G20, Bretton Woods II in DC, Doha: Reform or Smoke and Mirrors Status Quo?
Two economic summits are taking place that have global repercussions. The G20 meeting in Brazil began yesterday and next weekend the "Bretton Woods II" summit begins in Washington.
It was the G20 summit that Dubya didn't have a clue about.
Will these conferences bring substantive change to global economic policies or will they simply be more form than substance?
From IPS News reporting on the G20: "Brazilian President Luiz Inacio Lula da Silva called for "a pact between governments to create a new global financial architecture," while stressing the need to open up the global financial bodies controlled by the industrialised world to emerging economies.
"In his opening speech to the G20 meeting of finance ministers and central bank presidents Saturday in Sao Paulo, Brazil's economic capital, President Lula described as "irresponsible" the "disorder" that has marked global finances in the past few years and is now threatening the "real economy" with "a generalised recession," the loss of millions of jobs and a rise in poverty.
"The Group of Seven richest nations (G7), where "the crisis originated: s no longer sufficient to govern the world's economic affairs," said Lula, who called for "a new, more open and inclusive governance" for the world's financial system.
" 'We are all paying for this adventure" undertaken by speculators who made "excessive profits, investing money that they didn't have," and turning the world into a "gigantic casino,' Lula complained.
"He also criticised the "blind belief in the market's self-regulation capacity," pointing out that many of those who condemned state intervention in the economy are now turning to the state for help.
"Lula's address bolstered demands for greater participation in decision-making in institutions like the International Monetary Fund (IMF) by the emerging economies that make up the Group of 20 (G20), along with the members of the G7 and the European Union, represented as a bloc.
"In his opening speech to the G20 meeting of finance ministers and central bank presidents Saturday in Sao Paulo, Brazil's economic capital, President Lula described as "irresponsible" the "disorder" that has marked global finances in the past few years and is now threatening the "real economy" with "a generalised recession," the loss of millions of jobs and a rise in poverty.
"The Group of Seven richest nations (G7), where "the crisis originated: s no longer sufficient to govern the world's economic affairs," said Lula, who called for "a new, more open and inclusive governance" for the world's financial system.
" 'We are all paying for this adventure" undertaken by speculators who made "excessive profits, investing money that they didn't have," and turning the world into a "gigantic casino,' Lula complained.
"He also criticised the "blind belief in the market's self-regulation capacity," pointing out that many of those who condemned state intervention in the economy are now turning to the state for help.
"Lula's address bolstered demands for greater participation in decision-making in institutions like the International Monetary Fund (IMF) by the emerging economies that make up the Group of 20 (G20), along with the members of the G7 and the European Union, represented as a bloc.
"The G20, whose action has so far been limited to the gathering of finance ministers and monetary authorities, is thus taking shape as a new scenario for North-South disputes, given the clear need for the creation of new regulatory bodies and concerted action with respect to the crisis, and for the overhaul of institutions whose credibility has been seriously undermined by the financial meltdown.
"The Sao Paulo meeting is drawing up proposals to be discussed at the Nov. 15 anti-crisis summit called in Washington by outgoing President George W. Bush, which will bring together the presidents and prime ministers of the G20 countries. Spanish Prime Minster Jose Luis Rodraguez Zapatero, who was initially excluded, has also been invited.
"Brazil and other emerging countries want the G7 to be replaced by the G20, where they represent a majority, with Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey.
"The group would represent a new power bloc unlikely to be accepted by the rich countries, especially the United States, which is in an uncertain position however, with a lame duck president who will be succeeded by Democratic President-elect Barack Obama in January."
"The Sao Paulo meeting is drawing up proposals to be discussed at the Nov. 15 anti-crisis summit called in Washington by outgoing President George W. Bush, which will bring together the presidents and prime ministers of the G20 countries. Spanish Prime Minster Jose Luis Rodraguez Zapatero, who was initially excluded, has also been invited.
"Brazil and other emerging countries want the G7 to be replaced by the G20, where they represent a majority, with Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey.
"The group would represent a new power bloc unlikely to be accepted by the rich countries, especially the United States, which is in an uncertain position however, with a lame duck president who will be succeeded by Democratic President-elect Barack Obama in January."
And an article in AsiaTimes talks about the meeting in Washington.
"Next Friday, leaders of several of the world's most powerful countries will gather at the White House to address the burgeoning global financial crisis. The November 15 summit and an accompanying series of smaller meetings will weigh the potential for reforms of the international financial system, leading the meetings to be dubbed a "Bretton Woods II", in reference to the New Hampshire conference held in 1944 that created today's main global financial institutions, the World Bank and the International Monetary Fund.
"The power imbalance whereby these institutions are able to dictate intrusive conditions and set the prevailing paradigms for knowledge- and policy-formation processes in developing countries, in spite of the limited representation those countries have on their boards, could be up for review. The lack of international regulation for capital movement - also a feature of the existing "architecture" - would be scrutinized.
"For all the grandiloquent language, however, there's no reason to expect anything more than limited reforms to the existing system to emerge from this summit. The countries convening the summit seem likely to support a model that closely resembles the approach pursued to respond to the series of crises that shook Latin America, Asia, Russia, and Turkey in the 1990s and the start of this decade.
"For all the grandiloquent language, however, there's no reason to expect anything more than limited reforms to the existing system to emerge from this summit. The countries convening the summit seem likely to support a model that closely resembles the approach pursued to respond to the series of crises that shook Latin America, Asia, Russia, and Turkey in the 1990s and the start of this decade.
"This isn't the first time we've heard widespread calls for "new global financial architecture". Such calls abounded in the 1990s, yet nothing came of them. Now we're paying the price for that. Today's global financial crisis, as Financial Times columnist Martin Wolf recently said, is the worst anyone alive has seen - unless you have lived for longer than 100 years.
"The distributional results of the approach are also clear as developing countries start to feel the pain of reduced remittances, lower demand for their exports, increased costs of debt payments , and threats to future aid. Sadly, this is happening despite the fact that these countries already sustained painful reforms of their national financial systems in the name of that earlier call for new "architecture."
"The distributional results of the approach are also clear as developing countries start to feel the pain of reduced remittances, lower demand for their exports, increased costs of debt payments , and threats to future aid. Sadly, this is happening despite the fact that these countries already sustained painful reforms of their national financial systems in the name of that earlier call for new "architecture."
"But more extraordinary than news about the November summit is what's not in the news so far and, yet, seems to be the reason for such rapid action. There's another process where the words "Bretton Woods II" have resonated since the summer. From November 29 until December 2, world leaders will meet in Doha, Qatar, to review progress in implementing the "consensus" that emerged from the International Conference on Financing for Development held in Monterrey, Mexico six-and-a-half years ago.
"The reform of the international financial and monetary systems was a key theme on that conference's agenda. The upcoming review in Doha was poised to deal with this issue because it was clear that little progress had been made toward that goal - even before the global credit markets debacle provided a "smoking gun".
"The reform of the international financial and monetary systems was a key theme on that conference's agenda. The upcoming review in Doha was poised to deal with this issue because it was clear that little progress had been made toward that goal - even before the global credit markets debacle provided a "smoking gun".
"At the risk of sounding cynical, it's possible that the most compelling reason for holding the November 15 summit was the simple fact that the Doha review, scheduled last December, was about to happen. This would also explain the otherwise incomprehensible fact that not a single one of the leaders who convened the meeting has even mentioned the upcoming Doha meeting proposal at all, or pledged to support it. "
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