The president cautioned that the U.S. was unlikely to return to its role as a “voracious consumer market” that could anchor the world economy.
Pres Obama acknowledged that regulatory failures in the United States had a role in the meltdown.
Rift USA - Europe
Rift intensified over Anglo-American calls for greater fiscal stimulus spending and French and German demands for more intrusive global regulation of financial institutions
Rift intensified over Anglo-American calls for greater fiscal stimulus spending and French and German demands for more intrusive global regulation of financial institutions
Pres of France Sarkozy would reject an agreement that puts off stringent new regulations on banks, tax havens, and hedge funds.
Togher regulations -- he has called for a “global regulator” that would be able to reach inside the borders of the United States and other large nations to deal with international financial firms -- is “nonnegotiable.”
Chancellor Angela Merkel of Germany rejected Mr. Obama’s plea for other nations to follow America’s lead and pledge greater fiscal spending to stimulate their economies.
She said more spending was not worth debating.
She said more spending was not worth debating.
It appeared likely that countries would divide into 2 or 3 camps.
The United States, Britain and Japan will push for more immediate stimulus and “systemic risk” regulators that mostly operate within national borders; Germany and France will push the opposite position, probably with some support from the Czech Republic.
That leaves China and Russia, among others, to exploit the division to play a significant role.
Over the long term, Mr. Obama appeared to be preparing the world for a reshaped global economy in which the United States no longer was the ultimate export market for the world’s established and emerging powers.
Mrs. Merkel and Mr. Sarkozy laid out this argument: the United States had only now begun to understand the cost of poorly regulated free-market capitalism, and must now bow to the European model.
The German chancellor Merkel, who is scheduled to met Mr. Obama one-on-one this weekend, rejected attempts to link the American and British demands for fiscal stimulus programs to the French and German agenda on regulations
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