As G20 kicks off, Canada talks to Obama reps and hopes to push for regulationFri Nov 14, 10:07 PM
By Lee-Anne Goodman,
The Canadian Press
The Canadian Press Photo: Prime Minister
Stephen Harper speaks to media Friday
before heading to Washington for the G20WASHINGTON - Hours before Prime Minister Stephen Harper dined with President George W. Bush and other world leaders to kick off an international summit on the global economic meltdown, his officials met with the people representing Washington's real powerhouse - Barack Obama.
A Canadian contingent representing the federal government sat down earlier Friday with Madeleine Albright and Jim Leach, who are attending this weekend's G20 meeting on Obama's behalf.
It was the first face-to-face meeting between Canadian government officials and Obama representatives since the Illinois senator's historic election on Nov. 4. Obama named Albright, a former secretary of state, and Leach, a one-time Republican congressman, his emissaries at the international economic summit.
A senior Harper official wouldn't provide details on what was specifically discussed between the Canadians and Obama's people other than to say their conversation centred on the G20 summit.
"It was a positive meeting," he said. "We were able to articulate our position clearly, and we look forward to future discussions and meetings with the president-elect's transition team as they move forward on their work."
Canada is keen to advance one proposal in particular at the summit this weekend: an international "peer review" of every G20 country's national financial regulations.
Before flying to Washington to dine with Bush and other heads of state at the White House on Friday night, Harper acknowledged the idea of a such a review is "the most contentious" issue on the table at the summit.
But the point, said the prime minister, is "not to impose solutions."
"We want to respect national sovereignty. But that we get good, objective evaluations that we're able to act on," he said in Winnipeg. "We think that's a reasonable part of being part of an integrated global financial market."
He noted Canada has submitted to international peer reviews of its financial system in the past and "those comments and criticisms have been helpful in making reforms."
A communique to be issued Saturday, after a day of closed-door meetings, certainly touched on the idea of a monitoring system in place.
Sources told The Associated Press late Friday that a draft of the joint communique contains several ideas for making global financial markets more transparent and accountable to investors.
Among those is a commitment to more effective accounting rules, such as those governing how companies value their assets.
It also calls for improved international co-operation in the monitoring of markets and keeping an eye out for dangerous investing trends, the sources said.
Included in those mechanisms are an early warning system to look for signs of burgeoning problems like those in the U.S. housing market and related overuse of mortgage-backed securities.
On Friday, the heads of the International Monetary Fund, the world's financial watchdog, and the Financial Stability Forum, a group that includes central banks and major financial regulators, said they'd co-operate on "early warning exercises" to detect vulnerabilities.
Also, a new "college of supervisors" would gather global regulators to scrutinize the world's largest financial institutions and compare notes as they seek to spot excessive risk-taking.
For all the talk of frugality and responsible spending, however, the extravagant White House menu on Friday night was far from wieners and beans: the G20 leaders were treated to fruitwood-smoked quail with quince gastrique; quinoa risotto; thyme-roasted rack of lamb; tomato, fennel and eggplant fondue; a salad course of endive, baked brie and walnuts; and a pear torte for dessert.
One of the wines served at dinner was Shafer Cabernet "Hillside Select" 2003, which sells for about US$300 a bottle.
The feast provided fuel for the 20 world leaders who arrived here each armed with their own ideas on how to ease the global economic crisis. As they entered the White House, the chants of protesters skeptical that they can solve the crisis could be heard.
British Prime Minister Gordon Brown, elected 18 months ago, has been attempting to take D.C. by storm this week, meeting with leaders of Japan, Brazil and Australia and lunching with Alan Greenspan, the former Federal Reserve chairman. He reportedly sat down with Greenspan's successor, Ben Bernanke, on Friday in addition to the leaders of Russia and China.
Brown is calling for a super-regulator to monitor the world's leading 30 banks, and he's pushing for co-ordinated global tax cuts and interest rate cuts. He has said he wants the G20 summit to set a clear timetable for such reforms to begin.
French President Nicolas Sarkozy backs many of Brown's proposals and is also calling for stronger regulation.
Bush, meanwhile, is warning against over-regulation and has been defending free-market capitalism as the final days of one of the most unpopular presidencies in U.S. history draws to a close.
Harper has been straddling a line between those two positions - while he is vocal in his defence of the free market, he's also advocating more regulation of the world's financial markets.
He twice referred to past policy mistakes that contributed to the Great Depression, noting that the repetition of those mistakes - unregulated financial markets and trade protectionism - threaten to exacerbate what he describes as a dire global financial crisis that has yet to bottom out.
"Unregulated financial markets do not work," Harper, who's been linked by his opponents to the Bush administration, bluntly stated.
"Canada has known that for a long time. I thought, frankly, we all knew that from events of many decades ago - but obviously the United States went on a different path."
The G20 summit is the first in a series intended to deal with the enormity of the economic meltdown. The next meeting won't be held until after Bush leaves office on Jan. 20.
Besides the United States, the countries represented will be Canada, Argentina, Australia, Brazil, Britain, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey.
Those countries and the European Union make up the so-called G20.
