onntiorsn All arclibighameeenaity apeiron

Vietnam war a major cause

WHAT’S BEHIND THE GOLD CRISIS?

By EMIL BJARNASON

Another monetary crisis
has come and gone. On
Sunday March 17th, the
international monetary
authorities found the solution
to the gravest of such crises
Since 1929 by laying the
foundations for the next.

Tens of thousands of speculators,
lured by the unique profits that only
a rise in the price of gold can bring,
sank their savings in gold bullion or
gold stocks in the past few weeks and
woke up this Monday morning to find
the prospect an illusion.

Yet those speculators, however
wrong they may have been as to
timing and detail, had based their
actions on a perfectly sound
appraisal of the underlying situation.
They knew that the Johnson
government had committed itself to
a disastrous. course leading to
collapse of the dollar, from which
there could be no escape within the
rules of the game. Where they made
their error was in underestimating
the capacity of the U.S. and its allies
to change the rules. és

Why was the dollar in trouble?
A simple analogy will perhaps help
to explain.

Before the introduction of present
day banking laws, the monetary
system of the capitalist countries
Operated on the basis of two
institutions: the gold standard and
the banking system.

Under the gold standard, all values
were supposedly measured in terms
of gold. When the supply of goods
increased faster than the supply of
gold, the shortage of gold-backed
money caused prices to fall. This
discouraged production of goods and
stimulated the production of gold,
thus tending to reverse the situation.

Similarly, when the gold supply

increased faster than the production
of goods, prices rose, and set the
opposite process in motion. Thus the
gold standard supposedly
automatically regulated the price
system and kept it stable.

But along side this was the banking
system. People deposited their
money in banks, which loaned it out
at interest. But because it was
inconvenient and even dangerous to

‘carry the gold about, borrowers

were just as happy to accept notes
promising to pay in gold. And since
the bankers were rarely required to
deliver the actual gold, they availed
themselves of the opportunity to

lend, in the form of notes, ten or
twenty or forty times as much gold
as they actually had in their vaults —
and, of course, collect interest on it.

SYSTEM SHAKEY

This system worked fine, from the
bankers point of view, but it had two
unfortunate consequences. First, on
the few occasions when the public
came to realize that they were
holding notes equal to many times
the amount of gold the bankers had
available to redeem them, all
depositors would attempt to draw

See GOLD CRISIS, pg. 3

Te)

Financial Post Story Reveals

FRIDAY, MARCH 22, 1968

VAST GIVEAWAY PLANNED

Resources sellout

linked to Bill 33

By MAURICE RUSH

The Financial Post headline from the March 9 issue
reproduced on this page tells a big part of the story why

Premier W. A. C. Bennett wants to build and control the.

superport at Roberts Bank, and why he wants to throttle labor
with Bill 33. It also explains in part his anti-Canadian stand.

Huge Japanese trusts are investing
hundreds of millions of dollars in
B.C. raw material industries with a
view to extracting them for export to
Japan. In Japan they are being
processed into manufactured goods
for resale to Canada and the rest of
the world.

Exports of raw materials from
B.C. ports to Japan last year came to
about $483 million- up 44 percent
from 1966. If the outflow of raw
materials to Japan continues at the.
same rate in 1967 it could surpass
present exports to the U.S.

The Kaiser deal which will see coal -
from the Crow’s Nest shipped to
Japan in large quantities through
Roberts Bank, has served to draw
public attention to the rape of our
resources being carried out by
Japanese and U.S. corporations with
the direct collusion of the B.C. and
‘Federal governments.

The Financial Post estimates that

we are only seeing the beginning of
the vast Japanese —,and in some
cases, Japanese and U.S.-takeover of
B.C.’s mineral treasures. In 1967
B.C. mining rose to a production
level of $392 million. Now. the Post
says that this will rise to one billion
dollars in the forseable future.

‘Japanese companies interested in

{for lumber

B.C.’s mineral resources include all
the well-known mining and smelting
monopolies which dominate Japan.

-- Not only are these companies

buying large mining properties
outright, but in many cases are

Superport

too—Bonner

Attorney General Bonner said
the proposed Roberts Bank port
js needed for export growth and
not for coal alone.

Bonner told the Insurance
Agents’ Association of B.C.
convention at Richmond that
although Roberts Bank is talked
about in terms of coal export to

Japan, it is also necessary for
saore exports of B.C. lumber

The above story, which appeared in
the Province this Wednesday, confirms
the charge made in this article by the:
PT’s associate editor, that the Socred,
government wants to control Roberts,
Bank so that it can be turned into a
vast outlet for the export of raw
matericls of all kinds on a scale never
before seen in our history.

The Financial Post

Japanese invest more in B.C. than in U.S.?

entering into deals under which loans
are made which are repayable in raw
materials. Two examples are the
deals made by the Mitsubishi and

. Sumitcomo interests which took over

control of the production of Granisle
Copper and Wesfrob Mines on the

“Queen Charlottes by lending large

sums of money in return for
exclusive export contracts.

Japanese mining and smelting —
companies are interested in every
type of mineral found in B.C. They

see B.C. as a vast source of raw
-materials needed by their processing -

industries in Japan.

While their main interest is in_

minerals, Japanese financial groups
are also interested in B.C.’s forest
resources. They are already involved
in three large pulp projects,
including the $43 million Crestbrook
project at Prince George.

Despite warnings from the late_
Chief Justice Sloan in his famous
report on forestry, that severe
restrictions should be put on the
export of raw logs, there has been in
recent months a big jump in log
exports. In 1967 log exports reached
the highest figure since 1941 — 190
million fbm. Nearly all of this has
gone to Japan along with the
thousands of man-days of work
which their processing could have
meant to jobless B.C. woodworkers.

In the last two years Japan has
come close to replacing Britain as
B.C.’s second largest market for
forest products — the main one being

VOL. 29, NO. 12

the U.S. And the demand for raw
forest products is expected to expand
greatly in the next few years.

It is reported that the Socred
government is engaged in secret
negotiations with Japanese business
‘men covering many future deals for
B.C. raw materials. This is indicated
by the heavy emphasis in Victoria on
the coming B.C. government
pavillion at Expo 70 in Osaka.

The major reason why the Bennett
government wants control over
superport facilities at Roberts Bank
is because it wants unquestioned
control over the outlets for shipping
vast quantities of raw materials
from our forests, mines and other
resources to Japan and the U.S. It
also wants to ensure that facilities
will be built to handle not only coal
from the Crows Nest, but also logs,
lumber, pulp, minerals, oil and other
exportable raw materials.

<=

Tribune

_10c

It’s clear from the Financial Post
story, and from the many moves
made by Premier Bennett recently,
that B.C. is entering a new stage in
the process of giving away our raw
materials in return for quick profits
for promoters. In this new stage the
emphasis will be on the giveaway of
mineral resources — primarily to
Japan.

We are about to witness the
biggest sellout of the province’s
mineral resources in our history.
The job of alienating our forest
resources to foreign monopolies,
mainly U.S., has been largely
completed and most of our best
forest lands are already in the hands
of these monopolies. Now mining is
next.

The explanation for Premier
Bennett’s anti-Canadian stand —

See RESOURCES, pg. 11

Bill 33 can
be defeated

See Communist Party

statement on page 12