France's Sarkozy calls for summit on 'regulated capitalism'

(UNITED NATIONS) - French President Nicolas Sarkozy called Tuesday for an international summit to address the global financial crisis, advocating a "regulated capitalism" to end abuses.

In his first public comments since the crisis erupted, Sarkozy went before the UN General Assembly to invite fellow leaders to learn quickly the lessons from the torment that has seized the financial markets.

"I'm convinced that it's the duty of heads of state and government of the countries most directly concerned to meet before the end of the year to examine together the lessons of the most serious financial crisis the world has experienced since that of the 1930s," Sarkozy said.

Sarkozy, whose country holds the rotating presidency of the European Union, told reporters later that he aimed for a summit in November of the Group of Eight (G8) leading industrial countries, but possibly including emerging countries like China.

He hoped such a meeting would set down "principles and new rules" for the financial system, which will help settle big problems with rating agencies, bank solvency, executive bonuses and hedge funds.

"What is important is that no country, even the most powerful in the world, can provide an effective response to the crisis that the world alone is experiencing," the Frensh leader said.

Before the UN General Assembly, Sarkozy did not offer specific recipes for how to put ethical checks on businesses.

But he has long appealed for rebuilding "a regulated capitalism in which whole swathes of financial activity are not left to the sole judgment of market operators."

As he did on Monday evening when he received the Elie Wiesel Foundation's humanitarian award, Sarkozy said he wanted a system in which "those who jeapordize people's savings are punished."

Before US and French business and finance leaders, Sarkozy said those responsible for what he called a "disaster" to be "punished and held accountable."

Speaking to reporters, he railed against critics, especially those in France, who dismissed his appeals as simplistic.

"Freedom without accountability will lead us where? It will lead us where we are today," Sarkozy said.

"This crisis came from a real deviation from the market economy mechanisms. Capitalism, which should be geared to production, indulged in speculation," he added.

He slammed the corporate reward system of bonuses for business leaders who succeed and "golden parachutes" for those who are let go.

"This is a rather curious system. When things are going well, when big bonuses are being handed out, mega bonuses, we know who is responsible," he said.

"When it doesn't work on the other hand ... then we don't know who is responsible," he added.

Sarkozy recalled that it was almost exactly a year ago to the day when he pleaded at the same UN forum for a "New Deal" to address problems both with the economy and environment.

It was President Franklin Roosevelt who introduced the "New Deal" to rescue the US economy from the stock market crash of 1929.

Sarkozy pushed for a form of capitalism focusing more on development and less on speculation.

"There is a solution ... It is time now to act," the French leader said.