Remarks by President Obama at G-20 Press Conference in Toronto, Canada

Intercontinental Hotel, Toronto, Canada

6:03 P.M. EDT

THE PRESIDENT:  Please, everybody, have a seat.  Good evening.  I want to thank our wonderful hosts —- first and foremost, my friend and partner, Prime Minister Harper, as well as the Canadian people, and the people of Toronto, for their extraordinary hospitality. 

The success of these summits —- the G8 in Muskoka and the G20 here in Toronto -— is a tribute to Canadian leadership.  I also want to thank my fellow leaders for the sense of purpose that they brought to this summit. 

The G20 is now the premier forum for international economic cooperation.  We represent East and West, North and South, advanced economies and those still emerging.  Our challenges are as diverse as our nations.  But together we represent some 85 percent of the global economy, and we have forged a coordinated response to the worst global economic crisis in our time.

In London last year, we took unprecedented action to prevent an even larger economic catastrophe, to put our economies on the path to recovery and to begin reforming our financial system so that a crisis like the one we were emerging from never happened again.          

In Pittsburgh we went further —- moving beyond the old economic cycles of boom and bust by committing our nations to a new framework for growth that’s balanced and sustained, as well as specific financial reforms.

Our bold action has succeeded.  In the United States, we are committed, above all, to leading by example, and because of the steps that we’ve taken to get our economy moving, we are growing again, and this growth is beginning to translate into job creation.  And we’re now poised to pass the toughest financial reform since the aftermath of the Great Depression.

Globally, economic contraction has given way to economic growth.  Trade that had plummeted is rebounding.  Emerging economies in particular are seeing impressive growth.  So we have pulled ourselves back from the brink, and begun to move forward with economic recovery.

But as we all know, that’s not good enough.  In the United States and around the world, too many people are still out of work.  In too many economies, demand for goods and services is still too weak.  As we’ve been reminded in recent months, a financial crisis in one country can have consequences far beyond its borders.  And history teaches us that growth and prosperity is never guaranteed.  It requires constant effort and it requires continued leadership.

So we came to Toronto with three specific goals:  to make sure the global recovery is strong and durable; to continue reforming the financial system; and to address the range of global issues that affect our prosperity and security.  And we made progress in each of these areas.

First, to ensure the recovery is strong and durable, we agreed to continue coordinating our efforts so we’re creating jobs.  That’s my highest economic priority as President.  And that is why we are focused on increasing global demand.  Every economy is unique, and every country will chart its own unique course, but make no mistake —- we are moving in the same direction.

As I reiterated to my colleagues, after years of taking on too much debt, Americans cannot —- and will not —- borrow and buy the world’s way to lasting prosperity.  No nation should assume its path to prosperity is simply paved with exports to the United States.  Indeed, I’ve made it clear that the United States will compete aggressively for the jobs and industries and markets of the future. 

That’s why I’ve set the goal of doubling our exports over the next five years —- an increase that would support millions of jobs in the United States.  It’s why I’ve launched a National Export Initiative to help meet this goal.  It’s why we focused earlier this week on deepening our economic cooperation with Russia -– which would benefit both of our countries -– including restarting our poultry exports, and accelerating our efforts to support Russia’s entry into the WTO. 

That's why I announced that my administration will work to resolve outstanding issues regarding the United States-Korea free trade agreement by the time that I visit Korea in November.  This will create new jobs and opportunity for people in both our countries, and enhance America’s competitiveness in the 21st century.

A strong and durable recovery also requires countries not having an undue advantage.  So we also discussed the need for currencies that are market-driven.  As I told President Hu yesterday, the United States welcomes China’s decision to allow its currency to appreciate in response to market forces.  And we will be watching closely in the months ahead.

And because a durable recovery must also include fiscal responsibility, we agreed to balance the need for continued growth in the short term and fiscal sustainability in the medium term.  In the United States, I’ve set a goal of cutting our deficit in half by 2013.  A number of our European partners are making difficult decisions, but we must recognize that our fiscal health tomorrow will rest in no small measure on our ability to create jobs and growth today.

The second area we focused on was advancing the goal of financial reform.  Just as we’re on the verge of passing financial reforms in the United States, our European partners have committed to the process we went through in the United States —- a new level of transparency and a stress test for banks to rebuild confidence. 

Here in Toronto, we reaffirmed our commitment to the highest global standards.  To maintain momentum, we directed our teams to finalize for our meeting in Seoul a global framework to ensure that banks hold enough capital to withstand the stresses of government intervention.  Rules must be clear.  Oversight must be strong.  Complex trades -— like derivatives -— must be brought into the light of day.  Excessive risk-taking and abusive practices must be prevented.  Consumers must be protected.  In short, we have to do everything in our power to avoid a repeat of the recent financial crisis.

Finally, we made progress on a range of global challenges that are critical to shared prosperity.  We’re moving forward with the food security initiative that we announced last year, including by launching a special fund at the World Bank, which will strengthen farmers' productivity in the poorest countries. And we made progress toward a new coordinated approach so that we can invest more than $20 billion to reduce hunger and promote agricultural development. 

The G20 leaders renewed our commitment, made in Pittsburgh, to phase out fossil fuel subsidies.  The United States has laid out our plans for achieving this goal, and we’re urging our G20 partners to do so as well.  This would be one of the most important steps we can take to create clean energy jobs, increase our energy security and address the threat of climate change.

And I’m pleased we endorsed my proposal to broaden the G20 agenda to include the fight against corruption.  In too many places, the culture of the bribe is a brake on development and prosperity.  It discourages entrepreneurship, destroys public trust, and undermines the rule of law while stifling economic growth.  With a new commitment to strengthening and enforcing rules against corruption, economic opportunity and prosperity will be more broadly shared. 

Let me conclude by saying that I know that much of the focus coming into these meetings was on whether our nations would be divided by different approaches.  But as we’ve proven repeatedly over the past 18 months, our nations can -- and have -- come together through the G-20 to build on the foundation of our shared interests.  Indeed, that’s the purpose of these meetings. We can bridge our differences.  We can coordinate our approaches. And we can continue our relentless focus on durable growth that puts our people to work, and broadens prosperity for the world.

So with that, let me take a few questions.  I’ve got a handy list here.  And I’m going to start with Darlene from AP.

Q    Thank you, Mr. President.  Do you think the decision by your G20 counterparts here to endorse stiff deficit reduction goals is a repudiation of your view that cutting deficits too quickly and too fast would hinder the global economic recovery?

And then if I could ask you just quickly on North Korea -- you said yesterday that North Korea must be held to account for the sinking of the South Korean warship and that there must be consequences for such irresponsible behavior.  What specifically -- what kind of punishment would you like to see imposed on North Korea, short of some sort of condemnation from the U.N. Security Council?  Thank you.

THE PRESIDENT:  Darlene, I’m -- since you’re the first, I’m going to give you two questions.  Everybody else, let’s try to stick to one, please -- especially big questions.

With respect to the first question, we helped to draft this communiqué, which reflects our policies.  I know leading up to the conference, leading up to the summit, there was some sense of a divide.  In fact, the policies that we’ve been promoting are reflected in the communiqué and entirely consistent with what the G20 leaders came up with.

Keep in mind that we had already proposed a long time ago that we were going to cut our deficits in half by 2013.  And so the time frame and the measures that have been adopted are consistent with our view that it is important for us to make sure that in the medium and long term, we are paying attention the big deficits and debts that we have out there. 

What we did say coming to this conference is we can’t all rush to the exits at the same time.  So countries that have surpluses should think about how can they spur growth and how can they spur demand.  Not all of those involve stimulus.  Some of them might involve structural changes in their economy.  Some of them might involve passing financial regulatory reforms so that their banks are lending again. 

But the point is that in each country what we have to recognize is that the recovery is still fragile, that we still have more work to do to make this recovery durable -- but we also have to recognize that if markets are skittish and don’t have confidence that we can tackle the tough problems of our medium- and long-term debt and deficits, then that also is going to undermine our recovery.

Now, there are going to be some countries -- Greece being the most obvious example -- that have to act immediately because they’re facing a sovereign debt crisis.  There are going to be other countries where the issue really has to do with how do we start putting in place some plans that are credible for deficit reduction, even though they don’t kick in significantly in this first year.

So, for example, Germany, which cares deeply, obviously, about the issue of fiscal consolidation -- if you actually look at their plans, they’re no more front-loaded than ours are.  In fact, you can make the argument that some of the steps that I’ve already taken -- freezing domestic discretionary spending for the next three years in my budget, passing PAYGO, setting up a fiscal commission to tackle issues like entitlements long term -- that many of those decisions are comparable to some of the decisions that have been made by those who are promoting fiscal consolidation.

So I think this has really been an issue in which there is violent agreement between the parties.  We have to make sure we’re not rushing to the exits too quickly and all at the same time.  But we also have to be mindful that the debt and deficit levels that many advanced countries have right now are unsustainable and have to be dealt with in a serious way.

With respect to North Korea, our main focus right now is in the U.N. Security Council making sure that there is a crystal-clear acknowledgement that North Korea engaged in belligerent behavior that is unacceptable to the international community.  And the United States participated in the investigation that was conducted around the Cheonan.  Our experts concluded that North Korea had carried out that attack.  That was consistent with South Korea’s assessment and others who were observers in the process.

I think President Lee has shown extraordinary restraint given these circumstances.  And it is absolutely critical that the international community rally behind him, and send a clear message to North Korea that this kind of behavior is unacceptable and that the international community will continue to step up pressure until it makes a decision to follow a path that is consistent with international norms. 

And my expectation is, is that those who were here at the G20, as they look at the evidence, will come to that same conclusion.  I think it is a bad habit that we need to break to try to shy away from ugly facts with respect to North Korea’s behavior in the interests of -- or under the illusion that that will somehow help to maintain the peace.

All right.  Hans.

Q    Thank you, Mr. President.  Before the summit you said it was too early to tell if China’s revaluation of their RMB would lead to real valuation.  You suggested that you’d take a year to look at the trajectory to see whether or not it was real. You’ve just said a couple of months -- 

THE PRESIDENT:  Did I say a year at the press conference in the White House?

Q    On the 24th with Medvedev, you said --

THE PRESIDENT:  Did I say a year?

Q    -- you would take a year to monitor the RMB -- that was the trajectory.

THE PRESIDENT:  Okay.

Q    I just want to know if there’s a reason for the change in the intervening time?

THE PRESIDENT:  Look, I’d have to look at the transcript, but let me just make sure that I’m absolutely clear here.  Number one, China has determined that it is in its own interests, its own sovereign interests, to move back towards a path of flexible exchange rates.  We think that is a very positive thing.  We think in part it is a positive thing because a undervalued RMB has given China a significant trading advantage, and we have been very clear to them that we don’t consider that acceptable or consistent with the principles of balanced and sustainable growth that were discussed in Pittsburgh and that all G20 countries signed on to.

So we are pleased that they’ve made this first step.  But like I think a number of other countries, a number of other trading partners with China, the proof of the pudding is going to be in the eating.  We didn’t expect a 20 percent revaluation in a week.  That would be disruptive to the Chinese economy; it would be disruptive to the world economy.

We do expect that as more and more market forces come to bear, that given the enormous surpluses that China has accumulated, that the RMB is going to go up and it’s going to go up significantly.  And so we are going to be paying attention over the next several months to make that determination. 

Now, I don’t have a perfect formula.  Will I have a clear idea after three months as to whether it’s moving fast enough or not?  I will leave that up to Treasury Secretary Geithner, who makes these determinations.  That’s not my job.

Q    How long do you expect people like Senator Charles Schumer and American manufacturers who’ve lost so many jobs so quickly, how long do you expect them to wait?

THE PRESIDENT:  Well, Hans, we’re not going to have a colloquy here, but my expectation is, is that they’re going to be serious about the policy that they themselves have announced. 

Now, what I’m going to do is I’m going to work with people like Senator Schumer, manufacturers, workers who are affected by these trade imbalances.  And I think we all have the same interest, and that is the United States can compete with anybody as long we’ve got an even playing field. 

And as I indicated in my opening remarks, we’re prepared to enter into trade agreements with Korea.  One of the things that we discussed here was, is there a way to reinvigorate the Doha Round, which has been stuck for a very long time?  So I agree with the statement in the communiqué that trade can be a source of prosperity for everybody, but it’s got to be a fair deal.

And it’s not just currency, by the way.  I mean, we’ve had discussions with our Chinese partners about what are they doing on nontariff barriers; what are they doing with respect to intellectual property protection; what are they doing with respect to state-owned enterprises or stated-owned banks that are subsidizing industry.  So there are a whole host of issues.

Now, undoubtedly they’ve got some issues with us.  And I think we can manage these trade frictions, but it’s going to be important, I think, for China to take seriously not just what we’re saying, but what a number of countries, including countries like Canada, are saying. 

All right.  Jackie, where you at?

Q    Back here.  Thank you, Mr. President.  One of the noneconomic issues you covered here was Afghanistan.  And I’m curious whether you believe that the talks that Pakistan is reportedly brokering between the Taliban and President Karzai of Afghanistan hold promise?  Or do they concern you?  And a related question -- not a second question -- (laughter) -- is do you agree with the new Prime Minister of Great Britain, David Cameron -- David, to you -- that we can be totally out of Afghanistan by 2015 and turn the lights off?

THE PRESIDENT:  I’m not sure that's a quote from David, but I’ll take the second question first.  We have been in Afghanistan now for nine years.  Next year we will have been there for a decade.  This is now America’s longest war.  And what that means is that all of us have an interest not in occupying Afghanistan, but an interest in making sure Afghanistan is stable, can stand on its own two feet when it comes to security issues, and is not a base for terrorist activities launched against the United States of America.

Now, I think that we’re going to need to provide assistance to Afghanistan for a long time to come.  They are still building up a national government.  They are in a very tough neighborhood. They are a very poor country.  So on a whole range of issues -- from economic, development, setting up courts, setting up effective police forces, a political system that is transparent and fair, as well as with respect to security -- we intend to be a partner with Afghanistan over the long term.  But that is different from us having troops on the ground. 

Now, I’ve been clear about the policy that we’re pursuing.  It was announced last November, and we’re several months into it. The policy involves us sending in additional troops.  We already had approximately 68,000; we put in an additional 30,000 -- with the intent of providing the Afghan government the space and the time to build up its security forces, for us to be able to help blunt the momentum of the Taliban, to clear some of the areas in which the Taliban had gotten a very fierce foothold, to start moving Afghan security forces in -- even as we are improving governance and we’re improving the legitimacy and credibility of the civilian government. 

That is the policy that General McChrystal was pursuing. That is the policy that General Petraeus is pursuing.  That is the policy that all of our ISAF allies have fully endorsed, as has President Karzai.

Now, it’s tough.  It is a tough challenge for reasons that have been amply recorded.  As I said, this is the third poorest country in the world.  It has an extraordinarily high illiteracy rate.  It has suffered through 30 years of war.  And so this is going to be tough.  But what I expect is that by the end of this year, we will have seen progress on the strategy that was laid out.  We will conduct a full review.  Those things that are not working, we will fix.  Those things that are working we will build on -- both on the civilian side, and on the military side, as well as on the diplomatic side.

Because ultimately, as is true in -- as was true in Iraq, so will be true in Afghanistan:  We’re going to have to have a political solution, not simply a military solution.

Now, with respect to the negotiations and efforts at reintegration, I think it’s too early to tell.  I think that we have to view these efforts with skepticism, but also openness.  The Taliban is a blend of hard-core ideologues, tribal leaders, kids that basically sign up because it’s the best job available to them.  Not all of them are going to be thinking the same way about the Afghan government, about the future of Afghanistan.  And so we’re going to have to sort through how these talks take place.  But I think that President Karzai’s peace jirga was a useful step.  He’s going to be having a Kabul conference that I think will be a useful step in this direction. 

I think that conversations between the Afghan government and the Pakistani government, building trust between those two governments is a useful step.  I think to the extent that we can get all the regional players to recognize that it is in everybody’s interests that this region between Pakistan and Afghanistan are not used to launch terrorist attacks -- that will be a useful step.  And that's what we’re moving towards.

Peter Maer.  There you are.

Q    Thank you, sir.  Looking ahead to the Supreme Court confirmation hearings of your choice Elena Kagan tomorrow, first of all, what do you say to the critics who are portraying her as a politically motivated liberal?  And given your own support when you were in the Senate for a filibuster of a Supreme Court nominee, what’s your guidance to Republicans who may be threatening that at this point?

THE PRESIDENT:  I think they should pay attention to Elena Kagan’s record and her testimony.  Under our constitutional system, the Senate is entrusted with the process of providing advice and consent, and I am absolutely confident that if you give a fair reading of Elena Kagan’s record and her performance in every job that she’s had, what you see is somebody with an extraordinarily powerful intellect; somebody with good judgment; somebody who understands the impact that laws have on individual Americans; somebody who is able to broker understandings between people of very difficult ideological bents; somebody who is extremely hardworking, extremely diligent, extremely personable; knows how to build consensus; has been an outstanding lawyer, has been an outstanding dean of one of top law schools -- notice, even though it’s my alma mater, I just said “one of” -- has performed brilliantly as Solicitor General; and has the support, by the way, of a number of very conservative jurists who she’s worked with.

So as I examine some of the arguments that have been floated against her nomination over the last several weeks, it’s pretty thin gruel.  Having said that, I expect that my Republican colleagues and my Democratic colleagues should ask her tough questions, listen to her testimony, go through the record, go through all the documents that have been provided to the Senate Judiciary Committee, and then vote their conscience.

Q    (Inaudible) -- in your experience?

THE PRESIDENT:  Vote their conscience.

Mr. Kimura of the Kyodo News.

Q    Thank you, Mr. President.  I have a question with two parts if I may.

THE PRESIDENT:  But they’re related.  (Laughter.) 

Q    Yes, of course.  

THE PRESIDENT:  Yes.

Q    Okay.  The Cheonan incident once again indicated unstability of Northeast Asia and the importance of the U.S.-Japan security treaty that just marked the 50th anniversary this month.  And you will be meeting with new Prime Minister Kan after this.  And on this occasion, would you please talk about your long-term vision on the alliance and the security treaty?  I mean, is this current structure of the treaty sustainable for the coming decades, especially with the Chinese military expansion and unpredictable North Korea?  And -- or would there be more responsibility required on the Japanese side?

And the related second-part question is, in your meeting with Hu Jintao yesterday, you called for the cooperation from Chinese side to send a clear message to North Korea as a consequence.  How do you look at response so far?  Is it favorable and strong enough to send a united, clear message to North Korea?  Thank you.

THE PRESIDENT:  Let me answer the second question first.  I had the conversation with President Hu.  I was very blunt.  This is not an issue where you’ve got two parties of moral equivalence who are having an argument.  This is a situation in which you have a belligerent nation that engaged in provocative and deadly acts against the other.  And I think it is very important that we are clear about that.

Now, I am sympathetic to the fact that North Korea is on China’s border.  They have a security interest in not seeing complete chaos on the Korean Peninsula or a collapse that could end up having a significant impact on them.  And so I think the United States and the international community should be mindful that this is in China’s backyard. 

And so when they adopt a posture of restraint, I understand their thinking.  But I think there’s a difference between restraint and willful blindness to consistent problems.  And my hope is that President Hu will recognize as well that this is an example of Pyongyang going over the line in ways that just have to be spoken about seriously -- because otherwise we’re not going to be able to have serious negotiations with the North Koreans.

I, like I think every participant in the six-party talks, would love nothing more than to see these issues resolved diplomatically.  So in that, China and the United States and Japan and South Korea and Russia all share a common interest.  We’d like to see a denuclearized Korean Peninsula.  We’d like to see a North Korea that is a responsible member of the world community -- which would be good for the people of North Korea.

But that’s only going to happen if we’re honest about what’s taking place right now and if we’re honest about our basic expectations of how nations behave in an international order.

With respect to the alliance between the United States and Japan, we marked 50 years.  I expect that alliance to sustain itself for another 50 years.  I think the condition of the alliance is very strong.  I have already had the opportunity to meet with and discuss issues with the new Prime Minister over the last several days.  I think he is as committed as I am to making sure that the U.S.-Japan alliance remains strong and vibrant.  It is good for Japan’s security; it is good for America’s security.

And, by the way, I think, again, it helps to serve China’s interests and South Korea’s interests. 

I think rather than set it up as a rivalry, rather than see -- view this as an issue of spheres of influence, which is I think an old way of thinking, what we want to do is to say we are always going to be there for Japan; we are always going to be there for South Korea; we are going to be a presence in the Pacific because we are a Pacific nation as well as an Atlantic nation.  But we want to partner with all countries to create an environment in which trade and commerce, and the exchange of goods and people and ideas and cultures is thriving. 

And, look, Asia is obviously on the move.  China is on the move.  That’s a positive thing.  That shouldn’t be a threat to anybody.  What we want to make sure of, though, is, is that through dialogue, through forums like the G20, through forums like ASEAN or APEC or some of the other multilateral institutions that we’ve set up, that all countries are meeting their responsibilities even as their rights are also being recognized. And I think if we adhere to that basic principle, then a strong U.S.-Japan alliance is something that can continue to be a cornerstone of a peaceful and prosperous Asia which will benefit all people.

Okay.  Dan Lothian from CNN.

Q    Thank you, Mr. President.  To follow up on Jackie’s question, you talked about providing assistance in Afghanistan for some time to come.  But given the challenges there and the history in Afghanistan, what makes you think that after declaring victory in Afghanistan, that it won’t slide back into becoming a haven for terrorists?

THE PRESIDENT:  Well, I don’t have a crystal ball.  I think that right now the debate surrounding Afghanistan is presented as either we get up and leave immediately because there’s no chance at a positive outcome, or we stay basically indefinitely and do “whatever it takes” for as long as it takes.  And what I said last year I will repeat, which is we have a vital national interest in making sure that Afghanistan is not used as a base to launch terrorist attacks. 

It is true that al Qaeda right now is in Pakistan.  And you’ll often hear, why are we in Afghanistan when the terrorists are in Pakistan?  Well, Al Qaeda is pinned down and has been weakened in part because they don’t have the run of the territory.  We would be less secure if you return to a situation that existed prior to 9/11, in which they had a government that was friendly to them and willing to house their operations.  And I don’t think anybody would dispute that.

So, A, we’ve got a vital interest in the region.  B, we do not expect because of our involvement in Afghanistan that the country is going to completely transform itself in a year or two years or five years.  President Karzai does not expect that.  The Afghan people don’t expect that.  Afghanistan has its own culture.  It is a very proud culture.  It has a lot of work to do with respect to development and it’s going to have to find its own path.

But I reject the notion that the Afghan people don't want some of the basic things that everybody wants -- basic rule of law, a voice in governance, economic opportunity, basic physical security, electricity, roads, an ability to get a harvest to market and get a fair price for it without having to pay too many bribes in between.  And I think we can make a difference, and the coalition can make a difference, in them meeting those aspirations even as we are meeting our security interests.  Those two things are tied together.

Now, there has been a lot of obsession around this whole issue of when do we leave.  My focus right now is how do we make sure that what we’re doing there is successful, given the incredible sacrifices that our young men and women are putting in.  And we have set up a mechanism whereby we are going to do a review -- and I’ve signaled very clearly that we’re not going to just keep on doing things if they're not working -- and that by next year we will begin a process of transition.

That doesn’t mean we suddenly turn off the lights and let the door close behind us.  And if you look at what’s happening in Iraq right now, we have met every deadline.  By the way, there was a timetable in place, and we are -- we have -- by the end of August, will have removed all of our combat from Iraq.  We will maintain a military presence there.  We will maintain military-to-military cooperation.  And we are providing them assistance, but we’re meeting this deadline.

And I think it is worth the extraordinary sacrifices that we are making -- and when I say “we” -- not just the United States, but all coalition members -- to try to see a positive outcome in Afghanistan, as well.

All right?  Last question, Scott Horsley.  Where’s Scott?

Q    Mr. President, are there steps your administration can take now to build confidence that the U.S. will, in fact, meet its deficit reduction targets in the medium and long term?

THE PRESIDENT:  I’m sorry.  Could you repeat the question?  Put the mic a little closer to you. 

Q    Are there steps your administration can take now to build confidence that the U.S. will, in fact, meet its deficit reduction goals in the medium and long term?

THE PRESIDENT:  Several steps we’ve already begun to take: Number one, as I indicated, the budget that we’re presenting -- three years discretionary domestic spending freeze.  And I’ve sent a clear signal to the leadership when we met, even if we do not get the entire budget package passed through Congress, that top line number needs to stay firm.  And I’m serious about it.

We’ve initiated a whole host of measures to cut programs that aren’t working, including, by the way, in the defense area. Bob Gates has been, I think, as successful as any Secretary of Defense in recent memory in actually killing programs, which I think anybody who follows Washington knows is very -- very difficult.

We have instituted PAYGO.  And although there were baselines built in that took into account the fact that some of this stuff was not going to be solved overnight, it is starting to provide budget discipline to Congress as they move forward. 

And we have set up this fiscal commission who will provide reports starting in November -- and one of the encouraging things, although there was resistance, ironically, on the part of some of the Republicans who originally had been co-sponsors of legislation to create the fiscal commission and they, in fact, ended up voting against it -- what’s been encouraging, based on what I’m hearing both from Democrats and Republicans, is that there’s been a serious conversation there.  People are looking at a whole spectrum of issues to get at what is basically a structural deficit that preceded this financial crisis.

Even if -- the financial crisis made it much worse, but even if we had not gone through this financial crisis, we’d still have to be dealing with these long-term deficit problems.  They have to do with Medicaid; they have to do with Medicare; they have to do with Social Security.  They have to do with a series of structural problems that are not unique to America.  Some of it has to do with an aging population.  And we’ve got to look at a tax system that is messy and unfair in a whole range of ways. 

And so they're looking at the gamut of steps that are going to be taken.  And one of the interesting things that's happened over the last 18 months as President is for some reason people keep on being surprised when I do what I said I was going to do. So I say I’m going to reform our health care system and people think, well, gosh, that's not smart politics, maybe we should hold off.  Or I say, we’re going to move forward on “don't ask, don't tell,” and somehow people say, well, why are you doing that, I’m not sure that's good politics. 

I’m doing it because I said I was going to do it.  And I think it’s the right thing to do.  And people should learn that lesson about me, because next year when I start presenting some very difficult choices to the country, I hope some of these folks who are hollering about deficits and debt step up, because I’m calling their bluff.  And we’ll see how much of that -- how much of the political arguments they're making right now are real, and how much of it was just politics. 

All right?  Thank you very much, everybody.  (Applause.)   

END
6:46 P.M. EDT

Remarks by President Obama and President Yudhoyono of the Republic of Indonesia Before Bilateral Breakfast Meeting

Toronto Convention Center
Toronto, Canada

8:27 A.M. EDT
           
     PRESIDENT OBAMA:  Good morning, everybody.  Selamat pagi.
It is wonderful once again to see my good friend, the President of Indonesia, and members of his delegation.  I obviously have enjoyed our interactions here, although my hope and wish was that I was going to be seeing him in Jakarta.  Because of the crisis that we’ve had in the Gulf, I’ve had to delay the trip.  But graciously, for a second time now, the President has re-extended the invitation, and I am confident that we are going to get there.
 
     We’re having breakfast this morning because the friendship between Indonesia and the United States has always been strong, and it is our intention to continue to make it even stronger.  Working within the G20, we have been able to stabilize the world economy.  I was just hearing from the President the progress that's been made in getting back to pre-crisis levels in Indonesia with respect to economic growth and employment, inflation.  But obviously, we have many challenges that still have to proceed.
 
     Two areas where we are particularly interested in working together is on the issue of climate change, where we are helping to create a climate change study center in Indonesia that I think can provide enormous support for not only studies there but also in the region and around the world.
 
     And the second area is education, where we’re looking to put an additional $160 million into joint programs that can enhance cooperation on educating our youth, which is obviously one of our top priorities in terms of future development.
 
So I just want to once again thank the President for his graciousness, his cooperation, and reaffirm the great friendship between our two countries.
 
     Mr. President.
 
     PRESIDENT YUDHOYONO:  Thank you.  Good morning.  I am very pleased to meet again once again Barack Obama this morning to discuss issues of common interest, both bilaterally and multilaterally. 
 
Indonesia and America are entering and developing a comprehensive partnership which is elevating and transforming our relations based on the equal partnership and aim to meet the challenges of the 21st century -- promoting peace, reforming the world economy, addressing climate change, as well as promoting harmony among civilizations.  A stable, dynamic, and strong relations between Indonesia and the U.S. is good for our region and for our world. 
 
I appreciate the leadership of President Barack Obama and I thank to him for his friendship and goodwill toward Indonesia.
 
     I want to thank you.
 
     PRESIDENT OBAMA:  Okay.  Thank you, everybody.
 
                              END           8:33 A.M. EDT
 

Remarks by President Obama and President Lee Myung-Bak of the Republic of Korea After Bilateral Meeting

Intercontinental Downtown Hotel
Toronto, Canada

4:16 P.M. EDT
 
     PRESIDENT OBAMA:  Well, I just had an excellent discussion with President Lee and his team.  Obviously we are marking the 60th anniversary of the Korean War and the extraordinary friendship and alliance between our two countries.  And when I last visited the Republic of Korea, President Lee shared with me a wonderful story of what the American presence had meant to him as he was growing up, and it was a reminder and a testament I think of the importance of the relationship and the alliance between our two countries.
 
     I expressed to President Lee once again the condolences of all Americans for the tragic Cheonan incident, and indicated to him that we stand foursquare behind him.  He has handled this issue with great judgment and restraint.  He rightly is insisting on North Korea being held -- held to account for its actions in the United States Security Council.  We are fully supportive of that effort.  We think it is the right thing to do.  There have to be consequences for such irresponsible behavior on the international stage.
 
     We also reaffirmed the importance of our military alliance. One of the topics that we discussed is that we have arrived at an agreement that the transition of operational control for alliance activities in the Korean Peninsula will take place in 2015.  This gives us appropriate time to -- within the existing security context -- to do this right, because this alliance is the lynchpin of not only security for the Republic of Korea and the United States but also for the Pacific as a whole.  And South Korea is one of our closest friends -- we want to make sure that we execute what’s called the opcon transition in an effective way.
 
     One of the other points that we discussed extensively was the issue of commercial and trade ties between our two countries. There has been a lengthy negotiation to arrive at a free trade agreement.  The last time I was in Korea, I said that I would be committed to moving this forward.  And today I indicated to President Lee that it is time that our United States Trade Representative work very closely with his counterpart from the ROK to make sure that we set a path, a road, so that I can present this FTA to Congress. 
 
We are going to do it in a methodical fashion.  I want to make sure that everything is lined up properly by the time that I visit Korea in November.  And then in the few months that follow that, I intend to present it to Congress.  It is the right thing to do for our country.  It is the right thing to do for Korea.  It will strengthen our commercial ties and create enormous potential economic benefits and create jobs here in the United States, which is my number one priority.
 
     So both on the security front and on the economic front, our friendship and alliance continues to grow.  My personal friendship with President Lee and my admiration for him continues to grow.  And I’m looking forward to working diligently with him and I’m looking forward to an opportunity to visit Korea once again because I had a wonderful time the last time we were there.
 
     PRESIDENT LEE:  (As translated.)  Thank you, first of all.
 
Today during my talks with President Obama I recalled how we are commemorating the 60th anniversary of the outbreak of the Korean War, and I thought it was a very good opportunity for me to thank Mr. President, as well as the people of the United States and its government, for the sacrifice and dedication and commitment given to the people of Korea 60 years ago.  Because of your sacrifice by the American people and by the men and women in uniform, Korea today enjoys the freedom, prosperity, and the peace that we enjoy today. 
 
And I thanked President Obama for that.  And I also thanked the United States Congress for adopting a joint resolution commemorating the 60th anniversary of the Korean War.  And I also thanked President Obama for his firm and unflagging support given to my people and my government following the sinking of our Navy vessel, the Cheonan.
 
     And as President Obama just explained, he and I agreed on the timing of the transfer of the wartime operational control. We also talked in detail about the follow-up activities to the Cheonan incident, and also we agreed on the adoption of the Korea-U.S. free trade agreement, as well.
 
     And as you know, considering the evolving security environment of the region, as well as the world, and also in order to strengthen ROK-U.S. alliance, we made a formal request to President Obama and to the U.S. administration for the adjustment of the transfer of the timing of the wartime operational control.  And I would like to thank President Obama for accepting this proposal, and we agreed to transfer this in the latter half of 2015 -- by late 2015.
 
      And also President Obama and I talked about what to do following the Cheonan incident, and we talked in detail about the months ahead.  And we talked -- first of all, we agreed that Korea and the United States, that we will do all that we can to deter any acts of North Korean aggression leveled against us and that we will react swiftly and strongly so that this will not happen again. 
 
And also we are working very closely at the United Nations Security Council in order to bring about a statement, and a strongly worded statement, condemning North Korea.  And we also agreed on the follow-up activities that we would be jointly taking between Korea and the United States.
 
     And also with regards to the Korea-U.S. free trade agreement, as President Obama talked about, when he was visiting Korea last November he also assured of his firm, continued commitment towards realizing this very important agreement.  He and I agreed that we will continue to work closely together so that we can talk about the specific ways to move this forward.  And we very much welcome and thank President Obama for proposing a date for us to look forward to, and we will work towards that date and that objective in the weeks and months ahead.  And again, I thank President for this very constructive proposal.
 
     And also, President Obama and I agreed that we will of course work together in order to condemn North Korea at the United Nations, but also at the same time, we will work towards this very important global objective and that is to stop nuclear weapons proliferation. 
 
And having said that, the issue of Iran is a very, very important matter for Korea as well.  I assured President Obama that Korea will continue to support his goals when it comes to Iran and that Korea will be a firm supporter and also take constructive part and contribute in the application of the sanctioning measures against Iran.
 
     Well, President Obama, ladies and gentlemen, it was a very constructive meeting today that I had, a very useful dialogue with President Obama, as always.  It was a chance for me and everyone here to reaffirm once again what a close ally and partner and friends we are between Korea and the United States.  And thank you, President Obama, because not only as heads of state but as personal friends, I will continue to work towards strengthening this partnership, this friendship, that is so valuable to all of us.
 
     PRESIDENT OBAMA:  Thank you. 
 
I realize that I didn’t give my excellent translator a chance to translate my excellent remarks.  (Laughter.)  So she’s just going to summarize them very quickly.
 
     (Translation of remarks.)
 
     PRESIDENT OBAMA:  See, the reason I forgot to have the translation is because President Lee, he actually knows English perfectly but he -- (laughter.)  So I always know that he knows what I’m saying before the translator does.
 
                         END              4:32 P.M. EDT
 

Declaraciones del Presidente sobre la reforma de Wall Street

Jardín Sur

8:52 A.M. EDT

     EL PRESIDENTE: Buenos días a todos. En unos cuantos momentos partiré para Canadá para participar en una cumbre con los países del G8 y el G20.  Ésta es la tercera cumbre del G20 que hemos tenido desde que asumí la presidencia.
     En nuestra primera reunión en Londres, cuando azotaba al mundo la peor crisis financiera de nuestros tiempos, actuamos audaz y rápidamente para sacar a nuestra economía del borde del abismo.  En nuestra segunda reunión en Pittsburgh, al inicio de nuestra recuperación, acordamos seguir un patrón equilibrado de crecimiento mundial y solucionar los problemas de nuestros sistemas financieros.
     Este fin de semana en Toronto, espero que podamos continuar dicho progreso al coordinar nuestros esfuerzos por promover el crecimiento económico, dedicarnos a las reformas financieras y darle mayor solidez a la economía mundial.
     Es necesario que actuemos de manera concertada por una razón simple: Esta crisis probó y los sucesos continúan confirmando que nuestras economías nacionales están inextricablemente vinculadas. Y así como los problemas económicos en un lugar pueden diseminarse a otro, las medidas de protección en cada uno de nuestros países pueden ayudar a proteger a todos los países.
     Me satisface que hayamos alcanzado grandes logros hacia la promulgación de estas medidas aquí en nuestro país. Debido al trabajo sumamente arduo de los presidentes de comité Dodd y Frank, y el firme liderazgo de los presidentes de comité Lincoln y Peterson, y los grandes esfuerzos de los congresistas dirimentes y miembros de ambos partidos, quienes trabajaron anoche hasta muy tarde, estamos listos para aprobar la más estricta reforma financiera desde las que se dieron tras la Gran depresión. Temprano esta mañana, la Cámara de Representantes y el Senado llegaron a un acuerdo sobre un conjunto de reformas de Wall Street que representan 90 por ciento de lo que propuse cuando emprendí esta lucha.
     Ahora bien, permítanme ser claro. Nuestro crecimiento económico y prosperidad dependen de un sector financiero sólido y robusto, y continuaré haciendo lo posible para promover y apoyar un sector privado dinámico. Pero todos hemos visto lo que sucede cuando hay supervisión inadecuada e insuficiente transparencia en Wall Street.
     Las reformas que se están considerando en el Congreso harán que Wall Street rinda cuentas por sus actos de manera que podamos ayudar a evitar otra crisis financiera como ésta de la que aún nos estamos recuperando.
     Pondremos en vigor las más estrictas medidas de protección de nuestra historia y crearemos una agencia independiente para velar por su cumplimiento. Con esta agencia, combinaremos bajo un solo techo funciones de protección del consumidor que actualmente están divididas entre media docena de agencias distintas. Ahora habrá una sola agencia cuya exclusiva labor será velar por ustedes.
     Las compañías de tarjetas de crédito ya no podrán engañarlos con páginas y páginas de letra menuda. Ya no podrán ser afectados por todo tipo de cuotas y multas escondidas o las prácticas de prestamistas inescrupulosos que se aprovechan de las personas.
     En cambio, nos aseguraremos de que las instituciones hipotecarias y compañías de tarjetas de crédito cumplan con las normas. Tendrán ustedes más control con formularios fáciles de comprender para que sepan qué están aceptando. Y tendrán la información clara y concisa que necesitan para tomar las decisiones financieras más adecuadas para ustedes y su familia.
     La reforma de Wall Street también le dará solidez a nuestra economía de muchas otras maneras. Haremos que nuestro sistema financiero sea más transparente al sacar a la luz los tipos de tratos complejos que ayudaron a desencadenar esta crisis, como los tratos en el mercado de derivativos que asciende a $600 billones.
     Promulgaremos la Norma Volcker para asegurarnos de que los bancos protegidos por la red de seguridad de la FDIC no puedan ser partícipes de tratos arriesgados para su propio beneficio. Y crearemos lo que se denomina la facultad de resolución para ayudar a cerrar las firmas cuyo colapso podría amenazar todo nuestro sistema financiero. Ya no tendremos empresas "que no pueden quebrar porque son demasiado grandes". 
     En los últimos 17 meses, hemos aprobado una Ley de Recuperación económica, reforma del seguro médico, reforma de la educación, y ahora estamos a punto de aprobar la reforma de Wall Street.  Y en la cumbre del G20 este fin de semana, trabajaré con otros países no sólo para coordinar nuestros esfuerzos para la reforma financiera, sino para promover el crecimiento económico mundial a la vez que nos aseguramos de que cada país pueda seguir un camino que sus propias finanzas puedan hacer sostenible.
     En su calidad de principal foro para la cooperación económica internacional, el G20 es el lugar adecuado para tratar dichos temas.  Y en los últimos [sic] días, espero que podamos aumentar los logros alcanzados en el pasado y darle solidez a la economía mundial durante mucho tiempo.
     Muchas gracias a todos.
     P    ¿ Puede lograr que el Senado apruebe la medida?
     EL PRESIDENTE: Por supuesto.

                             FIN           8:57 A.M. EDT