NEOAVATARA

http://www.cnn.com/2009/POLITICS/04/01/us.obama.g20/index.html

http://www.cnn.com/2009/WORLD/europe/04/01/g20.london.protests/index.html

Should be fun political theater in London this week.

French President Nicolas Sarkozy threatened to walk out of the G20 meeting of world economic powers in London — Obama’s first stop — if the summit does not go his way.  Sarkozy recently told his cabinet, “If things don’t advance in London, there will be an empty chair. I’ll get up and leave,” the Guardian reported. He is reportedly seeking a concrete system for international financial regulation, including a global financial regulator.

Carla Bruni-Sarkozy...the real reason Sarkozy doesn't want to waste time in London.

It is unlikely that the U.S. Senate would approve of such a measure.  To give a foreign regulator oversight over the American financial system is almost unthinkable.  And the right wing wackos that still think that there is a black underground mysterious push for a global government would have a field day.

The main event in London is Thursday’s summit on the global financial crisis among the Group of 20 wealthy and developing nations. Together, they represent 85 percent of the world’s economy.  Obama planned to meet with leaders of Britain, Russia India and China — major players in the U.S. financial system. It should be interesting, because each has its own issues on global trade and regulatory practices, and Obama and Timothy Geithner will have to juggle all the balls in the air to have any chance of success.

Obama, trying to keep all the balls in the air.

The ultimate problem is not one of Obama’s making, though his naivete may be exploited because of it.  Obama is under the misconception that he is a transformational figure on the world stage, and thus will be treated differently than his predecessor.  Although he is clearly more liked than Bush, that doesn’t mean much in foreign capitals.  The key item Mr. Obama is missing is that all of these countries are looking only at their own best interests.  Some of those interests are in line with the U.S., and many are not, and regardless of who is President they will keep their goals in focus.

In the end, the meeting may devolve into the usual nonsensical anger toward the U.S. and against capitalism in general.  It gives a stage for the Russians and Chinese to drone on about how this is all the West’s fault, although they became quite wealthy upon that former system.  And Asia, above all, is going through one of its worst years ever.  You would think they would like a little coordinated help from the United States.

If the only tangible success coming out of this meeting is increased funding of the IMF (which appears likely), then this must be considered a failure for the G20 and Mr. Obama in particular.  He had campaigned on the belief that he, and he alone, could rally the world in time of crisis.  Well, the time is now, and if this crisis cannot be met head on, which crisis will be?

Countries broadly agree that international regulatory practices should be harmonized in order to optimize their effect (with or without a global regulator).  Most, but not all, countries agree a fiscal stimulus is necessary, and you would think they could at least have a broad consensus on that.   But maybe more simply these financial powers must give the markets a reason to believe in their captaincy of global capitalism.  A loss of confidence right now would be catastrophic.