Brown Presses Hard for Banking Crisis Agreement at EU Summit
Winning the argument against each country trying to take care of its own financial crisis independently, British Prime Minister Gordon Brown＇s coordinated-action approach appears to have won over his colleagues in Europe. Others around the world are watching as well.
His financial plan has been a guidepost for U.S. officials implementing the $700-billion bank bailout. On Monday, German Chancellor Angela Merkel announced a plan that closely resembles the British model.
Mr. Brown, who just a month ago was facing calls from within his own ruling Labor party to step aside before the next general election, has risen to the occasion in facing the global financial meltdown head on.
His decade as British Treasury Secretary appears to have prepared him for this moment. In Brussels for the European summit to hammer out an agreement on a common plan, Mr. Brown is leading the call to bring liquidity back into the system, to recapitalize the banks to strengthen them for the future, and to get banks to start lending money once again for things like mortgages and small business operations.
"Today is an important moment for the European Union, all 27 countries meeting together," Mr. Brown said. "I hope we will find agreement also from the whole of Europe on what needs to be done. That all countries within the European Union will feel part of the program that is necessary to stabilize the financial system and then to move the economy of Europe forward."
In addition to these initial goals, Mr. Brown says much stronger oversight is required if these financial problems are not to be repeated.
"Stage two is to make sure that the problems that developed in the financial system, problems that we know started from America, that these problems do not recur again and we give people the confidence that we have taken the action that is necessary to root out the irresponsibilities and excesses in the system, and to make sure that the rules of the system are such that we have proper disclosure and proper transparency, that we have supervision in areas where supervision was previously not required, but we now know is necessary," Mr. Brown said.
What Brown calls an early warning system needs to be established to identify financial problems before they get out of hand and he says better international coordination in needed to handle crises that may arise in the future.
Compared to just a month ago, the prime minister today looks like a man brimming with new found self-confidence. And while this will undoubtedly help him in the polls, more pain in Britain＇s domestic economy in the form of rising unemployment, increasing national debt, and a higher cost of living may temper the political gains he has made in leading Britain and other nations through these difficult economic times.
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