Bush sticks to free market principles

November 16, 2008
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, WASHINGTON, November 16 – US President George W. Bush emerged from the G20 summit Saturday satisfied with having preserved the principles of free market economics, while leaving his successor wide room for maneuver.

After 24 hours of hosting world leaders in what a senior administration official called an "extraordinarily successful summit," Bush will be confronted anew with the urgency of the crisis, including decisions to be made over the fate of the country\’s "Big Three" auto manufacturers.

In the space of just a few hours, the president whose approval ratings are among the worst in US history could claim to have halted an apparent "assault on capitalism," laid foundations for global financial reform, and worked out the first comprehensive international measures to tackle the crisis with leaders of industrialized and major emerging economies, top aides said.

"We just completed an extraordinarily successful summit," a senior administration official told reporters on condition of anonymity.

The official drew attention to the G20 action plan agreed by the leaders, which few thought could have been achieved in such little time — and which gave Bush much of what he had wanted.

"Our priorities were certainly addressed, I would say from our perspective we certainly achieved our objectives," the official said.

Bush, facing the gravest financial crisis since the Great Depression of the 1930s in the last months of his presidency, had hesitated to call the summit. But as the meltdown worsened and economies plunged into recession, the free-market apostle Bush invited leaders to Washington.

While French President Nicolas Sarkozy had said a financial system brought to its knees by the crisis must be rebuilt, beginning with the G20 summit here, Bush stood firm against calling into question the very fundamentals of "democratic capitalism," and against excessive regulation.

While affirming the need for greater reform and increased international cooperation on strengthening regulatory regimes, the G20 action plan noted a shared faith in free-market principles and the "critical importance of rejecting protectionism."

The senior official described it as "an affirmation" of capitalist economics.

"There was universal recognition by all leaders that the reform efforts that we are discussing would only be successful if grounded in (…) a commitment to free market principles," he said.

The action plan did express the need for increased international cooperation, but the leaders agreed that regulation "is first and foremost the responsibility of national regulators," a conclusion that would please the US president.

Other nations have blamed the United States for triggering the crisis, accusing it of promoting policies that encouraged risky loans and investments that collapsed and infected economies worldwide. Bush has not agreed with such an assessment.

And an official in his administration said Saturday that "there needed to be a very focussed set of actions" at the summit instead of finger-pointing and "rhetorical flourishes."

Bush must now decide if he persists with his opposition to a second US economic stimulus plan following a multi-billion outlay earlier this year.

He also must turn an urgent eye towards the possibility of a government bailout of the embattled US auto giants, something his administration has opposed.

The work begun Saturday links the outgoing administration to that of Democratic president-elect Barack Obama, as the official G20 statement says the leaders should meet again by April 30, three months into Obama\’s presidency.

But nothing in the text seems to bind the hands of the next president.

Bush said Saturday he vowed to leaders attending the summit that the United States would enjoy a "seamless" transition to the new team of president-elect Obama.

"I told them that we will work tirelessly to make sure the transition between my administration and his administration is seamless," he said.

A Bush aide said Saturday that "we intend to sit down with members of their team to give a debrief on the summit, and share our thoughts on some of the process issues."

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