THE EMPIRE CLUB OF CANADA
President Ronald Reagan and Prime Minister Brian Mulroney
Tuesday, June 21, 1988
About this Event
A joint meeting of the Empire Club of Canada and the Canadian Club of Toronto. The President of the United States and the Prime Minister of Canada spoke after the seven-nation Economic Summit which was hosted by Canada. Mr. Mulroney begins with some comments on what was covered at the Summit. Issues include: the Free Trade Agreement; defence and security of North America; the environment; economic issues such as Third World debt; and the issue of agricultural subsidies. Reasons for the annual meetings. Some of the results, and an acknowledgement of the vindication of many of Mr. Reagan's policies. Some remarks about a continuing positive relationship between himself and Mr. Reagan. Mr. Reagan continues with some introductory remarks on America's relationship with Canada over the years. A review of the relationship today; why it is more necessary than ever. The changing world and North America's role in it. The intention and purpose of economic summits. Some common strengths and goals of Canada and the United States. The move toward a freer and more global market place. The technological revolution. Fighting protectionism. Results of the strong defence partnership between Canada and the United States, and NATO. East-West relations now. The new threat to security to be faced together: illegal drugs.
President Ronald Reagan, The President of the United States and the Prime Minister of Canada spoke after the seven-nation Economic Summit which was hosted by Canada
Mr. President, Mrs. Reagan, Mr. Prime Minister, Mrs. Mulroney, Your Excellencies, distinguished guests, ladies and gentlemen:
June 1988 is certainly going to go down in history as one of the busiest and most productive months in the lives of the four distinguished guests seated immediately on my left and on my right. We have a great deal to be proud of in our country. We are well aware of and thankful for the tremendous economic growth in Canada, the impressive employment creation, the Meech Lake Accord, Tax Reform and the Free Trade discussions, to mention just a few of the items that are occupying the time of the Prime Minister and our other politicians. Regardless of one's political persuasion, one has to be impressed with the pace of activity surrounding the first four years of Mr. Mulroney's tenure.
The agenda of this government is being undertaken and fulfilled with a strong sense of purpose and compassion, guided by a focus on the future and an understanding of the complexities of our nation. It is a course charted by our leader, who has a vision of a prosperous and free nation facing the challenges and opportunities in an ever-changing world. No leader can do so without the support and assistance of their spouse. You, Mrs. Mulroney, have worked relentlessly at his side as an advisor, and as wife and mother to your four children. Your tremendous volunteer activities, particularly on behalf of cystic fibrosis, have recently brought you well-deserved recognition.
For the first time in years, there are many of us who feel that we have a relationship with our great neighbour and friend to the south on a plane higher than we have ever reached before. Those dealings have taken the high road at every turn. This is perhaps the reason that a great compliment has been paid to us tonight to have the President, during a back-breaking schedule, come here with his first team and honour us with his presence. The man who has been able to assemble this distinguished guest list today is Prime Minister Mulroney. I think, sir, it says a great deal about the respect in which you are held that you have such extraordinary leaders around you in these last few hours of this most successful Summit.
Ladies and Gentlemen, the Prime Minister of Canada, The Right Honourable Brian Mulroney.
Prime Minister Brian Mulroney:
Mr. President and Nancy, distinguished guests, mes amis: I have the particularly happy duty of introducing to you tonight a great friend of Canada, Ronald Reagan, the President of the United States of America. This is an important personal occasion for me in that it is the last opportunity for me to welcome him to our country as President.
As you know, there is something in the constitution of the United States, called the 22nd Amendment, which apparently limits the lease on the White House to two terms. That brought to mind an incident that actually occurred to me about a year and a half ago. I was sitting at home on a Sunday reading the New York Times, and there on the front page was a headline that said "Reagan's popularity plummets to 59 per cent:' So right there I said: "There is the fundamental difference between Canada and the United States - language:' The word plummet obviously does not mean the same thing here as it does in the.United States. So I called the President at Camp David and I asked him whether he had seen this. He said "yes" and he was feeling a little down. I said: "Ron, I don't know how to break this to you, but 59 per cent on a good day is all that Margaret, Helmut and I will get together."
Next January, Ronald and Nancy Reagan will be taking their leave of Washington and returning to California and their beloved ranch in the hills above Santa Barbara. Since September of 1984, I have had the distinct pleasure of working closely with President Reagan. In the process, we have become friends. This is not to say that either of us has ever lost sight of the national interest of his own country, but I think that it has helped us to find the mutual interest of both of our countries. I suppose that too much can be made of special relationships between countries just as too much, perhaps, can be made of personal relationships between leaders. I don't think that this is the case between our two countries and I don't think that it is the case between these two leaders but others will have to be judge of that. Along the way Ronald Reagan and I, as well as Nancy and Mila, have become very good friends. There is more to this than simply a case of a couple of Irishmen getting along or even singing a song. By the way, I want to tell the singer tonight that both the President and I appreciated his talent and we viewed it with great envy.
We decided early on that the best way to manage our relationship, the relationship after all between the two most important trading partners in the world, was to meet on an annual basis and to phone whenever either wished. That is exactly what we have done over the years. If you go back and look at our communications beginning with the Quebec Declaration and the various joint declarations emanating from it, you will see the agenda and the task we set for ourselves. It was a challenging agenda on trade, on defence and on the environment. I suppose it is fair to ask at the end of the day: "What have we achieved?"
The Free Trade Agreement is going to give Canada access to a market of 250 million people, half of them within a day's drive of Toronto, making Toronto the centre of access to the biggest and richest market in the world. It's a good deal, a very good deal for both of our countries.
On defence, we have renewed our commitment to the security of North America and we are going forward with the Warning System as well as completing the modernization of our air and naval defences.
On the environment, we have shown leadership in such issues as the deterioration of the ozone layer and toxic wastes in the Great Lakes and we have more to do on the troubling issue of Acid Rain. Secretary Shultz and External Affairs Minister Joe Clark are addressing that actively, pursuant to instructions from the President and requests from us at the end of the last meeting.
As always, there is much unfinished business between our two countries, but I believe the annual meetings between the President of the United States and the Prime Minister of Canada have become a permanent feature of our affairs. They have helped to focus our agenda and to galvanize our officials.
We have addressed some of the most complex and difficult economic issues here in Toronto, from the troubling question of Third World debt to the challenging issue of agricultural subsidies. One of the reasons for these annual meetings is that we live in an increasingly inter-dependent world. As the President noted last week in his particularly thoughtful address to the Atlantic Council, over the years the Economic Summits have been a corner-stone of co-operation among the major democratic economies. They are part of the superstructure of Western strength and East-West affairs. In East-West relations, we have seen more than a thaw under Ronald Reagan, we have seen infinitely more than a thaw, more than detente, we have seen the coming of a new season of hope. That season of hope came about because Ronald. Reagan said from the very beginning that there was one way to bring the Soviet Union to a realization of peace and that was from a position of strength - the strength of the United States and the solidarity of the alliance. That is exactly what is taking place.
I can say without hesitation that we saw tangible results while watching the President and Nancy a few weeks ago in the Soviet Union doing so much on behalf of human rights; being so active on behalf of the Refuseniks; on Jewish Immigration and most of the troubling social issues apart from the great questions of war and peace. The results, Mr. President, have vindicated your policy of the strength and solidarity of the alliance. An entire class of missiles is being eliminated with stringent verification procedures. This is an important step, not just in arms control, but in arms reduction. And so an era is indeed drawing to a close, a period in world history that will be known as the Reagan years, that will by and large be remembered as a time of peace and a time of prosperity. The world of 1988 and President Reagan's last Summit here in this magnificent city of Toronto is far removed from that world of 1981 when he attended his first Summit here in Canada. Whereas we stood then on the brink of the deepest recession in a half a century, the Western economies are now in their sixth consecutive year of unprecedented recovery and expansion. As with the improved prospects for a durable world peace, I tell you ladies and gentlemen, that this is due in no small measure to President Reagan's leadership and his courage and vision for a better world.
The President has done more than stay the course. He has changed the course of American and world history. On a personal note, I have always found Ronald Reagan engaging, good humoured and generous. I should tell you that the first time I ever had the chance to meet with him in the Oval Office, I was Leader of the Opposition. May that never happen again. (I just said that to give Senator Gerry Grafstein cardiacarrest.) I met with him in June of 1984 and that very morning in the Washington Post the reports had come out on the economy, (if it's in The Post, it's accurate). Growth of 6.9 per cent was reported in the previous quarter; unemployment was down to under seven per cent; investment was up 12 per cent. I said to the President: "My God, those are wonderful numbers. Boy, would we love to have those in Canada." He said: "You know, Brian, it's funny- they don't call it Reaganomics any more:'
We have not always agreed but we have always agreed to begin from the basis of friendship between our two countries and between ourselves. I shall miss our meetings, Mr. President, but I shall continue, as will Mila, to value our friendship. We wish you and Nancy good health and long life. Our Irish ancestors put it in another way: "May the road rise up to meet you, may the wind always be at your back, may the rain fall soft upon your fields and the sun shine warm upon your face, and, until we meet again, may the Lord hold you in the palm of His hand:'
Ladies and Gentlemen, the President of the United States.
President Ronald Reagan
It is a pleasure to join you. Toronto, like Canada, is brimming with strength, vitality, and self-assurance. Those qualities, together with our similar heritages and common values, have made the relationship between the United States and Canada unique. We have been best friends, important trading partners and allies for more than a century-and-a-half.
In many ways, America's relationship with Canada has been the vanguard of our relations with other nations. Our first environmental treaty - over boundary waters - involved' Canada. Our first permanent mutual defence relationship was with Canada. And the agreement to remove ships of war from the Great Lakes was our first arms reduction pact.
You may have heard me say that nations don't distrust each other because they are armed. They are armed because they distrust each other. With the longest undefended border in the world, Canada and the United States are proof of the flip side of that - when nations live in trust and friendship, they live in peace.
Today, our relations are better than ever. Over the last four years, the Canadian-U.S. partnership has grown and strengthened. In a world that is changing before our eyes, we need each other's friendship as never before. And in many ways, that is what, for Brian and me, the last three days here in Toronto have been about - the changing world and the role of North America in it.
As you know, we have just finished meeting with the leaders of the five other major industrial democracies. These annual economic summits have played an important role in the revival of growth in the industrial world.
This year's summit was informal yet highly focused. It was a get-down-to-basics, open-for-business summit. The progress achieved may not become fully evident for months, but it was substantial. Much of the credit for this success belongs to one of the democratic world's strongest and best leaders and someone whose friendship I cherish. It is rare that a personal friendship between two leaders can change the course of history - rarer still that it changes it for the better. But I believe that's the case here. No, we don't always see eye-toeye, but, then, what two Irishmen ever do? So let me just pause here to say thank you for his vision, leadership, and friendship to my colleague and your Prime Minister, Brian Mulroney.
As I said, economic summits are not intended to produce blockbuster announcements. They are regular business meetings. They give those of us around the table a feel for what the others are thinking. In economics at this summit, we advanced the process of co-ordinating policy. We agreed to work together to ease the debt situation in the poorest countries of Africa. Turning from economics, in East-West relations, we reaffirmed a common position on human rights, on the need to reduce the massive conventional forces imbalance in favor of the Soviet Union and its allies. In other areas, we underscored the need for a common fight against terrorism and the international narcotics trade. And finally, we said once again that we would work to resolve regional conflicts in the Middle East, the Persian Gulf, Cambodia, and South Africa.
You will see a great deal about our discussions in tomorrow's headlines. But sometimes - maybe most of the time - history is not made in headlines, and we don't recognize great turning points until they are long past.
This summit was held against the backdrop of a transformation as dramatic as the one you find at the place on the Prairies where the Rockies meet the plains. Less than a decade ago, inflation, stagnation, decline, and despair characterized the economies of nearly all the summit nations. Today, we live in a time of hope.
I know that I don't need to tell you this, because, as it was in the summit, Canada is a leader. In the last four years, among industrial nations, only Japan matched Canada's economic growth, while Canada created more than a million jobs, and, confounding the experts of just a few years ago, did it while keeping inflation in check. How? One answer, of course, is that you have been deregulating industry, moving government out of the ownership and management of industry, and reducing marginal tax rates. But another answer is that you have reaffirmed an old faith - faith in the abiding, universal truth that economic growth does not spring from the numbers and graphs in government bureaus but from the hopes and aspirations of ordinary people.
You have said, in effect, that the key to the future is in a simple human face. It is not the face of someone famous, but someone who carries a dream, an excitement, a drive. And despite others calling that person impractical, he or she goes out and builds a dream into a business. Sometimes the dream is technologically sophisticated. Sometimes it's as simple as the store on the corner. This person is the driving force behind all growth. And because he or she can come from any part of society with ideas that will often seem eccentric, at least until they are tested, we in government cannot help this individual. We can't effectively target money or other assistance. We can only keep out of his or her way. We can, as you have, reduce taxes and regulations, and open markets. We can give freedom. Like you, we in the United States have also rediscovered that human face, that enduring truth; and as it has for you, the spark from this faith in freedom has rekindled our fires of opportunity, invention, and growth.
Yes, as I looked around that summit table these last three days, it seemed to me we have come to a moment in which, as it must have when John Cabot landed on the shores of Newfoundland nearly 500 years ago, humanity stands on the shores of a new world and for a moment holds its breath in awe and wonder. Each of the summit nations has turned away from statism and toward the market. This movement toward freer enterprise is worldwide, stretching from India to Argentina and beginning to reach even into China and, now, the Soviet Union.
Already on this continent, that light has ignited a bonfire of entrepreneurship and technological innovation unlike anything mankind has ever seen. As one physicist noted not long ago: "The entire industrial revolution enhanced productivity by a factor of 100. The microelectronic revolution has already enhanced productivity in information-based technology by a factor of more than a million. And," he added, "the end isn't in sight yet:"
The heart of the technological revolution that produced them, that has, at the same time, put desk-top computers in homes across our continent while making North American industry vastly more productive - the heart of this revolution is a tiny silicon chip you can hold on the tip of your finger and still see most of the finger. Today, a single chip has the incredible power of a million transistors, that is, of the biggest computer of the 1960s. Yet, one of North America's most prominent research directors predicts that in less than 15 years, the power of a billion transistors will be packed on a chip. That's the power of 20 of today's most advanced supercomputers - all in a lap-top computer, available to every entrepreneur and executive.
Already this new technology is transforming our offices and factories, creating many jobs, eliminating others. And for that reason, some people fear it. I understand that. I remember returning to Hollywood from the service. Before the war I'd achieved the status symbol of all contract players. l could get away with saying: "I quit at six o'clock." When I got back, I decided I'd better re-establish this right from the start. The first day of shooting, I sought out the first assistant. I said: "I think we should get one thing straight. I quit at six o'clock." He shot back: "Well, you're going to be pretty lonesome that last hour. We quit at five." It seemed that with wartime excess profits tax, everyone started to think of production costs as mostly government money, so why not share the wealth. They started leaving early, and loosening standards.
Pretty soon, though, Hollywood had to shape up. It faced a new challenge from a new technology called television. Within a few years, studio employment dropped by thousands, and many predicted Hollywood would die. But Hollywood adapted. Many Hollywood people found work in TV, and that included a certain actor. The studios themselves discovered new markets, among them the television market. Today, almost as many people have jobs in the movies as at the peak, and even more work in broadcasting, which now faces the new technologies of video and cable.
This story of challenge and growth is not just the story of movies and television, but of all humanity in its long climb from the swamp to the stars. Do we dare stop climbing? Would we want to stop - especially we North Americans, we who, as Winston Churchill said when he addressed your Parliament during the bleakest days of the Second World War, have not journeyed all this way across the mountains, across the Prairies, across the centuries, because we're made of sugar candy. Nothing could turn us back faster from the new technological horizon and the morning of its promise than to do what some would have us do and hide from the growing global marketplace.
Your Prime Minister and I want to keep the world on the path of hope. This is why we have joined together in pressing for a new round of international trade talks, in working for reform of the agricultural policies of the summit nations, and, of course, in negotiating a Canada-U.S. Free Trade Agreement. That historic agreement, once approved by your Parliament and our Congress, will throw open the doors to the world's largest free-trade area. It will benefit not only our two countries but all nations now wrestling against the siren temptation of protection. Already Canada and the U.S. produce the world's largest volume of trade. The U.S. has a larger volume of trade with Ontario alone than with most other countries. Who better than Canada and America to show those who hear the call of protection that there is a better way?
With the European Community scheduled to remove internal barriers by 1992, we can hope that the two great continents of Europe and North America will become the dynamic engines of an even faster-expanding, open world economy. Our Free Trade Agreement will create in North America the world's most powerful market.
In the past, whenever we North Americans have lowered trading restrictions, we have seen our economies bloom like mountain meadows after a spring rain. Hasn't the moment come for another flowering? Some say that open trade and easier access will lead to an erosion of cultural distinctions. But I believe that to find North America's true future under this agreement, we need to look no farther than Canada itself, where distinct cultures have lived, worked, and traded together while respecting each other's differences for generations.
With protectionist storms brewing everywhere, the choice in both our nations and among all the summit countries is between moving forward toward freer trade, or backward toward the protection and isolation that are relics of another age. We cannot, for example, expect the limited free trade of today to remain secure if trade in other products becomes more and more restricted. We cannot stand still.
Let's remind those who call for sweeping separation that we have long worked in common for common goals, to protect our common security and peace, for example. Of course, some have criticized this security partnership, often saying that if we build weapons, we are bound to use them - which makes me wonder where they've been the last 40 years. In my country's Air Force museum there is an entire B-36 bomber, one of the first planes used for mutual security and an early part of NATO's nuclear umbrella. It has wings twothirds the length of a football field, six rear-mounted propeller engines, four jet booster engines, and lots of vacuum tubes. At one time it could carry a 10,000-pound bomb load and fly 10,000 miles. Three hundred and eighty-five were built. Most have been junked. None was ever flown in combat. Their only job was to keep the peace. It was kept. And now, because of NATO's strength and steadfastness, the Soviets have agreed for the first time to join us and eliminate an entire class of nuclear weapons. Is there any better answer to those who, in the name of peace, oppose a strong defence partnership?
Canada and America have been partners for peace, not just in maintaining a strong Western defence, but all over the world. From Cyprus to the Sinai, from pressuring the Soviets to get out of Afghanistan to supporting democracy in the Philippines, we have worked together.
I saw one of the fruits of our partnership during my recent visit to Moscow. I had some contact, not enough, with the Soviet people. They lined the streets by the thousands. I was amazed by their sincere warmth. Their faces were filled with hope, the hope, I believe, that they might be entering a new era in human history, an era of peace and, yes, of freedom. As I said at Guildhall, I found Mr. Gorbachev to be a serious man seeking serious reform. He and I talked about those reforms, as well as about regional conflicts, human rights, and arms reduction. Our discussions focused on freedom of choice and other individual freedoms. But as I also said at Guildhall of the security partnership between North America and Europe in NATO, "let us stay strong." Without our strength, the tide of oppression and expansion would never have been halted. Our partnership and that of our allies is the hope of all peoples who yearn for freedom. So, as the Prime Minister said so well in his speech to Congress in April, "We wish [Mr. Gorbachev] well, but history obliges us to retain a strong measure of skepticism about the Soviet system." We can all be, as the Prime Minister said, "in some ways - from Missouri."
Over the last three days, the summit partners here in Toronto discussed East-West relations. And we took up another threat to the security of our nations, a comparatively new but frightening one - illegal drugs. Drugs have only once before been on our agenda. Handling of money is proving the drug trade's weakest point. The drug trade is conducted primarily in cash and needs international banking to move and launder its money. Canada's strong support is reflected in the historic commitment endorsed by all the Summit leaders in the Toronto Communique. It is time to shut the teller's window to drug lords and close the money laundries for good.
So, yes, in ensuring the security not only of our nations but our ideals, in fighting the drug scourge, in leading the world economy to a future of opportunity and growth - the partnership between our countries is at the centre. It is the example to our allies and the world.
And so today, mankind, standing on the shore of a new continent, a new age of invention, adventure, and growth, holds its breath, and for one lingering moment wonders - go forward or go back. Let us choose life. Let us choose hope. Let us turn to the horizon and greet the morning and continue the adventure that our forefathers started so many years ago when, with faith and freedom, they landed on this great, strange, continent and began to build a newer world.
Thank you. And since this is my last official visit to Canada, let me add here publicly to Brian Mulroney, a colleague for four years and a friend for life, a particular thank you. Brian and Mila, God bless you, and God bless you all.
The appreciation of the meeting was expressed by Gordon Riehl, Partner, Deloitte, Haskins and Sells, and President of the Canadian Club of Toronto.