Lethbridge Herald, The (Newspaper) - April 3, 1974, Lethbridge, Alberta
4 THE LETHiHlOOI HIMALD Wednesday, AfWtt 1D74 EDITORIALS Unexploited territory Trudeau modifies anti- inflation attitude Nick Taylor, the provincial leader of the Liberal party, is in the enviable position of being a politician with nothing to lose. Critics may point this out as the reason he continues to sound so good. The real reason is that he has planted his party in a valid philosophical area which has not yet been exploited in this province and in so doing he can question assumptions of growth that have been so entrenched they are never really argued. Certainly, the NDP, whichJias provided the only critical opposition to the party in has not argued these assumptions, being more interested in means of development than in the question of development itself. And Social Credit, which can take credit for many of the good things which have accrued to Albertans in the past, can only cry "Free enterprise" in a dull voice hi a world in which nothing is free. It is one of the canons of practical politics that before you can get the voter's vote you must first get his interest. If the Liberals gain strength along the lines being described by Mr. Taylor it will raise the calibre of political argument within the province and may well make it the most interesting party in Alberta. At the moment the NDP holds this enviable position, partly because of the party's success elsewhere but mainly because of its excellent Alberta leadership. Grant Motley sets a very high standard of opposition. But he may have to move over for the Liberals under Nick Taylor if they continue to gain momentum enough to acquire a foothold in the legislature in the next election. New economic indicator On the theory that the things which will count are those which can be counted a theory based on the fact that statistics play a decisive role in most matters of policy there is encouraging news in the world of economics. Nations are accustomed to judging their wealth and their well-being in terms of gross national product. Indeed, the acronym, GNP, is so common that even the layman uses and understands it. This is a measure of the total goods and services produced by a country and is a quantitative indicator of the standard of living, of the availability of food, shelter clothing to that country's inhabitants. Now, one of the world's ranking academic economists has proposed a new standard which will take into account the quality of life within a country as well as the quantity of goods and services produced. This is a heartening turn of events. Paul Samuelson, professor of economics at Massachusetts Institute of Technology and a 1972 Nobel prize winner, in the ninth edition of his world- -famous, best-selling textbook entitled, "Economics: An Introductory has proposed what he calls Net Economic Welfare, or NEW. This index takes into account not only the goods and services produced but also the social and environmental costs of producing them. It attempts to measure the quality of life in terms of leisure time, health and other amenities. It also takes into account the contributions .made by women and other family members in the home who do not earn wages but contribute, nevertheless, to higher standards of living. In comparing GNP and NEW, Prof. Samuelson has shown that the former grows faster than the latter. More importantly, however, in doing so he has provided public policy makers with better tools for decision making. As he has written, "Public policy can choose to improve economic welfare, NEW if necessary, at the deliberate sacrifice of mere GNP growth. Political economy must serve mankind's wishes. There is no need for men to be chained to mere material growth unless they wish to be." It is probably no coincidence that MIT provided the computer model which was the basis for the book, The Limits to Growth. Prof. Samuelson's proposals for revising the means of economic analysis are not an isolated instance. Two Yale economists have developed a similar index which they call Measure of Economic Welfare, or MEW, which also attempts a measurement of quality as well as quantity. Whether Samuelson's measurement is the one which finally catches on does not really matter, as he himself says when he calls it a "rather crude" index. What does matter is that economists are at last turning their attention to the character of existence. The MIT professor predicts that the quality of life considerations which are implicit in his NEW index will be included in all economic textbooks within the next decade. And from there they will work their way into economic planning and all matters of public policy. And none too soon. RUSSELL BAKER The Good Life passes at 28 WASHINGTON The meaning of gasoline, electricity bills and 10 per cent mortgages is that the good life is over, kaput dead. Its obituary follows: The good life was born in the autumn of 1945 and died in a gasoline line in early March, 1974. It was 28 years old. It began with a free college education for every man who had worn a uniform and soon afterwards moved to the suburbs where it settled in a split-level house with a picture window in the living room and rain water in the basement. In 1947 it discovered television and beef, which, with 'the car, constitute the bulk of its estate, At the age of 2 its chief joy was to consume a huge quantity of roast or grilled beef, then go to a saloon to watch on seven-inch television screens.' Soon, however, it began producing babies and had to change its habits. By age 7, it had quit going out altogether and sat at home eating beef and spoiling babies. To ease its life it invented the 17-inch home television 'screen and diaper service. On Saturday evening it loved to sit in the dark, digesting beef and watching cigarette packages with legs dance on the 17-inch screen. Before it was 8 it had already invented tail fins for car fenders, which made can look like jet fighters that had been designed to carry babies. This made every baby-filled, beef-fed split-level yearn for two cars so that everybody could look like a Jet-fighter pilot while going to the TV-repair shop. By age 9 in the good life had discovered the back yard and gin, which gave rise to the cookout. Now it took its beef to the back yard with a martini pitcher, which ruined millions of tons of beef and several tons of marriages. a long while it smelled powerfully of charcoal-burned steak fat. In the meantime, Matt Dillon and Perry Mason were born in the living room. The babies, being staffed with beef, grew prodigiously while watching "ding-dong school" and learning that happiness was instantly KetUng whatever they craved, preferably from an 'aerosol can. Then came a startling day In the history of Vie good life. The babies an disappeared. Everybody looked at tin Mrew whtre the lubies used to Ml watching "ding-done and the (tabta wen fooe. In their places were huge muscolar, people land they were no longer witching "dlnf-donf but listening to astounding noises on the hi-fi, which had been invented at the same -time as the gray-flannel suit. good life was imposslMt with UMM immense neonle jll crowded Into OM level, but the challenge did not stymie the good life. It simply re-created the babies as kids and shoveled them all off to college. It also discovered the second home and the third car, and built superhighways to Everyplace so that everybody could get away from everybody else at 70 miles an hour. By the age of 15, however, the good life was showing signs of middle-age fatigue. It began grousing about the rat race. It went to Europe for the weekend and complained that the beef was no good. It invented color television and griped because Matt Dillon was green. Then the babies-turned-ktf-, took up politics and grew hair and said, "to hell with the gray flannel suit." It was a bad time for the good life. "What more is It asked the gray-flannel-suit haters. "Haven't I given you twice-as-much anti-perspirant power from an aerosol can to quell the odor of grilled steak fat which would otherwise give offense in the amatory "We want the even gooder came the reply, "preferably instantly from an aerosol can." Tims it discovered the generation gap, blue jeans at a pair and the science of kidnapping the dean. Meantime It went to the moon, not once but so often that it began complaining it could never get its favorite show on color television because it was always going to the moon. Within the past few years it had begun to show the of age. It no longer enjoyed breathing the chemical fumes with which it had replaced the air of its youth. Babies had become rarely seen curiosities dimly remembered. It still clung to the beef and the television screen, but the world had changed beyond recognition. One day in early March it walked into the back yard. It was wearing the now fashionable faded Jeans and felt only silly in them, realizing that' they were after all the clothing of now-gone babies. There may have been a moment of yearning for the old gray flannel suit. In the back yard the smell of cooking beef was many years gone. All that was done instantly and electronically now In the bows wUch would soon have to be abandoned because of the ISM It went to the beloved car, two tons of Detroit glory, patted it sadly on the dashboard, turned UK ignition and headed out for the last time In search of TD-cent gas. It Is survived by Matt Dillon, the Interstate highway system and hair spray in an aerosol By Mnnrice Wcttcn, HcraU Ottawa commentator OTTAWA In his six yean as Prime Minister, Pierre El- liott Trudeau appears to have modified drastically his ap- proach to public expenditures. He seems, in fact, to have fol- lowed the very path travelled earlier by his predecessor in office, Lester Pearson, arriving at the same conclusion in about the same period of time.. The late Mr. Pearson, in his Opposition years, was in no doubt that the government of the day had a responsibility to .resist demands for higher spending. In putting forward proposals of his own, he cau- tioned that they could be implemented only over time and as the economy became more productive. His first government showed considerable restraint; the estimates grew but at a rather slower pace. Only in the later years did ministers begin to .spend with the abandon to which we have since become accustomed. Mr. Pearson marked the change with a notable speech at Calgary. The new philosophy was expounded in these paragraphs. "I know that the role of gov- ernment in our society is than ever before. But this is not, as so often believed, pri- marily because government corporate or private addicted to empire-building, although this is always a temptation. "One of the main reasons for the growth of government activity la oar society Is the obugaUoothat voters Impose on government to promote social Justice and human equality, and to provide opportunity for every dtiien to develop his potential to the "This Is a reality we must accept; and in doing to, we must make sure that the growing role imposed on government by the rising expectations of people is carried out as effectively and efficiently as possible." This certainly limited the responsibilities of ministers. The voters imposed the demands and the government merely responded, taking care that money was spent efficiently (insufficient care, on the evidence of annual reports by the Auditor General.) Mr. Trudeau, on succeeding to the highest elective office, did not appear to share this somewhat passive philosophy. He had a good to say, in his first campaign, about tax- payer burdens. He also ex- pressed the view that govern- ments generally were spending about the right amount on social welfare and that they ought not to press ahead "with any .great gusto" in this area. He was for the freeze on the civil service and against any "Operation Bootstraps." On winning a majority, he summoned the country to fight against in- flation and conveyed an impression that the government, dealing sternly with its own expenditures, "Cheers" The virtues of "excess" profits By Bruce Whitestone, syndicated commentator Many are urging an excess profits tax on the oil industry or other industries benefiting from "windfall profits." Targets may include food processors, metal mines and even land speculators. According to reports, the federal government and some provincial governments are now considering such a tax. Previous excess profits taxes have been justified partly as a way to raise vast amounts of money quickly. Now, practically nobody bothers to talk much about how many dollars an excess profits tax might collect. Instead, the controversy turns on issues of fairness and effectiveness. Taxes are considered as a means of social justice or punishment LETTERS rather than purely as a source of revenue. by its very nature an excess profits tax is very complicated. Too, it should be recognized that there is no such thing as "excess" profit, because in a free economy a corporation is supposed to earn the highest profit it can. People who favour such a tax are unconsciously adopting a Marxist view that profit is basically exploitation. Some argue that profits can be considered excessive if they result, not from a corporation's efficiency or inventiveness, but from outside circumstances that remove the normal checks of the market and allow profit at the expense of the market. Too expensive for city 1 felt somewhat sorry for Mrs. Jessica Tichenor after reading her letter (The March 28. It should be obvious that we can never eliminate the demand for abortion by preventing pregnancies; any attempt to be a "Catcher in the Rye" will end in futility. Some women don't want to have a baby, and will submit to a pill dispension program. But there are always going to be women who want to have a baby. We can only hope that once they've become pregnant the father or women's liberation won't put ideas of abortion into their heads. It's true there is a definite need for birth control in Lethbridge, but I wonder whether a birth control centre is in the best interests of the people in .need. There seems to be so much red tape to getting contraceptives. First you go to the centre. They send you to a clinic. Then you see a doctor. There are too many frills nowadays in the professions. have to have teacher's aids to do their work for them, and doctors have to have a birth control centre to explain contraceptive techniques so all they have to do is to write out the prescription. I don't think the city of Lethbridge can afford to subsidize this group of highly paid professionals when its budget is in such a mess MONTY MANNING Burdett Cattlemen's charges The. information provided by the Southern Alberta cattlemen regarding the beef mark-up made very interesting reading. Unfortunately the reply that some officials made, In an attempt to refute these charges, appeared to be nothing more than the traditional ballyhoolnf that one hears so often whenever a pricing charge is made. I wonder how many readers caught the inconsistency found within the article regarding the gross retail mark-up? One owner appears to substantiate the cattlemen's charges when he said that his meat prices are always below the supermarket prices and yet be that be tries to operate on a 20 per cent mark- up margin. He appears to shoot down the supermarket's claim of a It per cent or lower gross mark-up doesn't he? Lethbridge. JON R. MEYERS Historically, that argument has been given a moralistic cast by war: it seemed wrong for a company to earn outsize profits from a situation that imposed suffering on many citizens. Advocates of an excess profits tax make exactly that pitch. Admittedly, some in government add a new twist; this kind of a tax should be a "carrot and stick" device. It should compel companies either to lower prices, or keep wages from exceeding government imposed guidelines, or be imposed if companies did not expand their facilities to meet rising demand and "shortages." In 1074, a few suggest that some of the abnormal profits generated by the'oil embargo should work for the public good by capturing them through taxation. Just how much of the profits should be considered A cynical definition is, that excess profits are whatever a legislature chooses to call by that name. There is no scientific way to measure them, but the usual procedure is to designate a time period for normal profits and tax the excess over that. There is thus a requirement that there must be a definition of what should be considered normal. The oil industry contends, for example, that its 1969-1972 earnings were subnormal. The food chains point to the food price war in 1970-1971 as times of greatly distorted earnings so these years, it is claimed, cannot be used in calculating normal earnings. With real estate companies for example, are prices normal in Southern Ontario or are they merely late in catching up to. Toronto price levels? Historically, difficulties of defining precisely normal and excess have led writers of excess profits tax laws to riddle them with loopholes and exemptions that have made administration of the laws a chaotic mess. Other general reasons for opposing an excess profits tax are even more obvloas, In the long run, corporate taxes are not borne by the shareholders of a company, but by the public at large which buys the product: higher taxes merely lead a company to raise its selling prices so that it can eventually attract the same level of net profits. This would be particularly easy to accomplish in times of strong demand. Then, excess profits taxes can be dodged all too easily by indulging in wasteful spending which reduces pretax profits. The drive to tax excess profits is primarily a political response to a misguided political conviction that some industries are taking advantage of the public during periods of shortage. This may be the case over the short run. However, profits are the mainspring of the economy. The fact that profits are high now in industries suffering from so-called 'shortages shows that the economic process is working properly. Without profits it would be exceedingly difficult for industry to expand production and thereby lower prices. Self-correcting market responses will eventually eliminate a dearth of capacity and high prices. Firms may ignore profits for reasons of sheer bureaucratic inertia, however, it is more likely that if they do, competition will take advantage of the situation by entering the industry or by introducing substitute products. Thus, the dynamics of the market will lead to increased fueled by the profits some would like to call excessive. Perhaps special unnecessary industry concessions such as depletion allowances or fast writeoffs should be changed for all industry rather than plunging into the philosophical and administrative surrealisms of an excess profits tax Imposed on some industries. was in a very resolute mood. On Sunday, responding to television interviewers, Mr. Trudeau's attitude was dis- tinctly different. He was certain not only that government expenditures would go up but even that they would rise as an overall percentage of the gross national product. "Why? Be- cause people are making more and more demands upon gov- ernment, all levels of govern- ment." The Prime Minister attributed the situation partly to the circumstances of minority Government, citing as an example the reversal of position on the Veterans' Land Act. This is a valid point but cer- tainly not a full explanation. In the majority years the Trudeau Government boosted the estimates by almost six billions. While it may be remarkable that it has almost repeated the performance in the last two, it is obvious that ministers had been converted to their free spending philosophy well before they had to worry about David Lewis and his successive shopping lists. It is highly probable that there always were more de- mands on government than ministers in office, as prudent men, felt that they could re- sponsibly meet. But Govern- ments did feel in the past that they were elected to resist ex- cessive demands; they were prepared to make a case for financial responsibility to the country; and very often found majority support for such views. If they are elected merely to respond to pressures from all sorts of groups, what credence can be attached to election platforms? Pre- election judgments will have to be scrapped anyway because subsequent decisions will be based on periodic voter mind-readings as govern- ments attempt to keep up with our changing expectations. The government, in its wis- dom and in response to pres- sure (including pressure from the Opposition) increased the butter price at week-end by six cents. This, it is said, will not hurt the poor because the government only recently increased various social payments. But those increases were supposed to be justified by higher prices. Where do social payments go from here? On, on and Mr. Trudeau overlooks the pressures for spending which do not originate with the general public or even with non-political pressure groups. It was surely not the voters who imposed Information Canada on a reluctant band of economizing ministers. And is it the fault of the voters that the expenses of the House of Commons will amount this year to over S41 millions as compared to millions in 1972-73? It may be that, with the best of will, costs of government will rise from one year to the next. But a resolute government might at least slow the pace of expansion. If, instead, the attitude is one of resignation, the huge annual increases are bound to continue. The voter will not only have to meet them in his tax bills; he will doubtless have to put up with innu- merable speeches explaining that he is wrong to grumble because it is all his fault. Who won? The Lethbridge Herald J04 7m St. S. MMrtt LETHSRIDOE HERALD CO. LTD. Proprietor. MM) PuMWwrs Stcond CtaM MM AtgMrMon No. 001! CLEO MOWERS, Editor md PuMMtMr DON H. PILLING Editor DONALD R. DORAM ROY f. MILES ROBERT M. FENTON DOUGLAS K. WALKER RMorM Editor KENNETH E. BARNETT ButttWM Mcnagw "THE HERALD SERVES THE SOUTH"