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Wal-Mart.com USA, LLCg8_meetingBy Rana Foroohar | Newsweek Web Exclusive

Jul 8, 2009

Why we should be grateful for the useless G8 meeting.

The G8 has only just begun to meet in the Italian mountain town of L’Aquila, but already it seems destined to fail. After all, how can you tackle the financial crisis, world poverty, and climate change when China, which is central to all those problems, isn’t even there (President Hu Jintao had to high-tail it back home to deal with increasingly bloody ethnic clashes in the country’s remote Xinjiang province). Then there’s the fact that the pope has chosen the moment to attack global capitalism. Oh, and the event’s host, Silvio Berlusconi, has his mind on other things—namely that he might get thrown out of office at any moment, following a cash-for-sex scandal.

All this highlights the usual question that precedes such meetings—why should we care? For some time now, the very existence of a G8 has been in question, with lots of folks arguing that a group of leaders largely plucked from declining, indebted Western countries can’t provide a representative view on the world’s problems. That’s why the G20 was invented, of course. Back in April, there were high hopes that this bigger, broader powwow, which included many of the world’s biggest emerging nations (China, India, Brazil, South Africa), would figure out a way to pull us out of the biggest economic downturn since the Great Depression. It turned out to be more or less a photo op. The look on the faces of these world leaders says it all: thank God we made it through this thing without a complete blowup!

Certainly, the notion of a more inclusive G20 is better than the past solution, which involved the G7 inviting the leaders of the BRICs—Brzil, Russia, India, and China—over “for tea,” as the Brazilian finance minister so famously summarized it. How’s that for patronizing? Yet there’s really no reason to think that 20 guys stuck in a room for a couple of days can accomplish more than eight could. For starters, they’ve got a lot less in common. The Americans and the Europeans don’t agree on how to restructure the global financial system, but at least they’re all worried about China’s export subsidies. Brazil and other commodity-rich emerging powers want to jump-start global trade negotiations, but the U.S. is wary. Political agendas of West and East, North and South, diverge. And so on. It’s hard to think of an issue on which a big group could ever reach consensus.

That’s not to say that we should just sigh deeply and settle for the G8. For starters, this isn’t a completely unified group either. Russia is a basket case that better resembles a petrostate like Saudi Arabia than a modern market democracy; lots of people would like to throw it not only out of the G8, but out of the BRICs altogether, possibly to be replaced by Mexico (though BMIC doesn’t have quite the same ring).

Nor should we eschew larger groups just because it’s hard to find a room big enough for all the ministers, an amusing argument offered up in the past by European leaders. China has already overtaken Germany as the world’s third-largest economy and will surpass Japan soon. Brazil, India, and Russia will be the same size as Canada and Italy (which is increasingly irrelevant in the global economy) very soon. It’s clear that we do need a bigger room (though I wouldn’t argue that it should be big enough to fit the G192, which is how the U.N. is rebranding itself these days).

While it’s still unclear what the “new G8″ will turn out to be, it’s safe to say that this is the last year that the G8 will be perceived as the world’s leading power summit. It has already been overshadowed, not only by the G20, but also by other forums. China and the U.S. will keep hashing through their own dysfunctional relationship on the G2 couch; emerging markets will strengthen their ties at the new annual BRIC economic shindig; Asian, African, and Latin American nations will come together under a growing number of regional tents. There’s no magic number that will solve the world’s problems. But given the institutional failures of the past couple of years, I’d say the more meetings that are called to figure out how to get the planet back on track, the better.

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This entry was posted on Wednesday, July 8th, 2009, 11:43 pm and is filed under Political Mix. You can follow any responses to this entry through RSS 2.0. You can leave a response, or trackback from your own site.

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