As a point of theory, in a highly deflationary scenario the correct response may be for the government to (controllably) print paper. Given the right distribution mechanism debt could be serviced on the freshly printed paper. The effectiveness of such a strategy is dependent on how efficient the mechanism to distribute paper to end debt holders as well as how well monitored the money supply is.

The worst case on such a scenario is that an economy sits on rationing for a period of time, followed by a strong and possibly inflationary demand spike, but businesses and people's balance sheets could be partially paused.