U.S. criticized for role in global crisis at economic forum
'Blind pursuit of profit' and 'a lack of self-discipline' cited as reasons for turmoil
Last Updated: Wednesday, January 28, 2009 | 9:25 PM ET
CBC News
Related
Video
- Ann MacMillan reports: Davos gathering muted by sobering economic reality (Runs: 2:24)
- Play: QuickTime »
- Play: Real Media »
External Links
(Note: CBC does not endorse and is not responsible for the content of external sites - links will open in new window)
The relentless pursuit of profit has been a key factor leading to the worst global financial crisis since Great Depression, Russian Prime Minister Vladimir Putin told attendees at the World Economic Forum in Switzerland on Wednesday.
Putin, who called the ongoing crisis a "perfect storm" that was wreaking destruction on all corners of the global economy, refrained from blaming the United States directly but pointedly noted that just a year ago in Davos, U.S. delegates emphasized the country's fundamental economic stability.
"Today, investment banks — the pride of Wall Street — have virtually ceased to exist," Putin told the more than 2,500 business and political leaders who are attending the five-day meeting in the Swiss Alps.
Chinese Premier Wen Jiabao also criticized the United States and Western financial institutions at the meeting on Wednesday.
Wen cited "an unsustainable model" of low savings and high consumption, a "blind pursuit of profit" and "a lack of self-discipline" among financial institutions, as well as a failure of regulators to keep up with new financial instruments.
'Depressed and traumatized'
People are "depressed and traumatized," Rupert Murdoch, chief executive of global media conglomerate News Corp., said at the first full day of the forum. He noted that worldwide, some "$50 trillion of personal wealth" had vanished since the crisis worsened with the Sept. 15 collapse of U.S. investment bank Lehman Brothers.
"The size of the problem confronting us today is larger than in the 1930s," billionaire philanthropist and investor George Soros said.
Economist Stephen Roach gave a grim forecast for the global economic outlook, saying growth worldwide in 2009 was only likely to be about 2.5 per cent — what the Morgan Stanley Asia chairman and longtime Davos attendee termed a "near recession."
The head of the forum, Klaus Schwab, has called for unity among companies and governments to steer a path out of the global financial crisis.
"We need a well-functioning financial community, we should not forget. Otherwise we don't have a well-functioning economy," Schwab said.
Profit, once the hallowed byproduct of capitalism, was the bogeyman of Davos 2009.
"Today, people from every corner of the globe ask how it was possible that decisions could be taken, led by greed or incompetence or with no effective oversight, decisions that had terrible consequences, not only for the global economy but also for real people who have lost their pensions, their homes, their jobs," Schwab said. "They may not understand what went wrong, but they are clear that their leaders have let them down."
Though capitalism still had its supporters, participants debated ways to make it more responsible and the role of government in easing the way toward recovery.
Underscoring the sober mood of the year's theme "shaping the post-crisis world," some of the glitz has been scaled back, and previous celebrity guests such as Angelina Jolie, Sharon Stone and Bono are not attending.
With files from the Associated PressShare Tools
Top News Headlines
- Ottawa wins appeal to block RCMP union
- Ontario's Court of Appeal has overturned a 2009 ruling that said it was unconstitutional to prevent members of the RCMP from forming a labour association. more »
- 2,000 jobs cut as GM to close Oshawa plant
- The Canadian Auto Workers union says General Motors is going ahead with plans to close its consolidated plant in Oshawa, Ont. more »
- Diamond Jubilee: Your photos of royal encounters
- The CBC Community team asked you to submit your best photos of the Queen's visits to Canada, or visits by any member of the Royal Family. The result was tremendous! more »
- Helicopter crash reported near Terrace B.C. with 3 aboard
- Search and rescue crews have been dispatched to an area west of Terrace, B.C., after a helicopter crashed with three people aboard. more »
Latest World News Headlines
- Gaza border clash kills Palestinian militant, Israeli soldier
- A Palestinian militant infiltrated into Israel and set off a shootout that left the infiltrator and one Israeli soldier dead, the military says. more »
- Mistrial declared in John Edwards case
- The campaign fraud trial of disgraced former U.S. senator John Edwards ended on Thursday with an acquittal on one of six counts and a mistrial declared on the remaining charges. more »
- Diamond Jubilee: Your photos of royal encounters
- The CBC Community team asked you to submit your best photos of the Queen's visits to Canada, or visits by any member of the Royal Family. The result was tremendous! more »
- How manhunts work
- A nation-wide manhunt, like the one being undertaken to find suspected killer Luka Rocco Magnotta, is a highly co-ordinated exercise that isn't quite as gritty or dramatic as it may seem in TV police shows. more »
Dispatches »
- Child "bomberitos" on Peru's most dangerous highway May. 31, 2012 3:34 PM The bomberito children of the Andes hitch homemade carts to passing transport trucks -- to aid motorists and victims of disasters in mountains that were once the domain of Peru's Shining Path rebels. They risk their lives for tips that help feed their families.
Connect Newsroom Blog
The Hunt for Magnotta and #bullyPROOF May. 31, 2012 7:32 PM Tonight we'll take you deep inside the dark recesses of the internet for a closer look what's being posted and who watching it.
- Body-parts victim ID'd as Chinese student in Montreal
- Edmonton teacher suspended for giving 0s
- Owner defends 'gore' site connected to Luka Magnotta
- New duty-free limits will challenge Canadian retailers
- Quebec student talks collapse and more protests loom
- Tree faller plunges to death as bucket breaks
- Bear pulls corpse from car near Kamloops
- Copyright board to charge for music at weddings, parades
- Last chance to see Venus transit across sun

