Abolish the loan system entirely and look at introducing transfer and salary caps in some way. Or an even distribution of TV and competition money.
Even distribution of TV money could well have the reverse effect. Now clubs can't improve their financial situation by doing better in the league, and those with better matchday and commercial income will have a financial advantage that will never be affected by poor performance. The gap between Leicester and Everton is smaller than the gap between Everton and United. It may well exacerbate the problem of haves and have-nots by levelling the playing field at the bottom end but not the top.
A transfer and salary cap is a good idea in principle, but fails on the rocks of reality. For one, every FA is an independent body, which means every FA in Europe would have to implement it at the same time (plus the Premier League). If only England did it, you'd be saying bye-bye to all the best players, who would be off to Spain, Germany and Italy where they can get 2 or 5 or 10 times the wages.
Another problem is that clubs have to vote to agree changes to sporting rules of that type in the PL.
Plus putting a salary cap in place for every team for UEFA competitions only would be tantamount to banning all the best players in Europe from the Champions League.
It's also hard to see how an absolute salary cap can possibly be useful for Leicester City with £25Mpa turnover, Everton with £86Mpa turnover and United with £400Mpa turnover. What number do you choose that is in any way fair for all those clubs?
Besides, the upshot would just be a youth academy arms race. That might be morally preferable to the current situation, but it would be the same upshot. Those with the money to pay for a stellar youth academy setup would challenge every season. They'd supplement their better youth players by spending their transfer budget on a smaller number of better players. Same outcome, different means.
The reality is that the problem is a hugely complex one, and there is no simple solution. Simple rules are never going to work. As the saying goes, if you want to turn something complicated into something simple, you need a system that is equally complex.
The fact that we're dealing with lots of different governing bodes, and lots of clubs with their own agendas means that its a slow process. In truth the problem is akin to a mini-version of the EU. If you're an EU politician and you think a rule should be brought in across Europe, it would be much easier if Europe was a single federal entity. But its not, so you can't just bring in blanket rules & expect agreement. You need to employ a mix of carrot and stick, making allies, making threats and shepherding people step by step in a given direction. Most importantly, it requires consensus.
Thats why I think FFP is a decent starting point. If you can get most leading clubs in each European league to start on the principle of break even - no matter how wonky the implementation - you've made a crucial step. You've agreed that spending and financial control is a sound principle. The idea that we should go from where we are now to a single European FA with total control over every aspect of a clubs spending is just unrealistic. It will take time, and will probably never be perfect. But some movement is preferable.
However I've yet to see any argument that says that allowing sugar daddies to take over clubs like City and PSG is sorting out the problem. It just adds another, different, problem to the mix and makes the situation more difficult.