KRUGMAN: This Is How The Euro Ends...

He hints that this is the beginning of the end for Europe, and that if the Eurocrats don't get the lesson that people need growth -- not just austere stability -- then it's all over.

This is the way the euro ends: not with the banks but with bunga-bunga.

OK, the euro isn’t doomed — yet. But the Italian election signals that the eurocrats, who never miss an opportunity to miss an opportunity, are getting very close to the edge.

The fundamental fact is that a policy of austerity for all — incredibly harsh austerity in debtor nations, but some austerity in the European core too, and not a hint of expansionary policy anywhere — is a complete failure. None of the nations under Brussels/Berlin-imposed austerity has shown even a hint of economic recovery; unemployment is at society-destroying levels.

For our explanation of why voters in Italy staged a "rebellion" see here >