G-8 members are meeting this May against a backdrop of one of the worst global recessions in history, and the best course of action for recovery is the hottest topic up for discussion at their summit.

The countries’ leaders need a meeting of the minds to figure out how to boost their sluggish economies, but economists say many factors are dragging down growth. For starters, the United States and Europe have a sensitive symbiotic economic relationship, which continues to upset the slow improvement.

“Whenever bond markets have a suspicion that these political responses are insufficient, you get increasing spreads and high volatility.  I do expect this (slow growth) to continue for quite some time,” said Francisco Torralba, a Morningstar economist.

“This takes many quarters for it to be clear for everyone. The more austerity you have, the less growth, then the more unemployment, and tax revenues decrease, so the debt hole increases,” Torralba said.

Recovery in the Eurozone presents a special problem because of its distinction as a group of individual economies trying to come to a consensus before making major changes, such as hammering down an acceptable austerity program.

“They’re bickering about the size of it,” said Martin Edwards, associate professor of international relations at Seton Hall University.  “External observers are saying, ‘The point of creating this reserve is to make it so damn big that you can’t use it.’

If one country had a financial hiccup, he said, the EU could easily handle that kind of austerity agreement, but when multiple countries are in trouble, and because EU member countries have to make decisions collectively, it can become a long debate about who would get more or less money.

As an example, he said, the German public is getting weary of lending money to help other countries. “The bill is effectively becoming due for Germany. They’re dragging their feet, which is obviously a problem.”

A push for fiscal union in the EU – austerity agreements are only one example of that – is not new.  But now, Edwards said, European institutions such as the European Central Bank and the IMF aren’t creating incentives for countries to keep their sovereign budgets down, which is stifling any movement forward.

Member countries are currently allowed to handle their own fiscal policy, and some are choosing to cut sovereign budgets as a short-term fix.  Torralba said this presents a problem.

“Spain in particular has chosen to implement the fiscal austerity goals that are far too aggressive,” he said. “They’re just damaging to the economy in the short term,” he said, adding that a timeline of 10 years instead of three for Spain to reduce its deficit would be more realistic and less damaging.

He explained Spain and other countries leave many fiscal decisions to regional governments, and it can be slow-going to have these smaller decision-makers look at the bigger, global economic picture when global financial groups ask them to.

The slow recovery also calls into question the viability of global financial institutions in their current state and under the current leadership. Though the IMF has been traditionally headed by a European and the World Bank by an American, Domenico Lombardi, senior fellow at Brookings, said perhaps we will see a regime change as emerging markets such as China, South Africa and Brazil gain more stake as their economies grow.

“They can express very good candidates,” Lombardi said. “There’s no reason why the U.S. or Europe would need to keep that monopoly [on those institutions]. The other regions are capable of having a good candidate.”

“In the best scenario Europe will be in a convalescent phase for the next several years,” he said. “Europe will go into a slight growth or very moderate growth.”

If things take a turn for the worse, however, Torralba said there could be some shakeups in terms of which countries actually remain in the Eurozone.

“If there was a big surprise meltdown [that] involved Spain, Italy or both defaulting or leaving the Eurozone, that would be a big shock.  I would expect growth to slow down, possibly have a mild recession in the U.S., but that’s only in the worst-case scenario in the Eurozone. In the absence of that, I think the impact of what’s happening in the Eurozone is not going to be much bigger or smaller,” he said.

G8 leaders may duck serious discussions on controlling a major source of pollution that includes black soot from cooking fires, methane from dairy farms, and gases released from aerosol cans.  Such talk is uncomfortable because it can appear to shift responsibility for climate change away from industrialized nations and onto poorer, have-not countries.

These hazardous emissions, called “short-lived climate forcers,” are thought to account for nearly one-third of current global warming.  Discussions at the G-8 summit could be the catalyst for policy makers to address climate change and related fundamental international issues, but many scientists and government representatives believe the conversation won’t happen, because of the issue’s sensitivity and a perceived lack of immediacy.

Short-lived climate forcers first entered serious public discussion in February 2012 when Secretary of State Hillary Rodham Clinton announced a global initiative to limit these pollutants and their negative effects on health and the environment. The international effort included the United States and its partners in The Climate and Clean Air Coalition to Reduce Short-Lived Climate Pollutants: the United Nations Environment Programme, Bangladesh, Canada, Ghana, Mexico and Sweden.

The reasons for eliminating these emissions go beyond the environment.

“Some of the interest in short-lived climate forcings is related to non-warming issues,” said Richard Alley, Evan Pugh Professor of Geosciences at Penn State University and contributor to the United Nations Intergovernmental Panel on Climate Change.

“Reducing black soot from small cooking fires by switching to solar cookers can help the health of people who now breathe the soot,” Alley said. The World Health Organization estimates that 3 million premature deaths are caused by urban outdoor air pollution and indoor air pollution every year.

Emphasis on arctic vulnerability is another reason for action, said Jennifer Morgan, director of the Climate and Energy Program at the World Resources Institute. When black carbon lands on sea ice, the dark color causes heat retention and therefore faster melting.

These pollutants also threaten food security, as they reduce the growth rate of crops like wheat and maize, added Kaveh Zahedi, climate-change coordinator at the United Nations Environment Programme, who is optimistic about potential dialogue.

“My understanding is that short-lived climate pollutants have generated quite a lot of interest and may well come up in the G8 summit,” he said.

For discussions about these pollutants to be successful and well-received, however, the United States must emphasize the continued threat of CO₂ emissions to global warming. Otherwise, the G8 host could be seen by other summit partners as a continued drag on international efforts to address climate change. Its allies in Europe, for instance, have worked hard to reduce “all kind of gases that cause climate change,” said Issac Valero-Ladron, spokesperson for Connie Hedegaard, the EU Commissioner for Climate Action.

“We are talking about the U.S. being the second largest polluter in the world,” he said “I think it’s important that they take their share of responsibility.”

After all, the short-lived nature of climate-forcers means we can deal with them at any time, Alley said. While “delaying action on CO₂ now means much sharper cuts in CO₂ in the future.”

Zahedi said this is well understood by coalition partners.

“We have to deal with both,” he said. “If we don’t act on CO₂, in the long term we will not have made a difference to temperature increase.”

Understanding short-lived climate forcers:

To understand how these pollutants influence the atmosphere, you can think of cooking a bratwurst on a barbecue heated by matches and charcoal briquettes, Alley said.

“The matches flare up fast, but burn out fast; the briquettes last longer,” he explained. In this scenario, the matches are the short-lived climate forcers, while the briquettes are CO₂. Like the matches, the methane’s influence is short-lived, while the briquettes (symbolic of carbon dioxide) last much longer.

In reality, the methane and the CO₂ have much larger time scales. Short-lived climate forcers stay in the atmosphere between a few days and a few years, while carbon dioxide can influence climate for roughly 100 years.