One newspaper described the meeting of G20 leaders in Osaka, Japan at the end of June as ‘a gathering of the great and the good’. It was more like the gangsters and the goons.
Trade wars and the world economy
The G20 met against a backdrop of six months of reduced IMF projections for world economic growth. At the beginning of June, the World Bank forecast the weakest growth in world trade for a decade, since the 2009 crisis.
The darkest shadow over the world economy is that cast by the US-China trade war. This was a key topic at the summit. Despite all his bravado, it was Trump who blinked first in the game of chicken he has been playing with Xi Jinping.
At the summit Trump agreed to resume trade talks with China, not to impose more tariffs, and to relax the ban on US companies doing business with Chinese telecoms company Huawei. He hardly got anything in return.
The reason for Trump’s U-turn is that the trade war with China is hurting the US economy and, with his 2020 re-election battle looming, he needs to turn things around.
The decline of US imperialism and rise of China are a recipe for instability and conflict. The US-China agreement is barely even a truce, and is far from being a peace deal. This wouldn’t normally be much to cheer about. But in a period of instability, where crisis lurks around every corner, the strategists of capital breathed a sigh of relief. This was as much as could have been hoped for.
There are still plenty of problems to contend with. The joint declaration of the G20 leaders at the end of the meeting summed up the world economic situation as follows: “growth remains low and risks remain tilted to the downside.”
A glaring omission from the declaration was any condemnation of economic protectionism. If an attack on protectionism had been included, Trump would never have signed it.
In other words, nothing has been solved. Crisis and instability will continue. And it will be the working class that is forced to pay the price.
As temperatures in France reached record highs in the last week of June, President Macron insisted that all the G20 leaders reaffirm their commitment to the Paris Accord, which aims to curb climate change. He was unsuccessful.
Trump refused to accept this. Nevertheless, Macron declared victory anyway, since he had managed to get 19 out of 20 world leaders to agree. This ‘victory’ was somewhat undermined the next day by the UN Secretary General, who said that the signatories were “not on track” to achieve the Paris Accord objectives - and even if they were, it wouldn’t be enough to prevent “catastrophic” levels of climate change.
Theresa May, in a desperate bid to carve out some kind of legacy for her disastrous term as British Prime Minister, made a big song and dance out of lecturing other G20 leaders about the need to combat climate change. But her words carry little weight.
Since becoming Prime Minister, May has publicly talked up the benefits of fracking, pushed through the building of a third runway at Heathrow, abolished the government’s department for energy and climate change, and blocked attempts to develop onshore wind farms in the UK. With such hypocrisy, all she achieved at the G20 is to cement her reputation as someone not to be taken seriously.
Hundreds of thousands of young people around the world have been on the streets this year demanding that serious action be taken on climate change. But the only response from the G20 was discord and hypocrisy. The slogan of these protests points the way forward: system change, not climate change.
During the summit, the EU signed a trade agreement with Mercosur, a trade block that incorporates the bulk of the South American economy. The deal has been 20 years in the making, and has the European capitalists licking their lips at the thought of opening up a new part of the world to its companies.
They seized the opportunity to push the deal through while right-wingers Macri and Bolsonaro are in power, in Argentina and Brazil respectively. These two gangsters are all too happy to invite big business into their countries to exploit their working classes and gobble up contracts to run vital parts of infrastructure and services.
In the photo taken to celebrate the deal, Theresa May was pushed right to the back. This was a potent symbol of the third-rate, back-of-the-line position that awaits British capitalism after Brexit. And once again, it is the working class will suffer, as industry and jobs are decimated.
Liberalism is obsolete
Just before the summit, Putin made headlines by declaring liberalism obsolete. Theresa May, among others, was outraged by this. But the PM swiftly went on to prove him right by having a cosy meeting with the Crown Prince of Saudi Arabia, Mohammad Bin Salman, declaring the importance of his friendship to the UK.
The Saudi regime is clearly a paragon of ‘liberal values’, with its massacre of people in Yemen, killing of journalists, and oppression of women. But why let such trivial details get in the way of the interests of British capitalism?
The anti-liberal Trump and Putin shared a few jokes at the summit. And after the meetings finished, Trump immediately went to meet Kim Jong Un in the DMZ in North Korea. The demagogues and despots are clearly feeling confident.
This bullishness was on display when Theresa May met Putin at the summit. She spent the whole time looking like she wanted to be sick, while the Russian President informed her that accusations of the Kremlin deploying Novichok nerve agent in Salisbury “aren’t worth five kopeks”. Not exactly a display of the power of liberalism.
Putin is right that liberalism is obsolete. But he is wrong when he says that he and Trump represent the future. Their nationalist rhetoric can only divide workers amongst themselves, not take society forward. But the way to fight against Putin and Trump is with socialism, not liberalism.
What have we learned?
The characters at this year’s G20 - from the self-important Trump, to the gangster Bolsonaro, to the hapless Theresa May - encapsulate the senility of world capitalism. By gathering together under the spotlight in Osaka, they have done us a great service in reminding us of the urgent need to overthrow all of them - and the global capitalist system they represent.