[Congressional Record Volume 145, Number 26 (Friday, February 12, 1999)]
[House]
[Page H648]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   GLOBALIZATION THE SINGLE MOST IMPORTANT ISSUE FACING THE WORLD'S 
                             ECONOMY TODAY

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Massachusetts (Mr. Frank) is recognized for 5 minutes.
  Mr. FRANK of Massachusetts. Mr. Speaker, I believe the most important 
issue, the single most important issue facing our country today and 
other countries in the world is how we deal with the globalization of 
the economy. That is a fact. It is a fact spurred by technological 
change and other matters beyond anyone's control.
  I do not believe it is reasonable to talk about stopping 
globalization because that is not an option we have, but we do have a 
choice to make as to how we will go forward, and there are at least two 
competing models. One is the argument that says all we need do is let 
capital find its highest level, let the owners of capital invest 
wherever in the world they think they can get the best return, urge 
every government to facilitate that process by making themselves as 
attractive as they can be to capital, and the result will be that most 
people will be better off.
  Domestically, we call that the trickle-down theory because what it 
says is, do not worry about negative effects on income distribution. Do 
not worry that to attract capital some places will cut their 
environmental standards and reduce taxes on the wealthy. Do not worry 
that this will reward the owners of capital disproportionately. In the 
end, we will all be better off.
  There is an alternative conception. It is one that Franklin Roosevelt 
began in the early thirties in this country and it is one that says let 
us have for ourselves the benefits of capitalism, let us get the wealth 
creation that comes from the incentive structure that the free market 
gives us, but let us then come together and deal with some of the 
adverse impacts that this system will have.
  Indeed, most recently that is a message that has been articulated by 
his Holiness Pope John Paul, II, who has called not for the abolition 
of a market system in the world's economy but for a recognition that 
the market system cannot be the only lodestar by which we make 
decisions.
  I am encouraged that the Clinton administration has been moving in 
the direction of understanding that what motivated Franklin Roosevelt 
in the early thirties, the need to preserve the best parts of 
capitalism while dealing with some of the excesses and inequities that 
can result, that that must be applied internationally.
  No better indication of that came than in the speech by Secretary of 
the Treasury Rubin at the recent World Economic Conference in Davos. 
Davos has not been known as a place where people come together to 
discuss compassion and equity and liberal principles. It has been a 
place where the free market and free movement of capital has been 
exalted.
  And it is thus particularly significant that in the course of a 
speech talking about the importance of globalization and going forward 
with it and creating a structure to contain it, Secretary Rubin, 
himself a man who messed in the markets, who for years in the private 
sector before becoming a very successful Secretary of the Treasury, was 
a leading figure in the financial community, nationally, 
internationally, it is significant that he included the following 
statement at his speech at Davos:

       We must do far better in enabling all of our citizens to 
     participate in the growth and economic well-being produced by 
     the global economy. That means not only strengthening social 
     safety nets for those in greatest need and promoting core 
     labor standards around the world, but also greatly increasing 
     investment in education and health care to provide all of our 
     citizens with the requisites for economic success.
       The World Bank and other multilateral development banks are 
     deeply engaged in pursuing these objectives and deserve our 
     full support, and here, most significant of all, from a man 
     who is now Secretary of the Treasury of the United States and 
     a former extremely successful leader at Wall Street.

  Along these same lines, and I am now quoting Secretary Rubin again, 
``I do not believe that a market-based economic system and a healthy 
global economy are sustainable unless we take strong steps to address 
the tremendous income inequality that is all too evident around the 
world within nations and between nations.''
  This is the sort of philosophy which, if it is made concrete, will be 
the basis on which we can come together and go forward in the areas of 
trade and promoting international development and promoting 
international economic activity.
  The recognition that capitalism unadorned is not enough but that a 
combination of the capitalist system and public policies which protect 
vulnerable people against the excesses that are inherent in that 
system, that is the basis on which we can come together, and I am 
delighted to congratulate Secretary Rubin. I do not think this is a 
message that has often been heard in Davos, and certainly not from 
someone of the public and private eminence of Secretary Rubin. It is a 
very promising move towards the policy consensus that we need.

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