It’s been 13 long months since the leaders of the G8 gathered for their annual talkfest. I’m sure the details of last year’s communique are etched into your brain but just in case you’ve forgotten what was agreed in Heiligendamm, here’s a reminder. “We noted,” the G8 said, “that the world economy is in good condition and growth is more evenly distributed across regions.” This was June 8, 2007, two months to the day before the entire global financial system came to a shuddering halt.

If you like your humour black, it’s rather funny isn’t it? But wait, because it gets better. The communique expressed confidence that there would be “a smooth adjustment of global imbalances which should take place in the context of sustained and robust economic growth”. Glad to see, then, that there was no risk that the US sub-prime mortgage crisis would prompt what the IMF has called the biggest shock to the global financial system since the Great Depression.

In fact, the G8 had nothing to say about housing bubbles at all, though it did find time to discuss the need for a settlement between Armenia and Azerbaijan over Nagorno-Karabakh. And so it goes on. The G8 managed a cursory glance at what hedge funds were up to and decided that — on balance — there was nothing really to worry about. “While noting the positive contribution [sic] of hedge funds to financial-market stability, we also want to minimise systemic risks by increasing transparency and market discipline on the part of all parties involved.”

These are the same cuddly hedge funds, presumably, that have been in large part responsible for driving up the price of oil and food on commodity markets, to the point where the “good condition” of the global economy is threatened by stagflation and hunger? As one hedge fund manager, Michael Masters, told a Congressional hearing in May, speculation in commodity futures has increased 20 times in the past five years and during that time the price of a basket of commodities has risen by 183%. The increase in demand from speculators, Masters said, had been almost equal to the increase in demand from China.

The G8 has more on its plate than simply a bog-standard cyclical economic downturn at the end of a prolonged period of low inflation and strong growth. In addition there are

three other meaty issues to consider: the threat of climate change; the threat that the global economy may soon be facing shortages of two vital resources (oil and water), and the parlous position of many of the world’s poorest countries as they grapple with the effects of global warming and rising food prices.

If the G8 was doing its job properly, this week’s communique would be rather shorter than usual. It would say the world is about to be battered by a triple crunch of a credit-fuelled financial crisis, galloping climate change and — even in the absence of speculation — a long-term increase in energy prices caused by the imminence of peak oil.All this requires more than just the tired old business as usual nostrums. On the last two occasions the global economy reached crisis point — in the 1930s and 1970s — there was radical change. It is worrying and depressing that there is an intellectual vacuum when there ought to be a plethora of ideas about how to dig ourselves out of this hole. — The Guardian