For Obama, A First Test On The World Stage

CBS News anchor Katie Couric is in London this week, covering President Barack Obama's debut on the world stage.

Mr. Obama called this week's G20 summit in London "a critical meeting at an obviously critical time in the world's economy."

It's also a critical opportunity for him.

"I think President Obama is going to get a fantastic welcome in Europe not just for who he is but what he represents," said Jon Bruton, the EU Ambassador to the United States.

What he represents, to many countries overseas, is a departure from the Bush administration, which alienated some foreign governments early on with its rejection of global warming initiatives and its national security positions. It's a fresh start. But the current president's approval ratings will only take him so far.

"Barack Obama is still extraordinarily popular at the street level throughout Europe but I don't think that's gonna translate into the governmental level," said Richard Haass, president of the Council on Foreign Relations. "They are going to push back. Because for them, basic questions of dollars and cents of economics are far more important than anything to do with the United States."

Several thorny issues will dominate the discussions. The White House is pushing for other countries to adopt their own stimulus plans similar to the $787 billion package passed in the United States.

President Obama will meet with British Prime Minister Gordon Brown Wednesday, and he'll likely find a receptive audience. Brown supports a stimulus package to jump-start his own country's economy, which is in a real bind, facing declining retail sales, a housing market in deep trouble and rising unemployment.

But when the president meets with French President Nicholas Sarkozy and German Chancellor Angela Merkel, he'll find two leaders very wary of spending their way out of a recession.

To get out the Great Depression, President Roosevelt infused money into the system through a number of programs known as the New Deal. President Obama is following that model.

But history has taught the Europeans a different lesson. In the early 20th century, Germany pumped massive amounts of cash into the economy, sending inflation sky high. The German people lost faith in their government and that led to the rise of Hitler, fascism and World War II. Today the German people fear inflation more than almost anything.

"We're not on the same page as the Europeans," Haass said. "The United States is focused on more stimulus packages. The Europeans are worried this will simply rekindle inflation. The Europeans are much more focused on things like regulatory reform."

The Europeans are calling for an international banking super cop to monitor the financial system worldwide but The U.S. is unlikely to support such a plan.

Meanwhile, the International Monetary Fund, or the IMF, will also be high on the agenda. Nations will be asked to donate more to the fund so it can support struggling countries like Hungary, Romania and Ukraine.

Meeting the heads of emerging economic powers like China and Russia may be the most challenging and delicate task for a president with limited foreign policy experience. Both countries have recently antagonized the U.S. by calling for a global currency to replace the dollar.

"What they're basically saying is, 'Hey, you Americans can't have it both ways. You've either got to give the rest of us a say in how may dollars you'll print or you may have to get used to the idea of something else besides the dollar,'" said Haass.

And China's new assertiveness on this and other issues gives it a powerful new voice in this, the tenth year of the G20.

All of these things seem to point to the fact that the United States is watching its importance in the world decline rather significantly.

"The fact that you have 20 countries meeting tells you something. The United States is simply one of the 20," Haass said. "Yes the most powerful, but others are beginning to assert their role on the world stage more forcefully."