'I Take Responsibility' Obama's G-20 Confession
Part 3: 'I Can't Sign This'
Alarmed by Zoellick's comments, the G-20 leaders once again turned their attention to the wording of the final communiqué. Chinese President Hu expressed concern that they might be promising too much. The draft text contained the assertion that the projected $5 trillion in stimulus programs would lead to the creation of 19 million jobs.
"That seems to me to be too optimistic," Hu said. "Could it be the case that these figures were arrived at simply by assuming a certain ratio of job creation to investment volume?"
Hu's question went unanswered. Merkel had a question of her own about another figure. "The 4 percent by which economic output is supposed to rise, is that 4 percent of global GDP or 4 percent of growth? We should specify exactly what is meant or we could end up saying something that turns out to be baloney," she said. Her choice of words was a reminder that world leaders are no less given to plain talking than ordinary citizens in their respective countries.
Brown, who in his function as summit chairman was responsible for formulating the draft text, tried to attribute blame for the lack of clarity to the sources in question, saying the 4 percent was a growth forecast and that the reference to 19 million jobs had come from the International Monetary Fund and wasn't a calculation his people had made.
"In that case, it has no business being in your text," someone called out.
"We do occasionally rely on information from other organizations," Brown replied somewhat defensively.
Indian Prime Minister Manmohan Singh also had doubts about the promise of 19 million new jobs. "If I go home with this figure, people are going to be asking me: 'How many of these jobs have you created in India?' And they will want to hold me accountable for the fact that the number of new jobs available in India is continuing to decline."
This was followed by further comments on the 19 million job figure by the Australian prime minister, the Russian president, and the head of the IMF. In a display of Asian wisdom, South Korean President Lee Myung Bak attempted to defuse the debate by saying: "If the economy has become so unpredictable, then economic statistics are likely to be less reliable as well." He suggested they write 19 million "according to the IMF." "No forecasts are correct anyway. Economics isn't like mathematics. One and one isn't always two. In economics it can sometimes be three or four. One and one can also turn out to be one."
This kind of talk was starting to make some of those listening to it feel a little dizzy. The exchanges between world leaders were redolent of the kinds of meetings that are held in thousands of companies around the world every day where, as here, people are prone to get hung up on minor details all too easily.
Now, it seemed, only the authority of a superpower would be able to end the debate that continued to rage in reference to the 19 million jobs. Before the meeting Barack Obama had said that he was there to listen, not to lecture. He had kept his word up to that point, but apparently felt things were getting out of hand: "I think we shouldn't waste too much time on this. If we want to use this number we should add 'according to economic models' or name the source."
Perhaps one should hold off for a while yet on writing the US off as a superpower.
At 2:27 p.m. Gordon Brown announced: "The final version is here." By that he meant the version of the communiqué in which all the desired changes had been made, at least those that had been discussed up to that point. The delegations then withdrew to consult further before beginning the final round.
Brown opened the meeting by saying that with a little bit of good will they could get the job done fairly quickly and asked everyone to be fair and not to make any major changes to the text.
He then started going through the text of the communiqué, reviewing each paragraph where changes had been made.
Brown was just about to call out paragraph 26 when he was interrupted by Argentinean President Cristina Kirchner. "I need to say something here." She wanted to talk about attempts to grant poorer countries more IMF support through the sale of gold reserves.
Kirchner was upset by last-minute changes that had been made in the text. "The delegations worked on this text for four months and then five minutes ago we get an entirely different text. Making changes in this manner, without discussing things beforehand, isn't very businesslike. I can't sign this unless a formal reservation is written into the text".
Brown was apologetic: "If I had known there was going to be a change in meaning, I would have let the old formulation stand."
That was the starting bell for a renewed round of haggling. One after the other, the leaders of the world's 20 most powerful countries presented their pet interests in an attempt to gain a further advantage of some kind for their countries. Italian Prime Minister Silvio Berlusconi was at the head of the line. As is so often the case, his motivation was pure vanity. "In paragraph 24 we have not taken advantage of the opportunity to mention the summit being held in July on La Maddalena," he complained. Berlusconi was referring to the G-8 summit, which his country will be hosting this summer.
Another person at the table, also known for his vanity, felt he had waited long enough. There was still no reference in the communiqué to Nicolas Sarkozy's list of tax havens and he took this as an affront. "What's with the tax havens?" he asked with an element of irritation in his voice. "I won't be able to agree to this thing if there's no list. I won't be able to sign it. I won't assume political responsibility for it. If there's no list these are just empty words. It would be a disaster."
Brown tried to calm him down again, saying that the OECD Secretary-General would be publishing a list that afternoon and adding that he had personally made sure of that just a little while ago.
"But our communiqué needs to make reference to this list," Sarkozy objected. He was gesticulating wildly and having difficulty staying seated. "A clear connection has to be made between them. Otherwise this is all meaningless."
Angela Merkel wanted to say something, but was interrupted by President Kirchner of Argentina. The latter wanted to resume talking about her favorite issue, gold reserves. "Cristina, please don't get angry about this," Merkel urged. "Our formulation is a success for the poor countries."
Once again Brown tried to mediate and once again he failed. Kirchner refused to stop. Finally, the British prime minister tried to take command of the situation by exerting his authority: "I'm the chairman, Cristina."
This failed to make any impression at all on Kirchner. She kept on talking. "What Merkel is saying makes it sound like I don't want to help the African countries. If that's the way it came across I apologize. What I'm getting at here is the way things are being done. Changes are being made at the last minute. We can't operate this way. And by the way," she said, looking at Merkel, "I'm not angry at anyone."
Before the dispute between the two women could escalate further, Sarkozy started up again about his list: "I can't tolerate the fact that tax havens are riding roughshod over our principles. There can't be an agreement here unless this matter is addressed. I don't want to be unpleasant about this, but it is clear that we are at a historical crossroads here. This is a time for a decision. We need to say who is honest and who is dishonest."
Brown again tried to calm him down by saying, "Nicolas, keep in mind what it was that we agreed on here. The era of banking secrecy is over. I'll see to it that this list is published before you hold your press conference."
"But then what would be so bad about writing that into our communiqué?" Sarkozy asked. "If there are ulterior motives of some kind here then we should say so openly."
"I think there's a misunderstanding here," Brown said. "It's not us, it's the OECD who's publishing the list."
Sarkozy hung on doggedly: "Then just one short sentence: 'The G-20 welcome the fact that the OECD is publishing the list.'"
"Couldn't the solution be that we write into the annex that we welcome the fact that they published a list," Merkel suggested. "That way it wouldn't be in the main document, but it would be included somewhere."
Berlusconi chimed in at this point: "I'm with Angela and Nicolas on this. It won't look good if we don't make reference to the list. The media in my country will be hugely impressed if we do."
Sarkozy finally leaned back and relaxed. He had received the additional backing he needed and managed to get what he wanted. Brown proposed that they agree on the following formulation: "We note that the OECD has today published a list of countries assessed by the Global Forum against the international standard for exchange of tax information." After that there were no further objections.