Paul Krugman makes an interesting point, but misses something obvious:

Ask yourself, why does the dollar area — also known as the United States of America — more or less work, without the kind of severe regional crises now afflicting Europe? The answer is that we have a strong central government, and the activities of this government in effect provide automatic bailouts to states that get in trouble.

Consider, for example, what would be happening to Florida right now, in the aftermath of its huge housing bubble, if the state had to come up with the money for Social Security and Medicare out of its own suddenly reduced revenues. Luckily for Florida, Washington rather than Tallahassee is picking up the tab, which means that Florida is in effect receiving a bailout on a scale no European nation could dream of.

Why aren’t the people in Wisconsin (say) furious at the people in Florida for the de facto bailout? Because there is far, far more cultural unity between them than there is between Germans and Greeks. People will sacrifice for “us”; they won’t sacrifice nearly as readily for “them.” It’s just a basic fact of human nature. In creating the euro system, European elites ignored the power of culture. It didn’t fit their theories of how an economically rational man is supposed to behave.

Incidentally, Daniel Hannan observes that the Greek elections solved nothing. Excerpt:

The Greek electorate is in denial. It rejects austerity, but insists on keeping the euro. All the main parties duly parroted what voters wanted to hear, making for a fantasy election, a make-believe election, a fingers-in-my-ears-I-can’t-hear-you election. The only list which was honest about the necessary cuts – a coalition of three liberal parties – failed to gain a single seat.

What will happen the next time Greece reneges on its promised spending reductions? Will the rest of the EU lose patience? I doubt it. For thirty years, Greece has been subsidised, indulged and encouraged to look to Brussels for all its solutions. Now, faced with what they see as a problem of the EU’s making, Greeks understandably shrug their shoulders and expect Brussels to sort things out for them. And you know what? Given the way the EU has behaved to date, they might just be right.

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