Our economic situation may be all Greek to us in more ways than we care to admit:
Mervyn King, Governor of the Bank of England, fears that America shares many of the same fiscal problems currently haunting Europe. He also believes that European Union must become a federalised fiscal union (in other words with central power to tax and spend) if it is to survive. Just two of the nuggets from one of the most extraordinary press conferences I have been to at the Bank.
Perhaps that warning will serve to concentrate minds, even as people like Paul Krugman assure us that massive deficits that take up huge portions of GDP are nothing for us to worry about. (Of course, we all remember that back when we had Republican Presidents, Krugman was a deficit hawk and missed no chance to attack Republican administrations on fiscal policy. It is only now, when we have a Democratic President, that Krugman believes that the deficit is much ado about nothing.)