Friday, April 3, 2009

A rare triumph of substance at the (G-20) summit

I was most encouraged when I read this story on the Washington Post mobile editionthis morning.

I have been watching with interest the most historic meeting of world leaders regarding the economy since the end of World War II, by some accounts. I have been impressed with Merkel, Sarkozy, Brown and of course, Obama as they have sought to find common ground and listen to one another about how best to handle the global economic crisis.

Here is an excerpt from the story: "Gordon Brown, meanwhile, emerged from yesterday's talks to declare an end to "the old Washington consensus," the now-derogatory description for the policy prescription of open borders, floating exchange rates and fiscal prudence long favored by the World Bank and the International Monetary Fund.

What emerged yesterday from the G-20, however, amounts more to reform than to revolution. Member countries committed themselves to adding $850 billion to the resources available to the IMF and regional development banks to mount rescues of countries in financial distress, with instructions that the money be used not only for traditional purposes such as debt rollover, bank recapitalization and balance-of-payments support, but also for more "flexible" goals such as stimulus spending, infrastructure investment, trade finance and social support.

And just as the old G-7 has given way to the enlarged G-20, the governance structure of the fund and the bank will be revised to give the bigger developing countries the authority they now deserve."

The entire story is worth reading:

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