The Obama administration hopes the financial regulatory reform announced Wednesday will help stem a “race to the bottom” by deregulation across the globe.
National Economic Council Director Larry Summers told CNBC that the administration would work with partners to “harmonize” regulations in other countries, as well.
“One of the real problems has been that too much of the energy in regulatory discussions has been around winning a race to the bottom, trying to deregulate faster than other people do so you’re able to attract business,” Summers told Maria Bartiromo in an interview to air this afternoon.
Summers said that the administration would emphasize strengthening financial regulations internationally at the G-20 meeting scheduled in Pittsburgh this September.
On international business, Summers hinted that the administration would seek to impose new taxes on U.S. companies’ foreign holdings as part of a “comprehensive” review of the tax code.
“I think most people who’ve looked at the international tax system have seen how much profits are located in jurisdictions where there’s a very low tax rate, but where the economies are small, so there can’t be that much actual economic activity,” Summers said. “And that’s got to be something that we view with concern and want to take a serious look at.”