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PRESIDENT’S MESSAGE

Interest rates are
ruinous to workers

by Jack Munro

o you know how many ways you and
your family are victimized by the
monetary policy of the Canadian gov-
ernment?

First, of course, you have to pay
more for your mortgage, either
directly or through rent increases. For exam-
ple, an increase of 4% on a mortgage of
$50,000 costs an additional $2,000.00 per
year, or about $1.25 per hour — depending on
how much you get.

But you can’t pay the additional mortgage
cost with pre-tax dollars. So, depending on
your tax rate, you will have to devote about
$1.65 per hour of your pre-tax earnings to the
hike.

Second, that is for those who are lucky
enough not to get laid off because of the
disastrous effects of high interest rates. Many
will not be so lucky. About 40% of Canada’s
forest industry workers had long lay-offs when

monetary authorities last ran amok late in
1981.

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v

The layoffs follow
from a variety of
effects. To begin with,
when mortgage rates
skyrocket, as they
have been doing
lately, a lot of people
decide not to build
houses, so lumber
isn’t sold, and forest

industry workers get
laid off.

Then the value of
the Canadian dollar in
foreign countries
rises, and with it, the
relative price of Cana-
dian lumber. So Cana-
dian producers have
to pursue what

most insidious effects
are longer-run and less
well-known. For one
thing, when the large
corporations that
dominate our indus-
try begin to experi-
ence the ‘cash-flow
crises” caused by high
interest rates (greatly
reduced revenues and,
simultaneously, great-
ly increased costs)
they look around for
others to carry the
load. They find the
Canadian forest indus-
try worker, and the
Canadian forests.
And in the longer

remains of the lumber
market with a double
handicap; the lumber of foreign producers
becomes cheaper, and at the same time, the
Canadian producer has to pay more for his
capital — currently about 5% more than his
U.S. competitor.

And with each of these effects, more Cana-
dian forest industry workers are laid off for
longer periods.

Then consider what is happening on the
grand scale. Canadian residential mortgages
alone add up to about 180 billion dollars. The
4% increase in rates, if it lasts long enough to
affect that total (about 4 years), means that
every year an additional $7.2 billion goes from
porrowel to lender, from the poorer to the
richer.

But for the forest industry, perhaps the

run, these obscenely
high rates make prin-
cipled, sustainable forestry impossible. Nec-
essary early silvicultural operations (plant-
ing, brushing, pre-commercial thinning, early
pruning) have to be financed for 50 to 100
years, depending on the rotation period.

If you apply a compound interest rate of,
say, 14% over periods like that, you will see
that present monetary policy is simply incom-
patible with sustainable forestry.

So get out your pen and paper and write to
Prime Minister Mulroney and Finance Minis-
ter Michael Wilson (send the letter to the
House of Commons, Ottawa, Ontario, no
stamp required).

You don’t need to write anything fancy.
Just tell them, in your own words, that you
are fed up with all this.

SUSTAINABLE DEVELOPME!

Accountability needed
in land use decisions

by Claire Dansereau

TIHE National Union’s efforts at involve-
“ment in the sustainable development de-
bate have produced encouraging results in
some cases and a reminder that we have a
| lot of work to do in others.

ee On the positive side, Brother Stanyer
has been appointed to the B.C. Round-Table. This
committee will advise Cabinet directly on most
issues related to sustainable development. It will
establish a conflict resolution mechanism, advise
Cabinet on environmental land use and other
economic development issues, and will monitor
implementation of National recommendations on
sustainable development, among other responsi-
bilities.

Again on the positive side, I have been asked to
continue my participation in the B.C. govern-
ment’s Old Growth Strategy Conference. This
group of stakeholders is attempting to establish
criteria and methodologies for making land-use
decisions on old-growth forests. This is not a
decision-making body. We are simply attempting
to come up with methods for measuring the real
impacts of decisions on the people of B.C.

On the negative side, important land-use deci-
sions have been made all over the country recently
by governments that did not consider the impacts
of their decisions on working people. The B.C.
government has reached a decision on the
Carmanah, the Ontario government on the
Temagami and the Alberta government is doing
all that it can to find someone to come up with its
answer on the timber supply of the north. Not one
of these decisions has been based on environmen-
tal concerns or on the needs of working people.

BRITISH COLUMBIA ... For those of you who
have not heard, the B.C. government chose to
divide up its most contentious valley, the
Carmanah, into two unequal parts, the larger of
the two is to become a park. In their press release,
the government admitted that workers would lose

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their jobs but did not
propose to do anything
about it. They also stated
that further studies
were required on the
areas designated for log-
ging. This last admis-
sion on their part indi-
cates that they have no
idea what area is re-
quired to be set aside to
protect the giant spruce.

ONTARIO. ..The Tem-
egami in Northern On-
tario is an even worse case of ignoring the needs of
workers. The Ontario Federation of Labour, the
NDP, the IWA and the Steelworkers of the area
were meeting on a regular basis with the Tema-
Augama Anishnabai in order to come up with a
plan that would help save the community and
provide the Native Band with meaningful input
into decision-making on

that applies across the country so that the compa-
nies and the public will know that when they
expend energy in one of these events, there will be
some accountability by the government for the
outcome.

Speaking of Manitoba, I was invited to be the
keynote speaker at the Manitoba Federation of
Labour Health and Safety conference in April.
They wanted to know about sustainable develop-
ment and what IWA-CANADA is doing about it.
Here are some of the things that I said:

... Sustainable Development: what do these
two words mean? Are they meaningless rhetoric
or a blueprint for planetary survival? It depends
on who uses them. If industry uses them in order
to say that our behaviour doesn’t have to change
— then the words are simply rhetoric. If they are
used by special interest groups to insist that all
industrial activity must stop — them they are
dangerous words that will create much hardship
for working people and their families and the
environment will eventually suffer.

SUSTAINABLE: In

resource-use in the area.
It was a plan that might
have saved local jobs
and it certainly would
have mended some of
the bad feelings in the
community.

The Ontario govern-

Recent land use decisions
have not been based on
environmental or worker

concerns

order for any activity,

sustainable it must be
politically, socially and
ecologically sustainable.

DEVELOPMENT: We
must talk about ‘appro-
priate development’. In

ment jumped in at the
eleventh hour and signed its own deal with the
Native People. Unfortunately, in their autocratic
way, the government chose to ignore all the good
work that had been done by the other stakehold-
ers. We are now trying to ensure that we have a
large chunk of the representation on the Steward-
ship committee. This committee will oversee the
development of the Temegami region and will be
comprised of fifty percent Tema-Augama-
Anishnabai and fifty percent Ontario government.
representatives.

ALBERTA AND MANITOBA ... It looks like
the governments of Manitoba and Alberta are
having a hard time understanding the meaning of
public participation. In Manitoba, where a suc-
cessful public participation process took place to
decide on the Repap conversion process, and
where that process established that it was all
right for the mill conversion to go ahead, the
government wants to start all over again.

In Alberta, where the public participation pro-
cess produced a report against the Alberta-Pacific
mill proposal, the government is looking for other
consultants to produce a different report! I guess
this tells us that we need a clearly defined process

order for it to be appro-
priate it must be compatible with the ecosystems
in which it takes place and it must suit the culture
within which it takes place.

The combination of sustainable with develop-
ment means development projects which are
appropriate to the ecosystem in which they take
place, which are acceptable to those people who
will be affected by them and which have been
agreed upon via a participatory democratic
process.

THE BASIC PRINCIPLE that flows from this
definition is that the environment and the econ-
omy must be given equal consideration in decision-
making. If we do not ensure that people's basic
needs are protetted and that meaningful work
with decent lifestyles are assured, the environ-
ment will not be protected. On the other hand, if
we do not ensure environmental protection, our
jobs will disappear, our health will seriously dete-
Tiorate, our social structures will disintegrate and
many many more of us will end up on bread lines.

Claire Dansereau is IWA-CANADAs
Forest and Environment Planner.

policy or process to be }

4/LUMBERWORKER/MAY, 1990