G20 summit and the art of beating about the bush

The pomp and glitter of the G20 summit in New Delhi successfully diverted attention from the fact that it was being held in the midst of an acute and growing global economic crisis.

The International Monetary Fund expects growth in advanced economies to slow down from 2.7 per cent in 2022 to 1.3 per cent in 2023, with a real possibility of falling below 1 per cent.

It would mean a substantial increase in unemployment, compounded in the case of the European Union by the influx of migrants from eastern Europe and refugees from Ukraine. The resultant crisis is likely to boost the forces of fascism and encourage animosity toward immigrants.

The neo-Nazi AfD in Germany is already the recipient of close to 20 per cent of the public vote. Marine Le Pen, the standard-bearer for fascism in France, reportedly now has a larger approval rating than President Emmanuel Macron. Italy has already elected a fascist government, and Spain, which was generally expected to do so, has just got a temporary respite by throwing up an inconclusive result in its recent elections.

With the world’s advanced economies facing an unprecedented crisis, the impact will be felt in the Global South as well, in terms of a slowdown in GDP growth, rise in unemployment, an accentuation of the debt crisis, and a strengthening of the tendency toward fascism.

Argentina, for instance, is poised to elect a president who is committed to eliminating all welfare expenditure; and this distressing trend may well catch on in countries where it has not already done so.

Given this backdrop, one had expected the G20 summit to take some initiative in overcoming the economic crisis, just as the G20 meeting held after the collapse of the US housing bubble had done.

Initiatives regarding the external debts of Third World countries were particularly expected, if only because India projected its G20 presidency as a favourable development for the Global South, and because some official spokespersons had flagged Third World debt as a matter for discussion.

The Delhi Declaration, however, said very little on the burning economic questions of the day, though, as the Chinese and the Russian delegates emphasised, G20 should be concerned more with economic matters than with those of security.

The Delhi Declaration undoubtedly marked a change from the one in Bali, Indonesia, where Russia had come in for explicit criticism for aggression in Ukraine. By contrast, the New Delhi Declaration scrupulously avoided laying any blame at Russia’s door. Its call for peace, though laudable, will have very little effect.

NATO countries are determined to use Ukrainian people as cannonfodder in their fight against Russia; it was the US and Britain that torpedoed the Minsk agreement; the same countries which also scuttled peace negotiations soon after the Russian military operations had begun; and they are still busy egging on Ukraine to persist with the war.

The war will end, therefore, only when NATO is ready for it to end, and that readiness will not be influenced one iota by the Delhi Declaration, notwithstanding its acquiescence with its not particularly favourable wording.

The declaration also dedicates paragraphs to extolling religious tolerance and respect for diversity; but these, though certainly laudable, have effectively little significance. With President Recep Erdogan of Turkey and Prime Minister Narendra Modi of India being signatories to this statement—even when their countries are moving in exactly the opposite direction under their watch—such paragraphs can only be seen as pious platitudes.

Not that economic issues do not figure in the Delhi Declaration, but they do so only in very general terms. Not only is there no specific proposal—not even for an international meeting to discuss debt relief for Third World nations but, even in the matter of achieving sustained economic growth—not a single thought appears to have been spared on the means for doing so.

There is no evidence of any discussion having taken place either on these issues. This should not come as a surprise. The host government’s overwhelming interest in the summit was to derive maximum publicity from it, which it succeeded in doing. The poorer countries—which are the main victims of the ongoing crisis as they are the ones crushed by IMF-imposed ‘austerity’ measures—were not represented at the summit at all.

And the advanced countries do not even admit the economic crisis, let alone discuss proposals to overcome it, though individual ‘establishment economists’ have attested to its existence. The G20 meeting, in short, was a show in which different countries participated for their own reasons, but which was not greatly concerned with resolving the problems facing the world or the Global South.

Why do governments of advanced countries face the current economic crisis with such equanimity? Unemployment in an earlier era had been a matter of great concern for capitalist governments, with John Maynard Keynes, a defender of capitalism, even saying that “the world will not much longer tolerate the unemployment which is associated… with present-day capitalistic individualism”.

However, in that earlier era, unemployment was symptomatic of a recession, which went together with a loss of profit, so that both workers and capitalists suffered from the crisis of which unemployment was a symptom. In the contemporary world, that is no longer the case: production is not the sole or even the main source of profit; instead, financial operations account for a substantial segment of profits, so that even when the economy is in recession, capitalists’ profits hold up well.

A recession per se, therefore, matters less to the dominant corporate interests under contemporary capitalism. But what about the social instability it generates owing to mass unemployment and destitution? Keynes was writing against the backdrop of the Bolshevik Revolution, when socialism appeared not just a possibility but an imminent prospect.

With the setback to socialism, capitalist governments are no longer as worried about social instability. True, the advanced countries are facing a challenge to their hegemony, but this challenge does not have the sharp ideological edge to it that it had earlier; and whatever threat comes from the working classes can be blunted by fascist elements.

These governments are, however, living in a fool’s paradise. We are currently seeing huge strikes by workers in advanced capitalist economies, and we had better not forget that the Bolshevik Revolution, too, had come without any warning.

(IPA Service. Courtesy: People’s Democracy)