1. The establishment encourages making credit widely available in order to pacify the less well off who would otherwise demand a better deal out of the social contract.
2. This leads to unsustainable debt, as people are forced into borrowing to meet basic needs with no means to pay it back.
3. Eventually this comes to a head as people begin to default, causes a cascading chain through the economy as people are unable to meet their obligations, leading to crash.
4. At which point, governments step in and debt is forgiven, correcting the imbalance created in step 1.
Seemed to make a lot of sense to me. And the interesting thing is that it suggests a solution: replace widely available credit with direct wealth redistribution and you end up with the same net effect (as the debts are being forgiven in the end anyway), but without the destructive boom-bust cycles.