THE only moment of disquiet in the love-fest being played out for the international media in Washington DC has been the cold shoulder Prime Minister Kevin Rudd received from US President George Bush.
History won't give a tinker's cuss about this petty interlude, although it might provide a useful aside to the haste with which the much-vaunted — outside the US — G20 conference was convened and conducted.
But, short of a miracle, the entire gabfest will be remembered as much ado about nothing. For Rome is burning, and the US power elites are looking at the coming week as defining the future of manufacturing, employment and retail sales as the housing credit crisis become just a memory.
Here are a few of the facts that have driven G20 from the US commercial consciousness.
General Motors and Ford may file for bankruptcy this week. The question being debated is just how bloody this will be, when it comes.
Ominously, Bloomberg has reported that GM may have to file for Chapter 7 bankruptcy, meaning it will be forced into liquidation, not reorganisation. Even Chapter 11 is risky enough in this environment.
The New York Times, relegating G20 to the back of the business pages, reported millions of jobs being at stake "if any of Detroit's three largest auto makers file for bankruptcy".
Detroit car companies are facing extinction — but while president-elect Barack Obama suggests a bail-out plan for the industry, Washington is determined to dither. The Republicans still have lame duck powers to crush any plan to bolster the car industry — and have promised they will.
Wilbur Ross, 70, the investment genius dubbed the "King of Bankruptcy" by Fortune magazine — a man who made billions through saving US steel and other companies — said at the weekend a Chapter 11 filing by General Motors or another US car maker will not be pretty.
Going to court to reorganise would be "a very inhospitable environment for any of these guys", he warned.
Ross, in an interview with Bloomberg, said a restructuring bid by one of the three top US car makers would topple its peers and drive weakened suppliers out of business because the credit crunch had dried up financing.
"If we were in a different overall economic environment, one of them going down wouldn't necessarily kill the industry," he said. But with the economy weak and debt markets frozen, the bankruptcies would not be an option, with a Chapter 11 filing for reorganisation resulting in liquidation instead.
GM, Ford and Chrysler have asked for $US25 billion ($A39 billion) in bridging loans to stay alive. Legislation is being crafted by Democratic Senator Carl Levin and Representative Barney Frank, but the Bush Administration opposes tapping the $US700 billion financial rescue package for the car makers.
Another far different set of facts comes from Credit Writedowns, and concerns unemployment. It predicts a "deep, deep recession" coming to the US: "Raw continuing claims came in at 3.45 million, another business cycle high. Seasonally adjusted continuing claims of 3.9 million puts the four-week average at 1.2 million above the level this time last year. The 3.9 million number is a new 25-year high."
Retailers are the latest to see the effect as spending plummets and even the most solid firms like JC Penney are having their shares sliced and diced.
As Asia Times noted: "To counteract the decline in their net worth, Americans will try to become net savers from being net spenders. This will push the economy further into a recession: this is why comparisons to the Great Depression of 1929 are apt."
All of this means that America goes where it must, and there is no possible point in continuing to pretend that such massive historical forces can be displaced by the heroics of Rudd, British Prime Minister Gordon Brown and all the other world leaders whose travelling press crews seem to be reporting from another planet.
Reuters has been reporting with monotonous regularity that Australia has been in a "coalition of the willing" with the US, Canada and Britain to derail European efforts to introduce meaningful prudential reforms.
While our nightly news refers to the G20 as "a meeting of the world's most powerful nations", the New York Times, concerned perhaps with matters like GM, buried the event in the Washington section of the paper. Its coverage began: "Leaders from nearly two dozen countries, large and small, converged here Friday …"
Travel is meant to broaden horizons but can as easily narrow them — especially if pundits are far from their regular turf and being led by the nose.
Australia is 12 to 18 months behind the US — that is, we are intellectually where the US was more than a year ago. But we will catch up a lot quicker. As we enter the new year, grim reality and merciless fact will come knocking.
The gap between perception and truth is widening, and while in the '30s travel and communications made for confusion and abject mistakes in policy making, our misunderstanding seems more wilful today.
