Pres. G.W. Bush may, as two NYT reporters wrote today, have been the first to insist that this weekend’s economic summit in Washington should include the leaders of all the “Group of 20” nations, not just the “G-7” or “G-8” that France’s Pres. Sarkozy originally suggested. But regardless of its authorship, it was an excellent idea.
The G-7 comprises the US, four European nations, Canada, and Japan. The G-8 (which may or may not be moribund at this point, after the Ossetian war of last August) includes those seven plus Russia. The G-20 includes those eight plus: Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Saudi Arabia, South Africa, South Korea, Turkey, and the EU.
Given the scale and the unequally distributed effects of the present crisis, including these additional heads of state in the current confab makes a lot of sense. The effects of the financial crisis have been the greatest on economies that had deregulated their financial systems and substantially opened them up to contagion by western-originated toxins before the onset of the crisis last year. As I noted here at the end of October, one analysis of the macroeconomic vulnerability of various “developing” nations to the effects of the crisis showed that Brazil, Russia, India, and China (aka the BRIC countries) all had relatively low vulnerability. That is just one reason why many analysts are now, quite correctly, saying that if the global economy as a whole is to be spared the worst effects of the current crisis, then this will have to be achieved through the leadership efforts of the non-G-7 countries.
The authors of today’s NYT article give some indications of the degree to which US supremacy of the world system has declined under Bush. They quote Adam S. Posen, described delphically as someone “who advises foreign governments on economic coordination” as saying of Bush:
- He’s going to be much more the host and much less the chairman than he realizes… He’s going to be providing the snacks and the venue and making sure everybody’s comfortable, but he is not going to be driving the agenda; that’s the reality. The agenda-setting is with Gordon Brown and Nicolas Sarkozy and Hu Jintao.
Actually, contra Posen, I’d say that it will be Hu and all his fellow leaders of the BRIC countries who will be driving the agenda along with Brown and perhaps Sarkozy. Both Britain and France have been badly affected by the financial crisis.
It was apparently also Bush who insisted that the G-20 meeting be held in Washington rather than New York, which was Sarko’s original suggestion.
That might not have been such a good idea.
I suppose Bush’s original aim was to try to demonstrate that Washington DC is the still the center of the universe, rather than Turtle Bay, NY, home of the nefarious (in his view) United Nations…
But I think the main effect of his decision will be to demonstrate to everyone concerned just how lame (or dead) of a duck he has become in his own national capital.
Doubtless all the foreign leaders flocking to DC will be most eager of all to connect with anyone who has the ear of the uber-charismatic president-elect, rather than paying much attention to GWB.
The O-man, for his part, is sitting pretty in Chicago, in furtherance of his quite appropriate insistence that the country only has one president at a time, and that the current mess the economy’s in still sits firmly on GWB’s doorstep, not his.
Obama is sending two unofficial “envoys” to the meeting, in the shape of Madeleine Albright and former GOP Congressman Rep. Jim Leach. The choice of those two throwbacks to the 1990s is pretty sad. Leach, in particular, was one of the named authors of the 1999 Gramm-Leach-Bliley Act– the legislation that abolished New Deal-era reforms of the federal banking system.
Oh well, they’re only “unofficial.” The Obama administration still hasn’t been officially born, remember.
Meanwhile, this weekend, watch for the degree to which the BRIC leaders– particularly Pres. Hu– start getting taken much more seriously as leading voices in global economic governance.