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Responsibility and nothing specific. This is what the G8 leaders produced at their summit

Published on , , Sofia

There are some signs of stabilisation of the economy but this doesn't mean that we have to comfort ourselves, agreed the leaders of world's leading economies at their summit in the Italian town of L"Acquila, symbolizing the crushed grandeur by the disastrous earthquake in April that killed some 300 people. In fact, the decision of the Italian prime minister Silvio Berlusconi, without being certain that he actually sought this effect, is quite symbolic.

The small trim town of L'Acquila was almost entirely squared down by the strong earthquake in spring this year and to demonstrate solidarity with people in plight Mr. Berlusconi decided to move the G8 summit instead in the luxury Sardinia to L"Acquila. On the one hand the goal was to save money which the leaders of the leading global economies accepted unconditionally so as not to cause the effect of a "feast during cholera". On the other hand, the idea of the Italian prime minister was the income from the numerous delegations and journalists to help local authorities to deal with the tens of thousands that remained homeless after the quake.

The situation with the global economic crisis is quite the same, except that it is not a natural disaster but the feeling is the same for a very simple reason - the market was left to work exactly on the principle of natural balance. After the first big victims of the crisis the world leaders agreed to take serious actions to regulate the financial markets in such a way that the repeat of the crisis could be avoided. In the meantime their main goal was the quickest possible stabilisation of economy and possible relatively quick passing to growth.

If we analyse the communiques from the summits of different world formats like the G20, G8 and any other global organisations, it becomes clear that the market continues to regulate itself and politicians only monitor what's going on. The forum in L'Acquila doesn't make an exception. Form the very first lines of the final declaration in the economic part it is written: "We are determined to fully take on our responsibilities, and are committed to implementing our decisions, and to adopting a full and comprehensive accountability mechanism by 2010 to monitor progress and strengthen the effectiveness of our actions". Have you understood anything? I haven't, beside the fact that the world leaders have, really, very good intentions to put things in order.

Another interesting moment in the final declaration of the G8 summit in L'Acquila is that now we can see the presence of two words in one sentence: "individual and collective". In other words the world leaders are not that inclined any longer to undertake collective actions to solve the problems with the black holes in global financial system and that is why they start gradually to transfer responsibility to individual actions.

"We will take, individually and collectively, the necessary steps to return the global economy to a strong, stable and sustainable growth path, including continuing to provide macroeconomic stimulus consistent with price stability and medium-term fiscal sustainability, and addressing liquidity and capital needs of banks and taking all necessary actions to ensure the soundness of systemically important institutions". I myself interpret this sentence like this: to keep the status quo by pouring money so as to return things in their previous course and only keep an eye not to over salt the meal by violating one or another strong fiscal factor like inflation, for example. But this would only lead to a repeat of the situation, some time later.

However, another argument supporting my thesis is that, in fact, this is an attempt to keep the current distribution of economic and political power globally is the fact that leaders inserted a text in their declaration about the oil prices. And if the European Commission fined couple of days ago two major European companies for cartel agreement, what can we say about the offer the 8 made to the oil-exporting countries - the prices of oil to vary between $70 and $80 per barrel?

But to be entirely honest we have to mention that individual measures that are being taken by some of the biggest economic powers like the US and the EU are quite alike, which does not change the fact that they still continue to be mainly individual actions. Besides, it is important to note that the EU is not represented in the G8 as an entity but only by 4 member states - France, Italy, Great Britain and Germany and that makes things much more complicated.

Another important element in the declaration of the G8 leaders is their special attitude towards tax policy. "In this difficult time, the protection of our tax base and the efforts to combat tax fraud and tax evasion are all the more important, especially given the extraordinary fiscal measures adopted to stabilize the world economy and the need to ensure that economic activity is conducted in a fair and transparent manner". In other words, let's squeeze out all possible sources of cash to pay for the expensive puring of money without any reform of the sick sectors.

And to conclude the G8 summit did not produce any news but, instead, confirmed the feeling that there really is a desperate need for a change, but not in "my" term, if possible.

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