Bad debt is debt that's not likely to be paid back. That's not a permanent quality of the debt. A bond from the Irish state is a bond that may plausibly not be paid back. From the diary:

Nobody is addressing the terms of the loan - the fact that the amount of the 'bailout' (not for Ireland, for the banks who lent to us!) of €67.5bn (not counting €17.5bn we are contributing - decimating our pension reserve fund) is not going to allow us to proceed  an 'orderly restructuring' (aka default) in 2014. In fact we will need in the order of €152 bn to get to 2014.

Irish debt is bad debt to the extent that Ireland falls short of those €152 bn.

Keynesianism is intellectually hard, as evidenced by the inability of many trained economists to get it - Paul Krugman