famine. Several Southeast Asian and African countries are suffering similar shortages and are seeking outside supplies.

"The dangers of mounting underemployment and unemployment are for many countries even more severe than the threat of food shortages. Masses of young people born during the 1950's are now entering labor markets in numbers far beyond available jobs. For these countries, two drastic efforts are essential: One is to create employment opportunities for those young people who will be entering the labor market in the next 15 years. The other is to take vigorous measures now to reduce birth rates so that the situation will improve, rather than deteriorate, after that time.

"Bringing family planning services to the masses of the people, especially in the rural areas, is particularly difficult in most African and Latin American countries. There is a strong feeling among many national leaders that family planning services, to be acceptable, must be provided in the context of maternal and child health (MCH) or general health services. Yet in these countries such health programs now reach only a small percentage of the people. Family planning services added to them will also reach only this small percentage. These countries and donor agencies and governments, including the United States, must consider further measures by which such countries can establish basic health services reaching into the remote rural areas.

"Even more fundamental than this problem is the possibility that substantial reductions in fertility can be attained only if there are significant improvements in social and economic conditions. Yet the combination of limited resources and rapid population growth may make general development too slow to create the needed downward trend in fertility. This situation points to a need for specific development projects and programs which are likely to have the greatest potential for creating conditions conducive to lower fertility. Recognizing this need, the nations at the November 1972 Second Asian Population Conference stressed their belief that 'while population has a direct effect on economic and social development and the human environment, conversely, policies in the fields of education, health, housing, social security, employment, and agriculture have an impact on population and, therefore, require integrated national planning and coordinated action at the highest level of government.' It is important that the United States and

other donor governments and agencies providing assistance to population/family planning activities coordinate such assistance more closely with their assistance in other sectors of development.

508-3670-73-9

Reading List

1. Agency for International Development. Population Program Assistance. Washington, D. C.: U.S. Government Printing Office, December 1971.

2. Ehrlich, Paul R. Population Resources Environment: Issues in Human Ecology. San Francisco, Calif.: Freeman, 1970.

3. Ginzberg, Eli. Manpower for Development. New York: Praeger, 1971.

4. Helfrich, Harold W., Jr. The Environmental Crisis: Man's Struggle to Live with Himself. New Haven, Conn.: Yale Univ. Press, 1970.

5. Nanus, Burt. "The World of Hunger--A Management Challenge." Columbia Journal of World Business, January-February 1971, pp. 51-58.

6. Population Bulletins. Washington, D. C. Population Reference Bureau, Inc.

7. Ruttenberg, Stanley H. Manpower Challenge of the 1970's: Institutions and Social Change. Baltimore: Johns Hopkins, 1970.

8. Thomlinson, Ralph. Population Dynamics: Causes and Consequences of World Demographic Change. New York: Random House, 1965.

9. U.S. Commission on Population Growth and the American Future. Population and the American Future. Washington, D. C.: U.S. Government Printing Office, December 1971.

10. U.S. Congress. Senate Committee on Labor and Public Welfare. Declaration of U.S. Policy of Population Stabilization by

Voluntary Means. 1971 Hearings, 92nd Congress. Washington, D. C.: U.S. Government Printing Office, 1972.

11. Wasmuth, William J. Human Resources Administration: Problems of Growth and Change.

Mifflin, 1970.

Boston: Houghton

INTERNATIONAL ECONOMICS

The past two decades have seen the building of a closely knit international economy. Remarkable growth in international commerce has gone hand in hand with sustained prosperity; each has contributed to the other. At times, deep and obvious strains in the international monetary system have imperiled this progress, but these difficulties have been weathered without a serious setback in economic growth or world trade.

The world economy emerged from the Second World War in a gravely weakened state with many countries suffering severely from war damage. However, the recuperative strength of the Western European nations, assisted by U.S. aid, resulted in rapid economic recovery.

The fruits of unprecedented prosperity are still not being fully shared by nations in Africa, Asia, the Middle East, and Latin America. The future growth of these nations must be built primarily on the skills, intelligence, and labor of their citizens. However, the developed countries can facilitate the process by providing technical assistance, public and private capital and access to markets.

During the 1950's, the increasingly prosperous countries of Western Europe liberalized trade and capital movements substantially. Meanwhile U.S. capital moved in to promote economic growth abroad and contributed to expansion of world monetary reserves, and in turn helped the expansion of world trade.

The growth of world trade and income continued and accelerated during the 1960's. But there have been periodic monetary disturbances. U.S. balance of payments deficits have continued to date, except for 1969. Important problems remain. Recent financial disturbances have emphasized the need for further evolution to insure that the system can continue to support growing world trade and prosperity.

The President's report to the Congress of February 1972 reflects the following pertaining to international economics:

"The year 1971 marked a turning point in the world economy. We undertook a series of far-reaching measures which revitalized our foreign economic policy and set the stage for fundamental and long term reforms in the international economic system.

"The Setting for Change. In the immediate postwar period new arrangements and institutions to govern the international economic system were established. At that time the United States was the preeminent economic power in the world and assumed primary responsibility for the economic viability and security of much of the non-Communist world. We launched the Marshall Plan to help Europe to get back on its feet. We assisted in the economic recovery of Japan. We encouraged European economic cooperation.

"Along with other nations, we helped to establish the International Monetary Fund (IMF) to promote world monetary cooperation; the General Agreement on Tariffs and Trade (GATT) to create a code and a mechanism for the orderly conduct for international trade; and the World Bank to assist reconstruction in Europe and provide assistance to the less developed nations. These formed the institutional basis of an international economic system which promoted the expanding flow of commerce and resources needed to restore free world prosperity.

"Since those institutions were established the world economy has undergone major structural changes. Both the volume of commerce and the transfer of financial resources have increased greatly. The industrial capacities of Europe, Japan, and Canada have grown rapidly, and each is now a strong trading and financial power. These new realities needed to be reflected in both our foreign economic relationships and international institutions and arrangements. In 1971 our policies were directed at achieving that objective.

International Monetary Policy

"After two decades of stability and progress, a series of crises beginning in the late 1960's had shown that the international monetary system could not cope adequately with the scale and