Just thinking out loud, but I don't think it's completely insane that what Krugman and others propose will work. What do I mean? What did Paul say that was the fundamental issue at hand? Confidence. Confidence in the dollar. Confidence in the economy. Etc. Now if the majority of people believe in and operate within this screwy system of superbureaucracy, then it's logical to also assume that confidence has existed and can exist within it. So as long as that is maintainable, then it's at least possible to sustain the system. And I don't see the ability to create, or really manufacture, confidence as gone yet. Assume everything Paul says, then the system will fail not when it's shocking or scary or absurd; the system will fail when the ability to gain is demonstratively less possible than the ability to lose.