the local elites are hell-bent on insanity

The local elites are not hell-bent on insanity. The local elites are playing in a global world where workers are worth as little as they can get away with paying them, capital can move instantly across borders without taxation, politicians and policy can be bought to order, and no one gives a crap about any of that fairness or progress stuff.

The 'crisis' has been excellent for the elites everywhere. They're all much, much richer and more powerful than they were ten years ago.

Can we please stop thinking this is an accident, or that they don't understand what they're doing?

It's not even 'austerity' - it's the Euro and Anglo equivalent of the rise of the oligarchs during the end of the Soviet Union.

While everyone here is busy debating whether Krugman has a point sometimes, we've all been robbed at gunpoint.