File, AP Photo/Jae C. Hong
WASHINGTON — Early in his presidency, Barack Obama went to London for his first world economic summit as a global rock star — the U.S. president who as a candidate could command giant crowds at home in Denver or abroad in Berlin. This week he arrives in Cannes, France, for his fifth such summit no longer starring, just a key player in the band.
Throughout his presidency, Obama has pushed countries with trade surpluses such as China, Germany and Japan to do more to promote domestic spending and more to support global economic growth.
Though Obama continues to push that agenda, all eyes at this week's meeting of leaders from the 20 largest industrial and developing nations will be on the urgency of Europe's debt crisis and whether the continent can implement an ambitious plan to save the euro and keep the crisis from contaminating other economies.
"It's much more about Europe," said Simon Johnson, a former chief economist at the International Monetary Fund. "There's not much the Americans can do."
For Obama, it means walking a fine line between pushing the Europeans to act swiftly and expressing confidence that they will.
Administration officials on Monday played down any financial role by the United States in helping Eurozone leaders create a firewall that would stop Greece's crisis from spreading. Though they noted that the IMF, with U.S. financial assistance, could be called on to assist.
The key is containing Greece's problems and keeping them from advancing to Italy and Spain, at which point it could let loose a global financial emergency.
"Obviously the challenges facing Europe have significant implication for the U.S. economy and for the global economy," said Lael Brainard, the Treasury Department's undersecretary for international affairs. "Fortunately, Europe has the resources and capacity to overcome these risks."
In an opinion piece in the Financial Times Friday, Obama called on the crisis in Europe to be resolved quickly. But the president otherwise reiterated his commitment to push for a short-term stimulus and mid-term fiscal restraint in the U.S. and for balanced international growth and global banking reforms.
"The only overriding international issue for the G-20 is the continuing crisis in Europe," said Rob Shapiro, a former undersecretary of commerce in the Clinton administration and now chairman of Sonecon, an economic consulting firm.
"His take away needs to be a commitment and actual steps by the Eurozone countries to solidify the commitment to stand behind the sovereign debt of Italy and Spain," Shapiro added. "In the international economy, there's nothing else that comes close to the significance of that."
To be sure, Obama has a huge vested interest in a healthy European economy. But his influence at the G- 20 summit is driven less by what the United States can do, than by the fact that the United States remains the largest world economy. Obama has frequently mentioned the situation in Europe as one of the factors that have contributed to anemic economic growth in the U.S.
Underscoring U.S. vulnerability are new unemployment figures for October that will be released Friday by the Labor Department, just as the G-20 meeting is wrapping up. Unemployment in the United States has been stuck at 9.1 percent for three months.
On Thursday, Obama will hold individual meetings with German Chancellor Angela Merkel and French President Nicolas Sarkozy, this year's summit host by virtue of France's year-long presidency of the G-20 meetings.
In his Financial Times opinion piece and in remarks by administration officials, Obama and the White House insist the U.S is playing a leadership role in the global recovery.
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