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A helicopter lands at Pearson Airport to transport dignitaries to the G8 Summit site in Toronto, Thursday, June 24, 2010. (Paul Chiasson / THE CANADIAN PRESS) Finance Minister Jim Flaherty speaks at the Toronto Board of Trade in Toronto on Thursday, June 24, 2010. Gary Rabbior, president of the Canadian Foundation for Economic Education, appears on CTV's Power Play in Toronto, Thursday, June 24, 2010.

G20 split on stimulus but united on maternal health

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CTV National News: Robert Fife in Toronto
The focus of attention will shift from protesters and the police to the economy in the next few days as leaders get down to business with their full agenda.
Power Play: Gary Rabbior, Canadian Foundation
The president for the Canadian Foundation for Economic Education says he is not hopeful that a consensus will be reached on a solution to strengthen the economy and that Canada is not going to change their policy based on the U.S. asking to not pull back on the stimulus.
CTV News Channel: Flaherty takes questions
Finance Minister Jim Flaherty speaks at the Toronto Board of Trade on Canada's global economic leadership ahead of the G20 Summit and takes questions from the media on his bank tax policies.

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A helicopter lands at Pearson Airport to transport dignitaries to the G8 Summit site in Toronto, Thursday, June 24, 2010. (Paul Chiasson / THE CANADIAN PRESS) Finance Minister Jim Flaherty speaks at the Toronto Board of Trade in Toronto on Thursday, June 24, 2010. Gary Rabbior, president of the Canadian Foundation for Economic Education, appears on CTV's Power Play in Toronto, Thursday, June 24, 2010.

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A helicopter lands at Pearson Airport to transport dignitaries to the G8 Summit site in Toronto, Thursday, June 24, 2010. (Paul Chiasson / THE CANADIAN PRESS)

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Date: Thu. Jun. 24 2010 10:00 PM ET

The G20 will approve Canada's plan to pump billions of dollars into maternal health programs in poor countries, CTV News has learned, but leaders are still struggling to find common ground on all-important economic measures.

Heading into this weekend's high-level meetings in Toronto, G20 leaders are still split on how best to promote long-term economic growth and nurture a fragile recovery from recession.

While some nations want to continue stimulus spending, others want to see across-the-board deficit reduction.

CTV Ottawa Bureau Chief Robert Fife said that even a Canadian half-measure -- which would see developing nations slash deficits in half by 2013 -- is facing stiff resistance from some countries.

"Right now, it's slim," said Fife, referring to economic consensus among the G20 leaders.

Agreements on climate change and financial regulation reforms are also up in the air.

Meanwhile, Prime Minister Stephen Harper's maternal health plan will get the green light from the world's most powerful economies, despite earlier criticism from family planning advocates who complained that no specific funds were allocated for abortion.

Instead, the G20-funded project will allow each nation to allocate the funds as they wish, which opens the door for abortion funding by countries which deem it necessary, Fife reported.

"Each nation will develop their own plans," he said Thursday night, adding that Canada will pump $1 billion into the plan.

Meanwhile, there appears to be no easy way to deal with a schism about how best to maintain economic health, as nagging debt issues in Greece and other Euro-zone nations threaten to pull the global economy back into recession.

Some countries, such as Britain and Germany, want to cut spending and balance budgets, while other nations say that stimulus spending is still needed.

Canada will continue stimulus spending through to March. U.S. policymakers also believe that since the world economy is still fragile, cutting deficits sharply could lead markets back into recession.

Gary Rabbior, president of the Canadian Foundation for Economic Education, said it's unlikely that total consensus will be reached on stimulus spending.

"I don't think you're going to get a unified series of actions," he told CTV's Power Play Thursday.

Rabbior added that fear and uncertainty are the real problems facing the G20, and leaders should instead be focusing on ways to stabilize jittery markets.

"I would like them to deal with the global fears that I think are really holding back the world economy ... Uncertainty is the worst thing for recovery."

However, the disagreement highlights growing tensions within the bloc of countries.

During the first G20 leaders' meetings in Washington and London, the group reached consensus on the need to pump public money into the economy. Nearly a year ago, in Pittsburgh summit, the leaders agreed on a framework for long-term growth.

But the growing unease appears to be sinking that tradition of co-operation.

However, perhaps some common ground will be found -- if only to show that the G20 is still a working body.

"You will see commitments to deficit reduction of some kind," said former ambassador Derek Burney.

He told Power Play that countries do need to reign in debt, and by agreeing to do so, the U.S. and Canada will maintain the political goodwill which resulted from previous G20 co-operation.

"It's important for global governance that that momentum be maintained."

Bank tax flap

However, Finance Minister Jim Flaherty said the tax issue is taking attention away from more important economic issues.

Rather than concentrating on the controversial tax proposal, Flaherty stressed that leaders should be finding common ground on a way to promote long-term economic growth.

"Is there going to be a global bank tax? No," Flaherty said Thursday at the Toronto Board of Trade.

"Why not? Because the majority of countries in the G20 don't want it. "

Some G20 countries, such as the U.S. and England, have been pushing for a universal bank tax, but the idea is unpopular in countries such as Canada, which did not have to use public funds to bailout the banking sector during the 2008 crash.

Nonetheless, Flaherty said that Canada is in a good position to influence the rest of the world, given the stability of banks and financial institutions here at home.

"We are the envy of the world," he said.

Flaherty said that countries which favour a bank tax are welcome to bring one in -- but only in their own countries.

Comments are now closed for this story

Mr. Lambert-trudeau Montreal
said

As a stong liberal I would of like to see gay rights first on the list, forget maternal health. All gay men who have a stay at home husband should be entitled to the tax deductions and benefits.


Nancy: Salute Statesman Harper
said

Maternal health thousands of years later in 2010 finally embraces Maternal health. World Statesman Prime Minister Harper we salute you.


Fact Check
said

They could all agree to fire Obama for stalling the economic engine of the world. As China embraces free markets the Obama is trying the socialist Greece plan out.


WestofTheRockies
said

@Wendy, here you are bleating on again about stuff you don't have the slightest clue about. According to you this government is complicit in some conspiracy they dreamed up in the last four years just to shank Canadians, just for the pure pleasure of it! Mr. Harper by the way is an economist. Banks don't print money; only sovereigns can do that, They issue bonds to cover that money which they sell to other countries. The interest is against these bonds to other countries like China for example who hold the bonds. Perhaps an easier example for you - You could also be a bondholder by buying Canada Savings bonds. You give the government money and they give you a bond (promise to pay) and because they have your money they pay you interest Sure as snow is white if we don’t pay the interest on our debt (which by the way is largely due to the drunken spending of your beloved Liberals, starting with the great Liberal messiah Trudeau) our dollar starts dropping like a rock and in little time we will be another Zimbabwe where the government doesn’t pay interest and inflation is running at several 1000%. The money you earn in the morning is worth half in the afternoon. It doesn’t matter what it is, the more there is the less valuable it is. I’m not surprised you agree with Bill Abram. He’s a nut, much like most teachers, he doesn’t know what he’s talking about outside what he learned in normal school. His whole hypothesis is based on false assertions. Maybe he could produce an actual document or two to support his assertions. From teenagers with drug abuse problems to this nonsense in one easy step. Whako!


LibertarianAtHeart
said

Agreed wendy. I have been telling people about the monetary system since 2006. I once worked as an investment advisor and we often advertised our services as doing what the banks do. Then I asked "what is it that the banks do?" Then I discovered the truth. We need to rid the world of privately owned central banks, and have money serve its real purpose: to facilitate the exchange of goods, so we don't have to live in a barter system. Even England used notched sticks as a form of currency for awhile. The king at the time declared that taxes could be paid using this particular type of notched stick. I forget the name of it, but it's true.


Glenn C
said

Hey Jimbo ,WHY does no-one believe you or take in anything you say seriously???? Bottom line, the whole meeting is a total WASTE of valuable tax dollars, do not 'Distract' from that!


Allan Eizinas
said

If he already knows what the members of the G8 and G20 want and do not want then why are we spending over $1 billion for this meeting?


RZ
said

@ WendyCouldn't agree with you more. The monetary system in itself is the true cause of all economic problems. Everything else is pure distraction. For those who are still confused, take a few minutes after work and look this stuff up. It's a lot simpler than you may think.Even though the monetary system itself is the main problem here, it still does not hide the fact that average Canadians need to take some responsibility as well. They should avoid living beyond their means and save whenever possible.


Bob,Calgatry,Alberta
said

The G8 is a spent force and the future belongs to the emerging economies, China,Brazil, India. Some of these countries are in the G20 group and others should belong to whatever new grouping meets in the future to set strategies for solving crises like the current recession/sovereign debt situation. The Western Europeans and the Americans (and Canada to a lesser extent) following the pied pipers of the Liberal left have put all of us into jeopardy. The truth comes back to haunt us. Western economies can only live beyond their means for so long. The future for our children is slow growth, higher and higher taxes, less and less government services so we can pay the "BILLS". Harper,Iggy and Layton can only lie to us for so long. The next Canadian goverment, whatever it's stripe, will have to implement a lot of tough love. I don't believe Harper or the Igmeister have the "gona--" to do the right thing and Layton is much too economically uneducated to even know what the right thing to do is. I worry for the future of my grandchildren in the brutal world of the future.


lc
said

Wendy);Glad to hear I am not the only one in Canada who is on to this little con game. Other countries populations are furious about it while in Canada people continue to argue over meaningless issues invented by partisans to distract from the theft. Western governments and banks have been in a obscene relationship for decades but actions of the last few years would make Al Capone blush


Sue
said

I don't believe Flarethy has any words of wisdom on this or any other issue, he helped Harper build the 60 billion deficit. I think Jim is just plain & simply whiz dumb.


Jim
said

One race, one planet...people will look back at all of this 50 years from now and go "O. The recession of 2008-2009 is when it all started."


Cam
said

The fact that this government has not named their massive taxpayer funded gifts to our banks "bailouts" doesn't change the fact that Harper used the CMHC (a.k.a. the taxpayer) to buy (a.k.a. bailout) all of our banks' recklessly acquired junk mortgages. Our banks were not only bailed out; they were bailed out in ADVANCE. The wave of mortgage defaults that are on the way are already the taxpayers' problem. And that's not all the Conservatives have done to Canada's once solid financial position, as if a massive fiscal time-bomb isn't sabotage enough.

Wendy
said

Here he is, alongside economists, politicians, and so on, going on and on about a tax on banks when the fundamental flaw in this whole debate is that the actual reasons for even talking about this aren't being addressed - namely, that international banks create money out of literally nothing, and lend it to the government AT INTEREST (out of nothing!), a government that is complicit in this game, who then turns to the public to pay tax to fund the interest on this debt that never needed to be there in the first place if government did what it should be doing and create interest-free currency and spend it into the economy. Current annual Canadian interest payment on debt - $30 billion . Completely unnecessary expenditure and illegal in the most common sense. Don't believe it? Look up Bill Abram. Does anybody ever ask about this? Does anybody even know about it? We sure didn't learn it in school. Not one course on financial literacy or the history of money. Not one. WHY!? All of this jargon about bank taxes and financial crises is trumped by issues that don't even make it into the public eye. If these issues were addressed, people would learn and understand how this ludicrous debt-money system works today, and we would be able to pull out of this nonsense and do something far more radical (and useful!) than argue over bank taxes. For now, it looks like the distracting squabble will continue. Hopefully, we'll all wake up to this crap, and then it won't last much longer, and we can work on solutions that will have a positive impact on real finance


Cindy
said

We know Jim that is all it takes to distract you is a ball of string.


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