Krugman is rewriting history now that the European model, beloved by East Coast liberals, is going down in flames.I have been caught off guard by leftist arguments that the Euro's failure is a failure in markets rather than governance to the point of suspecting the author's spirit. I suppose should not have been, but there it is.
The reality that Krugman refuses to accept is that Europe offers a glimpse of America’s future if it continues down the path of European-style big government. The root of Europe’s financial crisis lies in decades of over-spending and over-borrowing, largely to pay for overgrown and bloated welfare systems, vast public sectors, and incredibly generous pension plans.
And from the comments, raffles:
Into the Valley of DebtFor Germany at some point the cost of retaining the the Euro (bailing out debtor nations) will outweigh the cost of exiting the Euro (loss of loan repayment). Until then Germany will cost effectively do what it can to defend the Euro.
Rode Angie, and Sarkie and Berlusconi,
Bond markets to the left of them,
Eurosceptics to the right of them.
Theirs not to reason why,
Theirs just to charge.. and the Euro to die.