If we continue to deepen global market liberalisation and harmonisation, then the ability of countries and their sovereign people to choose their own policies becomes less and less. We could give up democracy, so that an autocratic ruler or a technocratic government could decree that everyone has to accept full market liberalisation or the globally harmonised rules that the government has negotiated.
But the costs of a disorderly default of a large interconnected firm may also be substantial, especially when the financial system is in a fragile state – as was the case in the default of Lehman Brothers. The best way to deal with those types of situations is to prevent them from occurring.