Keynesians Don't Believe That Fiscal Stimulus Can Solve The Economic Problems In Europe

Paul Krugman argues that fiscal consolidation in the eurozone has made a bad situation worse.  The common currency is the core issue in the eurozone.  It makes it impossible for the periphery countries to deflate their currencies.  Consequently, they are forced to resort to wage and price deflation which is much more painful and politically difficult to manage.  Moreover, fiscal contraction in the core eurozone nations makes things even worse.  He strongly objects to conservatives who argue that he, and other Keynesian's, believe that fiscal stimulus can solve the underlying problems in the eurozone.  He does not know who those Keynesian's are.  On the other hand, it is easy to see why his strong objections to imposed austerity in the eurozone could have led conservatives to argue that Keynesian's believe that fiscal stimulus is the solution to the problems in the eurozone.