---------- Forwarded message ---------- Date: Sat, 22 Nov 1997 16:42:22 -0500 From: Eric Jackson <[EMAIL PROTECTED]> Reply-To: [EMAIL PROTECTED] To: [EMAIL PROTECTED] Subject: C4LDEMOC-L: **Star: Few reap benefits of global trade push By C˙ arol Goar <Picture>November 22, 1997 By Carol Goar]> Few reap benefits of global trade push THERE HAS TO BE an explanation for the puzzling gap between the strong economic recovery that Canada's politicians and business leaders are celebrating and the profound sense of insecurity that millions of Canadians feel. Statistics don't help. There are numbers to back up either reality. On the positive side, Canada is enjoying the strongest economic growth of any major industrial nation. We have a healthy trade surplus; low interest rates; minimal inflation; and a smaller government deficit, in proportion to our size, than the U.S., Britain or Japan. But in many homes, it's hard to tell these are boom times. In the first six months of this year, workers' incomes failed to keep pace with the cost of living. Job creation has stagnated, after a brief summer upturn, leaving the unemployment rate at a painfully high 9.1 per cent. And every week brings new reports of layoffs. The Ontario government has cut more than 14,000 civil service jobs since it took power. Bell Canada has laid off 12,000 em- ployees in the past two years. Inco just announced that it plans to chop 500 employees. No workplace seems immune. Jobs are being slashed in factories, mines, schools and hospitals. ployees in the past two years. Inco just announced that it plans to chop 500 employees. No workplace seems immune. Jobs are being slashed in factories, mines, schools and hospitals. It is almost as if there are two economies - one for global high-flyers and one for ordinary citizens. That is exactly the conclusion of a study just published by the New York-based Council on Foreign Relations. The culprit, it says, is globalization. While trade enriches nations, the council acknowledges, ``global integration may not benefit middle-class citizens as a group.'' To move further toward a barrier-free world economy, the study warns, ``may not be democratically supportable.'' Until recently, these kinds of sentiments were confined to left-wing groups. But the 76-year-old Council on Foreign Relations is as mainstream as they come. It is a highly respected, non-partisan, non-ideological think-tank. Nor is it just academics who are questioning the wisdom of globalization.˙ President Bill Clinton suffered a humiliating setback earlier this month when his own party, reacting to public pressure, sabotaged his bid for authority to negotiate new free trade deals. In Ottawa, Trade Minister Sergio Marchi is having a tough time selling Canadians on a new multilateral agreement to open the international marketplace to more foreign investment. And last month's plunge on the Hong Kong stock exchange has left investors around the world questioning the durability of the ``Asian miracle.'' All this couldn't be happening at a worse time for Prime Minister Jean Chrétien. Two days from now, he plays host to 18 Pacific heads of government, meeting in Vancouver for their annual forum on Asia-Pacific Economic Co-operation.˙ The objective of the group, founded in 1989, is to create a massive new free trade zone by 2020. Until this year, the challenge always was to convince Asian leaders that they had more to gain than lose by entering into an economic alliance with Canada and the U.S. But now it's North Americans who appear wary. Corporate leaders in the U.S., who were once the most enthusiastic advocates of free trade, are now complaining that the global economy is producing more cars, computers, clothes and other consumer goods than people are willing to buy. ``There is excess global capacity in almost every industry,'' says Jack Welch, chairman of General Electric.. That leaves manufacturers with two unpalatable options: Cut prices or cut production. Meanwhile, it is becoming clear that the turmoil in Asian financial markets won't end soon. The currencies of Thailand, Indonesia, South Korea, Singapore and the Philippines are faltering because of excessive speculation, bad loans and failing banks. The appeal of closer trade and investment links with the region has suddenly dimmed. Even if fears of a global slump are exaggerated, countries that open their borders to foreign investment and trade expose themselves to risks: a weakening of their national identity, job losses in vulnerable industries, a curtailment of cultural and economic sovereignty. But the most worrisome aspect of globalization is that no one seems to have figured out how to translate trade gains into a better life for the majority of citizens. The old tools governments used to narrow the gap between rich and poor - universal social programs, regional development grants, a highly progressive tax system, low tuition fees for post-secondary education - are, for the most part, gone. And new ones aren't being developed. Retreating into isolationism isn't an option. Canada has to export to create growth and jobs. And our economy is already highly integrated into the global trade and investment network. But it might be wise to slacken our pace. The path we're on may lead to prosperity. But for many Canadians, the benefits remain out of reach. ------------------------------------------------------------------------ Carol Goar is a member of The Star's editorial board. Her column appears on Saturday. | |To unsubscribe: send mail to [EMAIL PROTECTED], no subject, with the |following message (and no other text): unsubscribe c4ldemoc-l
