Your humble blogger has learned that, in an amazing reversal of fortune, the leaders of the G-20 have heeded President Obama's call to embrace a "responsiblity to co-ordinate our action and find our common ground." The result will be a communique that actually addresses the current crisis on concrete terms.
Recognizing the need for a "grand bargain," French president Nicolas Sarkozy and Angela Merkel pledged to offer a combined $400 billion in fiscal stimulus in return for a United States agreement to allow for enhanced regulation of large financial institutions. China agreed to match U.S. and European commitments to the International Monetary Fund, in return for a doubling of its voting quota within the Fund. Furthermore, all parties agreed on their joint responsibility in unwinding the macroeconomic imbalances that contributed to the current crisis, thereby pleasing Martin Wolf to no end.
The G-20 leaders summit will have an immediate follow-up of a meeting of the G-20 trade negotiators, with the stated intent of completing the Doha round before the end of the year. The Obama administration, in line with attempts to reduce the budget deficit, have taken the first concrete step, pledging to slash agricultural subsidies by more than 80% over the next four years.
In related news, France and the United Kingdom agreed to relinquish their Security Council seats in return for an "EU" seat, paving the way for Japan, India and Brazil to join as permanent members, creating a new "P-7" in the Security Council.
These breakthroughs were achieved on the same day that a mysterious chemical attack was unleashed in Washington DC that rendered Bill O'Reilly, Keith Olbermann, Glenn Beck, Chris Matthews, Sean Hannity, James Carville, Paul Begala and Bill Bennett permanently and irrevocably mute.
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