Clinton urges G-7 to join to create jobs

March 15, 1994|By New York Times News Service The Los Angeles Times contributed to this article.

DETROIT -- President Clinton called on Japan to stimulate its economy more and on Europe to lower its interest rates, as he opened the jobs conference of the world's leading industrialized nations yesterday. But he also used the occasion to call for putting a lid on U.S. interest rates.

"I think that since there's no inflation in the economy, interest rates should not continue to go up," he said.

Mr. Clinton's remarks were part of an address to the finance, labor and economic ministers from the Group of Seven major industrialized democracies about how they must now cooperate in facing their common problem -- unemployment -- in much the way they have cooperated for the last 50 years to defeat communism, to stand up against Iraqi aggression and to expand the global trading system.

In effect, Mr. Clinton called on the group to transform itself from an exclusive club of statesmen who gather annually to talk about issues of high finance and high diplomacy into a global employment agency focused on "the challenge of creating a high-wage, high-growth society in mature industrial countries."

At issue in the G-7 nations -- in which there are more than 30 million unemployed people -- is a phenomenon known as the "jobless recovery," the post-recession economic rebound that has not brought with it the customary growth in employment because technological advances are wiping out jobs. This trend has been particularly severe in Europe.

The president said that to produce jobs, each of the G-7 -- Britain, France, Germany, Italy, Canada, Japan and the United States -- must do more to retrain workers, improve productivity and promote a more flexible job market.

Unless the governments do more to stimulate their economies, he said, there will not be enough jobs, and workers will not be willing to accept the costs they are being asked to bear, whether fewer benefits, relocation or retraining.

"The United States should continue to bring its deficit down," the president said. "Japan should increase domestic demand through more government spending and tax cuts so that its consumers will import more from the rest of the world. And Europe should continue to work for lower interest rates, so that these three things together can spark a new round of worldwide growth, which will create more economic activity and more jobs in European countries, in the United States and Canada and in Japan."

Just in case Alan Greenspan, the chairman of the Federal Reserve, did not get the subtle hint, Mr. Clinton told reporters when asked if rising interest rates in the United States were choking the recovery: "I don't think we can say that for sure yet. They were bound to go up some after the fourth-quarter growth figure came in. We had the highest growth rate in a decade. But I think that since there's no inflation in the economy, interest rates should not continue to go up. If they moderate and tail off, then we'll be all right."

For their part, Japanese officials here signaled no willingness to expand their stimulus program. German officials also refrained from giving any sign that their nation would follow Mr. Clinton's advice.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.