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Europe's debt crisis: The professor weighs in

Kenneth Rogoff, a professor of economics at Harvard, is one of the world's biggest brains on government debt defaults.

He's also the author of "This Time is Different," an epic tome that examines 800 years of financial crisis, and was one of the most highly-praised economic books of last year.

So when Rogoff talks, people listen.

The professor is talking today in the pages of the Financial Times and his subject is, not surprisingly, the big story of the week: Europe's growing debt crisis.

Rogoff argues that the one of the main points of the euro — to increase the size and liquidity of European markets — is at the root of today's debt problems. That's because the end result was lower interest rates, which fueled irresponsible borrowing by goverments and people, particularly in countries of the "eurozone periphery" like Greece, and to a lesser extent Spain, Portugal and Italy.

Here's the money quote:

"Thus, the spreading debt crisis is as much a product of the 'success' of the euro as of its failure. The euro was designed to be a superior debt financing machine and, to a considerable extent, it has delivered. Unfortunately, it should have come with a warning sign: Europe’s leaders were far too quick to admit members who might have been better served with a much longer probation period. The Maastricht treaty and, more importantly its implementation, was simply too forgiving, especially for countries with chequered financial histories."

The question now: what will Europe's leaders — particularly Germany and France — do about the growing mess?

And two more: what kind of additional political unrest and market turmoil will this all produce?

These are big, important questions. And we don't yet have many good answers.