Evening star., 1950-02-26
Canada Is Facing Period
Of Economic Adjustment
Her Government Is Apt to Let Privote
Business Adjust Itself With
Minimum of Interference
By MichoeI Borkwoy

OTTAWA.-While Britain has
general election and the plans anc
so largely dominated by the prosp'
tions in November, the Canadians
having got their election over last
of economic adjustment which is
things difficult for several classes
of people. But she is facing it,
with a Liberal government which
commands an overwhelming ma
jority and which has as little
need to be Influenced by electoral
considerations as any democratic
government can ever have.
The result is to make Canada, in
a certain sense, the outstanding
right-wing country among the
Western democracies. These are
words which it is easy to misun-
derstand. The Canadian Liberals
are an essentially pragmatic party:
they are middle Of -the-roaders.
But such dogma as they have by
tradition and inheritance is a free
enterprise doctrine. Few of them,
certainly none in positions of i'm
portance, would attempt to apply
18th century doctrines of "laissez
faire" in their fullness. But there
is a strong disposition against
government interference unless a
practical need for it can be clearly
demonstrated; there is feeling
that most of the world has tried
to do, too much regulating and
that the business of government
is to create favorable conditions
for free enterprise and impose as
few regulations as possible.
Case of Imports
Canada shouts about free en-
terprise far less loudly than the
United States does. but there is a
strong case for saying that Canada
is practicing it good deal more.
One good example is the program
OF import restrictions which was
imposed in November, 1947. 1t was
imposed. many economists thought,
far later than it should have been,
after Canadian purchases from
the United States had run the
Canadian reserves down to a.
dangerously low point. But the
government would not take &C
ton earlier, lest it's action should
interfere with the international
talks about the general agree
ment on trade and tariffs. It was
not until that agreement was
finally published that the govern
ment at last took action to curb
American imports.
In little more than two years
since the import restrictions were
imposed they have been gradually
and steadily reduced, until now
nearly half the effect of the orig
inal reductions has been Cancelled.
Each time the regulations have
been relaxed, people have asked
why particular items were chosen.
and while there were generally
good reasons in each specific case
the overall reason was simply that
the government was determined toI
END restrictions as soon as possible. |
The relaxation in itself was con-
sldered a good thing, and as
mounting reserves have made it |
possible the list of prohibited i'm
ports has been steadily reduced
and the quotas on other items
have been increased.
In the course of these relaxa-
tions. protests of soft-currency
countries which wanted to sell pro-
hlolted goods in Canada have car
ried a good deal of weight. The
British and other European gov
ernments would testify that Can
ada has given fair consideration to
every class of goods which they
had a good chance of selling here
Canadian ministers have gone be-
yond the removal of restrictions
and entered the field of exhorta-
tlon. The Trade and Commerce
Department has made 1t its busi-
ness to remind firms embarkinp
on large capital orders that it
would be to the national interest
If they could get their goods from
the soft-currency world and to
urge them to give British and
European exporters every consid-
Grafton.
Omens Are Good
But beyond exhortation the
Canadian government will not 60.
1t does not believe in creating an
artificially protected market by
excluding United States goods.
and it continually reminds the
soft-currency world that the re-
strictions on buying American
goods are intended to preserve
Canadian reserves, not for the
purpose of removing competitors
from the market. In the long run
Canadian ministers would say, It'll
is no cure for the sterling dollar
problem to take British goods
which are not competitive in price
and quality. They will try toI
create favorable conditions for
Britain and Europe to compete;
but compete they must. l
For this reason the most in
fluential government quarters are
not sympathetic to the idea Of
accepting sterling for Canadian
exports. To do so, they say, would
be the same thing as arbitrarily
excluding other foreign goods and
taking sterling area products
whether they were good or not.
And that is not the sort Of trad
ing world the government wants
to see. 1t is not the sort of world
ministers think, in which Canada
vfcI,