The G20 (or Group of 20), convening for the next two days in St. Petersburg, is a collection of representatives from the world's leading economies, representing approximately 85% of global GDP and tasked with coordinating global economic policy. Reaching its heyday during its response to the 2008 financial crisis, the G20 has grown in an era of lax global governance into a public forum for a variety of issues — from climate change to human rights — in addition to its traditional role of tracking the world's economy. As today's summit convenes in Russia, the group of twenty will be negotiating and gossiping about Syria, LGTB rights in Russia, and more. Let's hope they don't forget about the global economy, the thing this meeting is supposed to be about.
The most controversial thing about the G20 is that fact that it sits outside the official Bretton-Woods framework for international governance that was set up after World War II. The United Nations, which first and foremost was meant to be a collective security organization, was motivated by the urgent need after WWII to set up an international system that checked international aggression. We can quibble over how effective the UN has been in carrying out its mandate (perhaps it helped keep the Cold War "cold," but the past 50 years have hardly been bloodless), but it never foresaw a need for consistent coordination of global economic policy. The International Monetary Fund, World Bank, and World Trade Organization, the three Bretton-Woods institutions which do cover economics, are more geared towards encouraging third-world economic development and adjudicating occasional trade disputes.
By the 1990s, it was clear that there was a need for high-level economic coordination between the world's leading economies. Financial crises set primarily in Asia and Latin America were shown to have global ramifications. The G-7 came first in the early half of the decade, a collection of mostly Western developed economies, which soon expanded to the "G-8" when Russia was invited to join the club. By the late 1990s, the group grew to its current 20 members.
To give you an idea of how separate countries economic policies can have ramifications across the globe, look at current expectations that the Fed will be easing off its current monetary policy of low interest rates. As interest rates in America rise with the recovering economy, global investors will begin putting their money into American bonds and financial markets, which is good — for us. Developing countries like Turkey and India, which have been on the receiving end of a lot of this investment for the past couple of years, stand to lose billions as investors put their money back into developed economies. Add to all this controversies like keeping the dollar as a global reserve currency, international tax evasion, and the global phenomenon of financial institutions that are "too big to fail," and there's a lot for the G20 to talk about today and tomorrow.
Unfortunately, because other global institutions such as the UN Security Council are seen as so ineffective at carrying out their own separate mandate, conversations that are best reserved for those forums stand a good chance of dominating G20 deliberations. We will be hearing a lot about Syria, as Putin scores Chinese support against a U.S. intervention. We will be hearing about LGBT rights in Russia, which will also be holding the controversial Winter Olympics. There are many important issues facing the international community — the aforementioned not least among them — but they can only be properly addressed in the proper forums.
Most commentators single out 2008 as a high-water mark year for the G20, when it sprung to action coordinating a global response to the financial crisis, instituting policies meant to spur global demand without forcing poorer countries into bankruptcy. As the crisis faded, nothing like that level of cooperation and effectiveness has been seen since. We will not resolve 2013 global issues by cannibalizing the few effective venues we have for global governance. I'm always up for a debate over how to fix the Security Council, but in the meantime, let's not expect the G20 to fix all of our problems.