The Headline of the G20 Summit

Well, there wasn’t much of one, really.  Of course heading into it we knew Toronto was only going to be a pit stop on the way to Seoul in November, but even still I’ve been surprised by the general lack of enthusiasm and the minimal media coverage of the event.  Talk of a bank tax seems to have completely evaporated over the past couple weeks (count that as a victory for Canadian diplomats), and there wasn’t much on financial regulation at all.  The biggest takeaway seems to be the commitment of advanced economies to cut deficits in half by 2013 and stabilize debt-to-gdp levels by 2016.  Leaving aside the question of whether or not this is the right strategy, it seems unlikely this “commitment” will actually do anything to shift behaviors.  Like most parts of these communiques, the section on fiscal tightening is triple- and quadruple-caveated, full of language about how plans will need to be adopted to national circumstances.  In other words, if a country wants to do this great, but if not, don’t worry about it.

I’m not someone who believes that international agreements which leave room for national discretion can’t have an effect; indeed, they can often provide important political cover and international pressure to pass unpopular but necessary legislation.  (“We aren’t happy about having to do this, but it’s important we do so to remain a member in good standing of the international community.”)  But this is only going to work for countries and in situations where populations see some benefits to supporting supra-national causes, even at the cost of a little national sovereignty.  Today, I’d guess this is probably the case in Canada and Australia, two small-ish powers eager to prove they belong on the global stage (and for whom multilateralism is tied into national identity); maybe the case in France, another country that enjoys playing an out-sized, magnanimous role in global affairs; but I doubt is true of many other advanced G20 countries.  You certainly aren’t going to see any Republican Senators here in the US justifying a vote saying “I know people aren’t going to like this, but a global governance institution told us to do it, and I think we should do what they say”.

Coincidentally, the two countries that might actually shift their behavior in response to an international commitment happen to be the two with the least fiscal issues:  Canada and Australia already have plans to return to balance budgets — a seemingly infinitely far off prospect for most advanced economies —  by 2014/15 and 2012/13, respectively.  So my take on the G20 pledge is that it might, at the margin, slightly increase France’s likelihood of taking meaningful action on the fiscal front.  Quite an accomplishment.

All that said, I don’t want to be too down on the G20; this was always meant to be an in-between meeting, and it’s better for the G20 to make modest statements than overreach.  Let’s hope for more out of Seoul.

And somehow the G8 still managed to make the G20 look incredibly effective by comparison: the G8’s big headline, a new initiative on maternal and infant health, came in at several billion less than expected, and even then still consisted of mostly repackaging previous commitments rather than any new funding. Sigh.


1 Response to “The Headline of the G20 Summit”

  1. 1 Anonymous June 29, 2010 at 10:38 am

    I like this round-up of what transpired at the G20. This one especially seemed to baffle the press and resist summing up. Now I have a better idea of the take-aways (underwhelming though they may be).

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: