Obama Series

REMARKS BY OBAMA AT G20

Pittsburgh, Pennsylvania

25 Sep 2009

Six months ago, I said that the London Summit marked a turning point in the G20's effort to prevent economic catastrophe. And here in Pittsburgh, we've taken several significant steps forward to secure our recovery, and transition to strong, sustainable, and balanced economic growth. We brought the global economy back from the brink. We laid the groundwork today for long-term prosperity, as well.

It's worth recalling the situation we faced six months ago -- a contracting economy, skyrocketing unemployment, stagnant trade, and a financial system that was nearly frozen. Some were warning of a second Great Depression. But because of the bold and coordinated action that we took, financial markets have come back to life; and we stopped the crisis from spreading further to the developing world.

Because our global economy is now fundamentally interconnected, we need to act together to make sure our recovery creates new jobs and industries, while preventing the kinds of imbalances and abuse that led us into this crisis.

Pittsburgh was a perfect venue for this work. This city has known its share of hard times, as older industries like steel could no longer sustain growth. But Pittsburgh picked itself up, and it dusted itself off, and is making the transition to job-creating industries of the future -- from biotechnology to clean energy. It serves as a model for turning the page to a 21st century economy, and a reminder that the key to our future prosperity lies not just in New York or Los Angeles or Washington -- but in places like Pittsburgh.

Today, we took bold and concerted action to secure that prosperity, and to forge a new Framework for Strong, Sustainable and Balanced Growth.

First, we agreed to sustain our recovery plans until growth is restored, and a new framework for prosperity is in place. Our coordinated stimulus plans played an indispensable role in averting catastrophe. Now, we must make sure that when growth returns -- jobs do, too. That's why we will continue our stimulus efforts until our people are back to work, and phase them out when our recovery is strong.

Going forward, we cannot tolerate the same old boom and bust economy of the past. We can't grow complacent. We can't wait for a crisis to cooperate. That's why our new framework will allow each of us to assess the others' policies, to build consensus on reform, and to ensure that global demand supports growth for all.

Second, we agreed to take concrete steps to move forward with tough, new financial regulations so that crises like this can never happen again. Never again should we let the schemes of a reckless few put the world's financial system -- and our people's well-being -- at risk.

We will create more powerful tools to hold large global financial firms accountable, and orderly procedures to manage failures without burdening taxpayers. And we will tie executive pay to long-term performance, so that sound decisions are rewarded instead of short-term greed. In short, our financial system will be far different and more secure than the one that failed so dramatically last year.

Third, we agreed to phase out subsidies for fossil fuels so that we can transition to a 21st century energy economy -- an historic effort that would ultimately phase out nearly $300 billion in global subsidies. This reform will increase our energy security. It will help transform our economy, so that we're creating the clean energy jobs of the future. And it will help us combat the threat posed by climate change.

Finally, we agreed to reform our system of global economic cooperation and governance. We can no longer meet the challenges of the 21st century economy with 20th century approaches. And that's why the G20 will take the lead in building a new approach to cooperation. To make our institutions reflect the reality of our times, we will shift more responsibility to emerging economies within the International Monetary Fund, and give them a greater voice. To build new markets, and help the world's most vulnerable citizens climb out of poverty, we established a new World Bank Trust Fund to support investments in food security and financing for clean and affordable energy.

At the G20, we've achieved a level of tangible, global economic cooperation that we have never seen before, while also acting to address the threat posed by climate change. At the United Nations Security Council, we passed a historic resolution to secure loose nuclear materials, to stop the spread of nuclear weapons, and to seek the security of a world without them.