Spending more to get the Greece economy moving is the only policy that will work, but why does it not work. Balance is the key. It's possible to introduce balance by spending but both raising interest rates and taxes on specific activities. The problem Greece has is debt with low interest rates. Borrowing got Greece into a mess, but was it a domestic problem or an international one? Gregory talks one way and Krugman another. The question is really Greece's openness and who is taking or sending money out of the country. Is it a domestic issue or an international one? Overinvestment by foreign interests in dubious acquisition projects often masks real domestic issues.
http://www.forbes.com/sites/paulroderickgregory/2012/03/18/note-to-krugman-greece-proves-keynesian-economics-wrong/
