In the Guardian, economist David Graeber mentions a proposal by Warren Mosler and Philip Pilkington. The kernel of the idea is a tweak to the present system that would allow taxpayers to use national government bonds to settle their taxes with. This would work even if the bonds were defaulted upon.
The effect would be that, even in the case of a default by Portugal for example, there would still be a market for Portuguese bonds. Anyone who owes taxes in Portugal would be interested in buying those bonds.
Apparently, this was proposed to Noonan in Dáil Éireann but Noonan's advice was to shoot it down. Graeber strongly disputes the line of reasoning Noonan took.
The enormity of this plan is huge. Even in the event of a total lack of interest in Frankfurt or City of London for the bonds, the government would be able to raise real money on the markets. The Troika could ejected and the locals placed back in charge of their finances.Originally Posted by David Graeber
Hospitals and schools could start hiring again to start to patch up the damage caused by the 2009-2013 austerity madness.
Here is the Mosler-Pilkington proposal: Levy Economics Institute | Publications
Here is David Graeber's column: There's no need for all this economic sadomasochism | David Graeber | Comment is free | The Guardian