We have what social scientists call a terrific moral hazard problem in Iraq today.

NPR: Exiting Iraq: Larry Diamond's View

Some of the new financial instruments also confront investors with a problem largely absent from traditional asset-backed securities: moral hazard.

ECONOMIST: Bonds that rock and roll

In any case, the problem of moral hazard can never be eliminated, only suppressed (at a cost).

ECONOMIST: Could banks police each other?