Transcript: Q&A by Obama, Brown

Prime Minister Brown: I think President Obama is absolutely right. And I think the history books will record that what he has done in his first, well, nearly 50 days of office has been momentous in setting the means by which we can see the economic recovery happening.

We’ve had a global banking failure, and it’s happened in every part of the world. It’s almost like a power cut that went right across the financial system. And we have got to rebuild that financial system. We’ve got to isolate the bad assets. We’ve got to underwrite the financial system so that loans can start again to businesses and families. And we’ve got to get enough lending into the economy so that people — enough credit so that people are able to go about their normal business again.

And that’s why we’re looking ahead to the G20 in London in April, because a bad bank anywhere can affect good banks everywhere. So we’ve got to root out the problems that exist in other parts of the world, as well, set principles with the banking system for the future, and make sure that the banks subscribe to lending agreements where they actually increase the lending that is available to citizens in every country.

President Obama: One last one.

Prime Minister Brown: Tom.

Question: Tom Bradby from ITV News. Prime Minister, Mr. President, should all governments at this point acknowledge mistakes of policy and regulation in the past? Would that be helpful or unhelpful, in general? And can I just ask you, an awful lot of ink is used describing the individual relationships between Prime Ministers and Presidents. Could I just ask you to describe how at this point you find working with each other?

President Obama: Well, I will say that this is my third meeting with Prime Minister Brown, and I’d like to think that our relationship is terrific. And I’m sure he won’t dispute me, in front of me anyway. (Laughter.) No, look, I think that the Prime Minister has taken the helm of the British economy at a very difficult time. As he noted, I’ve just come in recently. But I think that there are a set of shared values and shared assumptions between us: That we believe in the free market, we believe in a government that is not overbearing and allows entrepreneurs and businesses to thrive, but we also share a common belief that there have to be sufficient regulatory structures in place so that the market doesn’t spin out of control.

I think, on the international front, we have a shared world view that it is important for us to be true to our values and ideals of rule of law, of a belief in human rights, a belief in our democratic practices, but that we also have to be respectful around the world and to listen and not simply dictate; that in this new world that we live in, that the way to get things done is to build partnerships and alliances, as opposed to acting unilaterally.

So I think both on the economy and both — and on foreign policy, we’ve got a shared world view that allows us to work together very effectively. And he also has a wonderful family, as I do. (Laughter.) So we can always talk about our spectacular lives and our wonderful children.

With respect to the first part of your question, look, I think there is no doubt that, setting aside who’s to blame, that in the past there have been some mistakes and lessons learned in terms of how we deal with the financial sector. Globalization can be an enormous force for good. And one of the things that we’ve talked about repeatedly is that countries in this crisis cannot start turning inward and try to erect protectionist barriers. We should encourage trade. The fact that we have a global capital system allows money to flow to areas that previously couldn’t get capital. That allows them to develop and to grow. That can grow the economy worldwide, increase trade, and that potentially benefits everybody.

But what is also true is, is that when you’ve got trillions of dollars that can now move at the speed of light, when you’ve got a whole series of unregulated pools of dollars outside of the banking system, but we still have a 1930s regulatory system in place in most countries designed from the last great crisis, that we’ve got to update our institutions, our regulatory frameworks, so that the power of globalization is channeled for the benefit of ordinary men and women, so that they have jobs, they can purchase a home, they can send their children to college, and prosper and thrive; and that the benefits of globalization aren’t just for a small handful of people who are not accountable.

And that’s the kind of transformation that we’re obviously trying to bring about here in the United States, and I suspect that that’s a view that Gordon shares.

Prime Minister Brown: Yes, Tom, I’ve enjoyed every conversation that we’ve had, both on the telephone and when we’ve met. I don’t think I could ever compete with you at basketball — perhaps tennis.

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