After a trenchant sketch of the reasons for the decline in American competitiveness that blames business as well as the government, Professor Behrman of the University of North Carolina argues that there have to be new rules for world trade and investment. The old ones broke down because they did not provide what many countries regarded as an equitable distribution of benefits. The way out is not through new global rules, but by a series of regional and sectoral arrangements for relatively free trade based on something like an agreed allocation of production; the structure of investments is to be worked out by multinational corporations and local suppliers. The novelty and difficulty of some parts of this prescription will remind readers that the phoenix is a fabled bird.
