Cheerleading our way to Ruin

Krugman is at it again. See if you can follow this reasoning from his latest column:

"Lately, financial news has been dominated by reports from Greece and other nations on the European periphery. And rightly so.

But I’ve been troubled by reporting that focuses almost exclusively on European debts and deficits, conveying the impression that it’s all about government profligacy — and feeding into the narrative of our own deficit hawks, who want to slash spending even in the face of mass unemployment, and hold Greece up as an object lesson of what will happen if we don’t.

For the truth is that lack of fiscal discipline isn’t the whole, or even the main, source of Europe’s troubles — not even in Greece, whose government was indeed irresponsible (and hid its irresponsibility with creative accounting).

No, the real story behind the euromess lies not in the profligacy of politicians but in the arrogance of elites — specifically, the policy elites who pushed Europe into adopting a single currency well before the continent was ready for such an experiment.....

......But Spain isn’t an American state, and as a result it’s in deep trouble. Greece, of course, is in even deeper trouble, because the Greeks, unlike the Spaniards, actually were fiscally irresponsible. Greece, however, has a small economy, whose troubles matter mainly because they’re spilling over to much bigger economies, like Spain’s. So the inflexibility of the euro, not deficit spending, lies at the heart of the crisis.

None of this should come as a big surprise. Long before the euro came into being, economists warned that Europe wasn’t ready for a single currency. But these warnings were ignored, and the crisis came."

He's basically saying that we shouldn't worry about our massive deficits because the problem we see in Greece is the adoption of the Euro, not their ruinous deficit spending. Am I taking crazy pills here? Greece has a massive problem because of its ruinous deficits, as it would with or without the Euro. Yes, they can't devalue their currency like a country with its own currency can- but who cares? It's bad news when a country has to devalue. So the Greeks have one less option when they find themselves in an economic crisis. But the root of the crisis is the deficit spending (not the currency), which absolutely should be an object lesson for other countries, even if there are differences among individual countries (investors will likely allow the US Treasury to get into more debt relative to GDP than Greece). Krugman is so disingenuous it's sickening, cheerleading our journey to fiscal ruin.