Last week, this blog listed five bad ideas to which politicians are giving too much consideration.

However, the intention is not to be negative.

To balance the criticism, and following on from the suggestion on fixed costs, here are some positive proposals as to what our leaders could and should be doing in the cash crisis.

1   Take a Long Holiday: this is just not the usual wish that politicians would stay out of entrepreneurs’ lives. There is a strong case for saying that their panic reactions, and their doing things simply for the sake of being seen to do something, are prolonging the crisis. The markets remain volatile in part because of the uncertainty about what governments will do next. If governments made it clear that they will do nothing until the markets settle, then the markets will settle.

2   Review Debt and Insolvency Laws: there is simply no avoiding the fact that a lot of businesses and people are going to go under. It is no longer about deterring bad borrowing. The priority must now be to endure that both debtors and creditors – at least those who have acted honestly – should be able to draw a line under the past and resume making a positive contribution to the economy as soon as possible. Keeping productive people in limbo delays recovery.

3   Share the Burden: it is particularly disgusting when those with safe public sector salaries and pensions lecture the rest of us on the need for sacrifice. The recession is being used as an excuse to increase taxes on the private sector to expand the public sector. Politicians should lead by example and start the sacrificing with some self-sacrifice.