We’re in this together

The Australian

The world's political leaders and bankers have reached their Waterloo, and they know it. The eye of history is on them more closely and mercilessly than they might ever have imagined it would be in their climb up the ladder of success. That realisation itself is a measure of progress towards an achievable solution to the global financial crisis, even if no concrete and immediate remedies emerged publicly from the [recent] emergency meetings in Washington of the Group of Seven and the Group of 20. International acceptance has at last arrived of the scale and character of the credit freeze, and of the need for co-ordinated action by governments in rich and developing countries to unfreeze credit by force of money from injections and interest rate cuts. …

One difficulty is that the architecture of economic management has not caught up with globalisation. There's no world body to provide a fix in a crisis of such size. We can't leave it to any nation, not even the biggest economy, the US. It's saddening to see the farcical way the EU has so far dealt with this crisis — members have been going their own way at the risk of hurting other countries, showing how hollow European co-operation is when push comes to shove.

The fact the US called in the G20, which includes India and China as well as Australia, shows belated recognition of the role of the new, high-growth industrial economies, as an historic shift in the balance of economic power occurs.

The Wall Street Journal

For newspaper editors who believe that governments can wave a wand and stop a global financial panic, the [recent] effort by the G-7 finance ministers will be a disappointment. For everyone else, it should be considered progress.

The causes of the Great Depression are a source of historical dispute, but most economists agree that its depth and persistence were amplified by the lack of international cooperation. Nations acted in what they thought was their own self-interest but often in ways that harmed others. This was the era that gave rise to the phrase "beggar-thy-neighbor," with competitivecurrency devaluations and other protectionism.

So it was welcome to see the ministers lined up behind President Bush [on 11 October] in what amounted to a united front. "As our nations carry out this plan, we must make sure the actions of one do not contradict or undermine the actions of another," Mr. Bush said. "In an interconnected world, no nation will gain by driving down the fortunes of another."