“More likely scenario - as inflation starts to go up and spending gets beyond control, responsible people like Paul Ryan are elected. (See Christie election in New Jersey - if they choose a responsible governor, the US as a whole can come to the same choice). Responsible reform of entitlements is still possible and long-term fiscal health is restored”
We have passed the point where responsible reform is really possible. Events are accelerating (for example, SS is in the red, years before it was supposed to). And there are so many big hits on the horizon (Europe, state budgets, CRE, etc), that any reform would be too little, too late.
Immediate default on all entitlement debts is going to be a bad thing. You will have people screaming because they were screwed over by their government who stole their money for years to pay for someone else, you will have people who are too dependent on the State to fend for themselves, you will have people who will use the breakdown in society to commit evil acts.
No one ever learns do they?
(for example, SS is in the red, years before it was supposed to). And there are so many big hits on the horizon (Europe, state budgets, CRE, etc), that any reform would be too little, too late.
And that is because of all the SSDI that everyone is collecting. and have been collecting for years.