Baseline Scenario publishes an interesting post and triggers a wise comment.
Regular readers of Learning from Dogs will know that we greatly admire the job done by Simon Johnson, James Kwak and others over at Baseline Scenario in debating this global economic crisis.
The comments that flow in are fascinating and often deeply educational. Not surprising! Baseline Scenario has nearly 12,000 readers! But many of them show the level of anger and frustration felt by so many.
The G20 Summit in Pittsburgh: should you care?
On Thursday evening and all day Friday, heads of government from countries belonging to the G20 will meet in Pittsburgh. On paper, this looks important – 90 percent of world economic output and 67 percent of world population will be at the table: the G7 (US, Canada, Japan, UK, Germany, France, and Italy), plus the European Union, the largest emerging market countries (including China, India, Brazil, Mexico, and South Africa) and a few others. And unlike the G7, which is really a club for rich industrialized countries, every continent and almost all income levels are represented in the G20.
If the G20 fails to deliver, is it really possible that we are doomed to repeat the same mistakes with regard to building up vulnerabilities in our financial system? Amazingly, the answer is: a definite yes. How can this happen, with so many smart people in government? Unfortunately, it is not about having clever individuals on the job; it is about their incentives, their world view, and whether or not they really face pressure for change.
Seems like more reasons to be pessimistic.
But then up pops MC Morley in the comments saying,
In general real innovation and investment take thought, time and effort (like the regulatory changes needed in finance) – none of which fits into the schematic or the “force field” that has harnessed the liquidity injections of the past year.
In spite of all this, the G20 matters. It may have utterly inadequate capacity to make the sort of regulatory and structural change that is needed. However, it remains an important symbol of effort to share political power on the international stage. The next question is; when the intellectual and theoretical change that is needed to re-store sanity to markets finally takes hold, (why not hope this is possible?) will bodies like the G20 still be around to help keep the idea democracy alive on the international stage?
Yes – we should care.
Well said. Hope is so much better than despair. As Winston Churchill was quoted as saying, “It has been said that democracy is the worst form of government except all the others that have been tried.”
By Paul Handover