Was it a success?

LONDON — The London G20 summit appeared to be a resounding success.

International stock markets cheered the results and staged a broad rally. British Prime Minister Gordon Brown, who hosted the summit, proudly reeled off a list of what had been accomplished — agreement on principles for reforming the global banking system, a common approach to cleansing banks of toxic assets, making an additional trillion dollars available to the World Bank and other international institutions to help troubled national economies, and giving a boost to world trade and an additional $100 million in aid to poor countries.

President Barack Obama declared the summit “historic," “very productive” and even “a turning point." Obama was the star of the meeting, but the results of its deliberations suggest that the United States did not dominate this summit to the extent that it has in previous world forums. That may be the flip side of Obama’s new “listening diplomacy.”

The United States and Britain wanted other countries to follow their example and spend huge sums to stimulate their economies. They lost that argument and agreed to a bland statement in the communique that G20 countries were undertaking fiscal expansion that will amount to $5 trillion by the end of next year. There were no specific pledges from anyone.

Other world leaders attending the summit praised the results. French Prime Minister Nicolas Sarkozy said they were “more than we could have hoped for.” German Chancellor Angela Merkel called the outcome “very, very, good, an almost historic compromise.”

Like all the participants, they were spinning the results for the voters back home, claiming they had scored important victories. Merkel and Sarkozy won an argument to publish a “name and shame” list of international tax havens, but tax havens did not cause the world recession, and shaming them will not cure it.

Much of the communique concerned arcane international finance matters that the general public finds confusing and even presidents and prime ministers have trouble understanding. A banker, Stephen Roach, chaiman of Morgan Stanley Asia, said he was worried that “many of the world leaders had gotten into something that was over their heads.”

Roach, who participated in a conference on the summit, said much of the advice from world leaders was bad economics and did not make sense. He said it was wrong to tell Americans, especially baby boomers facing retirement, not to save. They will not listen to bad advice. “The world is counting on the American consumer to pull it out of the recession,” the banker said. “Forget it. It won’t happen.”

http://www.globalpost.com/dispatch/worldview/090402/g20-success