Paul Krugman is rewriting history now that the eurozone, beloved by US liberals, is going down in flames By Nile Gardiner US politics Last updated: November 15th, 2011 http://blogs.telegraph.co.uk/news/n...loved-by-us-liberals-is-going-down-in-flames/ Paul Krugman is right about one thing, when he says: ânow, with Italy falling off a cliff, itâs hard to see how the euro can survive at allâ. But the rest of his analysis of the crisis in Europe, as well as the causes, is in the realm of pure fantasy. In his recent piece entitled âLegends of the Failâ, Krugman rejects the idea that âEuropeâs woes reflect the failure of welfare states in general, and that Europeâs crisis makes the case for immediate fiscal austerity in the United Statesâ. All of the European countries now in deep trouble in Europe have deeply entrenched welfare systems. The reality that Krugman refuses to accept is that Europe offers a glimpse of Americaâs future if it continues down the path of European-style big government. The root of Europeâs 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. Europe has a huge entitlements disaster heading its way, with graying electorates unable to sustain the status quo. It is Europeâs lack of fiscal responsibility, economic freedom, and national sovereignty, that are at the heart of the current economic crisis, and the United States must do all it can to avoid European-style decline.