A piggy bank with its 'belt tightened.'

Photo by Ken Teegardin

I think what we have here is a failure to communicate. All the critics I know, like Paul Krugman, Brad DeLong, Mark Thoma and myself, have been very specific that the European Central Bank (ECB) will have to provide some form of guarantee for the debt of the crisis countries. It will also have to promote higher inflation in the euro zone as a whole and particularly in Germany and other core countries. The former step would allow countries to borrow, while the latter would provide the basis for regaining competitiveness in the long-run.

In my case, I have been regularly ridiculing the ECB’s obsession with fortifying its Maginot Line of keeping inflation under 2.0 percent. That accomplishment will be long remembered after the collapse of the euro.

Anyhow a Post editorial told readers that:

“In their demand for growth, however, the critics fail to explain how to fund it.”

This raises the question of what critics the Post is referring to. Is the Post referring to the most prominent economists who have been arguing against European austerity and somehow cannot figure out what they are saying, or is there a whole different group of people whom the Post turns to as the major critics of austerity? Inquiring minds want to know.