The U.S. Bails Out A Profligate EU

September 19, 2011 06:49

The real problem is that Europe has created a massive welfare state that its shriveled, undynamic economies can no longer support.

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Geithner and the Fed are doing in Europe just what they did here: printing huge amounts of dollars and using them to buy public debt, a kind of mega-stimulus.

This may stave off a collapse of Greece, or Italy, or Spain, for a while. But ultimately, it will fail. After the default of Greece and one or two other fiscal wastrels, the euro zone could collapse — with disastrous results.

Why? This mega-stimulus fails to address the euro zone’s actual problem — just as $3 trillion in “stimulus,” TARP and Quantitative Easings I and II in the U.S. failed to address our problem: too much debt from too much spending.


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