we have those rules on the table in basel. then competitive financial services that can help fund a recovery and growing world. indeed, that leads me to the broader question that europe needs to address in challenge including the united kingdom of how we remain a competitive place to do business first off. and i think there is a role in the european union in leading europe in a direction where it directly addresses some of the challenges this continent has, some structural problems in the economy, some of the barriers to competitiveness. because we realize, surely, after the last two years, the world doesn't "europe a living. europe has to make its case as the best and most dynamic place to do business in the world. that brings me to my third and final point. in the end, there is a huge responsibility of course of national governments to get things right. we have to put our own houses in order. i speak of the finance minister representing the country with the largest budget deficit in the g-20, and until ireland overtook us th

you know, some things get decided with basel, some of them are decided g20, we have the i.m.f. sort of play a role prodding countries, um, not always in a good direction, i'll say, at least in my view. but i don't think there's a way around, you know, having sort of a hodgepodge of international organizations and conferences where these issues are decided, as opposed to sort of a single one taking the lead and laying down the law. >> and, peter, do you see a group out there that's likely to satisfy your definition of how this, how this oughta be regulated or handled in the future? >> there's no group yet, but i, i would think under the g20, uh, a group could be assembled with a broader perspective on the question of how we, we handle global, uh, financial transactions, uh, to make sure that we are not focusing solely on the question of, uh, stability, or the things that the regulators are interested in, which is regulatory power. >> peter wallison of the american enterprise institute, and dean baker, the center for economic policy and research, thank you both for being with us

i think an important stem is implementing the basel agreement. that basel agreement needs to be implemented not just in europe, in the united states, it needs to implemented elsewhere in the world. but there's a responsibility as we finance ministers look to turn the basel agreement into european law that we do not water it down. that we live up to the commitments that we have entered into. and we remember that actually three extremely distinguished european central bankers, were absolutely at the heart of drafting up the basel agreement. this is a european-shaped agreement. we need to implement it. i would suggest this should be the priority of the ecothin, of the european commission, and we should not get into the unnecessary distractions of other regulations that i think are beside the point. and frankly, if i can say this, in paris, we need to move on from a rather sterile debate which you hear whispered which is the competition between london and paris and frankfurt for financial services business and realize the real challenge is for europe

>> basel iii is primarily geared toward the larger institutions. and i would echo, almost all of this is geared towards the larger institutions. i mean, proprietary trading, securitization, senior activities, the lion's share is done by the very largest institutions. whether its intersection an intersection with committee banks, they're working hard to make sure there's no negative impact it small business loans or piggyback accounts for about 40% made by insured depository institutions. they are extremely important area of support and credit for small businesses. we are very cognizant of that and want to make sure that, when the threats of dodd-frank it was trying to level the playing field, it removes some of the competitors to the small institutions have faced with too big to fail, the big -- the too big to fail doctrine. that paint the economy, including small businesses as a result of the financial crisis, is so much more dramatically profound than any kind of incremental uncertainty that might be as we look for regulations to write more stabl

it is our objective -- the intention of both basel three and the dodd-frank act are to focus on the largest so-called too big to fail banks, and make them not to big to fail. we want to make sure we do all we can not to increase the regulatory burden on small banks face. small banks have played an incredibly important role, particularly as large banks have cut back to -- and proven their worth to the u.s. economy. >> thank you. >> thank you, such a. senator stabenow. >> thank you. welcome, mr. chairman terry thank you for your thoughtfulness. when you laid out in terms of where we have come from, of what we have done, and where we need to go is very important. i feel like i have a need to make sure we do not have three revisionist history when we talk about how we caught here. if we are not point to repeat mistakes that are going to be made, i think it is important to say for the record that when i had the opportunity to serve with you, we have not always been in this situation. there were on number of decisions made on spending, frankly without accountability that have gotten us where we a