Assuming a political system is a representative democracy, and that group also produces a currency, what moral hazards are possible?
I'm thinking that policy can be compared to my physics 101 class where "energy can't be created or destroyed". Similarly in politics, if someone is saving money, someone else is paying the bill. (link to 'Story of Stuff' explainer)
Specifically, when approving new financial instruments for use (investment strategies, new asset classes) any governance that includes fiscal policy may have a moral hazard of "improving the GDP at the cost of democratic freedom or truth".
- Can someone help me articulate this concept or conflict I'm sensing, and if it's a well known topic of study can you direct me to more information?