Q Thank you, Mr. President. I’d like to take you back to not this summit, but the one you hosted at Camp David a couple of days ago and whether you feel that you can assure investors there are contingency plans in place to cope if Greece leaves the euro to prevent a Lehman-like shock to the U.S. and the global economy?
THE PRESIDENT: We had an extensive discussion of the situation in the eurozone and obviously everybody is keenly interested in getting that issue resolved.
I’m not going to speculate on what happens if the Greek choose to exit because they’ve got an election and this is going to be an important debate inside of Greece. Everybody who was involved in the G8 summit indicated their desire to see Greece stay in the eurozone in a way that’s consistent with the commitments that it’s already — that have already been made. And I think it’s important for Greece, which is a democracy, to work through what their options are at time of great difficulty.
I think we all understand, though, what’s at stake. What happens in Greece has an impact here in the United States.
Businesses are more hesitant to invest if they see a lot of uncertainty looming across the Atlantic because they’re not sure whether that’s going to mean a further global slowdown. And we’re already seeing very slow growth rates and in fact contraction in a lot of countries in Europe. So we had an extensive discussion about how do we strengthen the European project generally in a way that does not harm world economic growth, but instead moves it forward.
And I’ve been clear I think in — not just this week, but over the last two years about what I think needs to be done. We’ve got to put in place firewalls that ensure that countries outside of Greece that are doing the right thing aren’t harmed just because markets are skittish and nervous.
We’ve got to make sure that banks are recapitalized in Europe so that investors have confidence. And we’ve got to make sure that there is a growth strategy to go alongside the need for fiscal discipline, as well as a monetary policy that is promoting the capacity of countries like a Spain or an Italy that have put in place some very tough targets and some very tough policies, to also offer their constituencies a prospect for the economy improving, job growth increasing, incomes expanding even if it may take a little bit of time.
And the good news was you saw a consensus across the board from newly elected President Hollande to Chancellor Merkel to other members of the European community that that balanced approach is what’s needed right now. They’re going to be meeting this week to try to advance those discussions further. We’ve offered to be there for consultation to provide any technical assistance and work through some of these ideas in terms of how we can stabilize the markets there.
Ultimately, what I think is most important is that Europe recognizes this euro project involves more than just a currency, it means that there’s got to be some more effective coordination on the fiscal and the monetary side and on the growth agenda. And I think that there was strong intent there to move in that direction. Of course, they’ve got 17 countries that have to agree to every step they take. So I think about my one Congress, then I start thinking about 17 congresses and I start getting a little bit of a headache. It’s going to be challenging for them.
The last point I’ll make is I do sense greater urgency now than perhaps existed two years ago or two and a half years ago. And keep in mind just for folks here in the States, when we look backwards at our response in 2008 and 2009, there was some criticism because we had to make a bunch of tough political decisions.
In fact, there’s still criticism about some of the decisions we made. But one of the things we were able to do was to act forcefully to solve a lot of these problems early, which is why credit markets that were locked up started loosening up again. That’s why businesses started investing again. That’s why we’ve seen job growth of over 4 million jobs over the last two years. That’s why corporations are making money and that’s why we’ve seen strong economic growth for a long time.
And so, acting forcefully rather than in small, bite-sized pieces and increments, I think, ends up being a better approach, even though obviously we’re still going through challenges ourselves. I mean, some of these issues are ones that built up over decades.
At a press conference during the NATO Summit in Chicago today, President Barack Obama was asked about the crisis in Greece and Europe and, specifically, about a possible Greek exit from the eurozone. The President stated that there was a desire for Greece to remain in the eurozone and emphasized both the need for Greeks to determine their own fate as well as the need for more pro-growth policies in Europe (emphasis added):
