over at marketwatch.com tells us what the G7 and major corporations said to each other on Friday, 4/21/06.
[Thanks to digidagboek.blogspot for the image.]
The article notes that, as usual, everyone was in agreement that someone should do something. Meanwhile: tick, tick, tick.
Here is a summary of the G7 statement with my sarcasms.
1. The G7 promise "that member countries will work together to tackle global imbalances." So it's business as usual.
2. "Success will not be easy. The world got into the mess it's in because it was the path of least resistance." Yes, it's not any government's fault, it's that lazy world.
3. "In the United States, cutting budgets will not be easy, because you might have to raise taxes that you promised would never ever be raised." Of course the option of cutting spending isn't on the table.
4. "Saving more means consuming less." Yes, people, you should put your money in a savings account at minus 1% interest and stop spending so much. (The savings rates may be changing, but they're not even keeping up with inflation.)
5. "Increasing U.S. exports means people trained to flip houses or underwrite mortgages will have to be retrained to do something useful." Indeed. The implication is that manufacturing is the only respectful profession and it's all of those poor unemployed factory workers who are stuck "flipping" houses a-la-McDonald's and pushing pencils instead of doing something "productive" -- a pretty non-economics view of the labor market.
6. "Investing more in productive enterprises means investing less in real estate." Real estate is so unproductive. Houses just build themselves. On the other hand, if governments hadn't created the real estate bubble in the first place, there wouldn't be all of this flipping of houses, underhanded writing of mortgages and admittedly wasteful speculation.
7. "For China, reducing the reliance on exports means creating new vibrant domestic markets, with all the necessary and expensive infrastructure, creating new expectations and a messy consumer economy. State companies would have to be allowed to fail. Some people, perhaps millions, would lose their jobs. The state could lose its grip." It's not the exports that are creating the problem. It is the centralized control of everything from A to Z that is. Change in that sector is probably not in the cards, but if it were, it would mean the Chinese state employees would be the only ones to suffer, if only temporarily. I would have confidence in those "messy consumers," much more than in the state -- although they have gotten some of it right, apparently, because the people of China have never had it so good.
8. "In Europe and Japan, reforming labor market structures is painful, because young people might riot over losing the right to keep a job they'll never have. The social compact might have to be rewritten with few guarantees that the new compact will be popular or just." No comment here.
9. "[T]he G7 ministers ... promised 'vigorous' and concerted action. In particular, the G7 said that further U.S. action is needed to boost national saving by reducing the budget deficit. European nations must encourage domestic consumption, while Japan should take further actions to ensure long-term growth, ministers agreed." Interpret this to mean that the US should raises taxes, Europe should increase loose credit, and Japan should continue to flood their economy with yen.