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Page THE HERALD OUTLOOK Saturday March 11 1H the HERALD Outlook Broadbent can rest well now OUTLOOK is published each Saturday by the HALTON HILLS HERALD Home Newspaper of Hills A Division of Canadian Newspapers Company Limited at Guelph Street Georgetown Ontario L7G Second Class Mail Registered Number 8772201 8778822 STAFF WRITERS Brian MacLeod Donna Kelt l SP0RTS WRITER David A Ottawa Stewart MacLeod Thornton Naws Sendee If New Democratic Party Leader Ed Broadbent lost any sleep over charges that he cheated during the election campaign by dredging up eightyearold quota tions he now can doze off in com fort The quotes he used have been up dated We refer to comments made in 1960 by Laurent Thibault head of the Canadian Manufacturers Association an organization that stoutly supports the freetrade agreement with the United States Mr Broadbent of course is not a supporter of the deal and during last falls campaign he argued strenuously that free trade would threaten Canadas social pro grams To buttress his argument he quoted Mr as saying that free trade would force Canada to tower its taxes to US levels and this would result in cuts to our social programs Mr lost no time in cry ing foul He said the quotes were a full eight years old and he scolded the leader for not saying so He left the clear impression that his views had changed in the mean time Prime Minister Brian Mulroney claiming that free trade posed no threat whatsoever to Canadas social programs was also critical of Mr Broadbent for being less than candid about the quotations he was tossing at the electorate Well if the leader wants to bring his quotations up to date Mr has come to his rescue The CMA head has produced 1969 comments that do nothing to sup port his contention that his views had changed since i960 BLAMES FREE TRADE Some quotes from a letter that Mr Thibault recently sent to Finance Minister Michael Wilson who is preparing his new budget The CanadaUS freetrade agreement that we fought hard for Berrys World YOUVE GOT TO BE KIDDING SHAKE HANDS AT THE HEIGHT OF THE FLU SEASON creates great opportunities but also makes it more urgent that we tackle the outstanding issues that affect our competitiveness Since Canadian taxes are already high compared to our ma jor competitors the burden of reducing the deficit must fall largely on cutting expenditures Because GO per cent of program spending is tied up in statutory pro grams with most of this on the social programs this is the spen ding area that must be reduced Now if that doesnt connect reduced social programs with the freetrade agreement I dont know what would And its not the type of connection that Prime Minister Mulroney wants to hear as his government takes the paring knife to expenditures After going through a harrowing election campaign arguing that free trade is no threat to social pro grams this letter from Mr certainly doesnt make it easier to sell the expected cuts Mr Thibault must shudder to think how many times his letter will quoted in Parliament when it meets again next month par ticularly if the government tampers with any of the major social programs such as pensions and family allowances TO NEEDY The association in an accompa nying brief submitted to the finance minister said social payments should go only to those in greatest need Mr Thibault add ed in an interview that were wasting a lot of that money on peo ple who dont need it Thats not a new argument But we all recall the furore that arose when the government tried back in 1965 to tamper with the univer sality of social programs And that was before free trade was even mentioned Now it will be virtually impossi ble for the government to do anything with social programs without the opposition pointing the finger directly at free trade Liberal Leader John Turner built much of his campaign platform on the proposition that the agreement would endanger these programs which Canadians hold so dear There seems to be little argu ment that the government must make a serious effort at deficit reduction Virtually every businessoriented organization in the country Is unanimous on this And from everything one hears around Ottawa Mr Wilson is deadly serious about trimming government programs The prime minister in restruc turing his cabinet has put himself in charge of a special committee to screen all expenditures There is no doubt many departments are going to feel some painful pinches But Mr is exceedingly anxious to distance all cutbacks from the freetrade agreement After all he said about the safety of our present social programs its little wonder Mr Thibault has certainly made the prime ministers task a great deal more difficult If not impossi ble EDITOR Mike Turner AD MANAGER Dan Taylor ACCOUNTING June Glendenning Tammy Leitcn CLASSIFIED ADVERTISING Joan SNAFU by Bruce Beattie The only Farmers Almanac prediction that came true was that its price would go up Inflation brings it out Your Business Diane Maley Thornton News Servlci Inflation seems to bring out the violence in people Pierre Trudeau wanted to wrestle it to the ground break its back Brian Mulroney wants to crush it smother it Inflation also excites our greed Many homeowners in Toronto and Vancouver like it because it makes them wealthy at least on paper Is inflation really a bad thing or are politicians and central bankers still fighting the last war Bravado grows in proportion to the time that has passed since the last scare As time goes by most people forget Central bankers do not In the halcyon days of I960 for example few of us dreamed that the boom would end and hundreds of thousands of people would be thrown out of work Although in terest rates tended to be high in the 1970s few imagined they would surpass 20 per cent But in August 1961 the prime business lending rate bit 2275 per cent For years afterward people feared it would happen again Our fear made it easy for central bankers to manipulate the economy using interest rates They would squeeze rates a big higher and people would stop buying and borrowing immediately they would drop them and off wed go on a borrowing binge FEAR RULES While central bankers can in fluence rates they cannot fix their direction That is done by financial markets Each time the bond vigilantes made their feelings known in the market politicians heeled promising to take the economy and the deficits firmly in hand Bond vigilantes are investors and traders who were burned by inflation and high interest rates during the 1970b since then at the faintest whiff of Inflation they have been selling the bonds they have and refusing to buy new ones forcing interest rates higher Bond yields are key measure of long- term interest rates By though people began to realize that the terrible recession of 1982 was over Even the stock market crash of 1987 did not dampen the economy for long Con sumers went wild particularly in the United States buying cars and houses running down their sav ings borrowing money Now after many false alarms inflation seems to be rearing its ug ly head again Interest rates are rising so quickly that borrowers heads are spinning and no one knows where it will all end Behind this sudden shock is the likelihood that North American in flation will come in at five or six per cent this year high by recent standards but nothing like the 12- annual gain of 1981 Does a fivepercent price rise justify a three or four percentage point spiral in interest rates Brian Mulroney seems to think so Once inflation takes bold its too late to deal with it Youve got to crush it and smother it before it gets out of hand the prime minister told reporters last week RISE TO SPREAD The prime business lending rate now per cent could rise by another full percentage point in the next few weeks in the opinion of Jeff Rubin senior economist at Wood Gundy Ltd in Toronto So far shortterm rates have been affected most A key measure of this Is the Bank of Canada rate which is set each week a quarter of a percentage point above the yield on threemonth government treasury bills The central bank auctions bills to raise money for the federal government A rising bank rate acts as a flag to chartered banks to raise their prime business lending rate which in turn pushes up rates for con sumer and mortgage loans Yet a fiveyear mortgage loan cost per cent last week a halfpoint less than the prime This odd situation known as an in verted yield curve will end In long- term rates rising and an economic slowdown setting in ADVERTISING SALES Jeannine Valois Craig Teeter Sharon PRODUCTION DEPARTMENT Dave Hastings Supt Annie Olsen Myles Gilson Wilson CIRCULATION DEPARTMENT Marie Shad bolt PRESSROOM FOREMAN Brian Aikman PRESS ASSISTANT Lee Where are they now Staff Comment Brian MacLeod The alma mater To those of us who toiled through four years of postsecondary education the mere mention of our alma maters conjures up memories of late night essays over pots of coffee pub crawls long and not so long lectures deadlines and familiar faces Its that last part about the familiar faces that prompts us to ponder our university contem poraries ultimate destinies When were reminded of our alma maters we recall those faces and inevitably we might think I wonder what theyre doing now The other day when I received my copy of the alumni news in the mail it even had my degree on the address card I scanned it with curiosity It was at York University where I spent four years balancing a healthy social life with books So when I turned to the Grad News section I naturally perked up when I saw a few familiar names in the Where are they now pages Jonathan Balcombe He was a pleasant fellow Sociable bright and a heck of a volleyball player The type of guy you might expect to find putting wayward youths on the right path You know what hes doing now Hes In his second year of a PhD degree in Ethology at the Universi ty of Tennessee in Knoxville where he is studying the behavioral ecology of bats How on earth does anybody ever end up doing something like study ing the behavioral ecology of bats Another pal George Alexiou was a colorful chap who came to school in Canada to avoid spending time in the Greek army An incredibly talented soccer player George is now coaching a First Division soc cer team in Greece His claim to fame Hes proud to have gone to York because Greeces prime minister George Papandreou was once a professor there Tom Eagles A sports fiend who liked his beer Hes now a consul tant at SevenEleven Employment Services in Willowdale filling posi tions in Toronto As far as glamor is concerned I figure I fit in somewhere in the middle of these chaps in my chosen career But Its always nice to know that should I ever find myself at the mercy of federal unemployment insurance could always ring up good old Tom