Jun 12, 2009, 16:49 GMT
Washington - President Barack Obama's top economic adviser on Friday defended the government's unprecedented interventions in private markets as necessary to keep the US economy afloat, and said the administration was only interested in taking 'temporary' control.
Larry Summers, director of the White House National Economic Council, said the government's private equity stakes in top companies - including Citigroup, American International Group (AIG) and General Motors - were designed 'to be as temporary as possible.'
'Our approach is clear. We do not want to be owners,' Summers told the Council on Foreign Relations in New York. 'We want to be stewards of structural soundness.'
Obama 'did not run for president to manage banks, insurance companies or car companies,' Summers said. 'The actions we take ... will be of necessity, not choice.'
The Obama administration has taken controversial stakes in a series of major US companies in a bid to stabilize the country's financial system and head off the country's worst recession since the Great Depression.
Conservatives have criticized the efforts as an unnecessary intervention in the workings of private markets. Some left-leaning economists have in turn argued that Obama should be nationalizing banks that lie at the heart of the global financial crisis.
Summers said the administration remained committed to free markets, which have come under fire as Wall Street's near collapse in October spread to all corners of the globe. But Obama does plan to increase government regulation to prevent a similar collapse in future, Summers said.
'Our approaches are directed at protecting and strengthening rather than replacing the market system,' Summers said.
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