Ninety-five percent of food price the past 10 years. « Policies needed to end |. , U Bs S. control By WILLIAM KASHTAN The government has finally admitted that Canada is in a recession. This economic recession has been al is being drastically worsened for Canadian working people by policies made in the USA and exported Canada by the Carter administration. ee The results of the recession are already evident. The auto industry is in crisis. The housing industry isin crisis. The crisis is spreading out to other sectors of the economy. Unemployment is rising. Infiation is rising. Living standards are declining for working people in the cities and in the farm communities. This recession threatens to be deeper and longer lasting than previous ones. ‘ Despite this the government, through finance minister MacEachen says inflation is the number one | s in the Soviet Union have not risen in problem. a This means that government policy directed to restrict growth, restrict living standards and create Bleak economic forecast ahead TORONTO — Canada’s cost of living figures for May were up a significant 1.2% over April, to re- gister a 9.4% annual inflation rate. This biggest jump since March, 1979, meant that goods and ser- vices costing the consumer $100 in 1971, now cost $207.60. Such. _ uncontrolled inflation, combined with other deep economic trou- bles, including mass unemploy- ment, is aggravating the crisis of Canada’s political system, and the growing crisis of confidence in it. The labor movement, or- ganized farmers, consumers, pensioners, the unemployed, all of whom have responded with protests to the crisis policies which constantly lower living standards, were seen stepping up the pressure on Ottawa and the provincial governments to adopt policies to stop inflation. The new inflationary rise — which reduces the 1971 dollar to statistics: 7.8% of the labor force are jobless even by official stan- dards. In reality more than a mil- lion workers are without work. The number of briefs, resolutions and convention decisions from organized workers and farmers, the Communist Party and sec- tions of the New Democratic Par- ty, indicate the increasing de- mand on governments for policies independent of the USA, and to curb the powers of monopolies who dictate current policy. A report prepared for a major newspaper reveals that an esti- mated three million people in this have consistently pointed out these dangers, and demanded new policies. Workers and working farmers express the increasing realization that the monopoly corporations and multi-nationals are the real threat to living standards. This general idea was voiced recently by CLC president ' Dennis McDermott. Related directly to that is the frequently-heard call now for nationalization of key sectors of the economy, so that they can be controlled by, and the profits utilized by, society as a whole. The Communist Party’s consis- tent call for an anti-monopoly co- alition is, party spokesmen point out, directly aimed at changing the calamitous policies of Liberal and Tory governments. The latest cost of living and unemployment figures, projected * into the future by business lead-. ers, only serve to justify all the demands and plans for action de- veloped by the labor movement — J.L. No price hike since 1970 MOSCOW — Retail prices are not going up in the Soviet Union. In the USSR’s socialist economy these prices remain stable despite increasing costs, because the overwhelming majority of prices are fixed by the state. (The excep- tion is prices on the collective farm market, which are regulated by supply and demand, and which accounted for only 2.5% of na- tional trade in 1979.) What is happening in the Soviet Union is a large-scale increase in wholesale prices, a move which, in Canada, would immediately boost prices for consumers. In data prepared by Leonid Korenev, an economics com- mentator for Novosti press agen- cy, it is noted that some of these wholesale prices, particularly ‘those for industrial products like energy and fuel, are being rasied substantially. ‘ Korenev, noting the im- TALE OF TWO PRICES country live below the poverty line. And, if Canadians are di- vided into five income levels, it shows, the top fifth receives 42% of total income, while the bottom fifth gets a mere 4%. According to a recent survey of businessmen, although profit levels are surging upward, our economy is headed down, partly in response to an approaching se- vere recession in the USA. Polled by the Conference Board of Canada, the chief executives of 240 large companies registered gloom and pessimism. They see ongoing mass unemployment and double digit inflation ahead; but what worries them are signs of less profit on investments. Nearly 60% of the executives questioned see worsening condi- tions in the six months ahead; in the first quarter of 1980, only about half that many had so grim a view. But labor bodies — unions, labor councils, provincial federa- tions, the Quebec centrals, and portance of keeping the economy efficient and its sectors profitable, points out that wholesale prices in Soviet industry have not been substantially altered since 1967. Industry’s overall potential has doubled, new types of production have come into being, the fuel and energy complex has» radically changed, the economic develop- ment of Siberia has gained momentum, and so on. Despite this, Soviet stores are continuing to sell 95% of foods, and more than 90% of nonfood items at the same prices as in 1970. This can be achieved be- cause of the way the socialist sys- tem works. : Wholesale prices are affected by bringing more raw materials - from less accessible and sparsely populated areas in the north and east of the country. The invest- ment in the development of west Siberia alone, Korenev points out, (and it is the supplier of half of all Soviet oil output) amounts to 50-billion rubles in the 1976- PACIFIC TRIBUNE—JULY 4, 1980—Page 6 1980 period. (On foreign ex- change markets the ruble is equal to about $1.75 Canadian.) Production costs are growing in coal, timber, peat and thermal power development. Geological prospecting in the fuel industries repays only half the investment at current wholesale prices, and the figure is one-half in the timber re- forestation industry. Therefore, wholesale prices will be raised, as of January 1, 1982, as follows: coal by 42%, commercial timber by 40%, rates for thermal power by 70%. Prices for gas will go up by commen- surate amounts. Electricity prices will rise by 12%, iron and steel products by 20%, and non-ferrous metals by 14%. At the same time, new con- servation measures will be intro- duced within industry. ‘*Since the price revisions do not affect retail prices,’’ Korenev explains in his data, ‘the produc- tion costs of some consumer goods may be higher than the re- tail prices charged for them.’’ He explains*further that the state- owned industries will be reim- bursed for this from the state budget. The natural response of Cana- dians would be to say that the consumer then pays in the end — -if not through higher prices, then through higher taxes. But in the USSR it works a different way. ‘‘Meat and dairy products, for instance, are subsidized to the ex- tent of 20-billion rubles. In this way the government pays about one-half the cost of the beef the consumer buys. Since the bulk of state revenue (over 90%) is made up of deductions from the profits of state enterprises (Trib emphasis) rather than by taxes, the subsidies will not affect consumer spend- ing. ‘*When all is said and done,”’ comments Korenev, ‘“‘the re- vision of wholesale prices in Soviet industry will help speed up its growth with due account of the changes taking place in its structure.” i unemployment, will be continued. = Canadians already know from past and bitter experience that creat: ing unemployment to combat inflation is not only immoral. It has HOF worked and it won’t work. What can check inflation are curbs on the power of monopoly and the corporations. = More and more Canadians aré beginning to see that the source ofth crisis is capitalism aggravated further by U.S. control over the Cana- dian economy. } This means that cosmetics will not cope with the recession. needed today are far reaching measures of radical reform. We need policies to end U.S. control over the economy. The illusi¢ that a branch plant economy would serve Canada’s interests proven to be false. The illusion that policies of integration, of contin” entalism with the USA would create permanent jobs and protect living standards have also proven to be false as can be seen in the auto path” and its negative results for auto workers and for Canada. Es Canadians are faced with the hard but necessary task of Fe structuring the economy and making it work in Canada’s interests, the interests of the working people, and not of monopoly and multi-nationals. — Instead of pouring billions of dollars, taken out of the hides of ed people and of Canadian industry into the coffers of the oil corporations, - we need to use part of these billions for industrial development building of secondary industry. 4 An investment and development fund should be established with direct labor representation on it to decide on Canada-wide develop” ment projects which in turn would further strengthen Canada’s dependence. ; 3 Instead of importing industrial machinery from the USA which COSt over 615,000 direct jobs, this should be produced in Canada by establishment of crown corporations to undertake such job creé projects: : Instead of boycotts and embargoes against the Soviet Union, we n® policies to extend all-sided trade with that country and with 4 the socialist countries. The USA has shown itself to be an uncerl@ and irresponsible trading partner. Canada needs stable, long © markets that are only possible on the basis of détente, not of cold wat While undertaking these longer term programs the government 4 parliament should also adopt the following immediate measures: e An immediate job creating crash program to include a vast cost housing program, a network of child care centres subsidize? * government and corporations, a training and retraining program trade union rates of pay. e Legislation to make it mandatory on companies to consult W! unions at least a year in advance on questions of layoffs, plant moving — and closures, and mandatory payment by companies of at least year’s severance pay. e Living standards should be protected. Workers must be assured a job or an adequate income as a right. 4 e Together with the above measures legislation should be adop* in all government agencies instituting the 32 hour work week with BO reduction in take home pay. Moreover, all firms doing business the government and its agencies should be compelled to introduce § clauses as a condition for receiving contracts. ¥ During the election campaign Prime Minister Trudeau, speaking” Windsor stated that ‘the Liberal Party puts people first and it’s on thé basis that we will worry about the deficit after we finish worrying 2)", the unemployed. These are the people we want to think about first These are fine sentiments. But judging by the statements =~ MacEachen and the inaction of the government so far, they are empty words. The government must be made to translate these words economic and social policies for Canadian independent economic © velopment in the interests of the Canadian people, not the m nationals. : Jass_ This calls for firm and united action by all parts of the working © and democratic movement. Resolutions alone won't do the trick. is a time for widespread mass actions to compel parliament not onl listen but to act to put Canada and Canadians back to work. : The Communist Party of Canada appeals to the Canadian * Congress, which adopted sound economic and social policies at recent Convention in Winnipeg, to initiate such mass actions ©? ganized labor that in turn will bring together, in a common front, © sections of the working class and democratic movement to exert maximum pressure on government and on parliament to act now. ‘Ina country as rich as Canada with all its great resources, and there is absolutely no reason for recession, unemployment, 10” and lowered living standards. Planning based on public ownershit with a people’s government to implement such a program coul these once and for all. r Wi This statement was prepared by Communist Party leader fe ai Kashtan on behalf of the Central Executive Committee of the .