I have a piece on the home page today about a meme that’s taken hold on the Left, the short version of which is that the U.S. really shouldn’t try to reduce its deficit right now because look what happened to Ireland. Paul Krugman started this meme a few weeks ago — I wrote about it here at the time — when he noted that Ireland’s CDS spreads (a measure of investor confidence in a country’s sovereign debt) were worse than Spain’s, even though Ireland started taking steps to cut its deficit in 2007 while Spain did three fiscal stimulus packages.

The New York Times evidently assigned a reporter to validate Krugman’s thesis about markets and austerity, and the report she produced is what got all the lefty bloggers comparing Ireland to Marley’s ghost and warning the U.S. not to be a Scrooge. But that reporter, and those bloggers, seem not to have noticed the change that’s taken place since Krugman first debuted his thesis.

Today’s headlines are all about Ireland’s official exit from recession. Yesterday, the Wall Street Journal reported that the weakening euro has helped Ireland disproportionately, since a disproportionate share of its economy is based on exporting to the U.S. and the U.K., against whose currencies the euro is depreciating. Meanwhile, Moody’s has placed Spain’s debt on review. Spain’s CDS spreads have now caught up to Ireland’s, even surpassing them momentarily yesterday after the Moody’s announcement.

Here is the more important point not to lose sight of: Ireland got absolutely creamed by a property bubble that was much bigger than ours. Their budget deficit spiraled to 14.3 percent of GDP — worse than Greece’s. Ireland chose austerity. Greece jumped on the stimulus bandwagon with everyone else in 2008. Ireland suffered a sharper economic contraction and higher unemployment than Greece, but Greece got stuck with the debt crisis. All this recent hand-wringing over Irish austerity blithely assumes that if Ireland hadn’t moved to control her deficits, the bond vigilantes wouldn’t have come for her instead. Given the severity of Ireland’s problems, that is a heroic assumption indeed.

The bitter irony in all this, of course, is that Greece wasn’t forced to live the consequences of profligacy: It got a bailout. Had Ireland’s leaders known that the EU would crumble so readily, maybe they would have thought twice about going the austerity route. But the U.S. lacks even the luxury of taking a gamble. It is too big to bail, which is why it might be wise to put down the dice and back away from the table.