A while back, before moving to Slate, Matthew Yglesias had what I considered a brilliant insight into the incentives facing small-country political leaders:

Normally you would think that a national prime minister’s best option is to try to do the stuff that’s likely to get him re-elected. No matter how bleak the outlook, this is your dominant strategy. But in the era of globalization and EU-ification, I think the leaders of small countries are actually in a somewhat different situation. If you leave office held in high esteem by the Davos set, there are any number of European Commission or IMF or whatnot gigs that you might be eligible for even if you’re absolutely despised by your fellow countrymen. Indeed, in some ways being absolutely despised would be a plus. The ultimate demonstration of solidarity to the “international community” would be to do what the international community wants even in the face of massive resistance from your domestic political constituency.

How small does the country in question have to be? Maybe not very: Nicolas Sarkozy’s road from the Elysée to private equity. As it turns out, Sarkozy’s money-making plans may be on hold due to a strange combination of legal troubles and the possibility of a political comeback thanks to Hollande’s timidity. But it remains true that Keynes’s dictum — “Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally” – is probably even more true for politicians than it is for bankers. And this probably helps explain the persistence of the austerity cult despite years of failure.