Economics: G8: Hard core advanced industrial countries gather in Toronto

Agence France Presse reporter, Jo Biddle, says "G8 summit gathers amid budget cut row" (Jun25,2k10).
The delegates are meeting in  a "remote location" near Huntsville, Muskoka, about 220 kilometers (140 miles) north of Toronto.

TORONTO, Canada (AFP) – The United States urged Europe to reform its economies to raise growth as world leaders gathered for a summit Friday, amid tension over US warnings about the global recovery.

The United States has expressed concern about the speed at which European nations, particularly Germany, are withdrawing state spending put in place after global financial crisis and economic downturn.

US Treasury Secretary Tim Geithner said: "Our job is to make sure we're all sitting there together to focus on this challenge of growth and confidence because growth and confidence are paramount."

Geithner played down America's differences with Europe telling the BBC the two sides "have much more in common than we have differences."

He said the summit offered US leaders "the chance to sit together and look at whether we've got a broad strategy across the country that's going to strengthen this recovery."

Europe "can make a choice to put in place the reforms and policies that will provide the possibility of stronger growth rates in the future," he said, as thousands of officials, journalists and activists descended on eastern Ontario province.

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The talks among the Group of Eight leading countries here were also to tackle global security and development, amid calls to deliver on past promises.

Budget cuts have become a pressing issue in Europe since the Greek debt crisis, and because of risks that similar problems could arise in other eurozone countries.

US officials have argued that unduly rapid and deep budget cuts could endanger global economic recovery and even provoke a so-called double-dip recession.

German Chancellor Angela Merkel has argued however that the German model of deficit cutting and disciplined public finances, and a focus on economic efficiency, is the one to be followed.

"I think that there will be very fruitful, but also very contentious, debates on this issue," Merkel acknowledged.

The USA Secretary of the Treasury is trying to warn European that the USA can no longer bail out European countries that face bankruptcy from excessive "sovereign debt."  Greece succumbed to this, and in effect blackmailed the EU countries and the euro-zone.  The USA has long bneen considered the ultimate backup of this system of largely socialist ovcerspending, as in the case of Greece, Spain, Portugal, Italy and Ireland.  I was following a story that claimed the just mentioned pattern is also true of the finances of Hungary, tho successive statements insist otherwise.


Is the USA finally itself waking up to the dire straits in which the global economy muddles?  If yes, how much better woud it be if President Obama woke up to the need not to increase the deficit, but to pay down the debt.,  The trick will be to prioritize the first braod point of the new Healthcare Law, extending coverage to the 32 million who had not had coverage hitherto (excluding I woud guess illegal immigrants).  Looking after the 32 million, while not adding further new entitlements. And cutting spending wherever else it can be factoered into all agencies of the Federal bureeaucracy.