Today, on the one year anniversary of the collapse of Lehman Brothers,
President Obama is speaking on Wall Street, addressing the need for
regulatory reforms to the financial sector. Since taking office the
president has led a coordinated global response to the worst economic
crisis since the Great Depression.
The leaders of the eight leading industrialized nations meet in the G-8 summit in Italy today. This meeting comes just a few months after the G-20 summit in London, which sought to create a unified global response to the economic crisis. The IMF today reinforced the concern that much work remains to be done, and that it is too early to back away from stimulus policies and support for poorer countries.
The justified outrage over AIG’s post-bailout bonuses should not be conflated with the revelation that AIG dispensed billions to foreign banks. The US needs an international recovery to sustain our own recovery, and our status as the sole global superpower and the world’s reserve currency give us a unique stake in working to maintain the global economy. Despite public anger at AIG, as President Obama noted during his address to Congress, “in a time of crisis, we cannot afford to govern out of anger.”
The Obama administration is dealing with the crisis by seeking a global solution for a global problem. Yesterday, Treasury Secretary Tim Geithner unveiled a proposal to shore up the IMF and ensure that global institutions have the resources they need to help failing economies. There is still no international consensus on this plan and much difficult work must be done before the upcoming G-20 summit in April. Unfortunately, rather than addressing these serious issues and helping find a constructive solution, conservatives in Washington are playing politics by railing against earmarks, which make up only 2% of the federal budget.
UK Prime Minister Gordon Brown arrives in Washington today, becoming the first European leader to meet with President Obama. Although British troops have fought in both Iraq and Afghanistan and the UK remains an important player on issues from Middle East peace to Iran, poverty and climate change, Brown’s visit this week will likely be dominated by the global economic crisis.