AUSTERITY might not work for Spain, Italy:

ONCE again Europe’s leadership has been forced to put up billions in cash to halt the spread of contagion to the Continent’s weaker economies, this time in the form of a potentially vast purchase of Italian and Spanish government bonds by the European Central Bank. And once again the condition for rescue is more austerity.

But this time there is a difference. Unlike Greece, Portugal and Ireland — the patients previously forced into the austerity cure — Italy and Spain have already made their own substantial strides toward cutting their deficits.