Begun in 1975 by the leaders of the seven largest industrialized democracies (the United States, France, Germany, Britain, Italy, Canada and Japan), economic summits tend to get much attention while producing little real progress.
Usually, the major players huddle in corners and try for a better understanding of each other while aides write communiques calling for such perpetual truths as free trade, economic growth, an end to terrorism and drug-money laundering, and help for poor, debt-ridden nations.The summit in London this week confronts a bigger challenge. It must decide how much help to give the Soviet Union without sacrificing the fledgling democracies in Eastern Europe. Sending Mikhail Gorbachev away empty-handed would also weaken his leadership at home at a critical time.
The crucial issue is the proposed transition for the Soviets from a totalitarian state to a market economy. Yet the reality is that most Soviets know nothing of the most simple banking practices or inventory management, let alone how to run a corporation or set up a franchise.
One thing is certain - talk of a "grand bargain" - meaning economic help in the neighborhood of $25 billion to $35 billion per year over the next five years - is just that - talk.
Clearly, the United States, Japan, Britain and Canada oppose aid anywhere close to those amounts. They argue that the money would simply be wasted until the Soviets make more progress in transforming to a free-market economy.
Soviet officials have said Gorbachev is hoping at the very least for $10 billion to $12 billion to help convert the ruble to a hard currency. Such a fund would be used to curb wild swings in the value of the ruble as the Soviets transform it from a currency virtually worthless outside of the country to one that can be exchanged for the dollar and other currencies.
Making the ruble convertible is a key demand of Western business executives who now must use complicated barter systems to get any profits on their Soviet operations out of the country.
If economic help is given now, this is the plan that makes the most sense, because it would immediately encourage Western businesses to establish operations in the Soviet Union.
The most likely result of the summit is a foot-in-the-door to global capitalism symbolized by an associate membership for the Soviet Union in the International Monetary Fund.
A sort of fiscal halfway house for the beleaguered Soviet economy, it would allow the Soviets to tap into the tremendous pool of expertise the IMF has on how to fix an ailing economy.
It is a wise first step, but the Big Seven should seriously consider bailing out the ruble as well. It is an absolute need if the market economy is ever to materialize in the USSR.