Lethbridge Herald, The (Newspaper) - September 7, 1973, Lethbridge, Alberta
4 THE UTHBXIDGE HERALD Friday, September 7, 1973 Sadat opting for the oil weapons By Jolia de St. Jorre. London Observer commentator Wheat and bread This, in short, seems to be the fed- eral government's new policy on wheat and bread prices. The wheat board will sell on the xvorld market for what it can get, currently around S5.60 a bushel. It will sell to Canadian millers for Canadian consumption at S3.25 per bushel, but to compensate the pro- ducers at least partially for taking less than the world price, there will be a maximum government subsidy of on domestic sales. As the world price drops the subsidy will drop, and will be eliminated entirely if the price goes to less than S3 25. (It was not made clear initially whether the subsidy would stay at SI.25 until the world pnce dropped to 54.50. or would start declining im- mediately pro-rata if the world price started dropping immediately.) In other words for the duration of the plan, five to seven years. Wheat Board sales to the domestic market would stay at S3-25 but returns to the farmers would stay between 83.25 and 84.50 regardless of the level of the world market. Bread prices in Canada would be pegged to S3 25 for v.heat for the dur- ation of the plan. lp to now the com- parable price has been the v. oriel price less the Si subsidy, so it means a reduction to the milling and baking trade and (other things being to the consumer. However there is no control on non-v.heat costs that go bread Some general observations may be made: 1. For manv years Canadian iarm- ers v-prp the victims of depressed world prices. Their costs rose stead- ily but their selling price stayed level, even declined. Only mcreasir.2 pro- ductivity and unusually good crops feept them in business 2. For most of this time Canadian consumers enjoyed the full benefit of the depressed world wheat market. The farmers, in effect, were subsidi- zing the Canadian consumers Only in very recent years was this admit- ted and an effort made to transfer the burden of the subsidy from the farmers to the federal treasury. 3. The present price is quite un- foreseen, quite unnatural, quite un- stable. 4. A good case can be made tor letting the farmers the full benefit of the present high market, just as for so long they had to stand the full cost of the depressed market. o. However most farmers would prefer more stable prices, certainly a good deal higher than what they had been getting but not necessarily as high as the current level. They gamble enough with the weather and v. ould prefer not to have to gamble the market. The new federal plan makes some sense, but it may not have been well enough thought out- Like so many of the federal government's farm policies, it may be deficient in not having been talked over suffi- ciently with the people concerned. 7. Pegging the domestic price be- tween S3.25 and S4-50 would be more realistic if there were some concur- rent guarantees, on the cost of pro- duction 8. The Wheat Board is the sole marketing agency, by (presumed I popular demand of the wheat grow- ers. The board is a government agency, and its policies are political policies There are more bread con- sumers than wheat producers. More voters are concerned about the high price of bread than the low cost of wheat Thcoe pra-ne critics of the new poLcy. v. ho say the farmers should get cent that the world price might dictate, forget that. The qovemmen1 to have been at least sympathetic and understanding to'.'.ard tr. farmers Whether it is wise is yet to be proven 9 With wheat worth S4 25 to S5.60 per bu-hel and the railways stuck v.-ith hisher wese more soon be heard about the rate at which wheat i? hauled by the railways- ER C NICOL Crumbling gods TJe stock market is not well. Everybody knws that. Turn to the business pages of this paper (breathe througn jour nose, and the chances are that the cough- ing ana wheezing of stock exchanges in New York, Toronto and Vancouver ma'M Dow Jcnes sound like La Dame aux Cam- elias. Various reasons are given for the fact that investors have lost confidence in the market as a bosom into which to tuck the discretionary dollar. These reasons are all wrong. They are wrong because they are the opinions of experts, who blame the market's sickly pallor on Watergate, infla- tion, smoking in bed., sunspots any- thing handy. What is needed is the opinion of an in- spired amateur. (I dropped out ot Com- merce after the first year.) Only brilliant insight can explain why the admirers who once bought blue-chip stocks are now taking their bouque's of greenbacks to rather strange persons flog- ging half-acre Jots in Wonder Land, a rec- reati'jr.cJ paradise built around a com- unspoiled swamp in the jungie of Parlay. are pc-ofJe buying paintings, old pofies, part interest in a Hereford steer, as an investment, where once they trusted cash to their stock broker? this is the question that is too big for any but the most Promethean apperception. Luckily, I happen to have mine with me. I invite you to see the stock exchange ss the temple, and the brokers as the high priests for the worship of the gods of materialism. The names of these gods have been known to and venerated by generations of inves- tors: General Motors, Shell Oil, ITT., U.S. Steel. Disneyland, and the rest of the divin- ities dear to the pantheon of greed. Most of these superhuman corporate boaie7 are showing the highest profits Yet tne investor remains unimpressed by the omens .Market analysts rummage around in the crops of pigeons, and de- clare that shares in the gods are rairacu- louslv underpnced. but tha faithful make no move to make an cflerirg. V ha as the prophet said hoppen' The awful a.-w.-.er is- the go longer seen as immortal. Cor.sider, for evaimle. the speculator's almigi.tv Genr-rd Motors. To our fath- ers. "CM was with a cower that '.culd continue to grow, to fill ihe wwld with thd er-d ct eternity Now. some say that eternity ends around 19SO. if net sooner G.M. the Apollo of the Americas, is being displaced by a swarm of minor cleiuts, and may shortly lose his choriot to a s'jrtp heap in Kvoto Even those guds of the sleek market, whose ommpo'ence is not jeopardized by the energy crisis, and which continue to create marvels in their own image (Xerox jes, these too feel the withdrawal of fa'lh the new skepticism towards tne icons of maieria'i'm. People have begun to qaestion the right of their stock broker lo dispense indul- gences The Financial Times publishes the mar- papal bull, and moves hearts no mere than does the papal bear. Any day now there will rise among us a reformist who has hurled his inkwell at J Paul Getty, and who dares to post on the door of the slock exchange building a manifesto of So theses attacking the concept of profligate growth and urging the return to an agrarian society. This is why you and I are sniffing about for a hit of land to sock our savings into. As usual, we're ahead of our time. Drinking friend By Dong Walker My cronies and 1 always by- pass the 19th hole but one night after a game I went home, picked up Elspeth and went over to have refreshments with Jim and Mary Rae at thoir home "I don't like coffee, I informed Mary when 1 saw her brewing the stuff. "Will you have .some tea, inquir- ed Jim. "No, I said, "I don't like either af them. "You ought to get together with Hilda said Jim. "I do.'' I replied. She's m> drinking friend at church, functions ue raise our coolaid glasses together. CAIRO President A n w a r Sadat has shown himself to be a nimble courtier in his hand- ling of Saudi Arabia and Libya, the two Arab states vitM to Egypt's new o i I strategy against Israel. While successfully wooing King Faisal towards a conser- vationist oil policy which is bound to intensify America's energy crisis. Egyptian president also side-stepped an immediate and total union Libya. The mortar is real and tangi- ble. Saudi Arabia has already given Egypt SlOO million this year over and above the annual "Khartoum subsidy" and now it is widely believed that Faisal has promised a blank cheque to meet Egypt's essential foreign exchange needs More imuoitant in ihe long run has been King Faisal's de- cision opposed by some of lite closest including his oil minister to peg annual in- creases in Saudi oil production considerably lower than t h e Americans want, probably around 10 per cent. This was a radical reversal of the King's ci! policy and the major pur- poje of Sadat's somewhat malo- cramatic secret visit to Saudi Arabia recenllv Ha.'.ever. Faisrl's caution ard Qadhafi's ardor remain constant inhibitive factors for Sadat who, having once again reshiified bis llm '.en cprioas ap- pears to have selected the "oil weapon'' abroad and economic expansion at horns as the only realistic palliative for Egypt's diplomatic and domestic stag- nation. The Egyptian government cortuiues to rattle its s w o r d, though the sound from the scab- bard increasingly hollow. Conventional diplomacy to find a negotiated solution continues, though the words are worn, the voices Even the arrival of Karl Walciheim, the United Nations Secretary General. La Cairo aroused little interest and no hope. Fighting could still break out. but the consensus here is that it could come only from maverick or freak causes The Egyptians discern two inter- related glimmers of light. Cbe oil. "the non-violent wea- the other is Hcnrv Kis- singer, America's new secre- tary of state F'OT the past year the Arab League in Cairo has be-on b isy on the blue punts e." oil weapon. Special attention has been paid to the economics of oi! and to brie, ins the oil-pro- ducing Arab Officials stress that notion of cither a united "oil front'' or a deliber- ate oil cut-off are premature The sinking value cf the dol- lar and the oil reserves are not iimi'.iess ha-.e encouraged the producers to iook more favorably on keeping tho stuff in the ground The Arab League, under the skilled and patient guidance of Msh- nisud Riacl, a former Egyptian foreign minister, is ropLig to persuade the oil to Latin Americans, third worlders? By Lduardo (ie Benito. London Observer cuinmemjlur .More Latin Americans than ever ars attending the confer- ence in Algiers (beginning Sept. 4th) of hsacs of non-aligned Same of these Ar- gentina. Peru and. Mexico have applied for full member- s.up the time, in the six- ties, when powerful U S. inter- ests still allowed to run the affairs of the Western hemisphere. And although there was an element of truth in the about the cultural historical difference's, ti.e real explanation ior Lai in Am- erica's attitude lay bs.-i.ind the rioo's ef the Penumon, the state department and United Slates board-rooms. Latin American politicians, with very few ex- ceptions, paid only lip service to the cause of underdevalop- irent vilhin the framework of I'.S -dominated regional orgaii- i72tions like ihe Organization of American States (OAS) and it- economic and social com- mittees, or on wider interna- !-cnal platforms such as the General Agreement on Tariffs and Trade and the UN Conference on Trade and De- Letters Need fairer of sharing The spectacle of ri.s'iig food prices and our inability to do much about Uieni should shat- ter some old myths. One such myth is the belief that the law of supply and demand forms a suitable basis for distributing goods. In a shortage situation tins amounts to charging what the traffic will bear. This is wrong. Whatever is a fair price should remain a fair price no matter how desperately psople need the goods in question. For the first time in our his- tory we are getting a sample of what this policy has been doing in the past to the poorer nations of the world. From every corner comes tha ques- tion "What can we Truly it makes you wonder where those politicians are who prom- ised to fight so valiantly for us if only we would give them a chance In the short term, controls v ill probably be needed ro- gtrdlcss of how irksome they may be. After all. if workers can sign a wage contract for a set salary over a certain peri- od of time, whv can't the busi- ness communi j do the same? Some firms do a very excel- lent job of this now. Ot course, the real answer is lo devise a fairer way of sharing the world's goods. Lethbndge. JIM BURXESS Levilfilion? 1 am not a chronic letter writer but this I must say: If ManWoman of Edmonton (page 24, Lsthbridge Herald, August 31) talks to trees or goes to the ceiling without his body- fine! That is his privilege. But when the Canada Council pays him to help him do it I go through the ceiling without any help. Arc a nation of idiots gov- erned by bigger idiots? AIRS. TIIELMA STEVENS Barn we II i elopmenl (UXCTAD They knew that their political survi- val depended upon feeing the Washington line. wuh us and jou will prosper" (meaning "yuur gov- ernment will Wash- ington kept telling them. "Keep awr.y from so-called anti-impe- rialist blocs. They only have a chip en their shoulders. You have been independent i o r many generations We are 1! American. We belong togc.ber in the Americas." It was IN: Monroe Doclrine paraphr.iaoJ., v.ith his "America for the Am- ericans" becoming "Latin Am- erica for the United States Departure from these giiiiic-- lines bad been swiftly dealt v.ith in the past. President Joao Goulart of Brazil, for in- stance, tried in the early six- ties to enforce a program of agrarian reform and nalionnli- zation of foreign (i e Ameri- can) interests, extending at the same time a friendly hand to non-aligned Asia and'Africa lie lasted only the time it look ihe Central Intelligence Apoivy 'CIA i to engineer a coup v, ovi brought back to pouer'in lUa-l th? oligarchy backed by the military. A year later the Dominican Republic became the scene of the bloodiest and most blatant example in recent history of the United Stales' of "the Big Stick" in the Western hemisphere, once again in order to preserve the status quo. Col- onel Caamano, the defeated constitutionalist commander in the Dominican struggle, fitted the pattern of the revolutionary Third World leader. The same could have been said of other radical politicians in the conti- nent who were repeatedly de- nied a voice in their countries' affairs in Ihe interest of U.S. hegemony. Thus, in the late 60s Latin America, with governments hand-picked or blessed a pos- teriori by Ihe U.S. state de- partment, did not. want to about Third World politics: Cuba, naturally, was the ex- ception. But the world scene began lo change. The U.S. military com- mitment to South-East Asia and growing disillusion within Ihe U.S. ss a result, of the Vietnam war made the Big Slick less plausible in the event of a jv..l- iiical confrontation south of Rio Grande. President Salvador Allcndc was allowed lo lake ol- fice in Chile in 1970 and, inora sigir.ificanriy. tlie comoined ef- forts of ihe International Tele- phone and Telegraph Company (ITT) and the to prevent him from doing so were pubilc- h denounced in the United States. It was the CIA's first major defeat on home-ground, so to speak. Encouraged by the changes in Chiie, President Velasco "Al- varado of Peru defied U.S. threats by natlonaliz rig U.S. mining interc-is. Panaira, iir.der the leadersliip of General Tei rijos, joined, at least on paper, the Latin American anti- imperialist bandwagon, and even Venezuela's cautious CnrisMan Democrats, and Ecuador, began moving in that direction. Tiu's loss of alignment with the United States led to closer 1 nks with iu.-n-aligned Asia and Africa. In the English speakir.'j Caribbean. Britain's entry into 1l-e European Economic Com- munity tamed the thought of the now independent West In- dian nations towards Latin America, thus foreshadowing an Arrican influence in hemi- spherical politics. Last, General Peron. accord- ing to members of his inner circle, is determined to be- come a major figure in Third World Affairs. The agenda at Algiers in- clfdes several Latin American interests: fairer trade betv.een rich and psor nations, preser- vation of natural resources from foreign exploitation, and measures against interference in the internal affairs of un- tlerdevelcped countries by mul- tinational corporations. Whatever the outcome of the conference, Latin America can- not expect immediate tangible results. But Algiers and suc- cessive non-aligned meetings will provide if, with a new forum to air its grievances to the world. shift their earnings into Arab Li vestments President Sadat's oi! strategy is undoctrinaire on nationaliza- tion. Control of the oil supplies rather than mastery of the in- dustry is what counts. Thus, Libya is on the nationalization path while Egypt openly wel- comes foreign involvement. Egyptian officials admit tbera is a long way to go. but they point to the favorable Kuwait, Libya and now Saudi Arabia have all adopted conser- vation measures ar.d a few specific omens such as the ap- pointment cf the American o'il James as tee r.ew ambassador in Saudi Ara- bia and growing concern sho7.ii by the media and politi- cian in the United States. But --Tub, the American-Rus- sian detente firm and Israel militarily mightier than ever, is there any hope for President Sadat's new policy putting suffi- cient pressure on Israel to make concessions nhich would be ac- ceptable to the Arabs? Trie Egyptians are looking to Henry Kissinger, whose Jewish- counts for less here than his diplomatic talents, for the ansv-er. Xo one expects a quick reaction The '-Year of Europe" cannot clearly be the "Year of the Midrib East" as well. But Arab oil is a vital American in- t'est. and the Egyptians fee! Kissinger is the right man to craw the right conclusions. President Sadat's desire for gradual with Libya has prevailed. But Qadhaffs sud- cc-i arrival in Cairo and a last r.nnute threat to walk out of the subsequent talks gave the go', eminent seme difficult mo- rn.2r.ts. The r.e-r unity pac; is. if any- thing, slightly less con- crete than Qadhafi had agreed to on one of his earlier iisit? to Cairo. It has few practical implications, but it does estab- lish a framework for the new state. Tne critical point now is the speed with which the con- s.ilution is drawn up and put ;o a referendum, Most observers here expect Sadat to dictate the pace, but Colonel Qadhafi is a notoriously impatient and im- pulsive man. Egypt has good reasons for closer links both strategic and financial: Libya is a key part- in tha oil campaign. Bet Qadhafi's shock tactics and par- si..-.Mve talks have not eroded Egypt's objections to instant union. There are four ef these, two major and two of lesser im- poitance. The Sadat-Faisal is now fundamental to Egypt. Union vith Libya on Qadhafi's terms would not only make life hard with Saudi Arabia but also with Sadat's Ba'athist allies. Syria and Iraq (Qadhafi hate? kings and godless with equal venom.') Secondly, the Libyan Colonel has made it clear he wants to his "cultural revolution'' to Egypt. This shook the establishment to the core, and perhaps more- than any other consideration, made an immediate merger a non-start- er. Of lesser significance but still important were Qadhafi's fundamentalist Islamic concep- tions. Egyptians have repeated- Iv pointed out to him that the Christian Copts in this country outnumber Ijhya's total popula- tion by more than three to one. La-'tly, the colonel wanted an end (o the Egyptian Soviet friendship treaty Relations with the Soviet Union are cool, but President Sadat prefers to keep them at that temperaturf for the time being. azy Capers' Must we decide this wav time I nsk for a raise, sir? The Lethbtidfje Herald 7tb St. S., Lethbrsdge, Alberta LETHBRIDGE HERALD CO. LTD., Proprietors and Published 1905 -1954, by Hon. W. A. BUCHANAN Second Clan Mall Rraitlrallon No 0013 ef The Canadian "reis and tho Canadian Dally Asioclafton ths Audit Circulation CLEO w MOWERS, Editor ana THOMAS H. ADAMS, Control Manager DON PILLING WILLIAM HAY WaruBlr-s Editor AMoelnte Editor ROY F MILES OOUGLA4 K. Wvvrltilng tdHorial Pnga ifl.V THE HERAIO SCRVES THE SOUTH"