Why would the government do a better job than private issuers?
Almost 10 years ago, a network of private businesses started issuing WebMoney (wmtransfer.com). In 1998, the Russian financial system crashed, the government defaulted on its internal debt, many banks went bankrupt and the national currency got devalued five-fold.
Webmoney weathered the storm unaffected. Ever since, WebMoney is the favorite medium of exchange in Russian-speaking e-commerce. Go figure...

A great example of the government raiding its supports for its money is Spain. http://www.oceanfullofmoney.com/?p=22 its amazing but still most people dont realize what is even happening until it is too late.