One country let the banks fail. Here's what happened...
"Why do they consider the banks to be the holy churches of the modern economy?"
No austerity. Support for the poor. Banks commandeered. Total success!
Our pundits keep pressing austerity upon us. They warn us that we are going the way of Greece, yet they keep recommending the Greek solution. Why not the Icelandic solution? When Iceland went down the neo-liberal path, the country received an economic blow that most observers considered unrecoverable. When Iceland cast off neo-liberalism (a.k.a., Libertarianism), the tiny nation quickly prospered.
If more people heeded what President Olafur Grimsson says here, someone in our national security establishment would try to "Chavez" the guy.