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Letter from President Obama to G-20 leaders

By Scott Wilson

President Obama sent the following letter to G-20 leaders on Wednesday:

As we approach the Seoul Summit, the world is looking to us to work together to strengthen the global economic recovery, continue to repair the financial system, and promote the stability of global markets.

The United States will do its part to restore strong growth, reduce economic imbalances, and calm markets. A strong recovery that creates jobs, income and spending is the most important contribution the United States can make to the global recovery. The dollar's strength ultimately rests on the fundamental strength of the U.S. economy. To secure the strong recovery the global economy needs, the United states joined with its G-20 partners to take decisive action to halt the fall in activity caused by the deepest crisis we have experienced in generations. The United States moved quickly to repair our financial system and to enact the strongest financial reforms since the 1930's. The United States is committed to an ambitious path of fiscal consolidation, consistent with our G-20 commitment to stabilize our public sector debt, as the recovery strengthens.

We all now recognize that the foundation for a strong and durable recovery will not materialize if American households stop saving and go back to spending based on borrowing. Yet no one country can achieve our joint objective of a strong, sustainable, and balanced recovery on its own. Just as the United States much change, so to must those economies that have previously relied on exports to offset weaknesses in their own demand. A rebalancing of the sources of global demand, along with market determination of exchange rates that reverses significant undervaluation, are the best base for the shifts needed to bring about the vigorous and well-balanced recovery that we all want.

When all nations do their part - emerging no less than advanced, surplus no less than deficit - we all benefit from higher growth. The action plan that our G-20 Finance Ministers and Central Bank Governors laid out in Gyeongju offers a new consensus on global economic cooperation. It sets out how unleashing domestic demand in surplus countries can support strong global growth as deficit countries increase savings and repair balance sheets damaged by the crisis. It commits us all to pursue policies to reduce the risk that unsustainable external imbalances will reemerge. It recognizes the responsibility of countries with reserve currencies, and the role that market-determined exchange rates - coupled with a commitment to refrain from undervaluing currencies for competitive purposes - can play in facilitating global adjustment. It can help to create a stronger internal monetary system that avoids destabilizing shifts in capital flows.

We should build on this foundation and ask Finance ministers and Central Bank Governors, with the support of the International Monetary Fund (IMF), to finalize the details of this consensus promptly. If we work together to avoid the kind of imbalances that weakened the global economy on the eve of the crisis, we will bolster the global recovery.

With these shifts, emerging markets will be an increasingly important source of demand for the global economy. In that regard, it is important that we discuss how to move forward on Doha. All G-20 countries have a responsibility to provide the ambition necessary to reach agreement.

The G-20 Leaders can be proud of our work in the area of financial sector reform. Our cooperation holds the promise of banishing the regulatory race to the bottom and opening the way for a genuine race to the top.

In the United States, the Dodd-Frank legislation will greatly strengthen consumer protections and financial market integrity. The Basel Accord will allow us to raise standards together in a way that, once fully implemented, will enable us to withstand stresses of the magnitude associated with the recent financial crisis without extraordinary government support. The United States will implement the new Basel agreement on the agreed timelines.

But now is no time to be complacent. The market will not wait for us to finish. They will test us every day. We need to press on and complete our reform agenda, with new steps to ensure no financial institution is too big to fail. We must work together to ensure large interconnected firms have a greater capacity to absorb losses. Each of us must also put in place a strong national resolution regime that protects taxpayers, and we must build on top of our national systems a framework for cross-border cooperation to promote the safe wind-down of even the largest and most complex global institutions. We must press ahead with the other important financial sector reform items on this agenda. We need to work together to assure that the momentum of reform does not falter.

We should also take great pride in the historic progress that we have made to modernize the world's economic governance institutions over the past 2 years. The IMF now has the resources it needs to fight crisis, better tools for preventing future crisis, and more effective governance. These reforms, like our plan to support a well-balanced global recovery reflect the growing role and responsibilities of dynamic emerging market countries in the global economy.

Finally, we should advance our cooperation to address common global challenges. The Korean presidency has highlighted the key role growth has played in lifting so many out of poverty, especially in emerging Asia, and drawn attention to what we all can do to increase the potential for inclusive growth in low-income countries. We should make sustained efforts to carry through with our groundbreaking Pittsburgh commitment to phase out fossil fuel subsidies. And we should recognize our special responsibilities to prevent corruption and promote a clean business environment.

This is an ambitious agenda, but the circumstances demand no less. I want to express particular appreciation for the leadership shown by President Lee of Korea in advancing this agenda. Together, we have important work to accomplish in Seoul.

By Scott Wilson  | November 11, 2010; 4:56 AM ET
Categories:  44 The Obama Presidency  
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Comments

Just like his letter to the G20 before it's meeting in Canada...The G20 leaders ignore this sad excuse for a 'leader'.

How embarrassing for the USA

Posted by: ferrylas | November 12, 2010 8:55 AM | Report abuse

Just like his letter to the G20 before it's meeting in Canada...The G20 leaders ignore this sad excuse for a 'leader'.

How embarrassing for the USA

Posted by: ferrylas | November 12, 2010 8:55 AM | Report abuse

Just like his letter to the G20 before it's meeting in Canada...The G20 leaders ignore this sad excuse for a 'leader'.

How embarrassing for the USA

Posted by: ferrylas | November 12, 2010 8:54 AM | Report abuse

What a piece of work... Obama has the gall to try and lecture the world on financial prudence and on increasing demand from developing nations - which is the only bailout he may have based on how much money he's pumped (i.e. printed and dumped) into economy. With the policies in place and lack of export development, the US is never going to see any worthwhile FDI or inflows unless the he decides to follow the lead of Detroit by throwing in the towel and selling US industry off for scrap metal. You know India will buy the scrap metal, they're actually producing for export these days...

Speaking of India, what a joke of a trip... he lands in Mumbai and cavorts with a bunch of shady politicians who are now up on charges for corruption - yes, the same Chief Minister who greeted him coming off the plane, Chavan, and the secretary of the ruling Congress party, Kalmadi, were ousted from office hours after the wheels came up on Air Force One out of Mumbai. How much do you think that supposed $10 billion trade agreement is REALLY worth? The party he was rubbing shoulders with will be lucky to be in office in a year - the ink hasn't even dried on the agreement and they're being replaced!! "And we should recognize our special responsibilities to prevent corruption..." - well, we know he can speak out of both sides of his mouth - I guess that's a talent.

Please, maybe just a little due diligence from you or your trusty staffers before trumpeting victory back to the American people from the sub-continent.

He really is the last person that needs to be giving economic direction and advice to the G20 - the man is facing a budding political coup from the house and the voter base... which was caused, in no small part, due to the economic policies he's chosen to employ - while failing to actually employ his citizens because there is nothing to promote sustainable economic growth in any of his actions to date - he has created a false economy.

He's replaced one burst bubble by inflating another... how much more money can you print to get out of the $1.2 trillion deficit? At this rate, you may as well be looking at the US dollar on par with the Mexican Peso by 2012. Based on the first 2 years, his best bet may be to shoot for another Democrat in office in 2016 because, at this rate, he's going leave such a social and economic mess behind after 2012, it will take several terms of decisive action to clean up.

There are a lot of great and hard working people in the US the deserve the opportunity to work and strong leadership with a firm understanding of what the greatest industrialized country in the world needs to thrive - here's a hint, it's not bail out money. Before you lecture the world on economics, maybe best to pick up an Econ textbook and do a little homework. You can raise taxes, increase the money supply, promote exports, attract FDI - a hint... the first two are not very good ideas unless the goal is 1 term in office and rampant inflation.

Posted by: FameRider | November 11, 2010 11:39 PM | Report abuse

What a piece of work... Obama has the gall to try and lecture the world on financial prudence and on increasing demand from developing nations - which is the only bailout he may have based on how much money he's pumped (i.e. printed and dumped) into economy. With the policies in place and lack of export development, the US is never going to see any worthwhile FDI or inflows unless the he decides to follow the lead of Detroit by throwing in the towel and selling US industry off for scrap metal. You know India will buy the scrap metal, they're actually producing for export these days...

Speaking of India, what a joke of a trip... he lands in Mumbai and cavorts with a bunch of shady politicians who are now up on charges for corruption - yes, the same Chief Minister who greeted him coming off the plane, Chavan, and the secretary of the ruling Congress party, Kalmadi, were ousted from office hours after the wheels came up on Air Force One out of Mumbai. How much do you think that supposed $10 billion trade agreement is REALLY worth? The party he was rubbing shoulders with will be lucky to be in office in a year - the ink hasn't even dried on the agreement and they're being replaced!! "And we should recognize our special responsibilities to prevent corruption..." - well, we know he can speak out of both sides of his mouth - I guess that's a talent.

Please, maybe just a little due diligence from you or your trusty staffers before trumpeting victory back to the American people from the sub-continent.

He really is the last person that needs to be giving economic direction and advice to the G20 - the man is facing a budding political coup from the house and the voter base... which was caused, in no small part, due to the economic policies he's chosen to employ - while failing to actually employ his citizens because there is nothing to promote sustainable economic growth in any of his actions to date - he has created a false economy.

He's replaced one burst bubble by inflating another... how much more money can you print to get out of the $1.2 trillion deficit? At this rate, you may as well be looking at the US dollar on par with the Mexican Peso by 2012. Based on the first 2 years, his best bet may be to shoot for another Democrat in office in 2016 because, at this rate, he's going leave such a social and economic mess behind after 2012, it will take several terms of decisive action to clean up.

There are a lot of great and hard working people in the US the deserve the opportunity to work and strong leadership with a firm understanding of what the greatest industrialized country in the world needs to thrive - here's a hint, it's not bail out money. Before you lecture the world on economics, maybe best to pick up an Econ textbook and do a little homework. You can raise taxes, increase the money supply, promote exports, attract FDI - a hint... the first two are not very good ideas unless the goal is 1 term in office and rampant inflation.

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Posted by: itkonlyyou371 | November 11, 2010 9:13 PM | Report abuse

The Great Orator's letter has a couple of boo-boos in it.

"Just as the United States much change" -- this is either a typo, or a Freudian slip.

"A rebalancing of the sources of global demand, along with market determination of exchange rates that reverses significant undervaluation, are..." -- Rebalancing IS! Singular verb!

So much for The Smartest Guy in the Room.

Posted by: wmpowellfan | November 11, 2010 10:30 AM | Report abuse

The Great Orator's letter has a couple of boo-boos in it.

"Just as the United States much change" -- this is either a typo, or a Freudian slip.

"A rebalancing of the sources of global demand, along with market determination of exchange rates that reverses significant undervaluation, are..." -- Rebalancing IS! Singular verb!

So much for The Smartest Guy in the Room.

Posted by: wmpowellfan | November 11, 2010 10:30 AM | Report abuse

This self-serving arrogant letter should seal whatever doubt there may be left among the G-20 that the U.S. president is in trouble and hasn't the slightest idea what to do about it. Obama has just invited the rest of the industrialized world to take advantage of what little the US has to offer them. Sarkozy, Joe Biden, and Hillary Clinton were all correct when they questioned Obama's ability to be president. Can we perhaps hit the pause button until 2012 and we're rid of this inept idealogue?

Posted by: Narquan | November 11, 2010 10:15 AM | Report abuse

.

Hey Democrats,

Mr. Roos aimed to protect nonprofit Nehemiah Corp. of America's "middleman" business of helping home sellers finance down payments so buyers could qualify for Federal Housing Administration mortgages -- a practice labeled a "scam" by the IRS in 2006 and banned by FHA in 2008. Yet in early 2009, as Waters tried to legislatively overturn that ban, Roos had Williams on his payroll.

BYE BYE

DEMOCRATS

.

Posted by: kstobbe1 | November 11, 2010 9:25 AM | Report abuse

President Obama has been eloquent in his letter to the G20 group. But the failure of G20 has been the fact that most countries for many years did not do anything and depended solely on exporting to US for their economies. Time has come that they need to increase imports from US. In any case there are two problems: currency manipulation by deliberate methods to loot US dollar all for themselves and too many countries to make a consensus based decision and cannot solve. Finally, there are countries that want willfully reduce the prosperity of US amongst G20. If these are the basis of functioning of G20, then US needs to take care of itself and not worry too much about other countries. This brings a solution - drill oil and use proceeds to remove the US federal deficit and then control spending in the US to support US manufacturing and services. Citizens know that they will participate, but whether congress and senate have any sense of this. This is the question that has been getting addressed in 2010 elections and now comes 2012 elections. Once 2012 elections are over, all selfish and lavish congressmen and senators would have been taken out by the election and the new generation of fiscally conservative people would be solving our problems.

Posted by: dr_vaman | November 11, 2010 8:46 AM | Report abuse

.

Hey Democrats,

A controversial bronze statue of President Barack Obama as a 10-year-old boy has been removed from an Indonesian park and moved to a nearby elementary school that Obama once attended, the Jakarta Globe reports.

BYE BYE

DEMOCRATS

.

Posted by: kstobbe1 | November 11, 2010 8:34 AM | Report abuse


The obama administration needs to hire an English major:

"Just as the United States much change" -- this is either a typo or a Freudian slip.

"A rebalancing of the sources of global demand, along with market determination of exchange rates that reverses significant undervaluation, are" -- Rebalancing IS! Singular verb!

Sloppy.

Posted by: wmpowellfan | November 11, 2010 6:20 AM | Report abuse

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