The article follows a week when the Liberal Party again tore itself apart on climate change, ending with a bizarre op/ed from Tony Abbott (the frontbencher who won’t comment on Indigenous housing – core to his shadow portfolio – because of an embargo from the publishers of his book). Abbott recited all the old denialist saws about “cooling”, but in the process called on the opposition to pass the government’s CPRS because the Coalition needed clear political space to concentrate on its economic message.

But what is that message? There isn’t one. It’s an entirely oppositional stance – repeating the mantra of “debt and deficit” at every opportunity. The Liberals gave up even trying to articulate an economic policy, hoping – as Shaun Carney observes in an acute analysis – that the economy would hit rock bottom and that they would resume their rightful place as natural “economic managers”. As Carney observes, economic credibility isn’t a given, it has to be established. That groundwork has not been laid. And, if things turn out not to be as bad as everyone was predicting, the Coalition is left without any political strategy whatever.

But, anyway, the lame duck President made his ritual obeisance to the virtues of American leadership and the glories of the free market. One imagines there’s some personal and political imperative there, but the reality of his governance is better disclosed in the fate of the TARP funds which Treasury Secretary Henry Paulson was given by Congress – it appears that crony capitalism and socialism for the rich is the name of the game according to American blogs such as naked capitalism, Obsidian Wings, firedoglake and naked capitalism again.

But Bush will soon be fading into history, and Barack Obama sensibly declined to act at the summit without executive authority, so what emerged from the G20 is more in the nature of a directions statement for the way forward, as The Big Picture foresaw:

Hopefully, a long term agenda for regulatory cooperation and communication can be set with the next meeting’s agenda decided upon. Far better to talk then not, but no real decisions will come out of this meeting. There will be gnashing of teeth and venting of rage at the mess that excess securitization has created, and the international regulation of and accounting for such derivatives will probably be a focus.

Planet Money looks at what transpired, and links to the text of the communique here. SocProf is right, in my judgement, that we’re seeing the eclipse of the Washington consensus, but the shape of what will replace it is still a work in progress, and some yardsticks to measure the work of the G20 have been provided by the Guardian. Bretton Woods itself was the culmination of some years of intellectual work and economic diplomacy, and if there is to emerge something we might call Bretton Woods II, it isn’t a bad thing that the interregnum in the US presidency implies that decisions won’t be made on the run.

In forming a judgement on what does emerge, I think we as global citizens could do worse than to keep in mind the choice posed by one of FDR’s brains trust in 1932, Adolf Berle:

Between a political organization of society and an economic organization of society, which will be the dominant form?

Elsewhere: Peter Martin has helpfully posted a link to John Quiggin‘s presentation on how the global financial crisis transpired, which should provide some necessary context.