Energy is likely focus of June economic summit
Washington — This year the West's revolving economic summit alights at Venice, where two presidents and five prime ministers will probe the murky future and try to chart a path of cooperation.
The June meeting in the famed city of canals will be the sixth annual get together of Western heads of government since French President Valery Giscard d'Estaing invited allied leaders to huddle at the Chateau of Rambouillet in November 1975.
That meeting came as the world was struggling out of its deepest economic recession since World War II, triggered by the Arab oil embargo and the quadrupling of the price of oil by the Organization of Petroleum Exporting Countries.
What did Rambouillet and subsequent summits -- Puerto Rico (1976), London ( 1977), Bonn (1978), and Tokyo (1979) -- accomplish?
"One measure of accomplishment," a senior Carter administration official said , "is the difference in [Western] response to the crash of 1929 and to the recession of 1973-74."
In 1929, the official said, "governments tried to export unemployment by shutting their doors to imports from other lands."
The US Congress, for example -- in an effort to protect domestic farmers and industry -- slapped the highest tariffs ever on foreign goods, through the Smoot-Hawley Act of 1930.
Swiftly America's trading partners raised barriers against US exports, world trade plummeted, and Smoot- Hawley -- or protectionism -- later was seen to have contributed greatly to world depression.
At Rambouillet, by contrast, Western leaders vowed to reject the "beggar thy neighbor" approach of protectionism and to cooperate in trade, monetary, and other economic realms.
Has it worked? Oil prices, after all, continue to soar, gold gyrates up and down, inflation rides high throughout much of the industrial world, and so does unemployment.
But, summit planners insist, things might well have been worse had not the top leaders of seven countries given a clear signal to their bureaucrats to cooperate.
On trade, for example, former US trade negotiator Robert Strauss says, summit leaders "got the bureaucrats out of their trenches," where they had been bogged down in endless detail during the so-called Tokyo round of Multilateral Trade Negotiations (MTN).
Now the MTN agreement has been signed, Congress has ratified it for the United States, and world trade should flow more freely in years ahead, benefiting the nearly 100 nations that took part in the long debates.
Other summit endeavors, either accomplished or set in train:
* Summit leaders, a top US official says, "persuaded the World Bank to invest in developing countries to produce energy."
* Government chiefs of the seven summit powers -- the United States, Canada, Britain, France, West Germany, Italy, and Japan -- spurred oil-importing industrial lands to set national import ceilings on petroleum.
This process will be advanced when the 20-nation International Energy Agency (including all summit powers) meets in March to set new oil import targets.
* Both West Germany and Japan agreed, after summit pressure, to speed up their economies and open their doors wider to foreign goods.
This year, in Venice, there may be one surprise: a new French proposal by President Giscard d'Estaing for reform of the international monetary system.
Trade, for the first time in several years, should play a minor role at Venice, unless some specific trade dispute -- over steel, for example -- requires a decision at the top.
Energy, as far as can be foreseen, will head the agenda -- both the cost and supply of oil, conservation, and joint efforts to expand production of national energy sources.
US officials, in addition, hope to focus discussion on how best to help the poor nations of the world increase their own food and energy output.