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| Not so bad, really |
| Edward Hadas / Jun 29, 2010, 00:20 IST |
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G20: A great crisis briefly united a family with a long tradition of bitter disputes. Once the worst was over, it could have been hard to maintain the wary agreement to put aside differences for the sake of the greater good. Yet the G20, which represents roughly the whole human family, has managed to keep the peace. The weekend summit in Toronto lived down to carefully managed expectations. Fiscal deficit reduction was endorsed, but at whatever pace seems right to each government and the financial markets. Financial regulation will be addressed at due speed - which means a bit of delay. And countries with trade surpluses and deficits agreed they should really do whatever they could to reduce to global imbalances.
A firm agreement to disagree and delay may not sound like much. It is easy to imagine much more progress. But consider the global strains.
Growth, mentioned 73 times in the 27-page final communiqué, is still anaemic in much of the world. Financial markets remain jumpy and show signs of vindictiveness, despite just about the most generous monetary conditions imaginable. And the fiscal conundrum - how to reduce governments’ borrowing to a sustainable rate without further crushing growth — remains unsolved.
Those are just the most pressing short-term problems. In the long term, there is the great transition in global authority from rich to more populous developing nations. There are also environmental challenges that need to be addressed on a planetary basis.
The world is not really well organised for dealing with such problems. The United Nations, International Monetary Fund and World Bank date from World War Two and are showing their age. The G20 is just about the only global organisation with much life in it.
Under the circumstances, just getting the leaders of the great and growing powers to stand together and smile is not a bad accomplishment. And the practice in finding common ground could come in use. There are enough strains out there to create another financial crisis. If one arrives, the residue of global concord might be vital.
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