Now that the end is in sight for Argentina's agonizing debt crisis, it is time the world financial system think more seriously about two important issues related to the country's slide into bankruptcy. When countries go bust, they do so on a grand scale. Yet the international financial community has evaded the difficult and sometimes tedious question of what to do when a government goes over the edge. The traditional response is to stand back and hope creditors and borrowers sort themselves out.
There is no well-oiled machine to process sovereign debt crises because they are infrequent compared to commercial failures and because the politics of enforcing decisions on debtors and creditors are so intractable. Still, global financial...
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