Count me among the cynics when it comes to G-7, G-8, and now G-20 meetings. They seem to involve little more than photo ops and platforms for politicians to bore us with platitudinous pronouncements—at great expense to the taxpayers in the host country and city, I might add.
As usual, nothing earth-shaking happened at the just-completed G-20 gathering in Pittsburgh, but let’s glean what we can from the proceedings:
The most salient feature of the confab was the explicit confirmation of the cynical view that G-20 is more hot air than substance: The announcement that there will be no enforcement mechanism to guarantee that member governments actually implement policies agreed upon at G-20 meetings. Instead, they will rely on “moral suasion”—as if anyone will be able to persuade Vladimir Putin or Hu Jintao (or our own president, for that matter) to alter government policies for any reason other than self-interest.
The utter banality of these ritualistic gatherings of heads of state was reflected in some of the resulting headlines. Examples:
From The Wall Street Journal: “G-20 Approves Growth Policy.” What were you expecting—“G-20 Unveils Plan for Economic Stagnation?”
From the Associated Press: ”G-20 Plans to Approve Greater Role for Asia”—as if the rapidly growing economies of China, India, South Korea, and others hadn’t already made these nations major global players.
Besides the banality, the G-20 meeting brought us the customary pious pronouncements of intentions to adhere to sound economic conduct. You know, like the statements made at April’s meeting in London about the importance of avoiding protectionism, which everyone ignored when they returned home, including President Obama, who recently slapped a 35 percent tariff on Chinese tires.
At last week’s meeting, one of the pious pronouncements was about the need for the United States to shrink the federal budget deficit. While I agree with this goal wholeheartedly, the reason we should pursue it is so we don’t commit economic suicide, not because the G-20 recommends it. Now, one would think that it would be a slam dunk to shrink a deficit of more than one-and-a-half trillion bucks, but don’t count on it. If it suits our president’s political goals (e.g. an expanded role for government in healthcare), the deficit will continue to swell.
As should be expected from a gathering designed to underscore the importance, if not the primacy, of government in the modern era, the heads of state seemed more concerned about the mote in the private sector’s eye than the beam in the public sector’s. Thus, politicians who are afraid to look in the mirror talked about curbing bankers’ bonuses and going after tax havens—as if those measures are more vital to economic growth than correcting government policies that stifle economic growth (e.g., taxes, absurd regulations, etc.) or cause destructive bubbles (e.g., central banks holding interest rates artificially low by printing money).
The free market took it on the chin in other ways at the G-20 meeting.
For instance, President Obama and British Prime Minister Gordon Brown emphasized the need for continued government stimulus spending. A word to the president and prime minister: You can’t engage in stimulus spending (a euphemism for increasing deficit spending) and reduce budget deficits at the same time.
Moreover, President Obama and his aides used the G-20 platform to call for lower tax credits for the oil industry due to alleged “overinvestment.” Another word: If we’re so over-invested in oil, why is the price so high and why do we have to keep importing more and more of the stuff?
Well, enough carping about politicians. Here’s a gripe about the media coverage of G-20: Why did the press give so much attention to a few thousand know-nothings protesting capitalism after virtually ignoring the 800,000 Americans who marched in Washington on September 12 in protest of oppressive government policies’ Do people who smash windows and roll barrels at police deserve more attention than respectful, well-behaved, law-abiding protesters’
The good news here is that only 2,000-3,000 anti-capitalist, anti-globalization groupies showed up in Pittsburgh. Maybe some of their erstwhile companions are finally comprehending that the rapid economic development around the globe in recent years is due to markets being opened and expanded, while stagnation persists where markets are suppressed by illiberal governments.
Finally, the best news about the G-20 meeting in Pittsburgh is that the assembled heads of state backed off from pushing for a global-climate agreement. The political leaders acknowledged that concerns about sluggish economic growth are trumping concerns about climate change. As the people of the world grow increasingly skeptical about global warming alarmism, it is immensely encouraging to see heads of state side with them against Al Gore and the green elitists for a change.
There’s still hope for us after all. Hallelujah!
- Biden Resumes Obama’s Efforts Against Domestic Oil Production - July 13, 2021
- Biden economic team predicts long-term slow growth - June 30, 2021
- The Worst-Kept Economic Secret in America: High Inflation Is Back - May 19, 2021
- Raise the Corporate Tax Rate? Economic Obtuseness in High Places - May 12, 2021
- Washington’s Bi-Partisan Fiscal Folly - May 6, 2021
- The Problem with Hedge Funds - April 13, 2021
- Wall Street Outsiders Versus Hedge Funds - February 1, 2021
- The Problematical COVID-19 Relief Legislation - January 14, 2021
- Giving Thanks to Society’s Economic Benefactors - November 19, 2020
- Why Fracking is a Big Issue - October 30, 2020