Today's column by Krugman was all about Paul Ryan's Republican response to Obama's State of the Union. Rather, it was really about Mr. Ryan's errors. Since Ryan did his best to make his audience believe that under Obama the US is heading for a Greek, Irish, UK and the rest of Europe's financial catastrophe. Thus, Mr. Krugman's statement about what really happened to Ireland.
The lesson of Ireland doesn't say "cut spending nor, or bad things will happen"; it says that balanced budgets won't protect you from crisis if you don't effectively regulate your banks--a point made in the newly released report of the Financial Crisis Inquiry Commission, which concludes that "30 years of deregulation and reliance on self-regulation" helped create our own catastrophe.
Paul Krugman, NYTimes, January 28, 2011