A Canadian Anti-Inflation Program
Publication:
The Empire Club of Canada Addresses (Toronto, Canada), 29 Jan 1976, p. 232-250


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Biddell, John L., Speaker
Media Type:
Text
Item Type:
Speeches
Description:
Two distinct anti-inflation programs: one announced by the Prime Minister Oct. 14 and second, the one which will have to be put together to get us out of the first one; one which will get us de-controlled without having inflation take off again. Merits of, and comments on, the first program. Primary responsibilities of the Anti-Inflation Board. Involvement of Canadians in the debate for solutions. Comments on the last two controversial speeches by the Prime Minister. Six separate issues which the speaker feels require public discussion: government spending, Canadian monetary policy, housing, energy, resource policy, labour-management relations. Summary of what is needed for the Canadian free enterprise market to survive.
Date of Original:
29 Jan 1976
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Language of Item:
English
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The speeches are free of charge but please note that the Empire Club of Canada retains copyright. Neither the speeches themselves nor any part of their content may be used for any purpose other than personal interest or research without the explicit permission of the Empire Club of Canada.
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Full Text
JANUARY 29, 1976
A Canadian Anti-Inflation Program
AN ADDRESS BY John L. Biddell, F.C.A., REGIONAL CHAIRMAN FOR ONTARIO, THE ANTI-INFLATION BOARD
CHAIRMAN The President, H. Allan Leal, Q.C.

MR. LEAL:

Ladies and gentlemen: We bid you a cordial welcome to this meeting of The Empire Club of Canada. Our distinguished visitor and guest speaker today is flanked--I do not say outflanked--by a group of prominent people who are as interested in what he is doing as he obviously is in their affairs, a mutual admiration society of a sort!

In the common parlance of industry and commerce, Jack Biddell has acquired a well-deserved reputation as a highly competent and successful trouble-shooter. If one's business affairs need or attract the attention of Jack Biddell, you are in real trouble. Thus, it may be a measure of the magnitude of our national economic woes, as well as some reason to hope for their resolution, when Mr. Biddell is again brought into service.

He was born, educated and practised as a chartered accountant in Toronto. In October last, he was appointed as a member of the Anti-Inflation Board which was set up under the Anti-Inflation Act to contain inflation in Canada. I do not wish to comment upon the Act, since our speaker will play that role, but I note that, rather unusually these days, it does carry a preamble:

Whereas the Parliament of Canada recognizes that inflation in Canada at current levels is contrary to the interests of all Canadians and that the containment and reduction of inflation has become a matter of serious national concern . . .

Whenever one sees a preamble in those terms, you can assume an attempt to forestall any attack on the legislation on constitutional grounds. That is not to say that such an attack would be successful; it simply means that someone is worried about it.

Mr. Biddell was formerly a partner in the firms of Clarkson, Gordon & Co. and Woods, Gordon & Co., with his major responsibility being that of President of The Clarkson Company Limited where he spent most of his time as a consultant to Canadian businesses which were having financial troubles. Under his direction The Clarkson Company Limited was involved in a number of the most publicized business failures in recent years, such as Atlantic Acceptance, Prudential Finance Corporation, the liquidation of the international financial empire of I.O.S. Limited, and, more recently, Rochdale College, an educational institution of sorts, which John Diefenbaker described as having more suicides than graduates, regrettably a true fact. Mr. Biddell says that for years he had the most interesting job in Canada to which one does not have to be elected. In order to accept the appointment to the Anti-Inflation Board, however, he has resigned from all of his former positions.

He has always taken a keen interest in public affairs and has been actively involved with the Committee for an Independent Canada in promoting Canadian unity and Canadian independence. For many years he has taken an active role in the Board of Trade of Metropolitan Toronto and the Canadian Institute of Chartered Accountants, primarily in the field of representations to government for improvement in the law as it relates to business. It was in the latter role that I first met him and benefited from his wisdom and experience, as well as feeling the sting of his lash.

It is a privilege for me to call upon Jack Biddell to address us.

MR. BIDDELL:

Mr. Chairman, ladies and gentlemen: Allan Leal and I have been associated on a number of problems over the years, he in his role as the very capable Chairman of the Ontario Law Reform Commission and mine as an occasional rather impatient applicant to his Commission on behalf of some pet project or other. Knowing my propensity for straying into forbidden areas, Allan was quick to point out to me that he expected me to speak to you about the anti-inflation program. Perhaps the only mistake he made was that he was not quite specific enough--he didn't tell me which anti-inflation program I should talk about.

There are of course two distinctly different antiinflation programs now facing us. There is the one which the Prime Minister announced on October 14th last to which we on the Anti-Inflation Board have been devoting most of our waking hours since that date. Then there is the second program, the one which is only just beginning. That is the one which will have to be put together to get us out of the first one. The one we must devise to get ourselves decontrolled without having inflation take off again like a sky rocket and also get ourselves out in a manner which will provide the measures to handle the vicious inflation-versusunemployment cycle which forced the government to impose the Anti-Inflation Act on our economy.

Both of these programs are essential to the containment of inflation in Canada. I think the first is much the simpler of the two. This may not appear obvious when one attempts to understand the Regulations which were issued on December 18, but sooner or later I am sure we shall all understand what they mean and how they are to be applied and, unfortunately, we will have to face their tremendous impact on Canadian business.

Our present program was relatively easy to set up since we had the example of the U.K. and U.S. programs to follow. We have not simply copied those programs. Ours is not as rigid on the price control side as the system which was initially introduced in the United States. Neither is it as inflexible as the U.K. system, where the prices and incomes board has very little of the discretionary power granted to the Anti-Inflation Board under the Canadian legislation.

By way of general comment on what I shall refer to as the current anti-inflation program, I might say that while the government introduced the program very reluctantly it was in my opinion introduced in the best manner. Many people have suggested that a program of this type would better have been introduced by way of a complete freeze on compensation and prices for say a 90-day period. In retrospect, I believe that the credibility of the program would have suffered much more extensively if that route had been chosen. There is no possible way that any regulatory body could monitor every price and compensation increase in Canada. Had we attempted a complete freeze there would have been bound to be many departures from the rules, either deliberately or unwittingly, and I believe that the public would have quickly lost faith in the government's ability to control the situation.

We on the Board see a good deal of evidence that for all practical purposes we have had a fairly effective price freeze since October 14th, in any event.

It was obvious that the government was reluctant to institute a program of wage and price controls, particularly when the conventional wisdom in Canada is that such controls do not work. In my opinion this is a misconception, however. The great problem about wage and price controls is not that they don't work. Of course they work. Properly applied they are bound to reduce the rate of inflation. The real problem is that they treat only the symptoms of inflation and do nothing to effect a longterm cure. As long as they are tightly imposed they will reduce the inflationary spiral. It is, however, quite impractical to keep such controls in effect indefinitely and still permit anything like the free enterprise system, as we have come to know it, to continue to operate in a satisfactory manner. Our major problem therefore is to as quickly as possible get on with phase two of the program: finding solutions to the long term containment of inflation on a basis which will also be consistent with satisfactory economic growth, a satisfactory level of employment opportunities and an economic system substantially devoid of government interference in the marketplace.

The current program will, so long as it is in effect, reduce the rate of inflation in Canada. It will be most unsatisfactory to live with for any extended period of time, however, and any attempt to do so will almost certainly destroy much of the framework of our free enterprise economy. In the absence of other measures, there is reason to believe that the moment we abandon the present program, inflation will once again speed up and we shall be back facing recurring bouts of inflation and unemployment, each of them at an ever higher level than before.

The primary responsibility of the Anti-Inflation Board is to administer the present program. Its secondary role is to assist in educating Canadians as to the basic causes of inflation in Canada and to make recommendations to the government for the long term control of them. We are well under way in the first phase and are now gearing up for that most important second phase, determining the causes and proposing solutions.

Just as we cannot possibly carry out the first phase of our mandate without the co-operation and assistance of Canadians generally, neither can we hope to contribute in a material way to phase two without involving all Canadians in the dialogue and debate which the solution to the problem will most certainly require.

In the last few weeks our Prime Minister made two rather controversial speeches on television. Many Canadians took serious exception to some of his remarks on those occasions. For my part, I viewed his comments as nothing more than an attempt, and I believe it was a worthwhile attempt, to lead off in the debate which we must encourage in Canada if we are to find a way out of the economic dilemma which required the imposition of the Anti-Inflation Act.

In virtually every one of my public appearances in recent weeks (and there have been too many of those for my liking), I have told my listeners that we should only keep the present Anti-Inflation Act controls in place for as long as it takes us to find a sensible solution to the problems which made them necessary.

We on the Anti-Inflation Board will of course continue to act collectively in administering the present program and shall certainly present our collective views to government on phase two of our mandate. In our role as educators, however, and in order to encourage the public input which we all must have to the solution of the main problem, we on the Board have agreed that as individuals we must take every opportunity to raise for public discussion any issues which we believe relate to the problem of inflation in Canada. When we do so, as I propose to do today, we shall be putting forward our own views which may well not ultimately be the considered views of the Anti-Inflation Board. The Board's opinion and recommendations will come later.

So in that context, Mr. Chairman, again emphasizing that these are my own views and not those of the Anti-Inflation Board, I should like to put forward a few of the issues which I think warrant public debate in our collective effort to find the solution to the dilemma of ruinous inflation versus ruinous unemployment.

I should like to comment very briefly on six separate issues, all of which in my opinion require public discussion if we are to achieve our overall objective. These are: government spending, Canadian monetary policy, housing, energy, resource policy, labour-management relations.

Now to begin with, I certainly don't pretend to know all the answers to the basic problem of how to contain inflation in Canada in a sensible manner.

I am equally certain, however, that those among us who propose that all that needs to be done is for government to curtail its expenditures, reduce the money supply and cut taxes, don't know all of the answers either.

On the subject of government expenditures, people have been complaining about government spending since we all came out of the log cabin era and set up government departments to do things we want done but don't want. to do for ourselves. Let me first suggest the obvious. If we want major cuts in government spending we are either going to have to support or have alternative employment available for a lot of present government employees. I agree that we should put restraints on salary increases at the higher levels of the civil service but basically I wonder if we are not wasting our breath in the manner in which we complain to our politicians about the number of people on government payrolls.

The private sector measures the success of its own employees by their contribution to productivity and profits. We may as well recognize that much of what we ask government to do cannot be measured by those yardsticks. That is not to say that if we put our minds to it we couldn't create a compensation plan for many groups of civil servants which could go a long way to encourage them to restrict the growth in their own numbers. I suggest, however, that we must first develop a much better set of employee incentives and much better labour-management co-operation in the private sector before we can expect to impose it on the government service.

As to monetary policy, I am not going to get into the debate as to whether increasing the money supply causes inflation or whether when inflation is upon us it is necessary to increase the money supply to prevent too many businesses going bankrupt. Conventional economic wisdom notwithstanding, I believe that there are arguments on both sides.

One area of fiscal and monetary policy in Canada which I suggest we should look very hard at right now, however, is the continuing policy of the Bank of Canada of maintaining Canadian interest rates at a much higher level than those in the U.S., and in doing so maintaining the exchange value of the Canadian dollar at its present level.

In my opinion, the single most important thing the government could do to contain inflation on a long-term basis in Canada, and to assist in avoiding the vicious cycle of inflation following recession, would be to lower interest rates.

If we look at the potential effect of lower interest rates on:

1. The carrying cost to Canadians of $18 billion of consumer debt;
2. The cost of servicing mortgages on the new housing construction we badly need and hopefully are planning in Canada;
3. The ability of our business enterprises to raise new equity, and
4. The lowering of the servicing costs on new debt issues by all levels of government; it seems difficult indeed to justify our central bank's insistence on keeping interest rates at their present level.

We all know that over the next few years we face a tremendous requirement for additional capital in every area of our economic affairs in Canada. For that matter so do most other countries, including the U.S., where we traditionally raise most of our foreign loans. For us to get into a bidding match with U.S. municipalities and U.S. corporations for money which is becoming scarcer all the time just doesn't seem to make sense. Obviously, if we are not prepared to pay the price to attract foreign capital we won't get much of it. If we can't borrow what we need abroad, however, we could do two things.

First, encourage Canadians to keep their investment funds in Canada by imposing a special tax on interest and dividends received from new foreign investments. The U.S. imposed such a tax when it had a balance of payment problem a few years ago.

Secondly (and if this doesn't get me impeached I guess nothing else will), if we can't borrow all of the funds we need from abroad to finance expenditures, which we are going to make in Canada in any event, and I stress this, then we probably should at least look at the advisability of the Bank of Canada itself financing some of those expenditures simply by creating the money.

Now all I ask of our economists and our financial writers who think that comment is sufficiently important to be shot down, is that when they do so they explain why the creation by the Bank of Canada of new money to finance expenditures we have irrevocably decided to make in Canada is much more inflationary than borrowing the same amount of money abroad to finance the same expenditures. If we are concerned about the inflationary effect by all means let us look at what we propose to spend the money on and whether or not we should spend it. Once we have decided we are going to spend that money here in Canada, however, I suggest that so far as its inflationary effect is concerned, it doesn't matter very greatly whether we get the money by borrowing it abroad or whether the Bank of Canada creates it and loans it on the same repayment terms.

I agree that if we curtail our foreign borrowing, the exchange value of the Canadian dollar will decline. This could have some inflationary effect by making it cheaper for other Canadian borrowers to obtain foreign funds to finance expenditures in Canada which they might otherwise have deferred. But even if there appeared to be a serious prospect of demand-related price increases arising from such action, there would always be other means available to our federal and provincial governments to dampen the enthusiasm of the potential borrowers.

Lowering interest rates in Canada could also be inflationary if at the same time we made credit, generally, more easily available. While we do not have anything like a perfect mechanism for rationing credit, we do have the means of controlling it within reasonable limits, measures which generally speaking have always been more effective than just jacking up interest rates.

At this point I am sure that many of you now understand why I am the despair of some of conventional economist friends.

I am certainly not suggesting that we consider a new monetary system for Canada, nor am I proposing that we activate the printing presses whenever we need more capital. I am merely suggesting that to pay for at least some of the projects which simply must go forward in this country in the next few years we should at least look at the prospect of government financing more of them itself at much lower interest rates. Please note: I only suggested that government finance them; I did not suggest that government manage them.

We are frequently reminded that if we lower the exchange value of the Canadian dollar this could reduce our standard of living because it would push up the cost of imports. The cost of imports would no doubt go up, and so also as our domestic manufacturers become more competitive we would see a rise in employment opportunities for Canadians. I think most Canadians would agree that with the exception of adequate housing, our standard of living is pretty satisfactory. Many of us might even agree that greater opportunities for new housing, even at the expense of temporarily increasing the cost of imported manufactured goods, might be a good trade off.

I put it this way because I believe that lower interest rates are one of the essential ingredients of any plan to give Canadians the opportunity they deserve to own their own homes, not two or three cubbyholes iris' a twenty storey box called a condominium, but honest to goodness single family homes with a bit of property to provide a worthwhile environment in which to raise a family and ultimately provide the best kind of a retirement fund.

The right to buy such a home, to live in it and to improve it and to ultimately own it has been one of the most stabilizing social and economic factors of my generation. Common sense tells us that to deny our children this privilege is to forego one of the most effective measures available to us to protect our society and our economic system! High interest rates maintained by the policies of the Bank of Canada and high land costs maintained by the parochial attitude of our municipal councils have so far frustrated the efforts of our federal and provincial governments to bring housing costs within the reach of the average Canadian.

I believe that it is essential to consider new approaches to both these problems. The federal government could by itself bring down interest rates and direct or supply additional funds to an enlarged housing program. There is little point to it doing so however if the provincial governments will not use their authority to make suitable land available at reasonable prices. Provincial land banking schemes have not been effective. Pressure by the provinces on municipalities to grant zoning applications and building permits, and pressure on land speculators to sell or build within a prescribed time frame could have a major effect on land prices. Between them the two levels of government could transform the entire housing picture and in doing so, because of the relative ease in scheduling expenditures on new housing, could provide one of the most needed elements in any plan to break up our inflation versus unemployment cycle.

The next area on which I should like to comment is that of energy: its pricing and its conservation.

Many Canadians are no doubt of the impression that one of the major factors which contributed to runaway inflation over the last year or two was the major increase in the price of oil and natural gas. No doubt some thought a little more deeply about this problem and reflected on the fact that we were coming to the end of our proven reserves of oil and gas and that this probably signified a much more difficult future for Canadians. There seems little doubt that our natural resource base has contributed in a major way to the standard of living which we Canadians have come to enjoy. Moreover, at this point we must accept that our petroleum and natural gas, together with coal and uranium, are probably absolutely essential to the continued existence of Canada as a nation.

The impact of the energy crisis obviously has far wider implications than its effect on inflation. Our energy reserves are by no means clearly defined at this stage. We have had clear warning from the federal government that soon we will have to spend billions of dollars per year on imported petroleum. In the face of this, one must wonder whether we should be rethinking our approach to energy conservation and pricing.

Our governments have been conducting a campaign to encourage Canadians to conserve energy. In the face of the problem, however, that campaign appears to be, to say the least, rather low key. Control of petroleum and natural gas prices was not included in the jurisdiction given to the Anti-Inflation Board and it appears that before long there will be further moves by the government to increase domestic prices to the level of the world market. I feel that we should take a hard look at this policy.

Surely another alternative would be to maintain a lower price in Canada for petroleum and natural gas and ration the use of some of the components, particularly gasoline. Rationing gasoline is not a policy which would have much appeal nowadays. But it seems to me that it might be done on a rather simple basis which would provide the owner of every automobile with a reasonable minimum quantity at today's prices and require him to pay a very substantial premium for any excess quantity he wished to burn. Such a system could be administered without coupons or categories simply by adopting a universal credit card keyed to each vehicle's license plate, and making use of data processing techniques which are readily available.

Canadians are unlikely to restrict their use of gasoline if the government just makes periodic increases in its price. A major increase, say an additional $1.00 for every gallon in excess of 500 used by any pleasure vehicle in a year, would have a dramatic impact. Such a program would likely substantially reduce overall gasoline consumption and in addition could raise very substantial revenues to subsidize the search for new petroleum supplies.

Obviously such a program would have no attraction for the major petroleum corporations which own our proven reserves and hope to own any new ones. They easily produce all of the supplies we are at present consuming and would be unlikely to favour any current reduction in consumption. However, until such time as it can be shown beyond doubt that we have substantially increased our proven reserves or have developed alternative energy sources, I find it very uncomfortable to see us continue to act like the proverbial grasshopper while we watch 1980 and its energy problems descend upon us.

There is little doubt that a major increase in oil and gas prices will have a substantial effect on the consumer price index. It will also have an important effect on the competitive position of many Canadian manufacturers. It seems to me that we should rethink our present plan to raise Canadian prices to the world market level.

I found it rather strange to read a few days ago that the government of Denmark has proposed that Canada be denied a trade agreement with the nine-nation European Economic Community until we stop selling our own energy supplies to our own people at less than the world market price. Possibly Denmark may have had some better reason than appeared on the surface for its suggestion. My own reaction was that it is just possible that someone in the government of that country had been in conversation with some of the "Seven Sisters".

A few moments ago I was referring to the need to increase considerably the supply of homes for Canadians. One thought that struck me in that connection was whether or not we in Canada could be facing a situation where, in a few years time, we will not have the means of heating our homes except at prohibitive cost. This led me to speculate whether or not we are now seeing, in these new major programs to mine and export our coal, a repetition of what happened to our "unlimited" supplies of petroleum and natural gas. I know nothing about the adequacy of our coal reserves. It would be comforting, however, if our government could assure us that this time it has reliable information on this subject and that we have no cause for alarm.

One of the reasons which led to the imposition of the current wage and price controls was the fact that wages in many sectors of Canadian manufacturing have risen to levels higher than those paid by many of our competitors in the United States.

A factor which has enabled some Canadian manufacturers to remain competitive has been our lower raw material costs. In the case of some commodities, petroleum, natural gas and some metals such as copper, Canadian manufacturers have enjoyed the benefit of a two-price system in which they obtained supplies at lower prices than those which prevailed on the world market. Not unnaturally the existence of this two-price system has been very upsetting to the producers of these commodities. I think that we should look very carefully at our policy in this regard.

The recent imposition of greatly increased taxes on our natural resource industries has led to an increase in the pressure to remove the two-price system. Consideration of the measures which we should adopt to protect our over-all economy when Anti-Inflation controls are removed should in my opinion include a serious look at the advantages which the two-price system has contributed in maintaining employment in secondary industry in Canada.

One of the areas which clearly must be improved in our economic system is the whole spectrum of labour-management relations. Regrettably, what seems to happen in the larger companies where employees are represented by unions is that, instead of the parties dealing with one another as partners in the enterprise, a great many matters are settled by a series of confrontations.

Unless we can somehow improve this situation, it is difficult to see how we can expect to control one of the basic causes of inflation: the understandable wish of our workers for ever more money as against the need of our employers for increased productivity if they are going to be able to pay it.

In a number of discussions I have had on this subject, I have found strong support for efforts to bring Canadian wage and salary workers into our profit system as partners rather than continue to deal with them as adversaries. Some of my friends have expressed considerable interest in the introduction to Canada of the share-ownership plan developed by Louis Kelso in the U.S.*

The Kelso plan combines assisting corporations to finance their expansion, widening the ownership of capital and improving employee-management relations through a new type of employee stock ownership plan. I would just like to say a word or two about those last two aspects.

Stock ownership plans for employees have been fairly common for many years. However, there are three basic reasons why they have never realized their full potential for improvement in our economy. The first of these is

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*See Louis Kelso's address to the Empire Club, February 21, 1974.

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that most plans only take in the senior employees of the corporation. The second is that the employee has to pay for his stock out of his after-tax income. For most employees this makes any sizable accumulation of shares quite impractical. The third factor is that because of an ultraconservative dividend policy by the directors of his company combined with uncontrollable fluctuations in the price of the shares on the stock market, the employee often found that his investment produced less than he paid for it.

The Kelso theory in its simplest form would merely permit a corporation which does not need additional capital but wishes to improve its relationship with its employees to make extra payments to its employees to enable them to purchase stock in the company, the payments being deductible from the Corporation's taxable income but not taxable in the hands of the employees. In this way the employees quickly become "partners" with the outside shareholders at no initial cost to themselves.

The payments to the employees are only by way of a "loan" however. The shares allocated to the employees are held in trust for them until the "loan" is repaid. All dividends on the shares become the property of the employee but must be applied against his "loan" account until it is retired. Until the "loan" is repaid, the dividends are not taxable in the hands of the employee. To be effective the plan would require the employees to retain the shares until their retirement from the company.

There are a number of worthwhile extensions to this basic idea which could be implemented by enlightened company directors and by responsive government. One such is that a corporation could issue a different class of common share under the plan. These would be fully participating with the ordinary common, but the employees would be entitled to a full annual distribution of their share of the annual earnings.

If the shares issued to employees under the plan had this mandatory profit pay-out feature, employees could more quickly retire their initial "loans". Moreover the continuing incentive to the employees to maximize their company's profits would be greatly enhanced if they could look forward to full annual profit distributions.

If industry is going to sponsor the widespread development of such employee stock ownership plans, I believe that it should seriously consider having this mandatory profit distribution feature applicable to all shares issued there under. In order to encourage the issue of shares with this feature, the Income Tax Act should permit the recipient of dividends thereon to re-invest them in additional shares of the same type in the company, free of income tax.

Some Canadian companies are already offering assistance to their employees to acquire company shares. But without the tax deferment feature which only government can provide, the accumulation of any significant stake by most employees is quite impractical. Government has taken a partial step in the tax rules which permit registered retirement savings plans. In my opinion this second and potentially important step warrants early consideration in the interest of upgrading the role of all Canadians in our free enterprise economic system.

Now you may well ask what all of these matters have to do with our current anti-inflation program. Strictly speaking of course, they are not at all relevant to the first phase of that program in which we are now engaged. If you agree with me however:

1. that the current anti-inflation program imposes restraints which are quite impractical for either business or labour to live with for any extended period of time; and

2. that it is neither fair nor sensible for the business or labour community to sit back and expect government to provide all of the answers as to how we get inflation under control in both the short and the long term while still protecting our free enterprise system, then I hope you will agree with me that these matters have some relevance and that we must all introduce our own ideas to this very necessary debate in a constructive way.

I believe that our Canadian free enterprise system cannot survive unless we solve the problem of recurring bouts of inflation and unemployment. It will not survive unless we can find a cheaper way of financing at least some of the major expenditures which now confront us. It will not survive if we cannot provide socially acceptable housing and decent job opportunities for Canadians. It will not survive if we don't deal with our energy problem by placing a greater priority on conservation and the development of both new and alternative energy sources. It will not survive unless we can bring Canadian wage and salary earners into our profit system as partners, not as adversaries.

All of these matters, and many more which I am sure will occur to you, are fundamental to the control of inflation in Canada. Only by addressing ourselves to them and thereby getting inflation under long-term control can we demonstrate that our free enterprise system will work and that our system, free of persistent government intervention, is the system which warrants the confidence and support of future Canadians.

Our distinguished visitor and speaker was thanked on behalf of the audience by Mr. William M. Karn, a Director of The Empire Club of Canada.

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A Canadian Anti-Inflation Program


Two distinct anti-inflation programs: one announced by the Prime Minister Oct. 14 and second, the one which will have to be put together to get us out of the first one; one which will get us de-controlled without having inflation take off again. Merits of, and comments on, the first program. Primary responsibilities of the Anti-Inflation Board. Involvement of Canadians in the debate for solutions. Comments on the last two controversial speeches by the Prime Minister. Six separate issues which the speaker feels require public discussion: government spending, Canadian monetary policy, housing, energy, resource policy, labour-management relations. Summary of what is needed for the Canadian free enterprise market to survive.