"You need good measures of both," Harper told British Lords and MPs in the ornate Robing Room of the Palace of Westminster.
Harper went on to endorse, however, British Prime Minister David Cameron's very controversial austerity program.
"The responsible actions of your government have set a powerful and necessary example to other nations as they grapple with massive sovereign debts of their own," Harper said.
He also said western countries need prosperity if they wish to promote their values.
"In the absence of solvency, relevancy will also disappear. Nothing can lead more quickly and more completely to diminished influence in the world than the decline of economic performance and financial credibility."
On the prospect of a free trade deal with Europe, Harper was cautious, saying only that "it remains our hope." He said such an agreement would be "a historic step — a monumental one, in fact."
But on the Middle East, Harper was blunt.
On Iran, he said, "Iran's leaders openly brag that they will eliminate Israel from the face of the earth. This is a profoundly malevolent regime that threatens us all and whose first victims are the Iranian people themselves."
On Syria, though, he seemed to endorse the western reluctance to get involved.
"Decent people agree that Assad must go; that Syria's government must represent all its people, including its minorities. Yet the extremist, sectarian nature of much of the opposition cannot be ignored or wished away. And Syria cannot be allowed to become another safe haven for the hydra-heads of terrorism."
Harper moves on to Paris Thursday evening to meet with French President François Hollande in preparation for the G8 summit in Northern Ireland next week.
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