G20

David Cameron is now in Seoul for the first G-20 summit hosted by a non–G-7 member state. It will be the Prime Minister’s second G-20. But things have changed dramatically since he came to power and had to jet to Toronto for his multilateral baptism. Then the Prime Minister’s arguments for austerity measures were theoretical - and a minority position. Now, they are real and have become the majority view. “Camerkelism”, the idea that short-term fiscal consolidation will induce sufficient private-sector activity to more than fully offset the fiscal drag seems to be in the ascendant. Yet the forced smiles at the traditional G-20 class photo will belie a number of continuing problems. The biggest issue will be about the Chinese exchange rate.

As Ben Brogan notes, there was a clean symmetry to David Cameron’s speech this morning: the crisis was Labour’s fault; therefore, Labour is to blame for the painful measures needed to restore stability. As Cameron put it: ‘I think people understand by now that the debt crisis is the legacy of the last government. But exactly the same applies to the action we will take to deal with it.’ Cameron made constant reference to the actions of the ‘previous government’. As a foretaste of what the Independent Office for Budget Responsibility will expose, Cameron alleged that Alistair Darling withheld estimates that Britain will be repaying £70bn per annum in debt interest by 2015.

George Osborne’s Asia trip has now been rounded off with a meeting of the G20 finance ministers in South Korea and he is now heading back to Britain and his Budget preparations. The trip must be marked up as a success for Osborne. In its communiqué, the meeting implicitly endorsed Osborne’s two major moves since becoming Chancellor, cuts this year and the setting up of the Office of Budgetary Responsibility:  ‘We welcome the recent announcements by some countries to reduce their deficits in 2010 and strengthen their fiscal frameworks and institutions’ No one can doubt that the Tories have comprehensively won the argument for in-year cuts.

Patrick Wintour has an insightful article in today's Guardian, setting out how and why Brown has dithered when it comes to deploying the c-word.  So far as the current landscape is concerned, this passage is particularly striking: "There is tension between Brown and Darling on how far the campaign can be based on Brown's achievements in saving the world economy, and how far it must be based on visions of the future. Brown's determination to dwell on the fact that he made the correct big decisions in the recession has been one cause of his past reluctance to address the future deficit mountain, and how to deal with it.

Most of Fleet Street might have abandoned Gordon Brown but judging by today’s editorial the FT, along with the Mirror, will be with Brown to the end. In its editorial today it praises Brown’s “prudent suggestions” for the G20 meeting. It goes onto say that “the G20’s aim should be to provide political cover so that governments – including the UK’s – have the room to continue running large deficits, if sustainable growth should prove to be further away than hoped.” Then, bizarrely, it goes onto say that the “prime minister faces both ways on bankers’ bonuses” as if this is a good thing.