U.S. and the G-20 Summit: Perspectives on Global Leadership

September 28, 2009

Editor’s Note: The National Perspectives on Global Leadership (NPGL) project reports on public perceptions of national leaders’ performance at important international events. The third series of commentary focuses on the Pittsburgh G-20 Summit and looks at the perception of how individual leaders advance national economic interests, strengthen the relationship with their publics by reflecting their concerns, enhance the geopolitical status of their country, and reassure publics that leaders are working together to take responsibility for the public interest in global outcomes. Read the other commentary »

Economic Priorities and Summit Outcomes

The United States and the Obama administration had high-priority interests in all the major items on the Pittsburgh G-20 agenda, including macroeconomic stimulus and coordinated “exit strategies,” financial regulation and reform, especially with regard to establishing high capital requirements for banks, and international institutional reform. The final G-20 statement manifested progress on each of these points; also particularly noteworthy was President Obama having been seen as pushing the Europeans to agree on bank capital requirements. The U.S. also got agreement on cutting subsidies for fossil fuels, which broke new ground. Where the Obama administration was eager to duck criticism and avoid overreach was on trade. After the controversy stirred up by the Obama administration’s actions to raise import tariffs on tires from China, President Obama was vulnerable to criticism for engaging in protectionism while at the same time the G-20 was trying to restrain it. Other issues so dominated the Pittsburgh G-20 Summit that the trade issue did not erupt into a visible point of discord, but rather was smoothed over by a call to complete the Doha Round to benefit developing country exports of agricultural products as a source of economic recovery for those nations.

Domestic Political Impact of Summit Leadership

Around the world, but especially perhaps in the United States, the G-20 Summit was overshadowed by the breaking news: 1) an additional nuclear site in Iran and the consequences for the efforts to forge a stronger nuclear proliferation regime; and 2) international support for forcing Iran to be transparent and adhere to international norms on nuclear energy. In fact, the domestic political impact of Obama’s international leadership was generated over most of the week, with a climate change summit at the United Nations on Tuesday, chairing the UN Security Council meeting on nuclear proliferation and Iran on Wednesday, and the G-20 Summit in Pittsburgh on Thursday and Friday.

President Obama’s withdrawal of U.S. nuclear missiles from Poland and the Czech Republic seemed to pay off in terms of greater support from Russian President Medvedev mid-week, as well as gaining strength on Friday after the revelation of the nuclear site in Iran. This along with the visible and vocal support of UK Prime Minister Gordon Brown and French President Nicolas Sarkozy, were the most palpable manifestations of Obama’s high-profile global leadership during “summit week.” Also, the fact that President Obama got the results he wanted at Pittsburgh at week’s end, and seemed masterful at orchestrating the G-20 leaders toward agreement on a broad range of issues, was icing on the cake in providing the American public with a sense that U.S. international interests are in steady hands. But nuclear and security issues overshadowed the economic crisis and the Pittsburgh G-20 Summit in terms of opportunities to demonstrate leadership at the global level but to the same effect.

Obama visibly demonstrated firm and determined international leadership throughout the week and a clear commitment to working with other nations, rather than going it alone, whether on climate change, nuclear security or economic recovery. His call for international cooperation in his United Nations General Assembly speech was strengthened by his actions on major issues throughout the week. This is not just an approach the rest of the world wants from the United States, but is an approach Americans now want from their government, in the wake of the Bush administration. The opportunity to demonstrate the effectiveness of his international approach in various forums on many issues throughout the week strengthened domestic political support for the Obama administration as a result.

Geopolitical Repositioning

President Obama consulted with all G8 leaders, and Australia, and with the 10 leaders from emerging market economies, and moved everyone forward in Pittsburgh to agree on the most significant reform in the international system since the Second World War, as Gordon Brown put it. By agreeing to make the G-20 permanently the “premier forum” for international economic cooperation, “the G-20 eclipses the G8,” as CNN encapsulated the news in a box on the screen. “G-20 Grabs Bigger Role in Global Economy” bellowed the Washington Post front-page headline on Saturday after the summit. Only a few weeks ago, President Sarkozy vowed to permanently establish a G14 in 2011 when France hosts the G8, and Canadian Prime Minister Stephen Harper was, and maybe still is, reluctant to convene the G-20 as chair of the G8. Nevertheless, the G-20 Statement indicates: ”Finally, we agreed to meet in Canada in June 2010 and in Korea in November 2010. We expect to meet annually thereafter and will meet in France in 2011.”

As a consequence of Obama’s leadership, global summitry has been transformed from a parochial Western-dominated G8 with false pretenses to act as a global steering committee, to a more inclusive, representative and now proven-to-be more effective G-20 summit that restructures global leadership into a new grouping. This new grouping balances the West and the non-West into a cooperative relationship. This move, initiated by Obama, but obviously supported by the other leaders, repositions the emerging markets in the global order, providing them with visible roles in global leadership, which are more clearly defined than in other more complex international institutional reforms that are currently underway. The emergence of the G-20 as the world’s global steering committee is a blockbuster reform, which will now become a more powerful driver of other international reforms.

Global Leadership and the Public Interest

The momentum for summit reform was bolstered by the success of the G-20 at the leaders level in establishing a track record in taking public responsibility for the public interest in economic recovery in the wake of the 2008 financial crisis. The London G-20 Summit was clearly pivotal in laying out the pathway involving macroeconomic coordination, financial system reform, and international institutional reforms which dovetailed into an effective, concerted strategy for dealing with the crisis that affected everyone everywhere. The fact that six months later, the world economic downturn had been halted and signs of recovery were appearing, testified to the fact that the G-20 acting together was able to have demonstrable effects. This evidence clearly has had the benefit of reassuring publics everywhere that someone is minding the store, there is a focal point for global leadership and that trust and confidence in markets, institutions and leadership, perhaps the most crucial ingredients in the recovery itself, are creeping back into the global economy. The G-20 has been instrumental in restoring confidence by being effective in addressing the global crisis with a global response.

The elevation of the G-20 to fill the void at the apex created by the lack of representativeness, legitimacy and effectiveness of the G8 acting alone, is a logical result of the critical role the G-20 and G-20 countries and their leaders have played in charting a new mode of global leadership for the twenty-first century.