Dr. Donal Donovan:

No. Of course there were many alternatives. It is an alternative if someone comes and writes off all our debt but it is not necessarily an option. An option is something that is practical and meaningful and that is as I understood the way Mr. Mody expressed himself in the debate. The impression was given that he was against austerity. I find that hard to believe because I do not think anyone said that with a deficit of 11% of GDP - or 32%, depending on which year one calculates it - that we did not need to reduce our deficit, and the debt to GDP ratio was heading towards 120%. Of course one may argue on the margin as to whether the speed was too fast or too slow, as we are discussing today. The impression that came across, which I believe was wrong, was that austerity was imposed because the other two options should have been considered but were not and that austerity is a bad thing. That is wrong because regardless of anything, even burning senior bondholders, we would still have needed to reduce an unsustainable deficit from 12% down to 3% or other level. I do think a strong intellectual argument has been made that one did not need to do that and that one did not need significant austerity.