The G20 Summit, a meeting of the world's twenty largest economies held in South Korea, ended on Friday with what many analysts viewed as a lack of progress on specific policy issues. But, in his remarks at the end of the summit, President Obama argued that some important progress had been made.
The countries did agree on a way to set guidelines to address trade imbalances, which occur when a country exports more than it imports or visa versa. The U.S. has a big trade imbalance with China, wherein the U.S. imports more Chinese goods than it can pay for or export to China. President Obama was also hoping to address the fact that China's currency has had a consistently low value, which the U.S. believes is done intentionally to make Chinese exports cheaper. This has caused other countries' exports to be more expensive and less desirable, making it difficult to keep people employed who make those exported goods.
While President Obama raised the currency issue at the summit, other global leaders refused to do so and criticized the U.S. for printing billions of dollars worth of paper money and injecting it into the American economy. President Obama argued this move was not intended to affect the value of the dollar globally, but was instead intended to boost the ailing American economy.
The President touted his trip to the G20 summit and other Asian nations as a quest to build alliances that would secure more American jobs. But, a free trade agreement he had hoped to secure with South Korea didn't happen on this trip. He will need to bring the issue to Congress and win representatives' approval before moving forward with the trade agreement.
The first three minutes and 43 seconds of this video gives an overview of what happened at the G20 Summit, while the rest is a discussion with Sewell Chan, a journalist who covered the event.
Quotes
"We should not anticipate that every time countries come together that we are doing some revolutionary thing. Instead of hitting home runs, sometimes we're going to hit singles. But they're really important singles." - U.S. President Barack Obama
"It wasn't any easier to talk about currency when I had just been elected and my poll numbers were at 65 percent than it is now. It was hard then and it's hard now, because this involves the interests of countries and not all of these are going to be resolved easily. And it's not just a function of personal charm. It's a function of countries' interests and seeing if we can work through to align them." - U.S. President Barack Obama
Warm Up Questions
1. What is free trade?
2. What is currency?
3. What are exports and imports?
Discussion Questions
1. How would printing more paper money affect the value of the dollar? Why? How could doing so help the U.S. economy?
2. Do you support President Obama's argument that people can't expect such large summit meetings to end in sweeping changes and that small steps are the way to get things done? Why or why not?
3. Why do you think President Obama decided to brand his trip to Asia as an initiative to generate more jobs?
Additional Resources
China and U.S. Debate Currency Values
