February 25, 2012

Krugman’s EUROmess Summary

By Glenn

“There are basically three stories about the euro crisis in wide circulation: the Republican story, the German story, and the truth.”

The Republican story is that it’s all about excessive welfare states.

OK, the German story is that it’s about fiscal profligacy, running excessive deficits.

Finally, let’s look at the balance of payments — the current account deficit, which is the flip side of capital inflows

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