AI Overview
“Insoluble insolvency” is a term coined by Dr. Jim Tozzi to describe a sovereign state’s terminal fiscal condition where long-term liabilities—such as unfunded entitlements and debt—cannot be solved through traditional tax increases or spending cuts. It represents a “mathematically unsolvable” state where fundamental structural changes or fiscal collapses (defaults, high inflation) are likely. [1, 2, 3]
Key Aspects of Insoluble Insolvency
- Definition: Coined by Dr. Jim Tozzi (Center for Regulatory Effectiveness), it refers to a situation where a government’s total liabilities, including implicit obligations, vastly exceed its assets.
- Difference from Conventional Insolvency: While standard insolvency occurs when a company or person cannot pay debts due, insoluble insolvency implies the governing system itself is fundamentally broken and cannot re-establish solvency through traditional policy adjustments.
The concept reframes fiscal crises from “structural insolvency” (a solvable problem) to “insoluble insolvency” (an unsolvable, systemic end-state). [1]
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theCRE.comhttps://www.thecre.comThe Birth of Insoluble Insolvency » Public ParticipationFirst-order CRR: evaluate individual regulations. Second-order (insoluble insolvency): evaluate the solvency of the governing syst…
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theCRE.comhttps://www.thecre.comDid Jim Tozzi Create The Term “Insoluble Insolvency” and Why?
Jim Tozzi coined and developed insoluble insolvency to describe a condition in which a government’s long-term fiscal obligations c…
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theCRE.comhttps://www.thecre.comPublic Participation – The Center for Regulatory Effectiveness
Google On Insoluble Insolvency … “Insoluble insolvency” refers to a state where a sovereign entity’s long-term fiscal obligation…
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