This is a serious effort to get a new mandate for global economic governance, one that combines the power of capital with the legitimacy of population.
This formula brings China into the list of stake-holders and could be of immense importance for the shaping of world economic policy. We will have to see whether the Germans are prescient in their demands for a simplification of the number of international groupings - implying prominence for G20. Schroeder has led the public calls for the inclusion of China.
This also shapes the politics for those of a multi-polar global economy.
As for Summers' proposed reforms to the IMF they look entirely reactive to me.
The problem for the IMF as the Asian - Russian - Brazilian financial instability of 1998 showed, was that the volume of short term financial movement is massively larger than any IMF fund can buffer. It only just protected Brazil. The attacks in the Senate on its failure to prevent Russia defaulting, are manifested in detective work about how the money went into overseas private funds, many of them back in New York. But this is epiphenomena. The Russian default exposed the fact that IMF funds often at best stabilised an economy only long enough for financial creditors to get their money out.
The new attention to trying to separate the functions of the IMF and the World Bank again does not analyse why they came to be so closely aligned in the administration of sadistic neo-liberal remedies imposed on third world economies.
That is because the processes of uneven exchange in the world were so powerful that the World Bank was often the only significant agency able to offer an extension of international liquidity to the poorest countries. In the last ten years there have been signs of some embarrassment at the crudity of its harsh medicine, but this and calls for periodic debt "amnesties" do not address the fundamental problem. They are that one of the fundamental laws of capitalism functions on a global scale: the larger the accumulation of capital, the larger the reserve army of labour. The latter concentrated in the poorest countries in which workers are pouring off the land into vast conurbations.
If the implication of Summers' proposals is that the IMF should concentrate on a more limited role of the stabilisation of "world money" (to use Marx's term) then it is going to have to address issues about the volatility of financial movements. If the World Bank is to concentrate on serious development it is going to have to have a source of revenue bigger than that grudgingly given by the capital-rich countries.
We will see how nervous the leading representatives of global finance capital have become about the loss of their mandate. TINA is no longer acceptable.
If the G20 gets greater prominence I predict we can expect China to use its economic and political leverage increasingly shrewdly. Rethinking whether the IMF is traditionally headed by a European and the World Bank headed by a US American is the least of the exercises in thinking the impossible that the leaders of capitalism will have to go through in the next ten years.
Chris Burford
London