Ahead of G-20, German leader balks at more spending and more debt.
Ahead of the London Group of 20 meeting, whether this is a bargaining position or a firm principle is unclear. But the German chancellor is the locus of the issue – especially after recent comments that reveal an even tougher stance against further debt and spending.
The G-20, billed as of great historic and practical importance for moving the world economy forward, has steadily inched backwards from the expansive global "New Deal" envisioned by host British Prime Minister Gordon Brown last fall. President Barack Obama is stressing "unity" among the 20 nations that make up 85 percent of the globe's economic output. But the "significant stimulus" called for again this week by the White House has been met in Berlin without joy.
The most significant player now may be Chancellor Merkel, who has become something of a spokeswoman for Europe's view of the crisis, which calls for foregoing more stimulus – though adding cash for IMF protection of East and Central Europe – and stiffer regulation. In recent days, she's applauded Mr. Obama for backing Europe on regulation to stop toxic assets and tax havens, but she continues to say stimulus will not lead to "sustainable growth."
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