Tuesday, November 18, 2008

Critics: Leaders do little to combat crisis.

No doubt the summit has contributed to global warming with all those jets flying in from around the world and then back home. Also there was all the hot air at the meeting itself. The leaders at least are able to still jet around the world instead of using conference call technology.
It seems that some are using the meeting to push free trade. Not only Sarkozy may be trying to keep some protectionist measures in place for France but Obama may do the same for the US. It is natural in hard economic times to try and save jobs for nationals.
Harper is swallowing his ideology without even gagging. Of course it will come up again at the first opportunity.

Leaders do little to combat crisis, critics say TheStar.com - Business - Leaders do little to combat crisis, critics say

Lack of concrete proposals from the G20 summit shows little of substance was achieved, they say
November 17, 2008 Lee-Anne GoodmanThe Canadian Press
WASHINGTON–The emergency G20 summit this past weekend brought together leaders from nations that have spent centuries as far apart politically and philosophically as they are geographically.
Yet, former foes that include the United States, Russia, India and China are uniting in the face of a common enemy – a global economic meltdown that's threatening to plunge the world into a depression.
That doesn't mean, however, that there weren't tough pills to swallow and tensions along the way as the leaders of the far-flung G20 nations, including Prime Minister Stephen Harper, formulated a broad action plan aimed at combatting their mutual menace on numerous fronts.
The magnitude of the crisis is such that Harper emerged from the summit to suggest he would cast aside his longtime aversion to deficit spending and dole out whatever cash was necessary if it was for the good of the world's financial health.
"Look, if there is a worldwide agreement, then we will engage in sufficient stimulus to do our part in carrying global economic demand," Harper said.
Discussions were reportedly pointed at times behind the scenes at the summit, with French President Nicolas Sarkozy apparently causing some of the biggest frustrations.
Diplomats present at the summit told the Washington Post yesterday that Sarkozy was the slowest to commit to a moratorium on protectionist measures and a reaffirmation of free trade at an extravagant White House dinner Friday night.
His stance irked some of the developing world leaders whose countries have been brutalized by a decrease in exports in the face of the global economic crisis and who would be further harmed by protectionist trade policies.
Each country is expected to implement a series of reforms by the end of March aimed at easing the crisis and stimulating their economies. The G20 meets again on April 30.
Leaders vowed to use fiscal policy, as well as interest rate cuts in countries that still had room to ease, to offset the steepest global economic slowdown in decades.
Among the few solid commitments was a ban on raising protectionist trade barriers for 12 months, and to agree to the long-running Doha round of trade talks by end-December.
There was also a timetable of tasks, focused heavily on tackling accounting and regulatory issues, which the leaders pledged to complete by the end of March.
Critics inevitably seized on the lack of concrete proposals for evidence that nothing of substance was achieved.
"There is no co-ordination in the fiscal arena, the promises made to emerging markets are vague, and even though there is a clear statement on protection and export subsidization, there is no monitoring or enforcement mechanism," wrote Dani Rodrik, a professor at the Kennedy School of Government at Harvard.
Others said they had only ever held low expectations for the event, but still voiced frustration that it had not measured up to the severity of task at hand.
"The G20 is such an unwieldy body that anything not agreed in advance is never going to happen," said Kenneth Rogoff, an economics professor at Harvard University.
"The global economy is tumbling ... this didn't really push the ball very far down the field."
Leaders did own up in general to policy mistakes that had contributed to the crisis, but refrained from pointing fingers at the United States, where a housing market collapse was the trigger for an ensuing global credit crunch.
There was also a call to reform the IMF and Financial Stability Forum to give emerging economies a bigger voice and the institution more clout in policing the world financial system. Time will tell if this will yield results.

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