much debt, too many promises, and too high a standard of living. Aside from Germany and Japan, there is not enough industry to provide a living for everyone. So the Government has a bigger and bigger role in employment and entitlements keep the rest of the population fed & docile. They play along because if there will be massive social upheaval if Government spending is actually cut to sustainable levels.
— For the East (particularly China): They need to grow, so they need to export. They play along because the alternative is massive unemployment and, likewise, social upheaval. Also, even while its Monopoly $$, it helps them catch up with the West from a military/technological standpoint.
— For the Oil Producers: They are in the same boat. The minute the petrol dollars stop, they will have to contend with their own restive populations
So, really, everyone has almost no choice but to play along.