Two Silver Linings at the 2010 G8 and G-20 Summits

Most of the commentary on the Canadian G8 and G20 meetings will focus on the failure to coordinate policy on two key issues: the shift from stimulus to debt reduction and common regulation of the international financial sector.  The attention to these two failures is much deserved – a collective response to the lingering effects of the financial crisis is as important now as it was in the fall of 2008. While the G20 meeting has been the target for the majority of the criticism, the real divide was within the G8.  I will return to that point in a moment.

The G8 and G20 leaders generated other targets to shoot at in Canada. The G8’s decision to walk away from its aid pledge is being lamented by the development crowd, though I’d find the critique more compelling if I thought that aid mattered very much for development; all the evidence is that trade, policy, and stability matter more. That point makes even more lamentable Canada’s effort to create a rationale for the G8, rather than the richer grouping of the G20, to focus on development – part of the G8’s “comparative advantage”, Canada argued. Really? With few exceptions, China, India, Brazil and South Africa are larger trading partners to the developing countries than any G8 member, and on economic investment, China is already spending more money in Africa than the entire G8 put together. Ah, yes, say the Canadians, but we have nicer rules than they do. Yes, we do, and talking to ourselves about those rules will impact their policies exactly how? If we controlled the gates to the world of development, keeping them out of our club might be effective, but we don’t have that control. That horse has already bolted, and all of the sophisticated barn-door-closing we can come up with doesn’t change that reality.

The substance of Canada’s initiative on maternal health is being excoriated elsewhere, so I won’t pile on. One bright spot in the Canadian initiative, though, was the inclusion of reference to the many other countries and foundations that had endorsed and contributed to the initiative. All the more poignancy then to former Prime Minister Paul Martin’s comment that the initiative properly belonged to the G20, not the G8.

Canada’s effort to sell the G8’s comparative advantage in peace and security issues was somewhat more credible: the G8 has been an engine of innovation in collective action against transnational threats. There is a case to be made, though, that a big goal of international policy in the next several years should be about getting the new powers to do more, not less on this agenda. When it comes to transnational threats, we have important shared interests with the emerging powers: time to start capitalizing on them.

On the toughest security challenges, both our interests and our perceptions still diverge – as graphically demonstrated by Brazil and Turkey’s dalliance with Iran and no votes at the U.N. Security Council. The G8 communique focuses on two such hard security challenges – North Korea and Iran. On Iran, the G8 could do little more than offer pious support for initiatives already taken by the Security Council. Its statement on North Korea was more important: having the G8 wrap its arms around South Korea following the Chenoan incident matters. Buried in Annex II of the communiqué was a further useful initiative, on Maritime Security Capacity.

So where were the silver linings? Odd thought it might be to say, the fact that the real disagreement in Canada was not within the G20 but within the G8 should be reassuring. There will be enough fights between the west and the rest, as Iran has already shown. In the world of international finance, the alignment is different. In Muskoka, Obama’s call for caution in a shift away from stimulus was supported by China, India and Brazil; it was Europe that was on the other side of the argument, and erstwhile allies Germany and Britain specifically. While it may be perverse to see this as a silver lining, think about the consequences if it was the other way around. If we witness a deep rupture between the west and the rising powers, we’re in deep trouble. For now, U.S. and BRIC alignment on global financial questions is keeping that rift in check. U.S.-Europe squabbles matter less because the ties that bind are deeper.

In fact, this U.S.-Europe clash is the real reason for the continued existence of the G8. The claim for primacy in development is nonsensical and the claim for continued primacy in peace and security is defensible but shortsighted. The real reasons the U.S. administration supported the Canadian notion to continue a G8 process alongside the G20 is it wanted a smaller forum in which to fight with the Europeans. When bickering within the family, best not to have an audience.

There was a second, important silver lining in Canada’s other signature initiative, the Muskoka Accountability Report, which examined the G8’s track record on fulfilling past pledges. There was a small amount of fudging in the report, especially on whether past or present dollar rates were used to calculate rates of progress. However, an annex that provides detailed information on each G8 government is a first for the G8, and a strong precedent in international affairs. In the days when the world was run by four or five countries with deep ties of alliance, formal transparency did not matter very much. That won’t cut it in the world that lies ahead. When 20+ countries control the levers of international policy, and mistrust is as abundant as cooperation, transparency and accountability will matter a great deal. Finding common ground with the emerging powers on international finance questions helps; creating a precedent for states holding themselves to account for their pledges and commitments helps even more. If the Muskoka Accountability Report is the G8’s last hurrah, it is a good one.