A group of "establishment" business, labor and academic leaders warned yesterday that an increasing protectionist trend in the Western developed countries could boomerang by curbing the ability of less-developed nations to buy the rich world's goods.
This was among the central conclusions of a report by a trade panel of the Economic Policy Council, sponsored by the United Nations Association of the U.S.A. Inc. and chaired by William D. Eberle, former special U.S. trade representative.
At the same time, the Eberle report said that a "key to an open and expanding trading system" is a U.S. economy that is operating with relative price stability and full employment. Only in this circumstance, the report said, can American goods be competitive in world markets, while foreign goods enjoy access here.
The endorsement of these positions, including an emphasis on incentives for business investment to improve lagging productively, was thought to represent a shift by the participating labor leaders away from their recent drift toward protectionism.
Key labor members of the Eberle trade panel included Sol C. Chaikin, president of the International Ladies Garment Workers Union, Jacob Sheinkman, secretary-treasurer of the Amalgamated Clothing and Textile Workers Union, AFL-CIO; and I. W. Abel,, retired president of the United Steelworkers of America, AFL-CIO.
It challenges resorting to a deliberate slowdown of economic growth as a way to beat back inflation, noting that slow growth also means loss of jobs and absolescence of equipment.
To some extent, the report raises more questions than it answers. But it has many sharp or specific suggestions and criticisms:
New international monetary devices are needed to deal with a shaky dollar and creaky international monetary systems. Referring to trade bodies as well as the IMF, the report says "old institutions . . . must renew themselves and learn to cooperate more closely."
As governments intervene -- for example, the United States by its "orderly marketing agreements" -- to restrict trade, they bring about cartelization. "The distinction between what is fair and what is unfair competition is gradually becoming blurred," the report adds.
Fears of domination by American multinational companies are fading as similar enterprises develop elsewhere, and governments play a bigger role in "state-trading activities of their own." One cautious suggestion: multilateral rules covering governments as well as multinationals.