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Thursday, April 02, 2009 

The G20.

In an incredibly rare example of coordinated thinking, or perhaps rather unimaginative subbing, both the Mail and Guardian tomorrow share the same front page headline - Brown's new world order. Whether the Mail's, with the addition of the exclamation mark, is sarcastic is unclear, but considering the closeness between Paul Dacre and Brown it wouldn't be surprising if even the Mail has decided to be positive for once.

Whether such positivity is genuinely warranted is equally uncertain. However much horse-trading went on behind the scenes is also impossible to know, but as Craig Murray points out, much of the "communique" which has been issued and which runs to a stonking 3,000 words, ensuring that few will read it, will have been all ready and set to go before many had even flown into London. Similarly discouraging, considering the emphasis which was put on the shutting down of tax havens and regulation of hedge funds is that the markets rose significantly today. True, the markets have been rising over the past week, but if those with so much dosh stashed away in the likes of Switzerland, Liechtenstein and the British Virgin Islands really feared the new measures put in place, they would have almost certainly taken fright. That they didn't suggests one of two things: either the economic situation has become so desperate that those with much to lose from the new agreements have decided that such sacrifices have to be made to avoid a slump into full depression, or that the new proposals aren't worth the paper they're written on. The smart money will be on the latter.

For the moment though, Brown will surely bask in the glory, once again, of being the self-proclaimed saviour of the world. Whether that glory will quickly turn, in masturbatory fashion, from euphoria to the deepest ennui and darkest depression remains to be seen. He must however be proud and thrilled with much that has taken place, probably the little things rather than some of the immediate greater achievements. You can't after all get much further from Bush calling Blair to heel in 2006 with his shout of "Yo Blair!" to Obama rather than Brown putting his arm across the prime minister's shoulders whilst in Downing Street. The "special relationship", however cynical and subservient a relationship it is, currently looks more equal than it has in years. Likewise, the communique itself will be a cause for celebration, written as it seems to be in the language which Brown and New Labour have long spoke in, note especially the early mention of the dreaded "hard-working families". To get the G20 also talking it and agreeing with it, however mediocre and mild much of the aims are, will be a source of pride, even if it shouldn't be.

As Craig Murray also suggested, there has been something for everyone to shout about so that no one goes home empty-handed. The French and Germans, who theatrically threatened to walk out if not enough was done on regulation, each got what they wanted, or have claimed to. Indicative of the pressure on him at home, President Sarkozy, who was elected on promise of wholesale reform of the French economy and nicknamed "Sarko the American" because of his enthusiasm for the country as compared to the more usual Gallic antipathy, raved about the promises for the changes on challenging the tax havens. The Chinese seem have to succeeded in their attempts to build up an alternative to the dollar as the reserve currency of choice through the IMF's special drawing right equivalent, which may be the first real signs of them exercising their coming clout over foreign policy. Probably the most significant and as a result under-reported achievement though was clinched yesterday, the pledged commitment between the Americans and Russians to reduce their nuclear arsenals. Any sign of a thaw in what was threatening to become a reprise if not a return to the war of words and threats of the cold war is to be welcomed.

Most vividly missing though was any mention of a global fiscal stimulus, which was never likely to be agreed but which Brown and his apparatchiks were still talking up until Mervyn King so rudely slammed that policy door shut last week. Equally missing was any genuine recognition that simply, things cannot return to how they were in the summer of 2007. Those who up until recently had believed that there was no alternative to neo-liberalism and that only the freest markets, uninhibited by regulation would deliver perpetual prosperity have not changed their minds - they've only changed their attitudes for as long as it takes for us to emerge from the recession of their very making. The world simply cannot sustain continuous growth, and the idea that we can protect the environment, cut carbon emissions to the extent to which we prevent run-away climate change and still slaver over the profits at the end of it is a false one. We shouldn't of course have expected the equivalent of turkeys voting for Christmas - but just the slightest recognition that even if not now, we need a serious re-examination of the very basics of modern economic orthodoxy would have been a step in the right direction.

This was Gordon Brown's last throw of the dice, for after this there's nothing left in the tank. There's no money for a further stimulus, the budget threatens to be a damp squib which will only underline just how bad the finances are and how wrong the government's predictions have been, although all predictions have been more or less worthless for some time now. He has to hope that some of the Obama magic has rubbed off, that the public has taken some notice of the praise bestowed on him by other leaders, and that even if little of this will make any difference to their personal finances whatsoever, that he has been demonstrably doing something in an effort to get the global economy working again. This credit, of which he will probably receive a little although not a lot, is still hardly likely to do anything whatsoever to lift the polls or his personal ratings. Far more influential will have been the weekend's revelations on expenses, which will have just underlined how much politicians are currently loathed. The only solace is that equally applies to the Conservatives just as much as Labour. In Westminster circles Brown might be on the up, but elsewhere the only place to go still seems down.

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