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Behind the Headlines Dollars As \Good As Gold?\ December 11,1986-Fort Covingttm Son-Fort Covington, N.Y.-Psage 5 By Philip C. Clarke When the new Democratic- controlled Congress convenes in January, one of the first orders of business will be renewed demands for trade protection. The last Congress in August came within eight votes of overriding the Pres- ident's veto of the textile, apparel and shoe protection bill. And the loss of American exports and jobs to cheaper- priced foreign goods was a major campaign issue for the Democrats. Protectionism promises to be a continuing issue despite Reagan administration warn- ings that raising import bar- riers could lead to trade wars, and a world-wide depression, as happened in the 1930's after Congress passed the Smoot-Hawley Tariff Act. Not that the White House is insensitive to the need for fair trade. In recent months it has filed more than two dozen actions against unfair practices by European and Asian trading partners, in- cluding the subsidizing of exports and restricting of U. S. imports. Also, the admin- istration's insistence on low- ering the excessively high exchange rate of the dollar against major foreign cur- rencies appears finally to be helping reduce our huge trade deficit. But tinkering with monetary exchange rates and jawboning for fair trade may not be enough to provide lasting solutions to the world's trade and financial problems. What's needed, according to Lewis E. Lehrman, the noted fi- nancial authority and founder of the Lehrman Institute, is \a workable international monetary standard that would both guarantee reasonably stable future values for na- tional currencies and guarantee that those currencies would be exchanged for each other at fixed and stable rates.\ Trying to achieve free and equitable trade without stable money, says Lehrman, is \like trying to run the New York Stock Exchange on a barter basis.\ In a persuasive article in National Review (Nov. 21, '86), Lehrman argues that reducing tariffs and quotes is of little use if prices remain distorted by \wild gyrations or even deliberate manipu- lation of (money exchange) rates...\ Such troubles began, he says, when remnants of the international gold standard were abolished in the early 1970's to be replaced by a de facto dollar standard, and when fixed exchange rates based on convertible curren- cies were replaced by today's \floating\ system based on manipulated currencies. As a lasting remedy, Leh- rman proposes a new inter- national monetary system that would \make the dollar con- vertible to gold...and, by law, substitute gold, self- liquidating Treasury bills, and secured commercial paper as the backing for U.S. cur- rency.\ He contends that \only gold, an objective non- national monetary standard, an independent reference point, not subject to creation by sovereign governments, can be the stable underlying reserve currency — the com- mon currency linking all nations.\ Lehrman concedes that gold convertibility may not be the perfect solution. But he argues that \fixed exchange rates/based on multilateral currency convertibility (into gold), constitute the least imperfect monetary system known to history — if our goals are a trustworthy money, low long-term interest rates, a reasonably stable price level, POINSETTIAS 1 In Four Colors Many Affordable Prices The best quality we ever had Our coolerls Full of Fresh Flower arrangements for Christmas at all times. F.T.D. and Teleflora arrangements for delivery next door or across the country Large Selection of Silk Christmas Arrangements Visit the expanded MULLARNEY'S GIFT SHOP For many unique gift ideas. Nelson's Flower Shop 45 E. Main St. Maloae 483-1330 \Yoir Dowmtowm Profe-kmal Flori**\ and steady economic growth toward full employment.\ Distributed by America's Future, Inc., New Rochelle, N.Y. BEHIND THE HEAD- LINES is a syndicated col- umn by Philip C. Clark. Mr. Clark is a veteran journalist and commen- tator specializing in po- litical, economic and se- curity affairs with forty years of extensive writing and research experience. He has served thirteen years with the Associated Press assigned as Carib- bean Bureau Chief in Ha* vana and as resident cor- respondent in Rome, Paris, London and Teheran. His special free-lance assign- ments have included Viet- nam, the Soviet Union, Poland, South Africa, Zim- babwe and other world trouble spots. As General Editor of NEWSWEEK magazine, Mr. Clark handled foreign affairs, with special em- phasis on U.S.-Soviet re- lations. For ten years, he was editor of the AMER- ICA'S FUTURE newsletter. Farm Income Tax Meeting A farm income tax meeting will be held on Tuesday, December 16 from 1:00 to 3:00 p.m. at the Franklin County Cooperative Extension Office, 11 Brewster Street, Malone. This meeting should be of interest to all dairymen and other farmers as well as to agribusiness people. The meeting will focus on high- lights of the 1986 Tax Reform Act, including tax changes that will affect farmers. Tax man- agement strategies and deci- sions for the end of this year, 1987, and later will be dis- cussed. There should be time for discussion of individual tax questions and problems. The instructors at this meet- ing will be Dave Herman of Farm Credit Service, Jim McKee & Empsall, and Russ Coombe, Cooperative Exten- sion Farm Management Agent. There will be no charge for this meeting. Pre-registration is required. Send your reserva- tion to Cooperative Extension Agricultural Program Office, 11 Brewster Street, Malone, NY 12953, or telephone 483- 6767, extension 358. GBCO ROCH. NY Distributed By: A&M Beverage Inc. Malone, N.Y. T\
