Harper credits regulations for preventing bank bailouts
PM takes economic message to U.S. media ahead of G20 summit
Canada has achieved a balance in the regulation of its banks that will serve the country well once the global economy begins to recover, Prime Minister Stephen Harper said in an interview Sunday with a U.S. television network.
On Fox News Sunday, host Chris Wallace pointed out that Canada's relatively tough banking regulations mean no Canadian banks have needed a bailout, but he asked Harper if he was worried that regulation saps the innovation and risk-taking that goes on in a freer market.
Harper said it's fine to say that countries should have less regulation in principle and less intervention in the marketplace, but that approach can mean more intervention.
"It's led us to a situation where the government is, in fact, intervening massively as a consequence of under-regulation and where we now have, effectively in many countries, nationalization of the financial system," the prime minister said.
"I know in Canada there have been some criticisms in the past that we were perhaps too [much of an] activist, intervening too much, but we're emerging from this probably with the only truly free market financial system in the world," he said.
Harper said Canada has a "pretty decent balance" where the government doesn't try to micro-manage financial systems.
The interviewer also asked whether Canada, as the only western nation that has had no bank bailouts during the economic crisis, believes U.S. President Barack Obama should be doing more to police financial institutions.
Harper responded by saying he believes the Obama administration does want reforms in the financial sector, something Canada will be recommending at this week's G20 meeting in London.
The prime minister made the comments while in Washington, where he was giving media interviews ahead of the summit.
Canada and India are co-chairing the G20's working group on the reform of financial regulations.
Harper wants member countries to commit to a broad series of reforms to increase transparency in the financial sector.