||A Review of: At the Global Crossroads: the Sylvia Ostry Foundation Lectures
by Martin Loney
Sylvia Ostry has been a prominent Canadian public servant, chief
economist, with the Organization for Economic Cooperation and
Development and chair of the Centre for International Studies at
the University of Toronto. Not surprisingly this slim collection
of essays organized by the Foundation established by her friends
and admirers addresses some of the key economic questions facing
Canada and the world. The issues of globalization and the rapid
increase in world trade and economic integration loom large.
The six lectures collected here were all given by prominent public
figures, including Jacques Delors, former head of the European
Commission, and Michael Camdessus, managing director of the
International Monetary Fund from 1997-2000. There is often a trade
off between an opportunity for wide-ranging discussion and the
merits of hearing from insiders who may be tempted to push the
agenda of their parent organizations at best or even exculpate their
own contribution. Camdessus outlines an enhanced role for the IMF
and his strictures on the need for G7 countries to pay attention
to their fiscal credibility and "their special responsibilities
as issuers of reserve currencies" bear repeating. The Bush
administration's squandering of the strong fiscal balance left by
Clinton and the soaring U.S. deficit must inevitably affect not
only the economic prospects of the U.S. but the stability of the
dollar internationally and thus the world economy. However those
looking for a robust defence of the IMF against charges that it has
neglected the world's poor while ensuring that restructuring programs
favoured foreign lenders will find little of substance here.
The most forthright contribution is the final chapter, a lecture
delivered by the former chair of the U.S. Federal Reserve, Paul
Volcker. In a refreshingly frank intervention Volcker castigates
corporate greed, the abuse of stock options and the outright
plundering of corporate resources. Volcker notes with dismay the
decline in auditing standards as major accounting firms have sought
to diversify into more profitable activities with inevitable conflicts
of interest. The auditor Volcker reminds us is "mandated to
serve the investor, not the particular corporate client." As
a call for the revitalization of "democratic capitalism"
from one of its leading exponents this is a tour de force.
Elsewhere Enrique Iglesias, President of the Inter-American development
Bank, welcomes Canada's growing interest in the region and urges
greater attention to Canada's role in trade and political development.
Some Canadians look nostalgically to Europe for an alternative to
our overwhelming dependence on U.S. trade. The Europeans have shown
little reciprocal enthusiasm. Latin America and the Caribbean, in
contrast, are banging on the door, with a market of 500 million and
a complementary interest in resisting U.S. continental hegemony
while working to increase trade and other relationships.