And now for a riddle: What is big, loud, unnecessary, and costs $75 million? No, not a retired elephant in a diamond-studded dress: The answer is, of course, a Group of 20 summit. These G20 meetings—younger, chubbier cousins of the equally pointless G7 and G8 summits —have been going on since 1999 in an under-the-radar kind of way but have lately taken on a new urgency. Indeed, the next one, which will be held in London on Thursday, is being widely billed as the summit that will save the international economic system, provoke a stock market rally, create lasting prosperity, and save the politicians present from the disgruntled voters protesting outside. And all this in a single day!
The truth, of course, is that nothing that will be discussed at the summit, and nothing that will be discussed at any of the follow-up summits, could not also have been discussed on the telephone. Or by e-mail. Or on a Skype conference call. Indeed, one British writer suggests that “the world’s leaders should have followed their usual platitudes about looking to the future and engaging the young by holding the whole thing on Facebook.”
But then, the purpose of this summit, like all such summits, is not really discussion. It is politics. From the hosts’ point of view, the primary purpose is to rescue Gordon Brown, the British prime minister, whose popularity is at a record low. Brown spent the years between 1997 and 2007 serving as Britain’s chancellor of the exchequer—the equivalent of America’s treasury secretary—and thus cannot, like his American counterparts, blame Britain’s financial crisis on the mistakes of the previous administration. He took credit for Britain’s booming economy during those years and is thus being held responsible for Britain’s unusually deep recession: For weeks now, the British press has been howling for him to “apologize.” If nothing else, those official summit photographs—Brown surrounded by the leaders of the United States, China, Russia, Argentina, etc., against the grim industrial background of London’s Isle of Dogs—will make him feel important again.
Others have different agendas, none of which entails much real discussion. The Obama administration, for example, hopes to use the summit as a tool to bludgeon the Germans and others into spending more money: They want each country present to commit 2 percent of its gross domestic product to a stimulus package, creating a sort of family support structure for the gazillion-dollar American stimulus package. This would, in theory, allow our president to go home and declare victory. And if it doesn’t happen, at least he’ll have a culprit when the international economy does not, in fact, fix itself within a month or two: It will all be the fault of the Europeans, who—typical Continentals!—dither, dissemble, and squabble among one another instead of rallying to the American call.
While I am usually the first to accuse the Europeans of dithering and dissembling, I have some sympathy for the Germans on this point. The reason they, the French, and many others in Europe—the British are an exception—have avoided spending large amounts of money on their economy is not because they are incompetent Continentals. It is because they do not think it will work. Strange though it may sound, Angela Merkel, the German chancellor, and Nicolas Sarkozy, the French president, are leaders who, for better or for worse, came to have some respect for what used to be called Anglo-American capitalism, with what used to be its reputation for fiscal conservatism. More to the point, they are also running up against the limits of what they can borrow and are worried about inflation as well.
This latter worry is even more acute in many smaller European countries, some of whom are actually cutting their budgets and introducing financial austerity packages as a result. Though these policies aren’t popular now, their advocates might well be proved right in the end. There is an analogy here, albeit an unfortunate one, to the recent past. After Sept. 11, the Bush administration, instead of fixing al-Qaida, Afghanistan, and Pakistan for good, decided to invade Iraq. The Europeans balked—and those who didn’t, like the British, are now sorry. After the banking crisis, the Obama administration, instead of regulating the banking system and the mortgage market, decided to devise a massive stimulus package, build a lot of bridges, expand educational spending, and maybe fix health care, too. The Europeans are balking again. Will those who aren’t, like the British, be sorry a few years from now?
At least if that happens, this week’s G20 summit will take on a genuine importance. It won’t be just another summit, producing another pile of documents, containing another bunch of euphemisms, but rather a turning point. It will be remembered forever as the moment when some of the rich world headed off in one direction and the rest headed off somewhere else. Which might mean it has been worth at least a portion of that $75 million.