G-20 leaders work to limit bankers' bonuses

PITTSBURGH — Struggling with a contentious issue, world leaders have reached basic agreement on limiting the bonuses of bankers whose risky behavior contributed to the global financial meltdown, Treasury Secretary Timothy Geithner said Thursday. In the streets outside, protests marred the opening day of the summit of the world's largest economies.

At a news conference, Geithner also expressed optimism that summit partners would endorse the broad outlines of a U.S. proposal to deal with huge imbalances in the global economy such as large trade surpluses in China and record budget deficits in the United States. He also said the U.S. supports China's efforts to gain greater voting rights in the International Monetary Fund over the reservations of European nations, who would lose influence.

Given the rise of China's economic powers, "it's the right thing," and Europe recognizes that, Geithner said.

World leaders descended on the comeback city of Pittsburgh to debate how to nurture a recovering but still-wobbly global economy. Nerves are still on edge, but this summit of the world's 20 leading economies seems free of the crisis atmosphere that hung over the past two — despite the clashes between protesters and police.

The treasury secretary said the G-20 countries had reached a consensus on the "basic outline" of a proposal to limit bankers' compensation by the end of this year. He said it would involve setting separate standards in each of the countries and would be overseen by the Financial Stability Board, an international group of central bankers and regulators.

Until now, European countries had pressed harder than the U.S. for limits.

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