http://www.usatoday.com/news/world/2010-06-27-Obama_N.htm
<http://www.usatoday.com/news/world/2010-06-27-Obama_N.htm>G-20 aims to slash their deficits * Richard Wolf, USA TODAY TORONTO — The world's leaders agreed Sunday to begin transitioning from spending to saving as they walk what Canadian Prime Minister Stephen Harper<http://content.usatoday.com/topics/topic/Stephen+Harper>called a "tightrope" between government stimulus and debt reduction. The tenuous agreement, to halve government deficits by 2013, represented a victory for European leaders such as British Prime Minister David Cameron<http://content.usatoday.com/topics/topic/People/Politicians,+Government+Officials,+Strategists/World+Leaders/David+Cameron>, who sought tough spending cuts. President Obama had urged colleagues not to abandon government spending too soon. Treasury Secretary Timothy Geithner<http://content.usatoday.com/topics/topic/People/Politicians,+Government+Officials,+Strategists/Executive/Timothy+F.+Geithner> said Saturday that premature austerity measures had proven fateful in past crises. "We can't all rush to the exits at the same time," Obama cautioned at the conclusion of the G-20<http://content.usatoday.com/topics/topic/Organizations/International+Agencies,+Alliances,+Cartels/G-20> summit of developed and emerging nations. "The recovery is still fragile." The United States<http://content.usatoday.com/topics/topic/Places,+Geography/Countries/United+States>, however, may be better positioned to reach the summit's goal, because its 3% growth rate is stronger than most in Europe<http://content.usatoday.com/topics/topic/Places,+Geography/Other/Europe> and its financial industry reforms are nearly enacted. Obama's letter to other Group of 20 major industrial and developing nations 10 days ago noted that his budget calls for halving the U.S. budget deficit from $1.5 trillion to $727 billion by 2013. He didn't point out that the same budget shows it rising again, to more than $1 trillion in 2020. BACKGROUND: G-20 views converge over deficit cutting<http://www.usatoday.com/news/world/2010-06-27-sarkozy-g20_N.htm> SECURITY: Police arrest more than 560 at Toronto G-20 summit<http://www.usatoday.com/news/world/2010-06-26-summit-protests_N.htm> Although a deal was reached on spending and saving, other matters were unresolved. Europe's desire for a global tax on banks went nowhere. Russia demurred on a stronger denunciation of an alleged North Korea torpedo attack on a South Korean warship. Host Canada got only modest support for its initiative to tackle child and maternal health in developing countries. And there were signs of impatience regarding the lengthy war in Afghanistan, which Cameron said must be righted "this year." The major achievement was the deal to tackle deficits. Just 15 months ago in London, the G-20 was pushing government stimulus to shake the world out of the worst economic decline since the 1930s. In Pittsburgh six months later, the group agreed it was too early to begin an exit strategy. That reluctance came to a halt Sunday, mostly because of the debt crisis that has racked Greece and threatens Spain, Portugal<http://content.usatoday.com/topics/topic/Places,+Geography/Countries/Portugal>, Ireland and others. "To sustain the recovery, it is imperative that we follow through on existing stimulus plans," Harper said. "At the same time, advanced countries must send a clear message that as our stimulus plans expire, we will focus on getting our fiscal houses in order." Some budget experts interpreted the G-20 deal as a defeat for the Obama administration's approach, which still emphasizes targeted government spending to reduce unemployment and help struggling states and localities. Congress has blocked additional stimulus spending thus far. "It is a pretty strong repudiation," said Douglas Holtz-Eakin, former director of the Congressional Budget Office<http://content.usatoday.com/topics/topic/Organizations/Government+Bodies/Congressional+Budget+Office> and a top adviser to Republican<http://content.usatoday.com/topics/topic/Organizations/Political+Bodies/Republican+Party> Sen. John McCain<http://content.usatoday.com/topics/topic/People/Politicians,+Government+Officials,+Strategists/U.S.+Senators/John+McCain> 's presidential campaign in 2008<http://content.usatoday.com/topics/topic/United+States+presidential+election,+2008>. He said Obama "is operating as if the past six months did not happen. The financial market fallout on the European sovereigns is real, and they have to respond." Less progress was made on the other problem plaguing world markets — the lack of strict regulations to prevent banks and other financial institutions from becoming overextended. New rules on how much capital they should retain were left for the G-20 conference in Seoul in November. Countries were left on their own to consider new bank taxes favored by European nations as a way to pay for potential future financial crises. Those opposed to such levies, including the United States and some Asian countries, were not required to join a global approach to the problem. "If you look across the range of agenda items, from bank taxes to financial regulation to deficit reduction, countries mostly seem to have agreed to do whatever they were going to do anyway," said Philip Levy of theAmerican Enterprise Institute<http://content.usatoday.com/topics/topic/Organizations/Non-profits,+Activist+Groups/American+Enterprise+Institute> . Though little progress was made to expand trade, Obama announced a new effort to finish a trade deal with South Korea by November and get it through Congress soon thereafter. He called it part of an effort to expand exports over five years. Environmentalists claimed a small victory when G-20 leaders agreed Sunday to continue an effort to phase out government subsidies that encourage the use of fossil fuels. They had feared the effort, begun in September in Pittsburgh, could be dropped. "It explicitly keeps the issue on the agenda for the next summits," said Kim Carstensen, a global climate expert for the World Wildlife Fund<http://content.usatoday.com/topics/topic/Organizations/Non-profits,+Activist+Groups/World+Wide+Fund+for+Nature>. Still, he said the agreement fails to set specific targets or timetables for unwinding subsidies. On other issues, there were areas of disagreement: • Afghanistan. The leaders endorsed a five-year timetable for moving to local control of military operations, but their impatience was evident. "Putting everything we have into getting it right this year is vitally important," Cameron said. • North Korea. Although they condemned Pyongyang's apparent torpedo attack on a South Korean warship that killed 46 sailors, Russia argued against an even stronger denunciation. • Aid to poor nations. Harper won $5 billion in pledges from the G-8 developed nations for a new health initiative aimed at children and pregnant women, plus $2.3 billion from other countries and foundations. Aid groups called the sum inadequate. Obama made use of his spare time over the weekend to hold seven private meetings with the leaders of Great Britain<http://content.usatoday.com/topics/topic/Places,+Geography/Countries/United+Kingdom>, China, Japan, South Korea, India, Indonesia and Turkey. He invited Chinese President Hu Jintao<http://content.usatoday.com/topics/topic/People/Politicians,+Government+Officials,+Strategists/World+Leaders/Hu+Jintao> for an official state visit, an honor reserved to date for Indian Prime Minister Manmohan Singh<http://content.usatoday.com/topics/topic/People/Politicians,+Government+Officials,+Strategists/World+Leaders/Manmohan+Singh> and Mexican President Felipe Calderon. * -- Peace Is Doable -- You received this message because you are subscribed to the Google Groups "Green Youth Movement" group. To post to this group, send an email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/greenyouth?hl=en-GB.
