Ashok Dhillon
Dec 3, 20188 min
The World’s 13th G-20 Summit was held in Argentina. This year’s location couldn’t have been more appropriately symbolic of the instability of current global affairs as Argentina is the poster boy of regular economic collapses and bailouts by the IMF, as just happened recently in the fall of 2018. Holding the G-20 Summit in Argentina is the perfect metaphor for the collapsing stability in the conflict riven international order, led by the increasingly authoritarian leaders proliferating around the world with mushrooms-like resurgence, from the dark recesses that had hidden them through the decades after the fascism-led Second World War.
The dominant contentious themes of this Summit were: President Trump’s aluminium and steel tariffs imposed on allies and foes alike; the ongoing tit-for-tat-tariffs ‘trade war’ with China; the gruesome murder of journalist Jamal Khashoggi by Saudi Arabia which the West uniformly finds repugnant and punishable, starting with sanctions and applied political pressure, for the time being; Britain’s and the EU’s exercise in frustration, Brexit; and of course – the uniform acceptance of ‘Climate Change’ by most of the attending nations, and its damage on the planetary environment, except of course by Trump and America.
The 2008 near collapse of the global financial-economic system, triggered in the U.S. by the increasingly deregulated financial companies and banks, which swept across the globe, had brought all the major nations together in a coordinated effort to try and prevent the imminent collapse of the world’s economic system.
The effort was spearheaded by an intelligent, thoughtful, diplomatic American President, who had literally stepped into the crisis at the start of his Presidency, Barack Obama.
Obama’s efforts, together with the coordinated actions of the EU leadership, in the West, Japan, as well as the major emerging giants, China and India, in Asia, had averted the financial-economic catastrophe that had then faced the world.
With careful coordinated nursing, which included ultra-low interest rates and with unprecedented trillions of dollars spent globally, in active economic support (sustained Quantitative Easing, which in some countries is still continuing), the global economy was force-fed to a semblance of health and general prosperity, through sustained ‘Assets Markets’ boost around the world, with what former Federal Reserve Chairperson, Janet Yellen, had termed ‘creating the Wealth Effect’. This coordinated wealth effect, created by the Federal Reserve and other major Central Banks’, globally, had brought back the semblance of prosperity through the stabilizing of jobs and economies, and the extraordinary rise of real estate and financial markets’ prices around the world.
This sense of prosperity was gained in a rather unequal way, with the wealthy getting wealthier at a significantly faster clip than regular folks, and by creating asset price bubbles in a number of asset classes, and by creating a debt burden far greater than before. But regardless of the imperfection of the plan, and the coming dangers it poses, all the major nations had worked together to stave off a global economic calamity and had literally saved the world.
One would have thought that after the years of working together, and the experience of the benefits of coordinated planning towards a worthy common goal, the world’s largest nations would have consolidated those gains and charted a new chapter in political and economic global cooperation.
But in fact, the exact opposite seems to have happened, particularly with the advent of Donald J. Trump as the next President of the United States.
Trump came into power trash-talking all previous Presidents and their accomplishments, and sowing political division, suspicion, isolation, heightened nationalism. He capitalized on the frustrations of those working people that felt left behind by the policies of ‘created wealth effect’, and ‘trickle down economics’, which favored those with the most money to start with, and by blaming other nations for having taken advantage of a naive and manipulated America – whom he was going to punish by breaking the various agreements to which the U.S. was party to, and by imposing punitive tariffs on trade between them - which all he did. Donald Trump, as the next U.S. President, materially destabilized America, and the existing World Order.
Trump, as the leader of the only global ‘Super Power’, seems to have also further emboldened the other bad actors to boldly step forward and sow their versions of discordant democracy, without fear of serious repercussions, secure in the knowledge that Trump, and hence ‘Trump’s America’, was ideologically on their side. As human history has shown time and again, it only takes one rouge leader and only one rouge nation to start a domino effect towards chaos, and for a hereto relatively stable World Order to become dangerously destabilized.
And, that is precisely what has happened. A relatively stable world, post the 2008 crisis and the Obama years, in spite of its normal problems, since 2017, is a cauldron of roiling tensions, disagreements, divisions, suspicions and accusations.
Russia’s Putin, secure in the knowledge of Trump’s unfettered admiration of him and Trump’s extreme reluctance to truly call him out over Russia’s increasing belligerence and interference in the West’s long standing unity, and its institutions of democracy, is now openly dismissive of the West’s disapproval of his disruptive and provocative actions.
And thus, with the seizure of Ukrainian ships, his most recent provocative action, (which he has refused to release at the urgings of other attending leaders at the Summit), Putin initiated a new crisis for the Western nations to contend with, with no apparent means to effectively curb him except talk of more sanctions, perhaps, further adding to Europe’s gnawing troubles.
Similarly, other leaders with an appetite for unfettered power have taken their cue from Putin and Trump’s disdain for due process, proper protocol, harsh intolerance for opposition and critics, and an active enmity of the free press. And, with the established examples of Putin and other dictatorial regimes’ going unpunished for silencing of all opposition, with the murder of critics and journalists, they have been emboldened enough to result in the spate of detentions and murders of those that oppose them, including the recent shocking murder of the U.S. based journalist, Jamal Khashoggi, by the Saudi leadership.
Khashoggi’s murder, and the obvious Saudi leadership’s involvement in it, had been a major source of distasteful unease at this G-20, except with Putin and Trump, as the suspected architect of the murder, Crown Prince Mohammad Bin Salman, was in attendance. And while some Western leaders chastised him for the gruesome act and called for an independent international investigation into the crime, for the most part, they were reluctant to sever ties with Saudi Arabia over the murder of a journalist, to protect their long-term commercial and political interests. So in reality the Prince got his wrist slapped and not much else.
To add to global instability, Britain’s move to pull out of the European Union has been a major disruptive exercise in the areas of trade, political cohesion, immigration, migration, and the handling of refugees, between it and the EU.
After months of intense effort to take Britain out of the EU (Brexit) in an orderly fashion, there seems to be no clear path forward as the process seems to be hopelessly mired in dissension, in the initiating nation itself (Britain).
So far, the entire exercise has been incredibly disruptive as not only business, trade, financial transactions, and movement of people between the EU and Britain has been thrown into serious doubt, other countries in the EU, feeling some of the same frustrations as Britain, have been watching closely to determine whether it may or may not be worth their while to consider an exit of their own, thus putting the entire decades long, and generally very successful peaceful cohesion of Europe in dire jeopardy. That exercise in instability (Brexit) is still ongoing with no clear resolution in sight.
In the one problem that the world’s nations had almost unanimous ‘Agreement’ - the mounting problems of, and the potential impending crisis brought on by ‘Climate Change’ - Trump threw a spanner into that united effort, by firstly denying the problem actually exists (in spite of a recent report by his administration stating that it definitely does), and secondly by pulling the U.S. out of the collective agreement signed by almost all the nations of the world, the 'Paris Accord’.
A perennially difficult job, getting unanimous agreement from most of the world’s nations to agree to a common problem, and an agreement towards requirement of definitive actions to fix it, became that much more difficult by the absence of the leading, and one of the biggest polluting nations in the world, the U.S.
All the attending countries at the Summit reiterated their commitment to taking action to try and mitigate climate change, but without the inclusion of the United States, which under Trump insists on the right to use fossil fuel without any curbs, the exercise is fraught with political frustrations, as America is still the largest economy, and still one of the greatest polluters in the world per capita.
And then there is the Trump initiated tariff war with allies and enemies, which is causing enough rancors between the U.S. and all its allies, but is also causing a major trade war with the fast closing, and threatening to be number one economic giant, China. Trump has vowed to take on and punish China with escalating tariffs, for its highly questionable trade and business practices.
Towards that end, Trump had initiated a series of escalating tariffs on Chinese imports into the U.S., to which China had responded with retaliatory tariffs on U.S. goods. That trade war had been escalating to the great concern of all countries and financial markets, as its continuation was having a dampening effect on the global economies whose renewed growth had been hard won, over the past decade, at great cost, with record global debt.
Trump and his administration had seemed impervious to the mounting concerns and the negative outcomes in business, and financial markets’ recent reactions. But, possibly due to the growing political threats at home from the frequency of guilty pleas entered recently from some of his previously closest advisors, and the mounting economic costs to America, Trump seemed to have cracked under the mounting pressure and called a 90 day truce from any further efforts to punish China into submission, through the continued escalation in the trade war.
China for its part has made general promises to ‘open’ its economy to greater foreign participation under vague terms and timelines. In essence, nothing much has been resolved except a temporary truce has been called with mutual assurances of ‘continued dialogues’ between the two countries.
In the background to all of these forefront contentious issues, there are the serious problems of migrants and refugees fleeing wars, famines, and abusive regimes and gangs at home; and the ongoing unsuccessful attempts to denuclearize North Korea, and the decades long accusations against Iran, for which America (Trump included) seem to have a particular distaste, while finding the equally distasteful (re: the totalitarian, ultra-autocratic human-rights abuses) of Saudi Arabia, quite palatable. This is not to mention the openly abusive regimes of China and Russia, which America views as competitive ‘frenemies’, but downright respectable to deal with.
These biased and contradictory political policies based on skewed ‘national interest’ create the additional possibilities of further conflicts, which could escalate into additional violence and war. At the Summit, no progress was made towards the resolution of any of these festering problems and growing threats.
The increasing influence of far-right leaning, and/or totalitarian and authoritarian leaders like Donald Trump in the U.S., Vladimir Putin in Russia, Xi Jinping in China, Recep Tayyip Erdogan in Turkey, Rodrigo Duterte in the Philippines, Viktor Orban in Hungary, Matteo Salvini in Italy, and the recently elected Jair Bolsonaro in Brazil, are a growing threat to post WWII World Order, and the myriad progressive institutions established thereafter, under the leadership of one of America’s most iconic progressive, Democrat President, Franklin D. Roosevelt.
As the world leaders met at the 2018 G-20 Summit in Argentina, there was little hope much would be settled, resolved, or stabilized, as some of the key players, like Trump, Putin, Erdogan, Salvini, Prince MbS, and perhaps even China’s Xi Jinping, have an agenda which does not include the restoration of the previous forms of cooperative status-quo. But they, with Trump as the poster boy of the new unapologetic mantra of ‘national interest’ over global cooperation, are leading the world towards a more fractious, conflicted, and unstable World Order.