Proposals designed to use stockpiles and buffer stocks to achieve price stabilization and better resource use have a long history. They are super- ficially simple to understand. The benefits seem clear. And yet I am well aware that this is not a simple subject: the more one studies it, the more complex it becomes. Worldwide interest in re- source management, while receiving fresh impetus from the OPEC actions, also has a long and chequered history. Those venturing into such ter- ritories must be forewarned of the traps and pit- falls which abound. Interest in these schemes has waxed and waned over the years with the fluctuating fortunes of the producers or consumers. As I write this paper towards the end of 1977, I am acutely aware of the low ruling prices for zinc, copper, and nickel._x000D_
These sacrifice prices remind me that it is difficult, for example, for a surveyor, to be calm and rational if he is up to his neck in a swamp full of crocodiles. He might be forgiven for forgetting that the aim was to drain the swamp! I am also aware that when swamps are drained, painful and dangerous stumps sometimes stick out._x000D_
Hence, in looking at the subject of stockpiles and resource management we must not set our sights too high, perhaps not initially hope for perfec- tion, if we want to secure worthwhile changes. My approach is to acknowledge a bias for the market system. We have, however, had experience (remember the 1930s) of some weaknesses in the untrammelled operation of free markets. Thus our international economic relationships over the past 20 or 30 years have been based on a desire to retain as much as possible of a liberal world trading system backed by such organizations as the GATT, IMF, and the U.N. to ensure the necessary cooperation. Some nations have seen this system work only partially in their best in- terests. GATT, for example, has been reasonably effective in liberalizing trade in many manufac- tured goods but far less so in regard to agricultural or semi-processed goods.