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KVOS Special: The European Common Market and You
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- France, German Federal Republic, Italy, Luxembourg,
- the Netherlands, like giant pieces of a jigsaw puzzle,
- the six countries of Western Europe
- that have formed the European Community are moving side
- by side to make one big picture.
- Frontiers are melting.
- And eventually, there will be none at all.
- Big changes are going on now.
- What is this transformation that is taking place in Europe?
- What will this transformation mean to Canada and the United
- States?
- What will it mean to businessmen and wage earners
- in Washington state and British Columbia?
- The European Common Market and you.
- Now here is Andy Anderson.
- Joseph C. Harsch has been a European correspondent
- for the Christian Science Monitor for over 30 years.
- He has been watching the development
- of the European Common Market or more
- properly called the European Economic Community
- since it first stirred in the imaginations of Jean
- Monnet and Paul Henri Spaak.
- In Seattle recently, Mr. Harsch called the emergence
- of the European Common Market the single most important world
- event in his lifetime, the World Wars, the atom bomb,
- and the race for space not withstanding.
- In it, he saw a great promise for a Europe
- strong both economically and politically,
- a Europe that could shoulder some
- of the burdens of the free world, which had been resting
- heavily on the United States.
- Newscasts filled with talk of Berlin and disarmament
- are neglecting the big story in his judgment.
- Tonight, Channel 12 spotlights the Common Market
- in an attempt to learn what it is
- and what it means to you and to me.
- The problems of Canada created by the current Common Market
- situation are twofold.
- If Britain enters the common market,
- as it appears at this time that she will,
- Canada will not only face the newly created external barriers
- of the European countries as the United States will,
- but she also will lose the preferential treatment
- in trading with Great Britain that has normally been afforded
- the Commonwealth countries.
- A good many Canadians have asked the question we recently
- put to Mr. W.K. Ward, the British trade commissioner
- in Vancouver.
- Why is Great Britain joining the European Economic community?
- Well, I think the short answer to that, Al,
- is that we've come to a conclusion
- that this is the best thing we can do in our own interest
- and in Europe's interest and generally
- in the interests of the world.
- We think that a larger community of European nations working
- together economically is going to lead to a stronger Europe.
- And we think that in these days when
- we've got to have regard to the communist empire on our flanks
- and our responsibilities in the world
- that a strong Europe is a good thing.
- From the standpoint of Britain particularly, of course,
- it would be extremely difficult for us
- to view with comfort a market of this size,
- of 180 millions, the fastest growing market in the world,
- and ourselves detached from it.
- To comment on this and discuss the importance of the EEC
- to Canada and the United States, here is Dr. James Robb.
- The economic expansion of the European Common Market has been
- much more rapid than Britain's.
- With the expansion of business, unemployment
- in all the Common Market countries
- has been substantially reduced.
- The foreign trade of the European Common Market
- countries has been increasing more rapidly each year
- since the formation of the Common Market.
- In fact, Britain's exports to the Common Market
- increased about 20% last year.
- The rate of growth of trade between Common Market countries
- has doubled since the formation of the Common Market.
- The European Common Market has an ever increasing need
- for a wide range of consumer and industrial products.
- However, joining the European Common Market
- does create a number of significant problems
- for Britain.
- One of the principal problems it creates
- is the future of the Commonwealth.
- Mr. Ward makes these observations
- about the Commonwealth.
- Would it be fair to say that by Great Britain joining
- the European Economic Community, it's
- deserving its children, deserting the Commonwealth?
- Oh, not at all.
- I think quite the contrary.
- You talk of Britain joining the Economic Community.
- But of course, the situation is that Britain
- has applied to join and has applied
- for the opening of negotiations on the conditions of joining.
- And one of our major considerations
- here, a great worry to us is how we
- can reconcile to the best mutual advantage, the best
- interests of the Commonwealth of Britain and of Europe.
- And again, it must be true that looked at generally,
- a strong Britain is a good thing for the Commonwealth.
- And a weak Britain is a bad thing for the Commonwealth.
- The Commonwealth should benefit from the increased strength,
- which we hope Britain will acquire by joining
- in this European organization.
- The paramount problem created by Britain's joining
- the Common Market creates for the Commonwealth
- is the possible loss of imperial preferences.
- This would subject Commonwealth countries
- to the common external tariff of the Common Market.
- While at the same time, the European countries
- would have free access into the British market.
- Britain has, over the years, reduced the amount
- of preference that Commonwealth countries
- enjoy over non-Commonwealth countries.
- Today, only about half of Britain's imports
- from Commonwealth countries enjoy tariff preferences.
- Furthermore, the amount of preference for specific items
- has been reduced over the years.
- On the other side of the coin, less than half
- of Britain's exports to Commonwealth countries
- enjoy preferred treatment.
- Even Canada has reduced the amount
- of preferential treatment for British exports
- throughout the years.
- The gains to the Commonwealth far exceed the short term
- losses, in my opinion.
- First, joining the Common Market will put new life into Britain.
- It will make her prosper and grow.
- A healthy Britain is a better market
- to the Commonwealth trade than an economically stagnant
- Britain.
- Second, Britain as a member of the Common Market
- will represent the Commonwealth within the Common Market.
- Third, Britain's negotiations with the Common Market
- will bring many trade preferences
- for the Commonwealth countries that they would not be
- able to achieve by themselves.
- Later, Mr. Ward was asked about his impressions
- on Canadian business opinion on the Common Market.
- Is it correct to assume that British business in general
- unlike, or, let me correct that, Canadian business in general
- unlike the Canadian government is
- favorably disposed to Britain's bid to the EEC?
- Well, I think that's really a question for Canadian business
- itself to answer.
- And I think that as far as the West is concerned,
- with which I'm more familiar, some of the leading industries
- have already answered it.
- The lumber industry, for example,
- I believe the fishing industry have come out
- loud and clear and said that they think
- that an association of Britain with the Common Market
- would be a good thing from their point of view
- because they too are taking the view that a stronger
- Britain, a better, more prosperous Britain
- means better business opportunities for them.
- As far as the East is concerned, as I say,
- I'm not at all so clear.
- But I can see that the problem there
- is more complex because of the greater interest of the East
- in the shipment of manufactured goods.
- And there, a great deal will depend
- partly on the tariff situation that emerges,
- the situation with the common tariff, and partly also,
- of course, on the nature of the goods
- and the competitiveness of the goods that the East of Canada
- produces in the European market.
- Canadian business looks at the European Common Market
- with mixed reactions.
- Those industries involved in manufacturing look
- at the European Common Market somewhat apprehensively.
- On the other hand, the natural resource industries
- see new markets created by the vast economic expansion
- of the Common Market.
- Since the British Columbia economy is based primarily
- upon natural resources, the outlook for BC products
- is generally excellent.
- When considering manufactured goods,
- the impact of the European common market
- on Canadian business is somewhat clouded.
- The external tariff of the Common Market
- will undoubtedly hurt some Canadian manufacturers.
- But it will have little or no effect on others.
- One thing is certain.
- The European Common Market offers
- unparalleled opportunities to Canadian manufacturers
- who can tailor their goods for the European market.
- The Canadian agricultural industry,
- however, is not generally favored
- by the European Common Market.
- Although the European Common Market
- seeks to expand trade in manufactured goods
- and in raw materials, it seeks to protect home markets
- for the farmers of the European Common Market.
- Canadian wheat is seriously affected.
- However, with this commodity, there is a note of optimism.
- Canadian wheat is a type demanded by European millers.
- Although the European Common Market
- may cause some short run hardships
- for some Canadian businesses, on the whole,
- I feel the European Common Market
- will have a stimulating effect on the Canadian economy.
- Of all Canada's provinces, British Columbia
- has more to gain from the expansion
- of the European Common Market than any other.
- Mr. Ward was asked his opinion on the future direction
- of Canadian foreign trade.
- Will Britain's entry into the EEC
- lead Canada to closer economic ties with the United States?
- Ah, well, that really is a question,
- I think, for the Canadian government.
- And I do think that the Canadian government itself would
- find it impossible to answer at this stage.
- Because as I said earlier, Britain
- is at the stage of negotiating with the Common Market
- countries, the European Community countries,
- as I prefer to call them, and we don't know any more
- than Canada knows at this stage what
- the outcome of these negotiations will be.
- One idea which has been advanced by some people for greater US
- Canadian trade is the establishment
- of a free trade area between Washtenaw
- County and the Vancouver area.
- Reg Rose, the general manager of the Vancouver Board of Trade,
- comments on this proposal.
- Mr. Rose, what is your attitude toward free trade
- between Canada and the United States?
- Well, any development that will help
- in the advancement of trade, whether it
- be international or multilateral trade, is to the good.
- We in British Columbia believe in reciprocal trade
- because we export so greatly so many of our commodities.
- And we recognize that there must be a buy
- as well as sell relationship when we're talking
- about international trade.
- An idea has been suggested that a free trade area be set up
- along the US Canadian border possibly Whatcom County
- and the corresponding area in British Columbia, which
- would allow total free trade between the two countries,
- but only within this area.
- And the idea would be to use this as an experiment, a Guinea
- pig, if you will, toward eventual elimination of all
- trade barriers between the United States and Canada.
- What do you think of that idea?
- Well, I think it would be administratively difficult
- if not federally from the point of view
- of the federal government impossible, certainly
- at this point, impractical.
- Because obviously, we must deal with the country as a whole.
- What would happen about the final destination of the goods
- coming in allegedly to British Columbia,
- but being fanned out across the country?
- Or alternatively, what goods going
- into Washington, which could be fanned out through the country?
- There is no control over this because your laws,
- as I understand them, as in Canada,
- prohibit the setting up of tariff barriers between states
- on your part or provinces on our part.
- And the final destination couldn't be controlled.
- Therefore, I think the administrative problem alone
- would have a bearing in this matter.
- In other words, what would happen
- is everybody would funnel all of their goods
- through this one little open door in the trade barrier?
- Well, they might not.
- But they could unless there were certain restrictions, which
- at the moment, I can't see being put into effect in Canada.
- Also asked to comment on this proposal
- was Robert Rose, the Washington State director
- of the Department of Commerce and Economic Development.
- Well, it would appear to me that the most reasonable approach
- would be to gear this to a reasonably long range
- program, perhaps directed towards a gradual lowering
- of tariffs, perhaps incorporating a lowering
- or elimination of tariff on individual commodity items.
- Whichever way it goes, I think that this is something
- that we don't do overnight.
- I think that it should be geared to a reasonable period of time
- in order to allow us to make the necessary adjustments.
- And probably not then restricted to individual geographical
- areas along the border?
- Well, again, it would seem to me at least that any attempt
- to do this on a segmented border type of approach
- would be highly impractical.
- Consider for a moment the reduction
- of trade barriers between the United States and Canada.
- Any program of trade liberalization
- and tariff reduction must be carefully planned and executed.
- Both governments must work together
- in order to reduce the shock of lifting trade barriers
- on domestic industries.
- Trade is a two way street.
- It involves a give and take.
- No nation can receive all favorable concessions
- and give up nothing.
- A nation's government must first be concerned with its economy
- as a whole and secondly with the problems faced
- by specific domestic industries from foreign competition.
- Robert Rose was asked to comment on the effect
- of the European Common Market on Washington state.
- What do you think the long term effects
- will be for the European Common Market on the economy
- of Washington state?
- Ultimately, and over the long haul, nothing but good.
- I think that this is a direction in which we in the West
- must move.
- I would say this, that perhaps during a transition
- period while these adjustments, these eliminations
- are being made, we do have to exercise considerable care,
- because inevitably, it would appear to me at least,
- some people are going to be hurt or at least run
- the risk of being hurt.
- And I would certainly hope that in developing this program,
- that the government gives considerable attention
- to how best carry these types of industries or activities
- through this transition period.
- What are some of the industries in the Northwest Washington
- area that might possibly feel a pinch initially?
- Oh, quickly, one, our leading industry, I think, timber.
- In order to better understand the influence
- of the European Common Market, one
- must consider the importance of Washington's export trade.
- Washington exports more per capita
- than any other state in the United States.
- In 1960, Washington's exports of manufactured goods
- ranked ninth in the United States.
- Three principal Washington exports and manufactured goods
- were, first, transportation equipment.
- The export of this type of equipment
- ranked third in the United States.
- Second, paper and allied products, Washington
- leads the nation in the export of these products.
- Third, lumber and wood products, the export of these products
- ranked second in the United States.
- Washington's agricultural industry
- also has a substantial stake in world markets.
- $0.21 out of each dollar's worth of farm products
- sold by Washington farmers came from exports.
- Thus, one can see international trade is of major importance
- to Washington state.
- The countries of the European Common Market
- are some of the principal customers
- for Washington exports.
- The opportunities created by the European Common Market
- are highly favorable to Washington state business.
- Some further meaning of the European Common Market
- and its effect on one of Washington's export industries
- is provided by Mr. Lawson Turcotte, president of Puget
- Sound Pulp and Timber Company.
- The European Common Market now consists
- of six countries, Belgium, France, Italy, West Germany,
- the Netherlands, and one other.
- Luxembourg.
- Luxembourg.
- And they have started in 1957 to reduce
- all their internal tariffs.
- By 1961, they have reduced them 40%.
- By 1967, they will have eliminated all tariffs, which
- will put them in the same shape as the various states
- of the United States.
- Now the problem here is that the Common Market does not
- affect too much the pulp and paper industry because they're
- not a producer.
- But if the Scandinavian countries, Sweden and Norway
- and Great Britain, for that matter,
- enter the Common Market, this will change the picture
- somewhat.
- Won't it?
- That will change the situation entirely.
- Because if we have the Scandinavian countries,
- such as Sweden and Norway, I don't think Finland will join,
- and Sweden and Norway get into the Common Market,
- then they will join the tariff free group.
- And they will have external tariffs
- against the rest of the world.
- And with the large production of Sweden and Norway
- in pulp and paper, it's possible that it
- could harm our exports greatly.
- This is prepared by the American Paper and Pulp Association
- and shows the very complicated thing
- that this Common Market is and what they are going
- to suggest at the hearings.
- In other words, give advice to the people
- who are going to make these deals on the pulp, paper,
- and paper board.
- This is the copy of the policy statement
- in which Mr. Turcotte referred.
- It's typical of interest shown by both businesses, trade
- associations in world trade.
- Mr. Turcotte comments further on the European Common Market.
- Turning to the picture economically for the nation
- as a whole, you're a member of the board
- of directors of the National Association of Manufacturers.
- What is the attitude of American business
- generally toward the European Common Market?
- Well, I would say, in the National Association
- of Manufacturers, there are many very divergent views,
- depending which industry the members belongs to.
- But on the whole, they are watching it.
- They are studying it.
- They will probably make representations
- at the hearings.
- And it's a very complicated question for one association
- to represent the whole United States
- in a very controversial subject at this time.
- They're taking a wait and see attitude?
- Wait and see, yeah.
- But they will be participating in the upcoming
- Senate and congressional hearings on the president's
- recommendations?
- Yes.
- I see.
- Thank you very much.
- In general, US business has favored the creation
- of the European Common Market.
- But this feeling has not been unanimous.
- One factor which indicates the optimism of US business
- in the future success of the European common market
- is the tremendous increase in US business investment
- in this area.
- In the last five years, the investment
- of US business in manufacturing facilities in Western Europe
- has doubled.
- Another factor which shows the importance
- of the European Common Market is the growth of US export
- to this area.
- From 1953 to 1960, US exports to all countries increased by 60%.
- Whereas US exports to the European Common Market
- countries increased by 130%.
- As a comparison, during the same period, US exports to Canada
- increased by only 2%.
- Recently, Washington state senior Senator Warren G.
- Magnuson, the chairman of the United States Senate Committee
- on Interstate and Foreign Commerce,
- said this about the European Common Market.
- One of the major problems before this Congress, of course,
- is the whole matter of world trade.
- This has been greatly affected in our future
- in the trade of the world by the formation
- of the Common Market in Europe.
- The Common Market's composed of nations
- that trade among themselves without tariffs
- or without discriminations, a great deal
- like we trade between states.
- This poses a great problem for these United States
- because we have been historically traders
- unilaterally with a given country and a given
- commodity and a given product.
- Now for instance, if we want to ship, say, our fruit
- to the United Kingdom if they should join the Common Market,
- they could not agree to accept it under any tariff terms
- unless the rest of the countries agreed to this.
- So we either have to get in to the Common Market,
- halfway in or all in, or work out some arrangements, which
- we may be able to work out with all the countries involved.
- The Senate is in the process of beginning hearings.
- The administration has sent up a bill.
- And it's going to really pose a great deal of discussion,
- controversy, but I think we'll probably
- come up with a good trade program
- giving the president much more authority
- to be flexible in decisions quick, make them quick,
- and raise and lower tariffs to contend
- with this problem in the world.
- In the last few weeks, the United States
- announced that it had successfully concluded a trade
- agreement with the European Common Market, which
- lowered mutually the tariff rates on about 1,500 items.
- These negotiations were the first negotiations
- by any country with the European Common Market.
- The results demonstrate the willingness
- of the Common Market to liberalize terms of trade
- with outside nations.
- Mr. Chastanet, a noted French journalist
- and author on the European Common Market,
- makes these observations.
- What will be the European Economic Community's attitude
- toward nonmembers, particularly the United States and Canada?
- Well, I think that to nonmembers, the European
- Economic Community's attitude will be
- and is a most liberal one.
- The common external tariff, that is the custom duties applied
- to goods coming from outside, is already low.
- And it was quite recently, quite simply
- decided to lower it by a further 20% in favor of the United
- States and also of Canada.
- It must be emphasized that the Common Market is in no way
- a protectionist device set up against the outer world.
- On the contrary, one of the chief aims
- is to prove that a sound economic organization
- on the part of the free world is beneficial to the whole.
- In conclusion, it can be said that the opportunities created
- by the formation of the European Common Market
- are highly favorable to both the United States and Canada.
- And they are especially favorable to British Columbia
- and to Washington state.
- Although the original external tariff
- of the European Common Market creates some problems
- for both Canadian and US business,
- the recent tariff concessions by the European Common Market
- are highly encouraging.
- This action by the European Common Market
- clearly indicates that the European Common Market
- is outward looking, and it does seek
- to expand world trade in addition
- to increasing its own internal trade.
- As we began this program, we talked of Joseph C. Harsch
- and his optimistic, almost jubilant analysis
- of the importance of the European common Market.
- But Mr. Harsh and others have also
- commented on the more sober aspects, those aspects that
- reflect the problems which may be created for you
- and me as citizens of Canada and the United States,
- as businessmen, and wage earners.
- It has been said that it is dangerous to look upon
- the European Common Market as essentially a strong political
- tool of the free world in its conflict with the Iron Curtain
- countries, that the European Common Market is more
- pro-Europe than it is anti-communist,
- that we cannot predict with exactness what its stand will
- be in the Cold War.
- But I think we can predict its general attitude.
- In doing so, one comes to the conclusion
- that the economic progress, the raised standard of living,
- and the tremendous economic power of Western Europe
- growing out of the Common Market will not
- lead the peoples and the governments of Western Europe
- to a position that is at all comforting to the Kremlin.
- But if Western Europe is to become
- an effective anti-communist weapon as well
- as a pro-Europe movement, there are many pitfalls
- to be avoided.
- First, the birth of a political unity out of an economic unity
- is fraught with labor pains.
- If this development were to become too divisive,
- it could endanger rather than strengthen
- economic common security.
- And secondly, the rise of Europe as an economic competitor
- to the United States and Canada is
- fertile ground for dissension between the two allies,
- a pregnant place for the communists
- to attempt to drive a wedge between those essentially
- compatible and cooperative groups of nations.
- Some believe that Russia's new ambassador to Washington,
- Anatoly Dobrynin, has as one of his jobs
- the subtle promulgation of the idea that the Soviet
- Union and the United States have a common need
- to protect themselves from the effects of Europe's
- new economic union.
- The question is simply this, are the United States and Canada
- to become partners or rivals of the European Economic
- Community?
- Will we cooperate while competing,
- or compete while fighting Europe tooth and nail?
- The policies are yet to be decided.
- Before Canada can develop a firm policy,
- it must know what advantages and disadvantages will
- accrue to it after Britain's negotiations with the ECM
- are completed.
- In the United States, President Kennedy, the Congress,
- and members of the business community
- are at work right now developing points
- of view, recommendations, policies, and alternative roads
- to a solution of the problem.
- When sifted and surveyed, these will be molded
- into a definitive US policy.
- It would appear that whatever policy our countries adopt,
- there will be some short range pain, problems,
- which will in the next five years, cause cries of anguish
- from certain quarters.
- What the long range future holds for Canada and the United
- States generally, and what the next 10 years
- holds for Washington State and British Columbia will
- be determined, we believe, by whether we
- choose to be partners or rivals of the Common Market.
- Europe is certainly on the move.
- Nothing we can do will stop it.
- But upon how we react to it will depend
- the final outcome of the European Common Markets
- and you.
- This program is produced and directed by Al Swift.
- Editorial advisor was Dr. Gerald V. Egerer.
- Your narrator was Andy Anderson.
- This program was produced by the Channel 12
- Department of Public Affairs.
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