Selling Stimulus Overseas

This week President Obama has gone to Europe for the G20 summit where leaders from around the world will be meeting to discuss the economic crisis around the world. In recent comments President Obama has suggested that other world leaders need to follow America’s lead and begin to pump more of their governments’ money into their respective economies to kick start the global economic engine. While there has been some receptiveness to the idea some leaders have been less than enthusiastic and others downright hostile to the idea of following in the Obama administration’s footsteps when it comes to economic policy.

President Nicolas Sarkozy of France threatened to walk out of the G20 summit in an effort to get the G20 to focus on regulation rather than stimulus. Sarkozy has expressed a belief that greater regulation commitments by governments as opposed to increased bailouts are the key to solving the current economic woes of the international financial markets and that a lack of regulation is ultimately what caused the current crisis to begin in the first place. The sentiments of German Chancellor Angela Merkel have been similar to those of Sarkozy in rejecting calls for more government stimulus and pointing to a need to more heavily regulate the markets in order to set the stage for recovery in the long term. In recent comments rejecting bailouts as the answer to the current crisis she was quoted as saying that the economy cannot be fixed in a day. Czech Prime Minister Mirek Topolanek went so far as to call the American stimulus program a “road to hell”. While experts explained later that this sounds worse in English than it is meant in Czech terms it was still a clear rejection of American calls for increased European stimulus commitment.

The British Prime Minister and host of the G20 Gordon Brown has been more supportive of the idea of stimulus. He said in recent comments that a “global New Deal” was needed to get the world economy back on the right track. His proposal is a three pronged approach involving increased investment, international trade and tightened regulation to address the issues facing the members of the G20.

The seriousness of the global economic crisis is evident in the attendees of this year’s G20 summit. In a gathering that is normally made up of finance ministers this year’s summit is comprised of leaders from throughout the industrialized world. In a seeming testament to the seriousness of the crisis world leaders have opted to attend in person as opposed to sending their economic advisors in their stead.

In his first major trip abroad since taking office in January, President Obama is also scheduled to visit France, Germany, the Czech Republic and Turkey over the eight days he will be out of the country. It is expected that in addition to the issue of the global economic crisis he will be discussing the ongoing conflict in Afghanistan and looking for increased commitments from our allies in getting the threat of the Taliban and Al Qaeda under control in the interests of not only increasing American security but global political stability as well.

Troy Wilson-Ripsom - Staff Writer | Give your feedback on this article. | Click icon to Digg this article