You're right imo. The UK seems to have went through something similar.

The thing is, the factories, farms, power plants, equipment, knowhow don't go away.

If you have the people and can feed them, a developed country will do fine even if it defaults on its debts and the world hates them.

Contrast that with more conservative/isolationist countries that took the dumb advice not to take debt and build fast - they'll be stuck being poor or at best mediocre for a long time.

That's much of Eastern Europe imo.