Canadian Prime Minister Stephen Harper is normally a reasonable man, and most of what he says in this video about the financial crisis is reasonable and to the point.
But he slips over the line into transnational UN-speak when he advocates “global governance” — for our own good, mind you:
Forgot yourself for a moment there, eh, Mr. Prime Minister? The Bilderburg Group stresses the importance of keeping such plans secret, but you in your well-meaning enthusiasm let the mask slip.
Journalist: Prime Minister, we know that financial institutions have played a big role in starting this economic crisis, and have played a big role even in the recovery. They get too much money to people that [inaudible] people have to serve money and there is kind of a credit crunch.
I know that your government, your minister of finance and yourself said that we need some international coordination, some rules to, in order to avoid what happened up to now will not happen again in the future. I wonder if you pushed this issue during the meeting, and if you did, what was the reaction, what was accomplished.
Stephen Harper: I did push that issue very hard. Let me go through the various things I said on that. I think they’re all important. I think there was a fair amount of agreement around them. First of all, it is important that we fix the financial sector. And that means, for those countries that have had to intervene in the financial sector, in particular, had to intervene to bailout banks and financial institutions, it is critical that that intervention be seen through to its conclusion.
|[1:18]||That means, what I mean by that, is the following: It means that .. toxic assets have to be removed from the balance sheets; the banks the financial institutions have to be restored to health, and the system of regulation that led to that problem has to be fixed, the national system of regulation. What we cannot have happen, what concerns me, is that we see government intervention in some countries, giving a great deal of money to banks and financial institutions. Then the financial institutions do short-term fixing to their balance sheets, and then say: “We want to give the money back to government, and then get out of our lives.”
That is the worst of all worlds.
|[1:58]||Because if we don’t see the intervention through to its conclusion, the message we will have sent is actually worse than the signal we had before. The only thing worse than a situation of unregulated Capitalism that led to massive failure would be a system of unlimited Capitalism backed by the unlimited desire of government to intervene at any point in time to bail people out. We can’t have that.
|[2:26]||The bailout, the situation that led to the bailout, has to be fixed. We have to allow institutions, that are particularly badly run, to fail, without having systemic failure. So that’s very important, I was very clear on that. We’ve also been very clear, as you know, Canada co-chaired the international panel on financial regulation. Our view is that all of these national systems of regulation have to be fixed.
|[2:56]||But there also has to be international coordination, there has to be an international peer review process for national regulations, so there’s transparency, there’s peer review and peer assessment. We’ve undergone that in Canada, it’s been very useful when we have undergone it, and we think all countries need to be part of that. It does not detract from national sovereignty. Nation-states are clearly going to exercise their rights to regulate the financial system.
|[3:28]||But in a globalized economy, we are going to have to take global responsibilities. And there is going to have to be some semblance of global governance on these questions. We can’t operate where major financial institutions operate in a manner that is not transparent, because it affects the entire global economy. So that problem does have to be fixed.
|[3:50]||The other thing, if I can add, that has to be fixed around this, and I’ve said that at previous meetings, is the underlying — I think there was an underlying situation here, that led to the massive problems in the financial system. And that wasn’t just the poor regulation of the financial system. It is that we have had a system of global imbalances, where the American consumer was sustaining global growth on the basis of unsustainable consumption.
|[4:23]||Financed, obviously, through American financial institutions, but also financed through excessive surpluses, excessive rates of savings in other countries. And that has to be corrected. Countries that have been in massive surplus have to start increasing their domestic demand to sustain global growth, and as President 0bama said very forcefully at this summit, very correctly: The American consumer cannot go back to a zero savings rate. That is not realistic, and it is not useful in the long term to the global economy.
|[4:57]||So, all of us have to put our minds together on fixing those global imbalances, as well as the regulation of the financial sector.|
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