OBAMA REMINDS G20 ABOUT ECONOMIC PRIORITIES…. For the better part of 2010, much of the West has embraced austerity measures in the wake of the global financial crisis. And for the better part of 2010, President Obama has reminded allies that such efforts are a mistake.
To his credit, Obama continues to take the right message to the world.
President Barack Obama, in a clear message to other leaders at the G20, said on Thursday that the best way to control the massive U.S. budget deficit was to help the economy grow faster.
“The single most important thing we can do to reduce our debt and our deficits is to grow,” Obama said in his first public response to bold early recommendations from a White House debt panel that was quickly attacked by U.S. lawmakers.
Obama has been forced to defend U.S. policies blamed for pushing up the U.S. budget deficit, while other Group of 20 partners, such as Britain and Germany have embarked on harsh spending cuts.
U.S. officials say this is exactly the wrong thing to do while a global economic recovery is still fragile, and Obama has stoutly defended a decision by the U.S. Federal Reserve to print another $600 billion to spur U.S. growth.
Good for the president. It seems like common sense — it’s a lot easier to reduce a deficit when an economy is growing and more people have jobs and can pay taxes — but it’s a point that’s too often overlooked, especially in countries where austerity measures are all the rage.
What I’m especially pleased with is the administration’s consistency on this. President Obama and Treasury Secretary Tim Geithner have both been making the case to the G20 all year about the need to prioritize growth over short-term deficit reduction.
It’s hard to say whether anyone’s actually persuaded by the message, but I’m glad the administration is sticking to it. The White House might even try to making it more often to domestic audiences, many of which still think more jobs will be created if we take money out of the economy and make things harder on the middle class.