You knew it was coming. From the German Chancellorette:
Mrs. Merkel has exerted discreet but stubborn leadership in Europe to prevent the kind of overspending that could lead to inflationary pressure on the euro.
It is not, she pointed out, simply a philosophical difference. Borrow and spend today, repay down the road, is a particularly difficult proposition for a country with a shrinking population, she said.
“Over the next decade we will undergo a massive demographic change, and, therefore, borrowing is a greater burden for the future than in a country with a much more continuously growing population, as in the United States of America,” Mrs. Merkel said.
She’s halfway there. What Frau Merkel is missing is the link between demographic decline and Euro-sized government (of the kind Obama is introducing here). I’ve written about the demography of stimulus in the forthcoming NR, but, if there was any point to this G20 summit, they’d be factoring in things like median age to their GDP projections. (When it’s 43 and heading north, as in Germany, Japan and Italy, long-term GDP growth becomes all but impossible.)
Instead, like the poltroons and poseurs they are, they’ll be wasting everybody’s time by demonizing tax havens and calling for global financial regulators.