Why the G20 Won’t Save the World

The G20 virtual summit held last week was somewhat reminiscent of the first pages of Leo Tolstoy’s War and Peace, where the reader is invited to witness a high society party at the salon of Anna Pavlovna Scherer. The invitees know each other well and diligently fulfil their respective roles at social events. No one wants loud scandals and public showdowns. All the necessary words will certainly be spoken. And the guests will go home, quite happy with each other. At the same time, an atmosphere of hypocrisy and ambiguity covers the lush salon; intrigues weave in the corners and crank up really important deals for the participants in the case.

If someone hoped that the summit would be a turning point in uniting global leaders in the name of confronting shared challenges and threats, they would be disappointed.
Of course, the G20 adopted a final statement on a joint fight against coronavirus. But no concrete proposals were made in the statement to expand the powers and potential of the World Health Organization or to launch new mechanisms for international cooperation in countering the pandemic. It seems to be agreed to work together to create an anti-viral vaccine. But in reality, the international competition for the creation of a new vaccine is more reminiscent of the “space race” between the USSR and the USA during the middle of the last century.
Coordinated Fiscal Stimulus Across G20 Could Help Counter the Global Economic Slowdown
The coordinated fiscal stimulus across the G20 economies should improve upon the 2008-2009 experience through focussing more on the composition of fiscal spending with greater priority accorded to human capital development, most notably healthcare. Apart from targeting short-term exigencies, the stimulus should also address longer term vulnerabilities, including the undersupply of healthcare services on a global scale.
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Of course, the G20 reported an allocation of an unimaginable sum of five trillion dollars to save the global economy. Only here, there is a nuance – these trillions are allocated not by the “twenty”, but by national governments and the leadership of the European Union. And they are not going to save the global economy as a whole, but their own economies in particular. Most likely not only at the expense of their competitors, but also at the expense of their allies and partners. Is it any wonder that the idea of ​​lifting numerous unilateral sanctions or even a temporary moratorium on these sanctions did not become the subject of any serious discussion at the summit?

Energy issues, as far as one can judge, have not been raised at all. But it was the beginning of the oil price wars and the subsequent collapse of the global hydrocarbon markets that became the trigger that launched the mechanisms of the beginning of the global crisis. “In the house of the hanged man they don’t talk about the rope”? However, one does not need to be the owner of a Nobel Prize in economics to understand that without stabilizing energy markets, the crisis will only deepen.

Today, many analysts are rushing to make comparisons between the state of affairs in the world today and the situation in 2008-2009, when, in fact, for the first time the G20 in its current format started working. At that time a new interstate instrument, with all its weaknesses and shortcomings, had demonstrated its effectiveness in stabilizing the global economy. Today, twelve years later, there is almost no hope “of the G20 demonstrating such effectiveness”. And this despite the fact that considerable experience has been accumulated in the institutional development of the G20. Despite the fact that there is already an understanding of the scale of the threat and even personal risks for leaders who gathered for a videoconference on March 26.

What is the matter here? It seems that there are at least three factors that distinguish the situation in 2020 from what we observed twelve years ago.

First, twelve years ago, the international community was much more united than today. In the global political elite – from Washington and Brussels to Moscow and Beijing – there was more unity on the most fundamental issues of international life: what is right and what is wrong in world politics, what is fair and what is unfair, what is legitimate and what is not very. Of course, already in 2008 there were disagreements between the main international players, resentments accumulated and multiplied, and contradictions intensified. Already then the claims were expressed in a sharp background – let’s recall at least Putin’s famous “Munich” speech delivered a year and a half before the crisis of 2008-2009. But in those days, it still seemed that disagreements, grievances and contradictions were mostly subjective or communicative in nature. You just need to reach out to each other, convey your position and show reasonable mutual flexibility to achieve a compromise. There are no such hopes today. As, by the way, there is not a small share of trust between leaders that existed twelve years ago.

Second, over twelve years, the priorities of these leaders have shifted sharply to domestic politics. For President Donald Trump, apparently, nothing directly related to his election campaign is of particular importance at the moment. For President Xi Jinping, the clear priority is to quickly overcome the effects of the pandemic at home. Chancellor Angela Merkel is looking for a successor and is desperate to keep Germany’s crumbling party system working. Prime Minister Boris Johnson is mobilising his country to minimize the still-unclear negative consequences of Brexit. Vladimir Putin has probably faced the most serious set of challenges in the history of his tenure in power. Even the host of the meeting, Saudi King Salman bin Abdul-Aziz Al Saud, can hardly say with confidence what his country can expect in the near future. In general, now is clearly not a very convenient time for international activity, especially for making long-term strategic decisions at a global level.

 Third, the problems of 2008-2009 were reduced mainly due to economics and finance. The current crisis is not limited to the economy; in this cocktail a lot of problems of politics, ideology and security are mixed. It is permissible to assert with a certain degree of certainty that the crisis of 2020 has a clear civilizational character. The G20 was never intended to deal with such complex, diverse, and complicated issues. Turning after Leo Tolstoy to another classic of world literature - Alexander Dumas (Sr.), it would be fair to say that “for Athos the musketeer this is too much, and for Count de La Fer it is too little.” The G20 is too small and too exclusive to represent all of humanity, but in order to be an effective crisis manager at the global level, it is too large and heterogeneous.

So, we need to look for other means and other platforms for making decisions that correspond to the specifics of the moment that we are all experiencing. The G20 may become one of the important nodes of the complex new global governance mechanism, but it is incapable of replacing the whole mechanism.
De-Globalization on the Way: The New World and the Democratic Renewal
Jacques Sapir
Events taking place in Latin America, be it the massive social movement in Chile or the victory of the Peronist candidate in the presidential election in Argentina, to which can be added riots in Bolivia are indicators of a important movement against what is called "neo-liberalism". These phenomena are not isolated. Similar movements have taken place in France, particularly the Yellow Vests movement, and others are taking place in Europe or the Middle East.
Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.