US denies economic rift with Europe

March 10, 2009 06:50:47 AM

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The White House Monday denied a rift with Europe over whether economic stimulus or regulatory reform offers the best path to revival ahead of a G20 summit in London next month.

"Our efforts at the G20 in London will focus on a number of subjects, both financial regulation and economic stimulus, largely because there isn't one single solution to those problems," White House spokesman Robert Gibbs said.

The US administration is pressing its transatlantic allies to emphasize stimulus, but the European Union has failed to forge a common approach and some EU leaders have blamed the crisis on a US zeal for free markets.

Obama believes that regulation is needed to prevent a repeat of the present crisis in the future, and stimulus is required to get the economy moving now, Gibbs told reporters.

"So I don't think there's any rift at all," he said.

Interviewed in Monday's Financial Times, Obama's top economic advisor Larry Summers urged world leaders to focus on boosting world demand ahead of the G20 summit on April 2.

Summers, who heads the White House's National Economic Council, said there was a need for "extraordinary public action" and urged leaders to take coordinated steps to pump more money into the global economy.

He said that regions like Europe also needed to deal with structural "weaknesses" which were "actually greater than some of the weaknesses here."