Blaming China won’t heal G7 internal woes

The G7 summit on Friday and Saturday is bound to witness sparks flying.

Clues can be found in the just concluded meeting of G7 finance ministers, which was filled with anger and finger-pointing. Being caught in the tariff dispute, European nations lashed out at Washington. Some did not forget to mention China. “The G7 ought to collectively tell China to follow global rules,” Japanese Finance Minister Taro Aso claimed.

Take a look at the chaos in G7 member states: Does it have anything to do with China?

Take Italy. The new populist government proposed an ambitious roadmap to spur the country’s stagnant economy, but Brussels sees it as a horror plan. Given Italy’s economic recession with its debt reaching 132 percent of its GDP – the highest in the eurozone after Greece – observers suggest that implementing the program will lead to huge fiscal expenditure, threaten the financial stability of the eurozone and trigger a new round of debt crises.

Does Italy care? Rome wanted to exit the EU long ago anyway. Quitting the bloc won’t help fix problems such as growing unemployment, an economic downturn and the rise of populism. Those were created by the nation’s declining competitiveness and governance capacity, an issue that bedevils not only Italy but also quite a few Western nations.

Friction is escalating between Washington and Brussels. Most annoying for the EU was the US withdrawal from the Iran nuclear deal and its ultimatum to its European allies to cease business with Tehran. Thanks to US metal import tariffs, the G7 will be divided. “It will be a G6 plus one,” said French Finance Minister Bruno Le Maire.

Contradictions between the US and Japan are no better. After the White House in March announced global tariffs on steel and aluminum, it offered temporary exemptions to some economies like the EU, Canada and South Korea. Japan was not included.

G7, the rich countries’ club which is supposed to better promote development of Western economies, is now all dog-eat-dog.

Why? The Great Disruption: Human Nature and the Reconstitution of Social Order by Francis Fukuyama may provide an answer. The book suggests that Western countries are suffering from a shortage of social capital, meaning a “set of informal values or norms shared among members of a group that permits cooperation among them.”

It is those shared norms that facilitate one’s trust that another will act reliably and honestly. This is related to the question of governance in the West.

In today’s Western world, individualism has triumphed over community. Faced with crises and divergences, people and nations tend to care about nothing more than their own interests.

The Yomiuri Shinbun newspaper recently published an article suggesting the world has entered a competition between the “free and democratic system” and the “new Chinese system,” calling on Japan, the US and the EU to unite in competition with Beijing. The challenges were not created by China, but all they tend to do is shift their attention toward Beijing.

But Western democracies should figure out their own problems first, instead of talking about competing with China.