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Krugman: How American Capitalism Fails β€” and Northern European 'Socialism' Succeeds β€” at Job Creation

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And why that's not a story the mainstream media likes to tell.


But macroeconomics, as I keep trying to tell people, isn’t a morality play, where virtue is always rewarded and vice always punished. On the contrary, severe financial crises and depressions can happen to economies that are fundamentally very strong, like the United States in 1929. The policy mistakes that created the euro crisis β€” mainly creating a unified currency without the kind of banking and fiscal union that a single currency demands β€” basically had nothing to do with the welfare state, one way or another.The truth is that European-style welfare states have proved more resilient, more successful at job creation, than is allowed for in America’s prevailing economic philosophy.

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