The ugly facts are that there can be no durable recovery in the economy until the excess capacity is removed, since there are no huge productivity boosters on the horizon, the only other way you can grow demand (that is, you must boost not only GDP-per-capita but more importantly per-capita income so that true demand is generated) is to reduce the debt load in the system.
Still, all efforts at a solution appear to be directed to hiding the extend to the problem, in the hope that those who brought us this disaster can be made whole, even if it is at the expense of everyone else. That is trying to squeeze blood out of turnips and is doomed. But I agree that consumers will need more income in order to sustain a recovery---after the debt has been dealt with. As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
