Europe's Economic Crisis

Many Americans may be surprised to learn that Europe, those lovers of the social welfare state that conservatives love to pick on, is not too keen on Obama's call for the rest of the world to enact an economic stimulus plan similar to the one that Obama just passed. While some of us may be laughing over whether Republicans are going to start saying the U.S. should be more like Europe now, others are seriously worried.

In his op-ed piece today, economist Paul Krugman writes that Europe is in a financial crisis similar to that in the United States and that governments there have not done nearly enough to mitigate the effects. The existing social welfare policies seem to have softened the economic blow, but Krugman predicts that Europe will be much worse off than the U.S.

Part of the problem, he argues, is that even though the economies of many European nations are tightly integrated, there is no government structure that oversees the entire European economy. While the U.S. has the Fed to oversee it's monetary policy, Europe's E.C.B. is stuck with 16 often quarelling nations who may not be willing to come together over this continent-wide crisis.