Martin Albrow is a senior visiting fellow at the Centre for the Study of Global Governance at the London School of Economics.

Economic Interests

The global crisis has opened up the issue that has long been dormant in British politics: whether it is in the national interest to be so dependent on the financial sector. In recent years all political parties have effectively signed up to an open borders, globalization agenda that appeared to enjoy sustained success and led to London displacing New York as the top global financial centre. It underpinned the credit boom and housing bubble. Warning signs were disregarded and critics marginalized. Government response to the crisis domestically has been to underpin banks, through public ownership, guaranteeing deposits and insuring against bad risks; to rely on the Bank of England to reduce interest rates and to expand the money supply; to run an ever-increasing budget deficit by easing the VAT; and bearing the costs of unemployment and selective bailout measures. A 30 percent decline in the value of the pound has been accepted in the hope it would reduce the British trading deficit.

These measures have opened up political divides and the Conservative Opposition, which has been directly critical of expanding government debt, has welcomed the Bank of England governor's statements as calling a halt to further expansion. The government's dilemma is that the more it stresses the global determinants of the domestic economy, it draws attention to the limits of domestic policy and to its role in championing globalization over the last 12 years. It rests its hopes on coordinated global fiscal expansion, but the G20 Summit has not provided any sufficient extra boost to what was already in the pipeline, and appears to offer nothing domestically. No one is suggesting any significant structural shift for the British economy is likely, while the banks, though villains of the piece, are now even more central to future recovery.

Political Interests

The summit was about as good as it can get for Gordon Brown. Plaudits came from all sides of the political spectrum, summed up best perhaps in the fact that on April 3 both the left wing The Guardian and the right wing Daily Mail (though adding an exclamation mark) carried the same headline: "Brown's New World Order." The Mail, in its editorial comment, declared, "This has been an impressive week for Mr Brown ... Nor should anyone underestimate Mr. Brown's achievements," though it showed its underlying animus by saying it "could have done with less of the ersatz celebrity trappings." ("Ersatz"? ... Obama, the Queen?) Any criticisms of Brown were largely related to presentation, to his "practised technique of presenting old information as if it were new" (The Times' leading article). Like The Times, Murdoch-owned The Sun put the dagger in with a smile: "While the PM's words may have echoes of movie baddie Dr. Evil, he may yet emerge from the global financial crisis as a superhero." The extraordinarily fulsome tributes to Brown from President Obama were repeatedly shown on television. Even Vince Cable, the Liberal Democrat politician, enjoying the prestige in Britain on the financial crisis equivalent to Obama's in the US on Iraq, has said Brown "deserves some credit for bringing things together."

The paradox in terms of British politics is that the more Brown appears as the global statesman and emphasizes the dependence of British jobs and prosperity on the global economy, the more it highlights his own earlier role as chancellor in positioning Britain in this way. There is a general view that his success at the summit will do little for him in the longer run. The Economist (April 2) goes as far as to say that his power is ebbing irrespective of the summit and opinion polls since show a boost of a mere three points for Labour, still lying seven points behind the Conservatives. Chancellor Darling has lowered expectations by saying the recession will last this year, but prepares us for recovery next - that is, election year. But 13 years of New Labour rule?  The voters will say, "Give us a break."

International Interests

In the run-up to the summit, the main international story was of a tension between Germany and France on the one hand, and the US and UK on the other, on the appropriate amount of extra fiscal stimulus for the global economy and on the degree of regulation the global system needed. This worked around the long-standing theme of the contrast between Anglo-Saxon and European models of capitalism. The story gained headline appeal through President Sarkozy's grandstanding on possible walk outs and the joint press conference he and Chancellor Merkel gave the evening before the summit. Brown fed into the story through repeated calls to combat protectionism, code usually for criticism of the French. This choreography was a net effect of interacting national stereotypes of the other, rather than a reflection of underlying national interest. Evidence from the Fund on overall stimulus when automatic stabilizers are added to special measures suggests the main countries are all injecting around 3 percent extra expenditure and from the Bank that nearly all the G20 countries have taken protectionist measures.

But the appearance of a crafted compromise with the healing balm and blessing of the US president, coupled with genuine cooperation at official level and the fact that the event was in London, combined to strengthen the British self-image of "bridge" between the US and Europe, while being very dependent on both (one walks over bridges). The expansion of the summit to a G20 (plus) helps Britain to go a step further to being what the Foreign Office describes as a "global hub," but caught as it is in the tension between the US and Europe, the UK is likely to find itself marginal to US-Asia or US-Latin American relations, and ever more likely to find itself subsumed in a European bloc. The London Summit is probably the maximum influence the UK will ever exert on international relations, but as we move away from zero-sum games to an interdependent world, that should not reduce its international engagement, nor indeed its dependence on and contribution to an ever-developing system of global governance.

Global Leadership

The summit has done an enormous amount to dramatize and portray for its public the UK as having a central role in a global community of nations. The theatre of Buckingham Palace receptions, of Michelle Obama in a London school (of the nine-page coverage in the Daily Mail, she was pictured in six of them) and of group photographs gained more attention than the substance, but at the same time needed the substance to match the imagery: for example, "rewriting the rules of capitalism" (Daily Mail) and "the G8 is now eclipsed by the broader G20" (The Daily Telegraph). The tabloid Daily Mirror's opening front-page sentence: "Gordon Brown and Barack Obama last night emerged triumphant from the G20 Summit with a $1 trillion global rescue deal has the general effect in a nutshell." The Times grudgingly applauds, "Its achievements were predictably modest, but it was not in vain." Mary Dejevsky in The Independent says, "Britain has a future as host to the world," but on its front page the paper's headline is "Obama hails the new world order," with subtext "Markets roar after President brokers "historic" G20 deal between world leaders to bring end to recession."

Broadly, while there were comments about how the summit in itself would not solve the crisis, there was an acceptance that it was an effective and intrinsic part of bringing the world together in a common cause. The expense and the logistical complexity, while noted, never became prominent issues, except in so far as they testified to the importance of the occasion. In the UK it signalled the debut of the new multilateral presidency of the United States, a new kind of leadership and a British hosting of the global community of nations. Obama's media skills made this kind of summit, pageantry with purpose, a perfect vehicle for global leadership.

London