Michael Spence, a senior fellow at the Hoover Institution and the Philip H. Knight Professor Emeritus of Management in the Graduate School of Business at Stanford University, discusses, with Andrea Catherwood on Bloomberg Television's Last Word, the prospects for the European Union leaders' summit and the possibility of a deadlock.

Eric Hanushek and Terry Moe, Hoover senior fellows and members of the K–12 Education Task Force, discuss the role of economic growth in dealing with current deficit problems. The breakdown of congressional fiscal discussions over the balance of spending cuts and taxes completely neglects the third option of increasing GDP growth, a policy that would deal with long-run Medicare and Social Security issues. Improving long-run growth, however, will take significant changes in school policy–something that is difficult to achieve politically. (6:06)

Allan H. Meltzer is a distinguished visiting fellow at the Hoover Institution and the Allan H. Meltzer University Professor of Political Economy at Carnegie Mellon University. He is the author of History of the Federal Reserve, Volume I: 1913–1951 (University of Chicago Press, 2002), a definitive research work on the Federal Reserve. Meltzer notes that Europe needs a strategy to deal with its debt problem. Eventually the Germans may have to pick up the cost of the debt, but the alternative is a plan for serious deflation in the southern countries or inflation in Germany.

Edward Lazear, the Morris Arnold Cox Senior Fellow at the Hoover Institution and former chairman of the President's Council of Economic Advisers, discusses why the unemployment rate dropped 0.4 percent and whether it is a sampling error.