JUDY WOODRUFF: Our lead story: The leaders of the Group of 20 most powerful nations promised sweeping new aid today to needy countries and new controls on the world financial system. There was no move toward major new economic stimulus plans.
Ray Suarez has our report.
U.S. PRESIDENT BARACK OBAMA: This is my man right here. Love this guy.
RAY SUAREZ: It was mostly smiles in public, despite policy differences, as President Obama and the other G-20 leaders discussed a coordinated response to the global economic meltdown.
GORDON BROWN, prime minister of Britain: We are now going to move to a discussion of the global financial institutions and global regulation…
RAY SUAREZ: And that discussion, hosted by British Prime Minister Gordon Brown, yielded broad agreement on a number of measures: new international regulation of hedge funds and credit-rating agencies; oversight of tax havens to end the anonymity cloaking many international banking transactions; and a pledge of more than $1 trillion to help developing nations, plus $250 billion on international trade assistance.
Afterward, Prime Minister Brown characterized the moves as a first step.
GORDON BROWN: Today, the largest countries of the world have agreed a global plan for recovery and reform.
RAY SUAREZ: French President Nicolas Sarkozy had threatened to bolt the summit unless it endorsed new regulation. He didn’t get a new super-agency, but welcomed the outcome anyway.
NICOLAS SARKOZY, president of France (through translator): It’s the financial crisis that brought about an economic crisis, and this financial crisis was brought about by a lack of regulation. But clearly today, a page has been turned.
RAY SUAREZ: However, there was no agreement on a coordinated fiscal stimulus. Germany and France steadfastly opposed any such move, while the U.S. and Britain, which have both passed large stimulus measures, urged worldwide action.
But in the end, German Chancellor Angela Merkel said it was an “almost historic compromise.”
ANGELA MERKEL, chancellor, Germany (through translator): I think, on the whole, it is very important that we can go home from this conference and say we have done our bit to see to it that growth is restored, of prime importance to developing countries and emerging economies. We have done something for supervision and regulation, something that is qualitatively new.
London summit called 'historic'
RAY SUAREZ: Still, when he met reporters in the early evening, President Obama said, "I think we did OK," even with no action on stimulus.
By any measure, the London summit was historic. It was historic because of the size and the scope of the challenges we face, and because of the timeliness and magnitude of our response.
RAY SUAREZ: after his first turn on the world stage, the president said he found it's important to forge partnerships and not try to dictate solutions.
summit was historic. It was historic because of the size and the scope of the challenges that we face and because of the timeliness and magnitude of our response.
RAY SUAREZ: After his first turn on the world stage, the president said he found it's important to forge partnerships and not try to dictate solutions.
BARACK OBAMA: You know, each country has its own quirks and own particular issues that a leader may decide is really, really important, something that is non-negotiable for them.
And what we tried to do as much as possible was to accommodate those issues in a way that did not hamper the effectiveness of the overall document to address what, I think, are the core issues related to this crisis.
Now, if it's just Roosevelt and Churchill sitting in a room with a brandy, you know, that's a -- that's an easier negotiation.
But that's not the world we live in, and it shouldn't be the world that we live in. And so, you know, that's not a loss for America.
RAY SUAREZ: But Mr. Obama also said he could not ensure the steps taken in London would provide the needed global boost.
BARACK OBAMA: In life, there are no guarantees. And in economics, there are no guarantees. The people who thought they could provide guarantees, many of them worked at AIG, and it didn't work out so well. So there are always risks involved. I have no doubt, though, that the steps that have been taken are critical to preventing us sliding into a depression.
RAY SUAREZ: On the sidelines, the president had one-on-one meetings with several leaders, including the president of South Korea. The two leaders promised a unified response to an impending North Korean missile test.
And for a second day, there were protests throughout the British capital. None was permitted closer than a mile to the East London Docklands district where the summit was held.
But overall, the protests were smaller than yesterday's raucous and occasionally violent demonstrations.
An international aid package
RAY SUAREZ: Late today, I spoke with Margaret Warner from the Excel Centre, the summit site in London.
This afternoon, the president at his news conference called this a turning point in our economic recovery and praised the magnitude of response that his G-20 partners came up with. Explain a little more about what's in that package of measures announced this afternoon.
MARGARET WARNER: There are three major elements. One is the commitment to continue all these different countries with their stimulus packages, continue enacting them and do whatever it takes.
Two is, of course, in the regulatory area, which we can talk more about in a minute.
And the third and big new element was really all this new money for the IMF and other international financial institutions. And it totals -- I mean, you have about -- it was $250 billion that the IMF had in loan authority. That's being tripled to $750 billion. They're adding another $250 billion for what they call special drawing rights, which is to help beef up the capital of a lot of the member countries of the G-20.
And then, finally, there's another $250 billion in special trade credits to help both imports and exports from the developing world.
So the Obama administration sees this -- it's not direct spending as stimulus is, but that it will have a stimulative effect. And as he said, this is not charity. These growing economies or these developing economies are really the future drivers, they're our markets and future drivers of world economic growth.
RAY SUAREZ: Great Britain and the United States came to the conference looking for more stimulus. France and Germany came to the conference looking for more worldwide financial regulation. Does everybody leave London having gotten at least a bit of what they came for?
MARGARET WARNER: I think a bit is the word. As one White House official said to us, nobody got 100 percent of what they wanted.
In other words, the U.S. and U.K. had already accepted they weren't going to get commitments for new financial -- new stimulus, new spending for stimulus. But the French and the Germans did get not a global regulator, which they wanted, but they did get new standards for reforming the banking system, for everything from hedge funds to executive compensation, which will be enforced by national regulators.
And finally, they got something they really wanted, which was a sort of expose of tax havens, that is, a blacklist that's going to be published or may have been today of countries that don't share tax information.
RAY SUAREZ: This was President Obama's first appearance on the world stage. Can he leave London with a set of accomplishments to talk about?
MARGARET WARNER: Well, you could see, I think, he certainly thinks so. He was modest and said, "I'll leave it to others to judge." But they are certainly pleased with the fact that they got a global response to this crisis.
And President Obama did clearly spend -- play a role here in bringing people who were already at the table to an agreement.
And I'll tell one anecdote. The big sticking point, the logjam all day was over this tax havens issue. France and Germany, particularly France, really wanted this, and they wanted this OECD, the Organization of Economic Corporation and Development in Europe, to publish this list, blacklist for the countries that don't share, a white list for those that do, and a gray list for countries, like Switzerland, which has said they will, but they haven't yet.
President Hu of China was absolutely unalterably opposed, because Macau, a city in China, is one of these, but China's not a member of the OECD.
President Obama, we're told, finally, late in the afternoon, first gestured to President Sarkozy. They went in a corner. President Obama showed him some suggested language to split the difference. Sarkozy agreed.
He then went back and he wrote it out, or someone wrote it out, and took it to President Hu, who then -- he and the Chinese were considering it and considering it, so finally President Obama gestured President Hu into the corner, they discussed it. And President Hu -- it took more time -- he also agreed. President Obama then brought Sarkozy to the corner, and they all agreed.
Now, that was the kind of, I think, leadership that he did exercise. It was not -- as they would say, it was not dictating an answer, but it was coming up with an answer in which the two parties each could meet.
Obama's vision for a world economy
RAY SUAREZ: During his news conference, the president sounded like he was trying to walk a fine line between a strict responsibility to his constituents, as he called them, the American people, and also an understanding that the United States is going to play a big role in pulling the world out of a ditch.
MARGARET WARNER: Ray, I think he was trying to say that they are one in the same. In other words, the question was from a Chinese reporter, who said, "How are you going to keep local politics -- or all politics is local -- from interfering with the execution of any of this by any of these leaders?"
And he said, "Well, of course, I'm the president of the U.S. And in the end, I'll be judged on by voters as to whether I made their lives better." But then he went on to say, "I have to make the case that their futures and their well-being are tied up with the well-being of people in your country," and, you know, went on to explain this interdependent, interconnected world that a company like Caterpillar, for example, is losing jobs because they can't sell abroad.
So I think at the -- when he said this, I think he was also speaking to all of his fellow leaders, as well, that they all are going to have to make this case and fight protectionist sentiment at home.
RAY SUAREZ: Did an Obama vision for what a recovered world economy looks like and how it's different from the past emerge from his discussions with the world press?
MARGARET WARNER: Yes, and I think from his discussions with other world leaders. Gordon Brown, British Prime Minister Gordon Brown, said today at his press conference, "The Washington Consensus is over". And by that -- he said there's a new consensus.
And by that he meant the old Washington Consensus of just completely liberalizing trade and encouraging all these developing countries to throw off all their subsidies and to adopt the, quote, "Washington model."
And what's interesting is, President Obama also had problems with the old Washington Consensus. As he said today, "I really believe in free markets, but I also think it sometimes goes off the rails if you just let" -- he didn't say unfettered greed, but that was the implication -- "take over." And he said, you know, "We need some rules of the road."
And so I think that's what they're moving towards is a recovery that is global that, as Gordon Brown said, is a more equitable and thereby more sustainable one. And that is not really terribly at odds, I don't think at all at odds, what President Obama himself personally believes.
RAY SUAREZ: Our Margaret Warner joining us from the just-wrapped G-20 summit in London. Margaret, thanks a lot.
MARGARET WARNER: Thanks, Ray.