It seems that the G-20 has become a yet another unnecessary, ineffective and very expensive, taxpayer-funded, talking shop.
China's carefully prepared meeting in Hangzhou will have no binding, or "best-effort," agreement on any specific and urgently needed coordinated stimulus measures to rev up anemic economic growth in Europe and in the United States – 40 percent of the world economy – where some 40 million people are currently without stable employment or are completely out of work.
Unable to agree on such a program, the meeting is recommending structural reforms and labor-saving production technologies that would inevitably create additional short-term job destructions.
These recommendations look like an intentional diversion from the immediate task of stabilizing a dangerously slowing world economy struggling with huge trade imbalances and exogenous shocks of deteriorating global security.
Some European observers will probably see there an eerie reminder of the German diktat to the hard-pressed euro area countries to implement structural reforms and fiscal austerity, while they were sinking into recession, with rising unemployment, heart-wrenching poverty, lengthening soup-kitchen lines and more than half of young people deprived of jobs and meaningful future.
A Sino-German deal?
That reminder would not be as far-fetched as it seems. According to the statement of China's ambassador to Germany on July 29, 2016, Berlin and Beijing "have been communicating with each other intensively in preparation for the Hangzhou summit." As the two largest trade-surplus countries in the world, China and Germany certainly had many things to share in order to avoid pressures to grow faster so that their trade partners can sell them something.
Germany, the next G-20 chair, also had a clear imprint on the EU platform for the Hangzhou meeting. With a fully-employed economy, Germany does not want to discuss policies designed to promote growth and employment. The EU, therefore, was mainly interested to talk about sharing the burden of the refugee crisis, preventing terrorist financing, tackling tax avoidance and controlling climate change.