Krugman: Those Revolting Europeans

[johnd83]

5. Once again, confederacies don't work

Confederacies have been tried several times in the past and have pretty much always failed. The EU had a common currency, but not a common monetary policy. Because all the countries have conflicting agendas they just ended up with a complete monetary mess. Throw in corrupt bankers and idiotic governments that borrowed in a currency they had no control over without an economy with even the potential to repay and it resulted in a huge mess.

The difference is that here in the US we can afford the things we want if we weren't so idiotic in terms of taxation and cost control. We have insanely low effective taxes and basically give health care and military companies truckloads of free money. Also our trade policies are ridiculous.