Bush Gives Strong Defense For Free Market System Ahead Of G20 Summit Friday

November 14, 2008 9:45 a.m. EST

New York, NY (AHN) - Speaking a day before he hosts an economic summit for world leaders, President George W. Bush on Thursday said that while nations including the United States must "properly regulate" and make "bold" reforms in their financial markets, the global economic crisis is not a failure of the free market system.

"In the wake of the financial crisis, voices from the left and right are equating the free enterprise system with greed and exploitation and failure," he said. "It's true this crisis included failures - by lenders and borrowers and by financial firms and by governments and independent regulators. But the crisis was not a failure of the free market system."

Calling capitalism the "engine of social mobility" and the "highway to the American Dream," Bush cited nations that based their economies on other systems. "Soviet communism starved millions, bankrupted an empire, and collapsed as decisively as the Berlin Wall. Cuba, once known for its vast fields of cane, is now forced to ration sugar. And while Iran sits atop giant oil reserves, its people cannot put enough gasoline in its -- in their cars," he said.

The President also said the steps his administration have taken to prevent the U.S. economy from completely melting down "were historic and necessary." He added that similarly "unprecedented measures" taken by other nations have "thawed" credit markets somewhat. But he warned that although "a measure of stability is returning to financial systems here at home and around the world," solving the crisis will take some time.

Bush is hosting a two-day summit for G20 leaders in Washington beginning Friday. The G20 is a group of twenty nations formed in 1999, after the last global financial crisis. The conference is planned as the first of a series seeking principles of reform that aim to prevent a similar crisis.

The U.N. Secretary General and heads of the World Bank, the International Monetary Fund and Financial Stability Forum will attend the summit.

President-elect Barack Obama will not be attending the summit because "there is one President at a time in the United States." He will send former secretary of State Madeleine Albright on his behalf.

Germany, Europe's largest economy, officially declared itself in a recession on Thursday. Retails sales in the United States fell for the fourth straight month and, at 2.8 percent, the most since records began in 1992, on Friday.