The United States already does this. 70% of the US bond market is through domestic bonds, ie the ones that you or I usually buy. Last year, the outstanding market bonds were worth $91 trillion US, a new record. The short answer to your question is that the bond market is inherently volitile which, in today's market, reduces the premiums paid for each bond. Personally, I used to invest substantially in them, but have more recently moved more capital into the money markets due to the fact that I have little faith in the long-term.
The bottom line is that many people do not trust the bond market, and they have little reason to do so.
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