Our final speaker is Professor Atif Mian. We were really pleased that he came all the way from the East Coast for this event, like many other people did. He is the John H. LaPorte Jr. Class of 1967 professor of economics, public policy, and finance at Princeton University and director of the Julis-Rabinowitz Center for Public Policy and Finance at the Woodrow Wilson School. Prior to joining Princeton in 2012, he taught at UC Berkeley and the University of Chicago Booth School of Business. His work studies the connections between finance and the macro economy. His latest book, House of Debt with Amir Sufi builds upon powerful new data to describe how debt precipitated the great recession. I should say that when questions come up in economics about the dynamics of the economy, oftentimes we just say Mian and Sufi and kind of leave it at that because their framework has been such a powerful explainer for many patterns in the US economy over the last decade or two. I hope that will leave us on an up-note instead of leaving us mired in debt, but please welcome Atif Mian. Thank you.
Thank you, and thanks to the Fed for having me. It's been a great day. I learned a lot from all the presenters and discussions. I want to start with just a story that all of you have heard, but I'm going to change it a little bit. So there was once a frog who used to love lying on the pond and he would lie down, kind of face down and he would enjoy the surroundings and the water, but the water would rise up and down in temperature every once in a while. So that's like the business cycle, right?
And so when the water temperature would rise up a little, it would get a little bit uncomfortable for the frog. But the frog had a strategy, or let's call it monetary policy, and the strategy that the frog had was it would flip and it would lie on its back instead of on its face. So that way it could, because the back was cooler because of the air, it could now feel more comfortable. So every time the temperature would change and the frog would feel a little bit uncomfortable, it would basically flip. As I said, that's monetary policy.
Now, this policy that the frog had worked very well as long as my basic premise that the temperature of the pond just varies by a few degrees up and down. As long as that premise was correct, this policy worked perfectly. But imagine that there is a structural change in the pond and it just keeps getting warmer and warmer. The frog doesn't fully understand it. So he still has the same strategy. He still relies totally on his monetary policy and he just keeps flipping. What do you think would happen? The frequency with which he would have to flip would have to keep on increasing, right?
But ultimately, there is a problem. The frog is not understanding that times have changed and the frog is still relying on this incremental policy, which I'm calling here monetary policy, which is flipping, right? So if we could come to that pond and if we could address that frog, what would we suggest? To paraphrase an ex-Fed chairman slightly differently, we would tell to the frog, "You must now have the courage to leap, the courage to leap outside of the pond," right?
The point I'm trying to make here is that sometimes there is stuff happening which is slow moving, and we keep holding onto old habits that may not work very well anymore, and we need to be willing to have the courage to leap. Another way of saying the same thing is that we need to understand that there are policies which are incremental in nature and they are terrific, and they work very well as long as the system is stable, which the pond was in my original configuration, but there comes a time when situation changes fundamentally and that requires the retooling of policy, retooling of policy in a direction that I might classify as radical change rather than incremental change. Again, this is about the courage to leap.
The first point that I want to make here is that I believe we are in that time, a time that requires a radical policy change. Now, that I feel quite sure about that, that we need to think more radically, that we need to have the courage to leap. Because it's a very serious question, I don't know exactly where we should leap to. I think that's a much harder question. But I'm not here to solve all the problems, but I'll try to give some direction in terms of where we should calibrate our leap to be. And that's what I'll try to do.
So with that preamble, let me now give you, in fact, actually, I think people are sensing the direction and they're sensing the structural problem that we're all facing, which is this temperature of the pond is rising. So to make that point, and I think this will help clarify where I'm heading next. I recently saw an article in the Wall Street Journal, which the title or subtitle was the following. It says, "Borrowing helped pull countries out of recession but made it harder for policy workers to raise rates." Right? So think about what this is saying, that we got out of the last recession by lowering rates and somehow facilitating more borrowing.
But having been successful at that flip, there's actually a trade off in the long run, which is saying that now it has made it harder for monetary policy to raise rates. Why? Because you have now borrowed so much. There's all that debt burden that is on your shoulders, which is making it much harder for you to raise rates. What I'm going to argue is that this process has actually been going on for a long time and in a way, it has now gone to a limit where you cannot really do it much more and we really need to think differently and we really need to understand why we have had to continually rely on this policy of relying on more credit creation to solve the T minus one problem without realizing that it makes it even more difficult to address the T plus one problem, okay?
I think Mark Carney, who's obviously heading the Bank of England, he said something very much in the same spirit. I'm trying to cite intelligent people so you don't think I'm crazy when I say where I'm going to say next. Mark says, "The world is in a delicate equilibrium. The sustainability of debt burden depends on interest rates remaining low." Think of what Mark actually is saying. He's basically saying, "Look, I can't raise interest rates," because this is not about the Phillips curve. This is nothing about where the unemployment rate is.
There is another state variable that has been introduced in the determination of monetary policy and we are not talking about it. That state variable is not the unemployment rate. That state variable is the level of debt that the economy has. And I want to focus on that in two ways. First, I want to understand why that has become a state variable. I think when we think of that question, a lot of the conversations that have happened throughout the day in this room, they start connecting to sort of the topic of my conversation, which is this fundamentally unbalanced pace of growth that we have seen since the 1980s that is very much connected to why the economy has become, in a sense, addicted to debt, and in a way that today we have Mark Carney saying that, "I'm actually constrained. I can't do much because of so much debt around."
So let's think of that a little bit more, and I'm going to start off with a chart that was first made famous by Òscar Jordà and co-authors. I have my own version of it. This is total credit. So the three basic components of credit, household, corporate and sovereign. I'm adding all of that up for some conceptual reasons, but let's put them aside. The basic thing you can see very clearly, and this is what Jordà et al called the hockey stick. You can see that hockey stick, that it's kind of flat and then like a hockey stick, it moves up.
The remarkable thing is that in terms of magnitude, it's really stark. As a share of GDP, credit has doubled. These are basically advanced economies of the world. Now, does that make any sense? Let's think of that a little bit more. Actually, one other thing. There are two things that are really important for economists, including water. So there are two things that are really important for economists. One is quantity and the other one is price. So what you're seeing on this graph is the quantity of credit, and I want to show you one other thing and when you see that you can basically understand most of what is really relevant here, which is the price of credit and that's the interest rate.
The thing to notice here is that while the quantity of credit has basically doubled as a share of the economy, the price of credit has kept falling down. And the point, and this is the point of Mark Carney's statement as well, it has to, because the only way for the same dollar of income—that's what GDP is—the only way you can sustain twice as much debt for the same dollar of income is for the price of that debt to come lower and lower, and that's essentially what has been happening. The interest rate has had to come down. There is no other place for the interest rate to go as long as debt keeps climbing up and up. So I just want to put that in our head.
Now, let's start to investigate why credit is rising, and let's start with some hypotheses as we might do in I'm an econ 101 class. Why has credit or debt risen to the extent that it has over such a sustained and long period of time? Notice, by the way, the 2008 recession did not do much to stop the growth of credit. We talk about 2008 as deleveraging, but overall there was no deleveraging in 2008. It's very important to keep in mind if you want to understand what's going on. So why is it rising? Now, there's a very interesting discussion of people blaming us, the educators, that we are not educating the right stuff and of course we are not.
And let me give you another example of how we have been teaching the wrong stuff. The basic story of where credit comes from and what its purpose is according to the stuff that we teach in econ 101 is that you need credit to fund investments, right? That people come and they borrow because they have some interesting idea that they want to borrow against, and once that idea blossoms, they will repay the debt and we'll all be richer because of it. That's the standard story for why credit exists in the world out there.
It turns out that story is actually in a way wrong. It's not sufficient to explain this most remarkable fact about debt or credit. So let me try to make that point. If that story were true, then as this credit is doubling as a share of income, we should see a lot more investment. We don't see that at all. In fact, if anything —so you see investment to GDP falling—in fact, if anything, if I were to directly plot and look at the correlation between total credit GDP and investment GDP, it's very strongly negative. As credit has increased investment to GDP actually has fallen. So this more credit is not financing on the margin more investment in the economy.
Another way to see the same thing, and here, John Fernald is here in the audience; he has done a lot of work on this, on plotting aggregate productivity growth or TFP growth on the left chart. You can see that just like investment hasn't gone up, it's not like we have found out other ways to become more productive. You could have argued that, "Okay, you don't need to borrow because you don't need physical investment," but we have become very productive in other ways. You don't see that in the data either, actually. And the same thing, if you were to plot total credit GDP against productivity growth, if anything, the relationship is negative.
So what are we doing with all this credit? When you start to decompose total credit, you start to get a hint of what this credit is doing. The point I want to make is that this credit is not financing investment and it's not expanding the supply side of the economy. In fact, most of this credit is being used to generate demand because that's kind of the world that we have been living in since the 1980s. It's an economy that is trying to generate more demand, but is having trouble generating more demand and is leaning or has been leaning on this drug or these crutches of credit and debt, if you might generate that demand. You can see that already when you start splitting total credit, because you can see that most of this increase in total credit that I was talking about, is coming through household credit and government credit. Both largely financing demand. Either credit is financing household demand directly or the government is doing it for them. Now, why is this pond heating up? What's the structural shift that is making the demand side rely on credit? This is one way of trying to, I'm not trying to say this is all of the explanation, but I feel this is an important ingredient of the explanation. Which is the rise in inequality since 1980 as one of the important factors that has made the overall global economy much more dependent on credit or debt. Two sides of the same coin.
Here I'm plotting, this is for the US, the way to think of credit in this picture is think of aggregate savings in the economy, gross savings. Aggregate savings in the economy, they have to go somewhere. Right? Again, one of the wrong things we teach in our econ 101 is that savings equals investment. Well, that's just an accounting identity. That's because we define savings to be equal to investment, but they don't actually equal investment. If you literally were to add up gross savings, you know what? The entire distribution of a population saves in a given year. That can be absorbed by a number of different factors. It can be absorbed through what we call investments, but it can also be lent abroad, right?
But there's also a third thing that can happen. Which we don't often talk about. Which actually is the most important here. That is the savings of one individual can be lent to another individual to show up as this saving, but it will show up in the economy as credit or debt. Okay, so this picture is trying to track all of these components together. And what you can see is that something shifts in this graph from 1980 onward.
For matters of illustration, I am splitting the aggregate into two subcomponents, the top 1% versus the rest. For obvious reasons because that's what defines inequality. It's a basically a battle between the top 1% and the rest of us. I'm assuming none of us is in the top 1% right? So the interesting thing there is that if you look at the savings of the top 1%, I won't go into the deep technical details of how you do that, but trust me, you can do it. If you look at the savings of the top 1%, they are rising specifically post-1980. Before that, there was no difference. Why? Because there was no change in inequality actually. The thing to remember here is the reason what gives this graph the shape that it has is the very simple fact of life that people have known for ages and all empirical studies have confirmed it. It's as good as Planck's constant in economics. Which is the very rich save at a much higher rate than the rest of the people, number one. And number two, the Fed can do whatever it wants. It will never change Bill Gates' saving behavior. He's going to save as much and consume whatever, which is basically he couldn't care less what the interest rate is. And so they're going to save at a very high clip.
If a larger and larger share of the income is going to keep going to them. What do you think is going to happen to aggregate savings of the top 1% of the share of national income? It's going to keep on rising higher and higher. That's what you're seeing here. Now at the same time, US has actually been borrowing from abroad and it's been investing the same, so in fact it was still absorbing more savings from the rest of the world. Someone had to absorb it. And this is just an accounting identity, the absorption was all done by the bottom 99%. And that's the dissaving of the bottom 99 9% that you're seeing it in this graph as a fraction of national income.
The point that I want to focus on is that these two shaded areas are roughly the same. In other words, we can think of the rise in inequality and given their very high savings, zero the top 1%, as them lending more and more to the rest of the population. And as a result, you see this rise in household debt in the US, right? But this kind of phenomenon happening across the world, sometimes they are happening within countries in this example, but sometimes they're happening across countries. We call that the global savings glut. But all of this imbalance, structural imbalance, just call it inequitable growth, is behind the rise in this total credit. And that's been raising the temperature of this pond that I talked about. And this is just another picture of the top 1% of the bottom line, 99% if you look at their leverage debt to income, you see all of the rise in leverage is basically about bottom 99% phenomena, because of the forces that I just talked about.
All right, let me take another five minutes or so and then we can open up for questions. What I've just told you is that there is this force that the global economy has been facing since the 80s which is at least partly driven by this inequitable growth. Which has led to the economy's. Because the thing is, think of the one useful counterfactual experiment. Imagine that the bottom 99% refuse to borrow more. Right? We could all coordinate, say we don't. But inequality keeps rising. Bill Gates still keeps saving at the clip that he saves. What do you think happened in that economy?
Something has to give. It's no longer an equilibrium. Those savings have to go somewhere. There's not enough room for investment to, nobody's interested in more investment. So this economy will start to contract. We call that the liquidity trap. That's literally the definition of the liquidity trap. To prevent that from happening, monetary policy and other or maybe the fiscal policy. They say, "Oh, we must generate demand somehow. Otherwise this economy will start contracting." And so they start lowering rates. They start liberalizing the financial markets, deregulating it. You start running fiscal deficits, start running fiscal policy to try to generate demand, so the economy does not shrink. In other words, you try to create credit to create demand. We may realize it, we are doing it. We may not realize it, but that's what we are doing. So that's what has been happening.
The point is that now we have reached a limit of sorts, which is given by the interest rate. The price is all the way down to zero. There's not that much room to go. And so it's time to address, have the courage to leap. It's time to address the fundamental imbalances in the economy. And I promised you I will not have an answer for that question, right? But I wanted to highlight the importance of answering that question.
I will use the balance of the time to talk about another related important point, which is everything I've said so far suggests that you somehow need to figure out where demand is. Otherwise there is no collateral damage of this process that I've just described. I just want to highlight there actually is collateral damage of this process of more credit and lower interest rates. Especially once you start going down to all the way to zero.
And that point we have tried to make in a recent paper with Ernest Lou at Princeton and Amir Sufi at Chicago, where the basic point is that if the economy is—and remember Mark Carnegie, we are stuck at zero, you know, you don't have room to go anywhere else. If the economy goes to that point, there are costs of very low interest rates. You can think of that as financial instability and so on, but there's actually a real cost. Even outside of that. Those are real issues. Even if you were to assume those away, even in a Modigliani-Miller world, which is the technical term for saying assume away financial instability, there is a cost. Because at very low interest rates, the playing field no longer remains even.
I won't have time to give you the conceptual argument in its fullest, but the basic punchline is that as interest rates start marching towards zero. They don't, the typical notion that we have is that very low interest rates help everyone, all the CEOs and others, because they can invest more. But that's true, but not for everyone. It doesn't help everyone equally. As interest rates march towards zero, they help industry leaders more than industry followers. And as a result of that, they lead to more market concentration and less competition. And that does something to the supply side of the economy, which is here.
As interest rates keep going down, the supply side of the economy actually starts shrinking at some point. And productivity growth slows down. Why? Because market concentration rises. The reason for that is that very low interest rates are not good equally for everyone. They are more useful for industry leaders versus industry followers. Which leads to wider problems of market concentration and lower productivity growth. And again we have seen a lot of evidence for that of rising market concentration and lower productivity growth.
The last thing I want to say on that point is that there are additional reasons to worry about very low interest rates. So now let me bring Modigliani-Miller back into the equation. Let me bring finance back into it. There are additional reasons to worry about low interest rates, and let me make that last point and then I'll close for questions.
I said earlier that lower interest rates favor market leaders more than market followers or industry leaders more than industry followers. For that argument to go through, I was assuming they both face exactly the same interest rate, because it was the Modigliani-Miller world. When you look at their drill data, real world actually, the problem is even worse than what I had argued before in the previous slide. Because it turns out in the real world, lower interest rates disproportionately pass through to industry leaders as opposed to industry followers. So this left graph which is only based off of Computation firms, so these are publicly listed firms. It's true even there, that if you were to compute or impute perhaps I should say interest that they're paying on their borrowing, and you plot that against the long-term risk-free interest rate, which obviously has gone down over time. You see that for both industry leaders, which are the top 5% of the firms by market share and the rest. You see that interest rates have gone down for everyone, but notice one thing, they have gone down faster for industry leaders than they have for industry followers
The other thing and this is a slightly technical comment, but this gap between them, even if it were constant, is actually increasing. But even if this gap between them, which is the interest rate spread, if you like. Even if this were constant, it implies that the fact that it is constant while the interest fee rate is going to zero, it implies that the real advantage that they have is convex in the level of the interest rate. Which is shown by this graph here, which is showing the relative debt capacity of industry followers versus industry leaders.
The point again, and I'll end at that is I wanted to make two points. The first one was that this dependence on credit is something that we have had for the 1980s, but it's no longer feasible. So it's reaching the end point. And this dependence on credit or addiction to credit is linked to inequality or an inequitable growth. That was point number one. Point number two is that that dependence implies that interest rates are stuck at zero, but it's not costless for interest rates to be at zero. It's costly for global growth, for interest rates to remain at zero for a very long period of time. So given that, we need to have the courage to leap out of that pond. In which direction? I'm sure we have smarter people to answer that question. Thank you very much and I'm happy to take some questions.
Thank you. That was an amazing presentation. I guess the question I would ask you, as you look at your analysis of increasing debt relative to lower interest rates, is there a tipping point in that analysis? And how do you think about that? Or how should we think about that?
Yes, I think there is a tipping point, and actually the literature is very clear on that. The technical term we sometimes use is the zero lower bound constraint, or something like that. That is partly what I was referring to as the very low interest rate environment as not being very healthy. There are many different reasons, actually, this is not healthy. I just pointed out a couple of them, but even before those two, something that has been talked a lot about in the literature is that essentially once you hit a constraint, which is called the zero lower bound, that you cannot lower interest rates anymore. Now the Fed and others have tried quantitative easing and that sort of stuff. But once you cannot lower interest rates anymore, but the economy is kind of demanding lower interest rates, to generate more demand,
Of me is kind of demanding, lowered interest rates, so generate more demand. The only way to then satisfy the economy is by shrinking the size of the economy. And that's obviously very painful. So that would mean lower growth overall, or higher unemployment, and things of that sort. But to essentially answer your question, that tipping point is kind of what we call zero lower bound or very low interest rates. And that's why I said we've kind of saturated ourselves. that's where we are. And so we are already at that limit.
Thank you. So what happened in the 1980s that caused that divergence that you sign the first graph?
Well, it's a trillion dollar question many people have. We know that something happened. We know that inequality started rising. I'll give you the sort of the hypotheses that are, I think, all true to some extent. Tax policy changed, obviously that's one thing that changed. Technology's always changing. So I don't know if it changed more in light of, who knows? But people attribute some of this to technological change as well. Some of it to globalization and things like that. I have no idea. But these are the things people talk about.
There's a question at the back. Yes.
So in the context of low rates being bad, how do you feel about the ECB's model of negative rates?
Very good question. I think this question actually, I should have clarified this during the conversation, not just because I'm here at the Fed. But anything that I've said should not be seen as implying that it's a statement about monetary policy, or what the Fed is doing. In fact, the only interest rate that I was talking about is what you might think of as like the natural rate of interest. Equilibrium rate of interest. In fact, the point that I want to put across is that it's not about the Fed. Remember, that's why I said we can think of that flipping of the frog as monetary policy, not to diminish monetary policy. That is not the point.
The point was that it's not about monetary policy. The real issue is much more structural, and it's much deeper than that. The wiggle room that monetary policy has is only around what we call the natural rate of interest, which itself has been coming down over time, and so monetary policy has been trying to adjust the short term around that. So because the natural rate of interest has been going down, you can try to accommodate for it more and more by having negative interest rates. Hypothetically, that's a useful thing to do, but this is precisely why I wanted to make sure that I mentioned some of the other forces, like its impact on competition among other things. That a solution that revolves around just somehow making the interest rates even lower and lower and perhaps in the negative territory.
I don't see that as a long-term solution, number one. Number two, another point that I didn't emphasize, but it's actually very important, it was actually baked into this comment in the Wall Street Journal article, is that if the reason, or the way you are helping the economy through lower interest rates is by somehow making the economy borrow more in the aggregate, you're actually making the problem even worse for yourself down the road. Because again, you will now need those permanently negative interest rates to sustain that even higher level of credit. And at some point, we need to recognize that this is just not possible as a road to keep going on on. So that's why I said we need to think of the courage to leap.
So let's think of some of the possibilities of those, how we might leap. I think the wealth tax, to give you an example, is a legitimate policy proposal that addresses some of these fundamentals in a way that negative interest rates and so on would not work. Again, I don't have time today, but that's a sensible idea. In fact, we might even want to go back to the Bible and read it more carefully. There are some important lessons from- I'm actually a great believer in folk wisdom. I think we should never not take things that have survived hundreds of years, never take that lightly. Listen to your grandmother and grandfather very carefully. I'm a big believer in that, especially when it comes to slow moving forces because an individual lifetime is so small, we cannot extrapolate from a daily experience what we should be doing over centuries. For that we need the Bible, right?
So the Bible talks about financial policy and macro-prudential policy, right? And it says that occasionally you need to write down debt. Because otherwise you're going to, every seventh year, clean the, obviously I don't know the exact words, but there is something to that effect. So I think this idea of figuring out ways to write off debt. I think it's important. We talked a little bit about it in the aftermath 2008 recession and saying, "Look, you know you have to think of those kinds of policies as well". But it's actually perhaps even more relevant given these macro issues that I just talked about.
Again, that's why I don't have a very strong, or a very small, I should say, confidence interval in a statistical sense. That's why I didn't want to explicitly talk about those. But these are the things, we really need to have the courage to talk about these issues. I just want us to have a conversation, a serious conversation, on these issues because I think some version, some convex combination of Bible and Bernie Sanders and Elizabeth Warren might be needed. And so we really need to talk, we really need to have a conversation about those issues. That is if I'm able to have that, then I think I will be successful.
Oh, depending on the time, there's a couple of hands here as well.
So, what's wrong with the price signal? Obviously what you're saying, the risk and debt of all types is now higher. We don't set, there's certainly an excess supply. And it doesn't seem like the price signal is pricing for risk. We just have low rates, even though you're in a very risky lending environment, the way you've described it, is really going up. So why isn't the price signal stronger?
Well, your question is an extremely deep one because when you say prices, to an economist prices are everywhere, right? And so it depends on which prices you're talking about. Some prices are obviously reacting, that was my point. The price of credit is going down, which is the interest rate, precisely because otherwise that high level of debt is not sustainable. So that price system is working perfectly fine. There's nothing wrong with that price system. It has implications-
It's the risk, I don't think it's priced in. That's what I'm saying. The price should be higher to me.
Well, at least in the story that I told, actually there was no risk. The world that I described was risk-free. It's just that growth is lower. That's a more subtle- There's no risk otherwise in this economy. But another way, I think I understand your question another way. There is something missing. There are clearly missing markets, and what are those missing markets? Well, those missing markets are whatever is leading to this very high inequality. So for example, part of why inequality is so high is that kids who need to be educated a certain way are not getting educated. Kids who need a certain level of healthcare, especially when they are young, they don't have that level of healthcare, so they're not productive enough in their adult age. And that's leading to, those are missing markers. Those are the price signals that are really lacking. But we understand exactly those, for that we need to coordinate and because that young kid is not voting, or whatever, things of that sort. So it's those price systems that are lacking for which we need to, I mean, healthcare is another one. So there are many externalities that we know that would lead us to a situation that we have seen, that is this highly inequitable growth. That's, at least, part of the problem. That's what I was aiming at. And there is a very real reason why the usual price signal, the so-called invisible hand of Adam Smith, does not work perfectly to make the economy grow equitably on its own. For that we need social and political constructs.
President Mary C. Daly:
Okay, so I am standing between you and a nice reception we have out there, and I will be brief. But I want to just say that this, I said this morning, is our 11th event in the Fed Listens Campaign, that Vice Chair Clarida's leading for the system. And I thought this was a absolutely terrific discussion. So I'd like to start by giving our speakers once again a big round of applause.
I also want to take the opportunity to thank the research department, the public affairs department and the community development department here in the San Francisco Fed who were instrumental, actually worked together collaboratively to put together this great program, and to the Board of Governors, Vice Chair Clarida and his staff too about putting this event together. So thank you very much. It was great.
And to all our volunteers, of course, who helped staff it. This is one of those "it takes a village" kind of a days. I want to leave you though with one of my favorite quotes in economics. I'm a labor economist by training, and I read this quote early in my career, and I referred to it regularly throughout my career, and it's by a famous economist, Arthur Okun. And in 1973 he wrote a paper about a hot economy. And in this paper he says, "The difference between unemployment rates of 5% and 4% extends far beyond the creation of jobs for 1% of the labor force". And what he's meaning is we can't see all the potential things that can occur just by lowering the unemployment rate by one percentage point. And so it takes all of you to help us see those.
We can always look at desegregated data and try to stretch farther, and well beyond what our aggregate data showed us to see the distribution. But really we need people in the communities, business leaders, people on the ground working with individuals, to figure out what the benefits of those kinds of declines are, and also what any potential costs are that we might want to offset. And what I personally learned today is that those differences, that difference between 5% and 4%, or 4% and 3.7%, are material. The benefits are real. Jobs are good. And when everybody who wants a job gets one, and some of those who would prefer not to have a job, still have one, we probably are doing something right for the American people. So with that, I will say thank you very much, and please enjoy our reception.