how would like both of your insight. i know i am slow mentally. i am not the only person in america that is. i am not good with the arithmetic and we are discussing the economy. we cannot subtract the policies that the bush administration has inflicted into the economy. give me your suggestions. with the legislation vetch's past -- with the legislation back just passed, obama went to the g-20 cas you have to spend t was taken out of the economy or

put it back into it. you have to inject a transfusion if the country is hemorrhaging. with the work that is going on in congress, although we have people listing disclosures, campaign disclosures, would you say that president obama and the tarp you brought up earlier, is it a reaction from the administration? guest: yes, we cannot figure out where to go if we do not realize where we have been. we have been recovering from the

worst financial crisis in 75 years. we lost $12 trillion worth of wealth that. has led to a decline in economic activity. you don't know for how long. it is hard to be sure. it took a big ball of of the economy. it led to 8 million jobs lost. we are starting to restore them. it will be a long time before we recover fully from that. i think the bush administration policies were responsible in part for that. it was your watch when this occurred. what we need to talk about is what do we do going forward. you can see that the financial industry took too much out of the real economy.

main street did not get the funds it needed because of the financial speculation. this bill will help. it probably will not rain in wall street and the financial sector as much as it needs to we cannot have an economy where people make a most of their money >> we leave "washington journal" for live comments from president obama. >> i went to think first and foremost in my friend, prime minister harbor, as well as the canadian people and the people of toronto for their extraordinary hospitality. the sec's -- success of these hearings, including the g-20 here in toronto, is a tribute to canadian leadership. i also want to think my fellow leaders for the sense of purpose they brought to this summit.

that g-20 is now the premier forum for 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% 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 avoid an even larger economic catastrophe, to put our economies on the path of recovery, and to begin recovering our financial systems so that the crisis, like the one that 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 for growth that is balanced and sustained as well as specific financial reforms.

a bold action has succeeded, and in the united states, we are committed above all to leading by example, and because of the steps that we have taken to get our economy moving, we are growing again, and this growth is beginning to translate into job creation, and we are now poised to pass the toughest financial reforms 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 have begun to move forward with economic recovery, but, as we all know, that is not good enough. in the united states and around the world, too many people are still out of work, and too many economies, demand for goods and services is still weak. as we have been reminded in recent months, financial crisis in one country can have consequences far beyond its

borders. and history teaches us that growth and prosperity are never guaranteed. it requires constant effort, and it requires continuous leadership, so we came to toronto with reese is a goals. to make sure the global recovery is strong and durable. to continue reform in the financial system. and to address the range of global issues that affect our prosperity and security, and we have 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 are creating jobs. that is my highest economic priority as president, and this is what 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 for 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 natton should assume its task to prosperity is simply paved with exports to the united states. indeed, i have made it clear that the united states will compete aggressively for the jobs and industries and markets of the future, and that is why i have set the goal of doubling our exports over the next five years, an increase that would support millions of jobs in the united states. that is why i have launched a national initiative to get me to this growth. this is what be focused earlier this week in deepening our economic cooperation with russia, which would benefit both of our countries, including restarting our poultry exports and efforts to support russian entry into the wto, and that is why i announced my administration will work to resolve outstanding issues regarding united states, korea free trade agreement by the time i visit there later this year. this will create jobs and

opportunities in both of our countries can enhance the american competitiveness and the 21st century. as strong and durable recovery also requires countries not having an undue and vantage, so we also discussed the need for currencies. as i told president hu yesterday, and the americans welcomed them allowing their chinese currency to appreciate a 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 long term. in the united states, i have said the 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 secondary refocused on was advancing the ball 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 time for banks to rebuild confidence. here in toronto, we reaffirmed our commitment to the highest global standards. to maintain momentum, we have authorized the teams for a meeting in seoul, korea, to have a global perspective that banks can withstand the stresses of bank intervention. -- government intervention. complex traits, 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 must do everything in our power to avoid a repeat of the recent financial crisis.

finally, we made progress on a range of global issues. we are 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, and we may progress to invest more than $20 billion to reduce hunger and promote agricultural development. the g-20 leaders renewed our commitment made in pittsburgh to use fossil fuel subsidies. the united states and laid out our plans for this goal, and we are thinking this is one 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 am pleased that we endorsed my proposal in the fight against corruption. in too many places, there is a break on -- brake on

growth. this will be more broadly shared. many include 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 have 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 interest. indeed, that is the purpose of these meetings. we can bridge our differences. we can continue a 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 have got a handy list here. i am going to start with darlene from a peak. -- ap.

>> thank you, mr. president. deficit-reduction goals, the 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 war ship 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? >> ok. >> thank you. >> darlene, since you are the first, i'm going to give you two questions. anybody else, let's try to stick to one, please, especially big questions. with respect to the first question, we helped to draft this communique, 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 have been promoting are reflected in the communique, and is consistent with what the g-20 leaders came up with. keep in mind that we had already proposed a long time ago that we were going to cut our deficit in half by 2013, and said 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 to the big deficits and debts that we have out there. what we did say coming into this conference is that we cannot all rushed 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 involved

stimulus. some of them might involve structural changes in their economies. semi involved passing regulatory reforms so that banks are lending again. the point is in each country, 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 do not 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, they're going to be some countries, greece being the most recent example, that has to act immediately begins 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 do not kick in significantly in this first year? so, for example, germany, which cares deeply, obviously, about the issue of fiscal consolidation. if you look at their plants, they are no more front-loaded than ours are. in fact, you can make the argument that some of the steps we've already taken, freezing discretionary spending domestically for the next three years in my budget, passing pay- go, setting up a commission to tackle things long term, he many of those decisions are comparable to some of the decisions that have been made by those you support this consolidation, so i think this has really been an issue in which there is a violent agreement between parties. we have to make sure that we are 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 the u.n. security council making sure that there is a crystal clear acknowledgment that north korea engaged in a belligerent behavior that is unacceptable to the international community, and if the united states participated in the investigation that was conducted around that, our exports 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 li had shown significant restraint in these

circcmstances, and it is absolutely critical that the international community to rally behind him and send a message that this kind of behavior is unacceptable and that the international community will continue to step up ppessure until it makes a decision to follow a path that is consistent with international norms, and my expectation is that those who were here at the g-20, as they look at the evidence, will come to the same conclusion. it is a bad habit that we need to break to try to shy away from ugly facts with respect to the north korean behavior. in the interests of or under the illusion that that will somehow help to maintain the peace. all right. hans? >> thank you, mr. president.

before the summit, you said it was too early to tell about a real evaluation. you suggested that we take a year to look that the trajectory to see whether or not it is real. you just said a couple of months. >> did i say one year? >> one year to monitor. i just wanted to know if there is a reason for the change in the intermediate time. >> look. i would have to look at the transcript, but let me just make sure that i am absolutely clear. 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 an undervalued renminbi has given

china a significant trading advantage, and we have been very clear to them that we do not consider that acceptable or consistent with the principles with balanced growth that was discussed in pittsburgh that all of the g-20 nations signed on to, so we're pleased that they made this first step, but i think like a number of other countries, the proof in the pudding is going to be in the eating. we did not expect a 20% revaluation in one week that would be disruptive to the chinese economy and the world economy. we do expect that as more and more forces come to bear, given the enormous surpluses that china has accumulated, the renminbi is going to go up, and it is going to go up

significantly, so we are going to be paying attention over the next several months to make that determination. now, i do not have the perfect formula. will.i.am a clear idea after three months as to whether it is moving fast enough or not? i will leave that up to treasury secretary geithner he makes these decisions. >> how long would you expect people like charles schumer and american manufacturers who have lost jobs so quickly, how would you expect them to wait? >> my expectation is that they're going to be serious about the policy that they themselves have announced. now, what i am going to do is work with people like senator schumer and manufacturers who are affected by these trade imbalances, and i think we all

have the same interests, and that is the united states can compete with anybody, as long as we have got an even playing field, and as i indicated in my opening remarks, we are prepared to enter into trade agreements with korea, and one of the things we discussed here is 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 communique that trade can be a source of prosperity for everybody, but it has got to be a fair deal. and it is not just currency, by the way. their chinese partners about%- what they're doing with barriers, what are they doing with respect to international protection, state-owned enterprises, or state owned banks that are subsidizing industry, so there are a whole host of issues. now, and data become a they have

got issues with us, and i think we can manage these trade issues. this is for a number of countries, including countries like canada. jackie? >> thank you, mr. president. one of the noneconomic issues to cover here was afghanistan, and i am curious whether you believe that the talks that pakistan is reportedly brokering between the taliban and president karzai of afghanistan all promise, or to the concern you, and a related question. a related question. do you agree with the new prime minister of great britain, david cameron? we can be totally out of afghanistan by 2015 and turn the

lights out? >> i am not sure that is a quote from david, but i will take the second question first. we have been in afghanistan now for nine years. next year, will be there for a decade. this is now america's longest war, and what that means is all of us have an interest not in occupying afghanistan but an interest on making sure that stand on its own to the defeat when it comes to security issues, and is not a base for terrorist activity launched against the united states of america. i think we're going to have to provide assistance to the afghanistan for a long time to come. they are still working with a national government. they are in a very tough neighborhood.

they are a very important country, so a whole range of issues, setting up courts, setting up effective police, a political system that is transparent and fair, as well as with respect to security, we intend to be a partner in afghanistan over the long term, but that is different than us on the ground. it was announced last november, and we are several months into it. the policy involves us sending an 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 from which the taliban had gotten a very fierce foot pole, to start moving the afghan security forces in, even as we are improving governance, and we are 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 strategy that all of our allies have fully endorsed, as has president karzai. now, it is 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 was true in iraq, so it will be true in afghanistan. we are going to have to have a political solution, not only a military solution. now, with respect to the efforts of reintegration, i think it is too early to tell. we have to view these efforts with skepticism but also

openness. the taliban is a blend of hard core ideologues, tribal leaders, kyd said basically sign up because it is 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, so we're going to have to sort through how these talks take place, but i think that president karzai's peace jargon was helpful. i think building trust between those to the new government's is useful. to the extent that we can get all of the regional players to recognize that it is in everybody's interest that this region between pakistan and

afghanistan are not used to launch terrorist attacks, that will be a useful step, and that is what we are moving towards. peter? >> thank you, sir. looking ahead to the supreme court confirmation hearings of your choice, elena kagan, tomorrow, first of all, what do yyu say to critics who are portrayed her as a liberal, and given your own support when you're in the senate for a filibuster of a supreme court nominee, what is your guidance to republicans who may be threatening that at this point? >> i think they should pay attention to elena kagan's record in her testimony. under our constitution, the senate is entrusted with the process of providing advice and consent, and i am absolutely

confident that if you give a fair reading, elena kagan's record and her performance in every job she has had, what you see is somebody with an extraordinarily powerball intellect, somebody with good judgment, somebody understands the impact that laws have on individual americans, somebody who is able to broker understandings between people of very different ideological balance -- bents, someone who is extremely hardworking, extremely diligent, knows how to build consensus, has been an outstanding lawyer, has been an outstanding team of one of our top law schools. even though this is my alma mater, it