Former German Chancellor Schmidt says G-8 Summits have been outlived by reality, Calls for action against Caribbean Hedge Funds

June 7, 2007 (LPAC)--In an editorial for the weekly Die Zeit , published today on the occasion of the ongoing G-8 Summit in Heiligendamm, Helmut Schmidt writes that the first few such summits, after he and France's President Giscard d'Estaing invented them in 1975, still had the format of an in-depth discussion. Today, they have degenerated into a huge media show, and the fact that such a complicated issue like global warming has been moved to the center of the summit, with the helping hand of the fear-mongering media, is just an indication of the summit crisis.

The format of the summit must change, to include important countries like China, India, Brazil, South Africa, and oil-producing countries like Nigeria and Saudi-Arabia, Schmidt writes. It is an illusion to think one can discuss the "world economy" without inviting the developing countries, he adds. The "transatlantic economic zone" which the present German Chancellor Angela Merkel is pursuing, is an unrealistic dream, that idea was already past history 30 years ago, Schmidt writes.

And lastly, the volatility of the global financial markets should be a prime concern at such summits, Schmidt writes. The liquidity bubble is "lethal," because "you can shovel this money back and forth, one can cancel all short-term loans out of fear and thereby cause a recession. In order to prevent such a fatal development, the big economic powers must bring the wildly growing financial markets under control. They must isolate all the islands that are free from taxes and supervision. It were possible to dry out all the Caribbean tax havens through American, German or English legislation. So far, however, this has failed, because especially America and England think that their short-term benefits are more important than the danger of a systemic collapse. I have, as already stated, no big hope that the G-8 summits will achieve much in this respect. But it would be necessary, bitterly necessary."