Tuesday, September 6, 2016

The Well Runs Dry for the G20

Calling for higher levels of economic growth, the various ministers assembled in Hangzhou this week were whistling in the dark.  Other than China and a handful of non-Western countries, there is no economic growth anywhere in the world.  The various government policies in the G20 countries have assured that outcome.

But, now, the G20 countries are looking for more money to spend on their pet projects.  Good luck on that.  Once economic growth grinds to a halt, as it has in the US and in Europe, the pie no longer grows and slicing a constant pie creates political frictions -- frictions felt in every western country these days.  Most recently, Angela Merkel's electoral prowess collapsed this week, even in her home state.  It won't be long before Merkel disappears from the political scene.  Others will follow.

Economic growth is the lifeblood of the left, but their policies are designed to kill economic growth and have been largely successful.  Now what.  Increasing debt eventually has its limits and we are probably at those limits now.  So, the G20 ministers fret, struggling in their own self-created stew.

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