Putting the Covid-19 pandemic and the climate change at the center of the Rome’s G20 agenda was a diversion from the organization’s core concerns.

A quick reminder will clarify that puzzling forum attribution.

The G20 (an organization of world’s 20 largest economies) was created in 1999 as a talking shop of finance ministers and central bank governors in the wake of several major financial crises: the Mexican peso crisis (aka “tequila crisis”) in late 1994, Asian financial crisis in 1997, Russian financial crisis in 1998, and a bankruptcy of LTCM, a large U.S. hedge fund, in 1998.

The upgrading of the G20 to the level of summits of heads of state and government was initiated by France and the United Kingdom, and its first meeting was held in Washington D.C. on November 14-15, 2008, to discuss the rapidly advancing global financial crisis.

Ever since, the G20 summits have dealt with key issues of global economic and financial management, with particular emphasis on international economic policy coordination to promote a sustained and balanced growth of world economy.

G20 was a wrong forum

In view of that, the focus of the G20 meeting in Rome on October 30-31, 2021, on issues of Covid-19 vaccines and carbon neutrality is rightly considered as a short shrift to problems of world’s accelerating inflation and seemingly uncontrollable global debts and deficits.

One may indeed wonder whether the G20 summit had to acknowledge the fact of a raging pandemic, and to acquiesce in the evidence of failure to stop the global health crisis.

After two years, 70% of people in developed (i.e., rich) countries have had at least the first dose of Covid-19 vaccines – while such protection was offered to only 3% of the long suffering third-world population. Despite that, the rich countries’ leaders maintain their empty pledge to have 70% of the world population vaccinated by the middle of 2022.

That sad truth was fully known to participants of Rome’s expensive jamboree – skipped by Russia and China -- underwritten by overstretched public finances. The rich countries also know that they must make vaccines and food available to sick and starving people in developing nations. Instead of that, they continue to play shockingly discriminatory vaccine games, and callous vaccine trade fights in their geostrategic confrontations.

Think of this: The German Covid-19 vaccine manufacturer BioNTech (partnering with Pfizer) complains that it cannot sell one billion of its vaccine doses in China – when the EU won’t even consider allowing the use of Chinese, let alone Russian, vaccines by its health agency.

An even more grotesque story was a G20 discussion of climate change, while a two-week separate conference (COP26) was opening up in Scotland to conduct an expert investigation of the measures needed to forestall the devastating impact of global warming.

What is going on here?

The same old problem: the rich countries – the U.S. and the EU – had to find popular discussion topics, such as pandemic and climate change, because they could not agree on apparently boring and “stale” issues of international economic policy coordination to maintain a steady, sustained and balanced growth of the world economy.

Rising inflation always leads to recession

That is regrettable because a growing economy is essential to managing the global health crisis, and to profound restructuring, in the decades ahead, of the economic and social systems to reach carbon neutrality by the middle of this century.

A tall order indeed for the G20 going their separate ways – a distressing development witnessed even within a tightly integrated and controlled EU community.

And yet, the West could have tried to see how to deal with inflation – the universal growth breaker, and the one problem the trans-Atlantic world had in common.

But all they found there was to blame Russia. They claimed, incorrectly, Moscow’s gas price manipulations. That was safer than accepting that West’s inept energy policies were causing their soaring inflation rates -- 5.4% in the U.S. and 4.1% in the euro area, at the last count. They also complained that Russia and Saudi Arabia were playing havoc with their energy prices because they refused to flood world markets with oil supplies.

Meanwhile, ignoring inflation, the U.S. and the euro area continue to float massive issues of public debt -- instantly and generously monetized by their compliant monetary authorities. And then they argue, against all the evidence and the basic laws of economics, that the currently rising inflation pressures are transitory and reversible events.

So, nothing to worry about, they say. Just be patient. The U.S. and the euro area official money managers are urging that it may take time, and a period of high inflation rates, until the economies come back to price stability.

Here is what that means: On current U.S. and euro area economic policies, that transition period covers an inflation-induced recession of ex ante unknowable amplitude and duration.

Head for the hills?

It may look that way. Biden’s declining poll ratings, the looming mid-term Congressional elections (November 2022) and Trump’s quest for an election re-run will immensely complicate America’s uniquely difficult economic outlook.

Apart from that, one must hope that calm and wisdom will prevail to keep the volatile security situation in the South China Sea, and a grinding civil war in Eastern Europe, from spreading to wider and irretrievable military confrontations.