Sunday, March 08, 2009

Obama and Brown Look Forward to G20 Summit

Brown Wins Obama's Support for a Shake-up of Global Regulation, Financial Times

Obama Sees 'Pillars' of Recovery in Place This Year, AFP

While economic indicators, including the recent staggering unemployment numbers, continue to point toward increasingly grave economic circumstances, President Barack Obama expressed measured confidence this week that the coming months would bring the foundation of recovery from the current recession.

These expressions came during President Obama's discussions, both during and after recent meetings with British Prime Minister Gordon Brown, regarding the upcoming G20 summit in London. While meeting with Brown, Obama committed the United States to a global effort to overhaul the global system of financial regulation, which both men agreed was outdated. One central element of the regulatory overhauls will be what Brown described as "a crackdown on shadow banking and tax havens."

In addition to a renewed committment to regulatory reform, Obama also touted the recently-enacted $787 billion stimulus and the reservation in pending budget legislation of $250 billion in further stimulus or bailout money as being the "pillars" of a recovery of the United States' economy--a recovery Obama hopes will being before the end of the year. Obama called on Brown and the rest of the world community to join the United States in a global fiscal stimulus effort. This theme of coordinated global stimulus will likely be at the top of Obama's and his administration's agenda at the upcoming G20 Summit.

Discussion Questions:

1) Is a global system of financial regulation, as opposed to individual, national systems realtistic? Is it desirable?

2) Is fiscal stimulus the best approach to addressing the global financial crisis? If not, what is a better strategy?

3) What is the most favorable outcome of the upcoming G20 Summit?

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