Airstrip One

Time to disband the G8?

Blair and his European counterparts must have been overjoyed at the flattery lavished upon them by the moral conquistadors of Live8 who conquered all with their brand of moral monopoly and slogans of urgency. History will judge the objective of "Make Poverty History" less kindly, as expectations outrun outcomes.

Bewitched by the popularity that a positive headline on climate change can bring, all G8 leaders have basked in the warm glow of Live8. None more so than Tony Blair, who has never spotted a bandwagon without hitching a ride and Geldof was willing to provide the Moderniser with the photo opportunity he craved. Perhaps we should be thanful for small mercies. New Labour is now a media parasite, surfing the efforts of others and unable to make waves itself.

Where the G8 leaders have dropped the ball is co-operation, if that is possible, over the macro-economic risks that face the global economy, especially when this effects their own electorates. It is a concern that many economies in Europe as well as Japan operate with high levels of unemployment and low levels of demand at a time when world economic growth is relatively strong. If an economic crisis were to hit these countries, the social and economic damage could lead to severe repercussions, as unemployment soars to new levels and deficit financing proves a useless tool. The window of opportunity for economic reform may be closing as the imbalances within the global economy unwind. If they do so gently, reform is both possible and necessary. If the adjustment is not gentle, France, Germany and Italy will face huge pressures to act and save their industries.

The day of reckoning is not looming, if current economic indicators are believed. A stronger oil price has not resulted in recessions, repeating the pattern of the nineteen-seventies. Indeed, the Global Purchasing Managers' Index has turned upwards. If we wish to understand how such developments may impact upon economies in the Eurozone, it is best to analyze the responses of the Italian government to its slowly developing depression, a symptom that may eventually spread to Germany and France.

In the longer term, some view this summit as the high point, at least in media potential, of the G8, a testament to Blair's skills at spin. As with the Security Council and other international institutions, rising powers question the need for this focus upon the forthcoming decline of former great powers.