The American economy is approaching a choice between free competition and governmental control, Michigan Governor George Romney told an overflow crowd at Carey Cage yesterday afternoon.

Romney, here to campaign for Attorney General Edward W. Brooke, said that "the American economy is unique and different from other economics" because it is based upon competition and upon cooperation among the competitors.

When cooperation breaks down, Romney asserted, government steps in, disrupts the competitive balance, and forces economic interests to choose sides in one or the other of the political parties. Romney said political parties have no place in economics, that "they should not be a means for satisfying our guts."

A monopoly of collective bargaining by national unions and employer organizations stands in the way of better co-operation, Romney said. "The customer is being shortchanged" through the selfish interplay of the national groups, he claimed.

Romney prescribed free competition as a cure for a variety of economic ills. He called for private technical aid to make the world's underdeveloped nations competitive on the world market, and for public assistance to groups in American society who cannot compote because of hindrances of race or poverty.

The former president of American Motors warned that if we do not help raise the ability of the poorer nations to compete, "our enemies will turn the envy of the world against us and destroy us."

To assure the choice of free competition rather than absolute authority, Romney said, men who will "modernize the laws that shape our economic policy" should be elected. He compared the present choice in economics to the last century's choice between freedom and slavery.

Romney, whose address was sponsored by the Public Affairs Forum, studiously avoided any mention of the Presidential campaign in his remarks.

He supported his arguments by quoting from the statements of George Meany, Henry Ford, Walter Reuther, Thomas Jefferson, and others.