PSR (or its EFL equivalent) working well agsin there I see.

If the whole point of PSR is to prevent these sorts of scenarios, wouldn't it be far better in these situations for a government body to just be able to step in and seize a failing club from it's owners like it has done wkth failing rail companies?

If you are going to fhuck about as an owner leveraging it with loads of debt that you can't pay back then you run the real risk of losing your asset lock, stock and barrel for nowt and it being handed over to a body that can run it properly instead.