Obama wants 'robust' stimulus not 'super-regulator'

14th March 2009, Comments 0 comments

The president's remarks to business leaders highlighted the jostling for position underway for control of the agenda of the Group of 20 summit of developed and developing nations in London in April.

Washington -- President Barack Obama Thursday tried to bridge apparent differences with Europe on rescuing the global economy, calling for "robust" stimulus plans but not a "super-regulator" for finance markets.

The president's remarks to business leaders highlighted the jostling for position underway for control of the agenda of the Group of 20 summit of developed and developing nations in London in April.

Obama said it was important that "stimulus efforts of all countries are sufficiently robust to deal with the decline in demand."

"We want to make sure everybody is mindful that the decline in global demand is enormous and now is the time for us to provide some balance," Obama said.

The president said he backed greater financial regulation, pointing to an approach European leaders have argued is preferable to framing new fiscal stimulus plans,

"We think it is very important that there is coordination, not necessarily a super-regulator," Obama said, in comments that might fall short of European aspirations for reform.

Earlier, just three weeks before a gathering of Group of 20 leaders, European leaders appeared to differ with the United States over the prescription for global recovery.

German Chancellor Angela Merkel and French President Nicolas Sarkozy laid out a joint position at a press conference in Berlin.

"We have agreed that Germany and France will send a common signal at this summit" Merkel said.

"The issue is not spending even more but to put in place a regulatory system to prevent the economic catastrophe that the world is experiencing from being repeated," Merkel said in a direct rebuttal to US calls for more spending.

There must be "regulation and transparency of financial markets," she said.

Despite signs of a differing approach between Europe and the United States over the G-20 summit, Obama said he thought it was "feasible" that a joint path could be agreed at the highly anticipated London meeting.

The president, perhaps with an eye on fellow G-20 nations, told the Business Roundtable, a gathering of CEOs of top US companies, that it had not been his original intent to come to power and immediately pass a 787-billion-dollar economic stimulus plan.

"Now, let me say that it was not my preference, believe it or not, to launch my administration by passing the largest economic recovery plan in the nation's history," he said, but argued dire economic conditions gave him no choice.

Obama also hit back at critics who said that he and Treasury Secretary Timothy Geithner have acted too slowly to address the banking crisis, which many people believe are at the root of the economic crisis.

"Critical to that solution is an honest and forthright assessment of the true status of bank balance sheets -- something that we've not yet had," Obama said.

"That's why the Treasury has asked bank regulators to conduct intensive examinations or "stress tests" of each bank."

"When that process is complete next month, we will act decisively to ensure that our major banks have enough money on hand to lend to people even in more difficult times."

AFP/Expatica

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