 Jeffrey Frieden, a professor from Harvard. Thank you very much for being with WPC-TV. A quick question. Are we condemned to what Larry Summers course called secular stagnation, especially in Europe? I think the question of secular stagnation is a complicated one. We should define it. Second, yes. So secular stagnation, the concern is that there are underlying structural characteristics of our economies. And in particular, this really is about the advanced industrial economies of North America, Western Europe, and Japan. So the argument would be, and it varies from individual to individual, that there are structural characteristics of our economies that have in the long run, and perhaps even in the very long run, slowed the equilibrium rate of growth. So we are used to growing 3%, 4%, 5% a year and have been growing at that pace really in the post-war period, and maybe a little bit before, but certainly in the post-war period. But people like Larry Summers and Robert Gordon an economist in Chicago have made the argument that this is not simply a result of the crisis, that the slowdown in growth is due to some underlying structural factors in the economy. Things like, so here's one example of an argument that's made. The fact is that in all, pretty much all advanced industrial economies, the distribution of income has become substantially more unequal. We know well that the marginal propensity to consume out of income is lower among wealthier people. So wealthier people save much more of their income than do poor people who can't afford to save in most cases. In as much as income becomes more and more concentrated in the upper echelons of society and the top distributional tiers, then less of it gets spent and there would be at least in this story, this variant of the story, there would be a continuing tendency for the rate of growth of demand to slow. And it's somewhat perverse because as the rate of growth of demand slows, wealth becomes more concentrated, which slows the rate of growth further and so on and so forth. So that's one concern, one structural characteristic. Another structural characteristic is demographic, that all of our advanced industrial societies are aging as we all are, but these societies are aging in the sense that the birth rate typically in the average advanced industrial society is below replacement rate. And it's above replacement rate in some, France, the US and some others, but on average it's below replacement rate. Some of that is counteracted by immigration, but certainly not in Japan and not so much in most of Europe. Given that, the demographic trend implies that more and more has to be spent on supporting the elderly in their retired years. And that again would tend to slow the rate of growth in a long-term sense. Now, so that's the argument and I'm dragging on at some length because it's important to understand how that differs from concerns about the current rate of growth in the aftermath of the global financial crisis. I can only give you my view, which is informed largely by an observation of what has happened in this crisis and what has happened in previous crises, crises which are at least comparable in some way. In my view, the current slow pace of growth is completely explicable as the aftermath of the greatest debt crisis the world has ever seen. This is the first debt crisis that has affected a whole host of developed countries simultaneously. We had one previous example and only one of a debt crisis that affected an industrial country and that was Germany after 1929. So what we know both theoretically and empirically is that debt crises are different than normal recessions. As Reinhart and Rogoff show statistically, the average debt crisis takes five to seven years for recovery and we are in the worst debt crisis in modern world history. It is not surprising that recovery is extraordinarily slow and it's especially not surprising that it's so extraordinarily slow in Europe because the political response to the debt crisis in Europe has been sorely wanting the policy response. Well, that was gonna be my final question. I mean, you're talking about a five to seven year horizon. Most politicians have a much shorter horizon. Five to seven years is an eternity in politics. Exactly, so if you were a European politician in, for example, France, what would you do? I think... Or what should you do? Apart from leave the business, I suppose, I think that from the standpoint of any individual European economy, the real task has to be to try to find some coordinated resolution to the crisis. And my view is, and I know it's not a very popular one in some circles in Europe, but I think it is informed by having spent a lot of time both involved in and studying debt crises past and present. My view is that this crisis will only end in any fundamental way if there is a substantial restructuring of the existing debts. The reason the economies are growing so slowly is that there is a massive debt overhang. Both creditors and debtors are hampered in their economic activities by the burden of accumulated bad debts. As long as those bad debts stay on the books of the banks and on the books of the debtors, growth will be substantially impaired. So whether in France, in Spain, in Germany, I think the primordial task is to try to deal with directly, which has not been done, to deal directly with the debt burden. All of the other measures that have been attempted, useful as they may have been, monetary, fiscal, regulatory, are only dancing around the problem. The crux of the problem is unsustainable debt burdens which cannot be serviced and whose persistence slows the entire rate of growth of the entire continent. It's in everyone's interest to reduce that debt burden. Professor Zeridin, thank you so much.