As the G20 talks continue today in Pittsburgh, what is likely to be accomplished? Skepticism about the value of multilateral meetings is nothing new. But international summits are important, and even inspire optimism in some quarters. A brief rundown on the case for why you should pay attention to this week's G20--and also the case for why you should not:
The Pittsburgh G20 is Important
- Restructuring Voting in the IMF Reuters' Lesley Wroughton notes the profound significance of the proposed IMF reforms, which will give greater influence to "emerging market countries like China":
The agreement to overhaul the IMF's voting structure is especially big for the new Obama administration, given that the United States proposed the 5 percentage point shift. The speed with which the G20 agreed to the change--if the draft communique is eventually adopted--is surprising because of the politically sensitive nature of the issue for Europe, which will see the biggest dilution in its voting power.
- Self-Interest Makes Things Happen Previous multilateral meetings may have underwhelmed, concedes Christopher Swann of Reuters, but "self-interest is providing a strong tailwind behind the current talks." For instance, there's "the mounting suspicion that imbalances were a leading culprit of the 2008 financial crisis," while "world export giants" fear a dearth of "free-spending consumers" under their current "mercantilist" policies. Converging on economic matters, Swann argues, is beginning to look like a good deal.
- Higher Taxes? James Pethokoukis (Reuters again) quotes the Wall Street Journal's report that the G20 "is close to an agreement that would require members to subject their economic policies to a type of 'peer review.'" This might, Pethokoukis worried, be "one more step toward tax policy harmonization which would likely lead to higher U.S. taxes and the addition of a VAT tax." But if the G20 is actually doing something, he added, that's good--though better if it were "global security."
- It's Never Important These sorts of meetings, Simon Jenkins writes in the Guardian, "convey a false impression that statesmen are acting, rather than parading." Pointing out that "confidence-building face-to-face encounter[s] between foes" has become less important with the increasing "density of international contact," he declares that he knows "of no evidence that remotely justifies ... this week's $19m on security alone in Pittsburgh."
- No Deal on Economic Issues "The Americans," writes the Guardian's Dan Roberts, "have already conceded we are unlikely to reach agreement on the key issue of bank capital ratios." So, he concludes, "it looks like we're heading for a fudge."
- No Deal on Climate Change Natasha Chart at Open Left summarizes a lengthy report from the Solve Climate news site thusly: "Wealthy nations won't finance climate change adaptation and that's probably going to whack any chance at a good Copenhagen treaty before the G20 is done."
- Probe Economic Problems, Re-examine Ideology Eric Lotke at the Huffington Post sees the G20 as an opportunity to have a serious discussion about economic policy. It provides a chance, he writes, for "Americans to look at what's happening, and ask hard questions ... move beyond shibboleths of free trade and protectionism, and to question the true functioning of the market." Lotke suggests that we reconsider American manufacturing and re-think a blind commitment to free trade, especially with emerging-market imports bearing the taint of lead and pesticides.
- Time to Communicate, Commit The New York Times editorial board argues that "[t]he United States must clarify where it stands on open trade," particularly after the Chinese tire tariff. Furthermore, all "[l]arge nations in the G-20 must commit themselves to continued government support of the world economy, including investment in poor countries and more stimulus spending for their own economies."