It is always popular with people to proclaim a new era or a new divide in history which will usher in a fundamental change in our societies. For the most part, people living through such a period very rarely recognize it, and it is almost universally true that these ages of transition do not acquire a name until long after the event.

No one living in the age of the Renaissance proclaimed it as such, and yet, despite this fact, it is difficult to escape the feeling that we are now at some kind of a historic watershed. Some observers even now perceive an era of vast change.

One of the men who understand the ways of the world best works as a stevedore on the docks of the West Coast, but in his spare time is one of our leading philosophers. This man, Eric Hoffer, recently wrote: "The revolutionary changes of our time are taking place in countries outside the Communist sphere. These countries have revolutions without revolutionaries. In the Communist world, where time stands still, there are self-styled revolutionaries but no revolutions." This is also the theme of a much longer and sophisticated book called "Without Marx or Jesus," written by a French scholar. Part of our revolution lies in our own recognition of change.

A great deal has been written and spoken about the nature and velocity of change in our society. In fact, so much has been articulated that it has become increasingly difficult to determine what, if anything, has fundamentally changed and what is only the fashion of the moment.

Quite understandably, we all tend to concentrate our attention on those events which affect us most, either as individuals, companies or as nations -- and often as all three. From our separate viewpoints, we perceive that the revolution of rising expectations is, in fact, upon us, but we do not always appreciate that the same phenomenon has also caught up with our neighbors. This syndrome vastly complicates international relations, because each of us tends to explain to his neighbor that in order to fulfill the expectations of our own people, our neighbors must substantially change their posture toward us. The other and equally dangerous side of that proposition is that when our neighbor changes his posture toward us, we read that action as an assault upon us, rather than a response to our neighbor's internal conditions.

What heightens the dangers confronting us is that this is also a time when the internal pressures upon all of us are intensifying.

Although all of us speak in the abstract of change as something to be welcomed, something that is progressive and something that is essential -- when it happens to us personally, it can be highly unsettling.

Currently the relationship of the United States to its neighbors, in what has been called our global village, is undergoing profound change.

For a generation, the United States has poured out money and know-how and help on a scale almost beyond belief. It was entirely fitting and proper that we did so and is completely in accordance with the basic character of our people who, after all, grew up on the frontier where each person had to help his neighbor in order to survive.

In the long Congressional debates about the beginning of the Marshall Plan, you will look in vain for anything which might indicate this outpouring of money might have an effect upon our balance of payments. The relative weight of the American economy on the world scales was so overpowering at the end of World War II that thinkers on international financial affairs were attempting to design intricate, complicated schemes to somehow get rid of all of the sterile gold piled up so high in Fort Knox.

Our greatest problem was perceived to be the redistribution of those gold reserves. Our balance-of-payments surplus was said to be structural and permanent. I would think it is fair to say that everyone now agrees that these gold reserves have, in fact, been redistributed, partly through the outpouring of American aid and partly through the adjustment of the world's trade patterns.

For a good many years, some of our friends abroad have been informing us that the U.S. dollar is an over-valued currency, that our balance-of-payment deficits are too large to sustain over time and that we ought to do something to redress the balance of the world's trade and monetary picture. So long as we did nothing, the situation could remain the same while the rhetoric could escalate. Now, however, the President has heard the voices from abroad and has moved to redress the balance in recognition of the changed relative position of the United States.

It is not surprising that in seeking to redress this balance, all of our neighbors around the world are assessing the change of policy on their own countries. What is, in a sense, surprising is that some countries view this change as an unfriendly act against them without perceiving that its main motivation was the U.S.'s altered position. As our position has altered in the United States, so has that of the Philippines.

Yours is a remarkable story when you consider that over the past two decades, the Philippine gross national product has almost tripled, and that this extraordinary record has been matched by the increase both in exports and in personal income. In the past two or three years alone, your exports have increased nearly 25%, which is an enviable record by any measure. Despite this progress, or rather because of it, expectations of more and faster progress have been raised.

All the world now stands at a crossroad in economic development awaiting the stabilization of the international monetary situation. In addition to working out our international problems together, we all face similar demands in our own domestic economies. No longer do people debate whether or not it is necessary to improve the quality of life. We only question the means which may be employed to achieve it.

People are beginning to wonder what has happened to the quality of housing and education at all levels, and to the clean air and water. Everyone talks about a reordering of priorities. This reordering of priorities or, if you will, a change in our value system, is responsible for much of the economic international misunderstanding in the world today.

Moreover, we perceive with great clarity our own problems, and with typical human reaction, assume that the grass on the other side is greener. All the major cities of the world are stalled in traffic, and the air is far from clean. In whatever language, our problems are the same -- they vary only in degree and intensity.

In your country, as in mine and throughout the world, there are two schools of thought on how we can produce the greatest good for the greatest number. One group would delegate to the free market the allocation of resources, while the other would somehow attempt to have the government make these allocations. The dialectic on both sides of the question has been so heated that it tends to obscure what the actual record of economic development has been over the last twenty-five years.

Recently, Harry G. Johnson gave a lecture at the University of Ghana in which he examined the empirical evidence of the various degrees of success which the world has had in promoting economic development. Dr. Johnson observed, "Experience of these efforts...strongly suggests that the approach to the promotion of economic development through controls, central planning, and the like, has been both a failure in terms of results achieved and a shocking waste, both of the time of the world's very scarce supply of educated manpower and of the political energies of the peoples of the developing countries. Whatever the theoretical appeal of deliberate economic planning, we have in practice lacked the capacity to execute it properly." Dr. Johnson's remarks are borne out at every hand.

Perhaps the greatest practical explanation of this phenomenon that I have ever heard came from a young American businessman who served for a time in Washington, in the office of the Secretary of the Interior. He described what he had learned about the difficulties of setting government policy and he used as an example the kind of problems that faced the man who was in charge of setting policy on ducks. He wrote: "Just as a random example, how many ducks do you think there should be? Twice as many as now? Half as many as now? Should you listen to the duck hunters? Or to the naturalists? What value should be placed on ducks anyway? How much money should we spend on ducks? They are all killed in one fashion or another. And they certainly aren't a major source of food. These problems are real for the fellow setting 'duck policy.'"

If you multiply this kind of problem by the number of items in our economy, the impossibility of progress through centralized control becomes apparent.

The bankrupt dream of centralized planning has run through the long history of mankind. In the 18th century in France, the bureaucrats stipulated the length of a fishing boat with the expectation that they could thereby control the amount of fish which would be brought to market. They constructed regulations which set the size of a loaf of bread and the size of a handkerchief.

One historian writing of this period said, "Edicts and regulations followed one another by the score; methods of manufacture with details as to the size, color and quality of manufactured articles were laid down. The tone adopted was that of a schoolmaster who alternates punishment with moral platitudes.... Everywhere restrictions, definitions, disputes; everywhere a paternal government telling its subjects how they might earn their living and under what conditions...." To read this history is to be reminded that we hear basically the same thing on the 7 o'clock news in many, many countries around the world.

Despite the volume of the arguments for more and more controls over the last twenty-five years, the world happily went the other way. The very great cooperative efforts of your country and mine have helped to bring down trade barriers, to moderate controls on capital and rebuild the exchange of goods and services. Sometimes we stumbled in this direction almost by accident.

Everyone is familiar with the economic miracle of West Germany. Some people, however, like to forget that one of the principal ingredients of that miracle hinged upon an old American tradition of the long weekend. This came about because our high commissioner, General Lucius Clay, went away on a weekend, and Chancellor Erhard of Germany seized this opportunity to lift all the economic controls that had been imposed on Germany by Clay's advisors. When Clay returned from the weekend he was appalled, but was told there was simply nothing that could be done to put it back together again. This was the beginning of what the world came to call the economic miracle of West Germany.

In times of rapid change, the danger always exists that voices will be raised to direct the social changes from a central point. As we move into this new age, too many people have failed to study the history of past episodes of this kind. There will be too many voices raised to say that the past is dead and that it has no lesson for the present or even the future. It has been said, "Industrial society does not need the past."

One of the people who have thought the most deeply about the developing world is Barbara Ward. In one of her essays, Barbara Ward pointed out, "Between the wars each nation pursued its own self-interest by a wrong route by constantly increasing its protective tariffs. The end result was not the good of all, but the ruin of each." In the postwar period, we reversed that ruinous course. We must all persist along this liberal path and not repeat the errors of the past.

In your country, over eighty years ago, Rizal pointed out that "to foretell the destiny of a nation, it is necessary to open the book that tells of her past." That past includes the particularly close relationship that exists between the Philippines and the United States. While that relationship, like every relationship in the world, is undergoing change, we nevertheless are building on a very solid base, and the conflicts as they arise can be adjusted.

Not only has the Philippine economy progressed enormously, but the Philippines has undoubtedly assumed a leading role as a foreign investor in the Arc of Asia. Your industrialists, your bankers and your central bank have accepted the important idea that the future of the Philippine economy lies not in aid, but in improving your international trade and investment.

As Gunnar Myrdal noted in his massive study of Asian development, "despite the increased interest in South Asian problems in other parts of the world, the leading figures in this drama are the people of South Asia themselves ... the participation of outsiders through research, provision of financial aid and other means is a sideshow of rather small importance to the final outcome."

The fact that we are here in Manila today and that we have chosen your city as a location for a meeting of our board of directors is evidence of our faith in the solidity of our relationships. I would like to think that working together we can resolve our mutual problems through the mechanism of the free market. There will undoubtedly be difficulties and frictions which can be resolved with good will on each side.

When the problems seem great and difficult to resolve, I think that we could do no better than to take as our guide what Rizal wrote many years ago: "We ought not to be dismayed before an insignificant failure, not go backward at the least obstacle that is discerned on the horizon." It is excellent advice for all of us today.