This link leads to Simon Wren-Lewis’ latest post. As such there is not so much in it that was not known yet, e.g. the role of German and French banks (not to mention Dutch banks), but it is always useful to have a reminder of how we ended up in this crisis (hint: it doesn’t have to do with public overspending in Spain, Portugal, Italy and Ireland).
This post by Simon Wren-Lewis is excellent, and this one by Paul Krugman is a more abstract version of the same thing. The point is (again and again) that what Germany wants most of the rest of Europe to do is simply impossible in current circumstances.
As a companion to this I would recommend the book Austerity: the history of a dangerous idea, by Mark Blyth (Twitter: @MkBlyth). It is simply excellent, well written and should be obligatory reading for any serious parlementarian. Anyone telling you we need austerity has political motives to slash the welfare state.