High-stakes debut looms for Obama at G20 summit
Seldom has a US president faced such a stern first test overseas as the one awaiting Barack Obama at Thursday's Group of 20 economic crisis summit.
Obama leaves for London Tuesday after an exhausting first two months in which he battled to ensure the worst economic slump in generations does not overwhelm the huge expectations and ambitious plans of his young presidency.
Now, he must take a central role in global efforts to mitigate the crisis while easing hints of rifts between Europe and the United States on the best way forward.
"President Obama is not only confronting the biggest challenge he faces, he's doing it for his first time on this type of world stage," said Steven Schrage, of the Center for Strategic and International Studies.
"He's doing it just weeks into his presidency when many key members of his team, particularly Treasury, aren't on board yet."
Obama has dismissed the growing conventional wisdom ahead of the summit that the United States wants more stimulus and less regulation to tackle the crisis, while Europe wants less stimulus and more regulation.
His Treasury Secretary, Timothy Geithner, said in an interview published Tuesday that the US is united with Europe in wanting regulatory reform to strengthen the international financial system.
The "US has a huge interest in acting quickly and comprehensively to use this opportunity to develop an international consensus on how to make the system more robust and stable", Geithner told the Financial Times.
"The gap between where the French are, where the Germans are, where the Americans are, where the Chinese are -- it is a very small gap."
In a phone call to Stephen Harper on Monday, Obama and the Canadian prime minister "discussed opportunities for working together to resolve the global financial crisis and restore economic growth by spurring demand, restoring trade and creating jobs," the White House said in a statement.
"The leaders pledged to do all that is necessary to restart growth and concurrently work to advance regulatory reforms to ensure no such crisis occurs again."
But transatlantic relations experts said that despite the desire of all the major developed and developing powers at the G20 to show a united front, differences exist.
"The Obama administration has been pushing Europeans to spend much more, but the Europeans are balking at that," said Kati Suominen, a transatlantic fellow with the German Marshall Fund of the United States.
"Particularly the bigger countries, France, Germany and the current holder of the European Union Presidency, the Czech Republic, have been very adamantly opposed to new spending. So there is a little bit of a rift there."
Obama administration officials say they established a balanced and multi-pronged plan to fight the crisis, including a 787-billion-dollar stimulus package and a bid to cleanse banks of toxic assets.
Last week, Geithner unveiled a new raft of regulatory reforms covering banks, finance firms, hedge funds, money market funds and the more complex derivative market.
White House spokesman Robert Gibbs said Saturday that Obama had two objectives at the summit: "ensuring that there is concerted action around the globe to jumpstart economic growth, and that we are advancing a regulatory reform agenda to ensure that this crisis never happens again."
Dan Price, a former assistant to president George W. Bush for international economic affairs, argued that reports of discord between nations like France and Germany and the United States were "somewhat overblown."
He noted that Washington had acted broadly to enact crisis rescue measures since the G20 finance ministers meeting in southern England just three weeks ago.
At those talks, Geithner said Washington would provide a capital assistance program for financial firms, and outline a plan to clear toxic assets from the books of crippled banks.
While all leaders will face intense pressure at the G20 summit for action, there will also likely need to be some effort to dampen expectations that anything agreed in London can have an immediate impact.
"To take the US example, and in many other countries, there's going to be a need in some cases for new legislation," said Matthew Slaughter, an adjunct fellow at the Council on Foreign Relations. But, he added, differing legislative processes means that "it's going to take a while."
Obama has also been stressing the need to ensure that efforts to reignite the global economy do not descend into protectionism -- in part to ease foreign worries about a "Buy America" clause inserted by Congress into his stimulus plan, which the administration had to water down.