President Barack Obama came to the summit table this weekend with a strong hand to press his case to foreign leaders for tougher financial regulations throughout the developed world, after Congress agreed to a far-reaching overhaul of the American regulatory system. The opposite is true for his effort to persuade other governments to keep stimulating their economies rather than attacking deficits. While Congress allowed Obama to pack the big victory on banking regulation as he left for the Group of 20 summit, the Senate separately dealt him a significant setback that no doubt resonated with the foreign leaders here pushing fiscal austerity: Democratic leaders shelved an economic stimulus package of aid for the long-term unemployed and financially strapped states, along with assorted tax cuts. The Senate set aside the effort after failing for a third time to get the 60 votes needed to overcome a Republican filibuster and the fear of some Democrats that it would add to big deficits. And that package was a scaled down version of what Obama had proposed in January to give the slowly recovering economy a last push. At home as abroad, Obama is confronting the limits of the consensus that took hold after the economic crisis began in 2008, which favored bigger deficits to spur job creation. At stake, as the administration sees it, is continued global recovery or a relapse into another recession. Even within Obama's administration, there are fault lines on how much additional stimulus is desirable. Some news reports in recent days suggested that Peter R. Orszag, the budget director who recently announced that he would be leaving in late July, was resigning partly out of frustration that he had lost the argument that the country must cut projected deficits -- and sooner rather than later. Advisers and associates of Orszag insist that is not so, however, and Orszag was moved to address the issue late Friday in his blog on the website of the Office of Management and Budget. 'After nearly four years in public service -- first as head of the Congressional Budget Office and then as director of OMB -- and since I will be getting married this fall, it was simply time for me to move on,' Orszag wrote. He recounted the deficit-reduction steps that Obama has proposed: a three-year freeze after this fiscal year for nonsecurity domestic appropriations, $1 trillion in reductions over the coming decade and a bipartisan fiscal commission -- a priority of Orszag's -- that is to try to make recommendations for reducing the debt by Dec. 1. 'The president has made it clear to his economic team that he is seriously committed to tackling our fiscal problems,' Orszag wrote. Indeed, Orszag has complained to associates that the debate over job creation versus deficit reduction is a false one; the only disagreement is over timing. In advance of the summit, two other administration officials -- Timothy F. Geithner, the Treasury secretary who is closer in his thinking to Orszag, and Lawrence H. Summers, the director of the White House National Economic Council, and a proponent of more short-term stimulus measures -- co-authored an op-ed column in The Wall Street Journal to project a united front on the issue. 'We must demonstrate a commitment to reducing long-term deficits, but not at the price of short term growth,' they wrote. 'Without growth now, deficits will rise further and undermine future growth.' But in Europe especially, leaders are moving to raise taxes and cut spending, led by Germany's chancellor, Angela Merkel, and by Britain's new prime minister, David Cameron, who arrived in Canada fresh from proposing the biggest austerity package in his country in a half-century. 'Look, the threat to the British economy is not taking action on the deficit,' Cameron told Sky News on Friday. 'I think that this G-8 will actually conclude that those countries with the worst problems need to accelerate their action, which is what we have done.' Cameron was to have his first meeting as prime minister with Obama later on Saturday. Canada's prime minister, Stephen Harper, the host of this fourth G-20 summit since the global economic crisis began, on Friday praised Cameron for his economic initiative, saying it was the sort of fiscal constraint that Harper wanted the rest of the G-20 nations to adopt. On Saturday, an adviser said Harper would press for a commitment among the countries to fully implement 'existing' stimulus plans -- suggesting no appetite for additional spending measures -- and to cut their annual deficits in half by 2015 and put them on a downward trajectory thereafter. That deficit-reduction path is similar to the one Obama has proposed as the goal of his fiscal commission. And several officials from other countries said they believed apparent disagreements between the United States and Europe over the pace of fiscal belt-tightening could be resolved. 'We can make economic growth compatible with fiscal consolidation measures,' said Kazuo Kodama, a spokesman for the Japanese Foreign Ministry, describing the position of Japan's new prime minister, Naoto Kan. He said Kan 'recognizes the importance of striking a balance between fiscal consolidation and robust growth. The important thing is how to strike a balance.' The American delegation likewise has sought to play down differences. A senior administration official, speaking on condition of anonymity because he was not authorized to speak publicly about the situation, said that the G-8 leaders' exchange of views at a luncheon on Friday suggested a broad consensus. 'The president reiterated his strong belief that we need to maintain our commitment to durable growth in the global economy' in the short term, the official said, and that the leaders agreed on the need for 'fiscal consolidation and deficit reduction in the medium term.' Defining the 'medium term' is the tricky part. Angel Gurria, the secretary-general of the Organization for Economic Cooperation and Development, said the Europeans' tilt toward belt-tightening now is understandable in the wake of debt crises threatening Greece and several other countries on the Continent. 'Greece was an alarm bell, a signal, to say the speed at which debt is being accumulated, and the size of the deficits, are now becoming a subject of concern for markets,' said Gurria, an economist and former Mexican foreign minister. 'If you don't deal with the question of the deficits and the debt, you cannot have sustained growth,' he said. 'But will there be a short-term cost in terms of growth when you do the adjustments? Yes, there will be.' But he predicted that the cost will 'tend to be modest and it will largely be compensated' by an improvement in market confidence as European countries consolidate their balance sheets. 