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Leaving our children with a solvent government is less so.
Any fiscally solvent government can stand behind its banks, but providing such guarantees is a recipe for repeated trouble.
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ACROSS the developed world, solvent governments have temporarily nationalised banks whose survival was in doubt.
A run on illiquid but solvent governments has been halted.But this being Europe, a host of worries remains.
The European Central Bank (ECB) rejects the idea of acting as a lender of last resort to embattled, but solvent, governments.
Would the ECB and Germany, staring into the abyss, at last commit themselves to ring-fencing solvent governments?Sometimes the worst really does happen.
First, it must make clear which of Europe's governments are deemed illiquid and which are insolvent, giving unlimited backing to the solvent governments but restructuring the debt of those that can never repay it.
A real rescue for the euro would have to involve open-ended financing for fundamentally solvent governments subject to the risk of self-fulfilling panic, plus a much more expansionary monetary policy and, almost surely, a higher inflation target.
The commission, sponsored by Congress but headed by Allan Meltzer, an economist at Carnegie Mellon University, wants to see the IMF concentrate mainly on short-term crises in emerging-market economies, providing funds only to solvent governments that meet pre-set conditions.
He will need to promise that the ECB will continue to back embattled but solvent governments by buying their bonds; support a big debt reduction for Greece; and cut short-term interest rates.
This requires a controlled default of insolvent governments which, so far, means Greece and the protection of solvent governments by a pledge to buy as many of their bonds as it takes to ward off market panic.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com