LaRouche On The Record:
A New, Just, International Economic Order
For over four decades, American physical economist Lyndon H. LaRouche, Jr. has provided the intellectual and political leadership in the fight for a new international economic order for the planet, for the purpose of ending the historic imperial control of monetarism and unleashing mankind's creative powers as a species. We have divided this lengthy history into four section, by decade, and we include links from the both text and the graphics to the original documents, for you to study.
EIR Magazine’s abridged printable version
can be found here
The profound impact of LaRouche's intellectual leadership is clearly reflected in the current actions being taken by the BRICS nations and others to create a new global financial architecture and strategic alliance among nations, with the recent establishment of the New Development Bank (NDB) and related developments.
A partial timeline of LaRouche's role in leading the fight for a new international economic order is chronicled below:
2005: LaRouche in Berlin Details 'New Westphalian' World Economic Order
At an EIR-sponsored seminar in Berlin, Germany involving leading Russian, Chinese, Indian, American, and European policy makers, Lyndon and Helga LaRouche elaborate the 'Westphalian' principles which must serve as the foundation for a new international order between states. LaRouche authors two discussion documents for conference, titled "Toward a Second Treaty of Westphalia: The Coming Eurasian World" [PDF] and "The Dialogue of Eurasian Civilizations: Earth's Next Fifty Years" [PDF].
During the dialogue at the conference, Lyndon LaRouche invoked the fight for a new economic order, saying, "go back to 1976 to this experience, where the Non-Aligned nations group, in majority on the initiative of India, actually, adopted a resolution on a just new world economic order." In his speech titled "We Need a New Treaty of Westphalia" [PDF], LaRouche declares that the time for that new international order has come:
"We're going into either a period of chaos, which could be a Dark Age, or we're going into a period in which the assumptions of relations among states, especially respecting economic and related kinds of relations, will be changed forever... The decision is on the table: are we going to create a new monetary system, which presumes that a concert of nation-states, sovereign nation-states, will put the existing IMF system into bankruptcy receivership? In other words, governments would take these banking institutions into receivership and manage these bankrupt entities, in such a way as to promote the general welfare."
During the seminar, Helga Zepp-LaRouche delivers a speech titled "Society Needs a New Paradigm Worthy of the Dignity of Man" [PDF], in which she elaborates the history of LaRouche's role in leading the fight for a new international economic order and asserts the urgent need to "put the new world economic order back on the agenda," saying:
"In 1971, when Nixon decoupled the dollar from gold, creating the private banking power over money creation in the offshore markets, LaRouche said, this will lead to a new depression, the new danger of fascism, and the danger of a collapse of society-or, the just new world economic order... In 1975, Mr. LaRouche went to Iraq, to participate in the celebrations of the Ba'ath Party. And he came back, and he made for the first time, the proposal to have the International Development Bank, as an instrument to replace the IMF, to be the vehicle for a $400 billion credit per year for clearly defined development projects. This idea, we then circulated for one year, among 85 countries, the countries of the Non-Aligned Movement. Many of these countries did feasibility studies, with the idea of Mr. LaRouche's work. Then, in Colombo, Sri Lanka, in '76, eighty-five nations accepted the idea of a new world economic order... Then, the next major thing was when LaRouche got the cooperation of López Portillo, to make a proposal-again, to have a new world economic order. This time coming from a debtors' cartel, from the Latin American debtor countries: Mexico, Brazil, Argentina...
Helga LaRouche traces this history through the collapse of, first, the Soviet Union and then the collapse of the free-market 'globalization' system, asserting:
"This is now the opportunity to put the idea of a just new world economic order, back on the agenda. If you want to have a just new world economic order, it's not a technocratic question; it's not only a question of a new financial system, a new economic system: It's a question of a passionate idea, of the idea of the international community of people.... So, I think we need to have the discussion on this level, and put the new world economic order, back on the agenda."
Helga Zepp-LaRouche ˇ Berlin, January 12, 2005
What we are trying to discuss here with this seminar is a vision for the 21st Century. We are not talking just about geopolitics, financial crisis-all of this; but, in a very fundamental way, we are struggling with the question: How can we make mankind more human? How can we make the political order on this planet more worthy of the dignity of man? And that has gone completely awry...
Remember, that in the immediate post-war period, there was a completely different philosophy. You had the idea of the two Development Decades in the United Nations. A Development Decade was the idea that you would look at ten years of development, and you would expect that the life-expectancy, the living standard of the so-called Third World, would improve in a measurable way. That was normal. There was a normal understanding, that eventually, the underdevelopment of the so-called Third World would be overcome. That was the period in which you had the Non-Aligned Movement. You had outstanding leaders, like Nasser, Tito, Nehru, later Mrs. Gandhi. And even in the United Nations, under U Thant for example, you had a clear perspective of overcoming the underdevelopment of the Third World...
LaRouche had for the very first time, in 1958, forecast that the world, if it continued the then-already visible monetarist policies, would end up in the danger of a new fascism and a new depression. Then, in 1971, when Nixon, indeed, started the bubble economy-by decoupling the dollar from gold, by creating the private banking power over money creation in the offshore markets-LaRouche said, this will lead to a new depression, the new danger of fascism, and the danger of a collapse of society-or, the just new world economic order.
And, the entire LaRouche movement, internationally, was built on that idea. You had always two tendencies: You had the increase of globalization, and you had the growing LaRouche movement, being absolutely certain, that the moment which we are seeing right now, would eventually come.
So, in 1975, Mr. LaRouche went to Iraq, to participate in the celebrations of the Ba'ath Party. And he came back, and he made for the first time, the proposal to have the International Development Bank, as an instrument to replace the IMF, to be the vehicle for a $400 billion credit per year for clearly defined development projects.
This idea, we then circulated for one year, among 85 countries, the countries of the Non-Aligned Movement. Many of these countries did feasibility studies, with the idea of Mr. LaRouche's work. Then, in Colombo, Sri Lanka, in '76, eighty-five nations accepted the idea of a new world economic order.
Then, all Hell broke loose! I remember this, because, when the resolution came from Sri Lanka, I called up DPA, the German news agency. I said, "Oh, this is great! When will you report about the fact that the majority of mankind has decided for a new world economic order?" And the officer of the day said, "What? Sri Lanka? That's not newsworthy."
So, then-a gigantic counter-attack by the neo-cons, by the same people Mr. LaRouche was talking about earlier, started. They killed Bhutto, because Bhutto of Pakistan had dared to demand an international debt conference. They destabilized Indira Gandhi, because she, at that point-for various reasons having to do with her son, Rajiv, had made compromises with the World Bank, so it was relatively easy for them to destabilize her. They destabilized Mrs. Bandaranaike [in Sri Lanka], and every Third World leader who had dared to speak about the new world economic order.
Then, the next major thing, was when LaRouche got the cooperation of López Portillo, to make a proposal-again, to have a new world economic order. This time coming from a debtors' cartel, from the Latin American debtor countries: Mexico, Brazil, Argentina. And Wall Street, at that point, was absolutely terrified, that if many countries have enough debt, they're powerful enough to dictate the terms to the creditors. But LaRouche didn't want to bankrupt the banks, he just wanted to reduce their power to a normal means.
Then, the same year, he made the SDI proposal, which, again, was not what it was portrayed as, "Star Wars," but it was really the same thing as the Eurasian Land-Bridge: it was basically the idea that both superpowers would develop these modern [antiballistic-missile] weapons based on new physical principles, make nuclear weapons obsolete for the first time through the joint deployment; dissolve the Third World as proxy areas for superpower conflicts, and help the Soviet Union to use these modern technologies in the civilian economy as a science-driver, to then increase the productivity of the world economy, and have a gigantic technology and capital-goods transfer, from the industrialized world to the so-called Third World.
And this was on the verge of succeeding, because LaRouche got President Reagan, for a short period of time, to go with this program. And, again, all Hell broke loose.
Now, LaRouche, at that point, prophetically forecast that if the Soviets would refuse this, they would collapse after five years. It took six years, and then, you had the '80s "Reaganomics," Thatcher economics, and eventually the Soviet Union started to collapse in 1989. And there, between '89 and 1991, you had what correctly can be called an historical chance of mankind to completely change the order on this planet! Because there was no opponent any more! You had the United States and the West; the Soviet Union, as the so-called "enemy," had just disintegrated. And there was the absolutely incredible possibility to totally recreate the relationship between the East and West on a completely new level.
But, as we know, at that point, the neo-cons emerged in the United States, and they talked about a "New American Century" doctrine, and the chance was lost.
We, however, knew that if you would make the mistake imposing on the bankrupt Communist system, the equally bankrupt free-economic-market system, that eventually you would raise up an even bigger crisis. And that is the crisis which has arrived now...
Now, I think that what the purpose of this seminar is, and similar discussion groups which we are planning to have in the next months: We have to find a way how we make this world livable. We can not sit here, and see the world go to pieces, just because the powers-that-be decide that that should happen. We need a new paradigm. We need a new basis for society, which defines, at a point where nobody can deny that mankind is at probably the worst point of danger ever-I mean, if you think how close we are sitting to the potential of asymmetric nuclear global warfare; with madmen having their finger on the button, I think anybody who is not crazy should not sleep well! Because we are sitting on a volcano, a complete powerkeg.
And, if you look at the level of governments: What are they doing about it? Do they think: How can we change a world order which clearly doesn't function? How can we remedy something which does not allow the survival of the larger part of mankind? One-third of the entire human race is hungry, every day; one-third is barely nourished; and only one-third has enough food! Fifty thousand children die every day! This is a failed system!
I'm sorry: This present world system, is as failed and bankrupt as the D.D.R. was in the beginning days of November '89, and it is going down in the same way.
Now, what we have to do-and I want to really say this-once we have an idea that mankind is in danger, we have to think, what are the common aims of mankind? How can we agree on principles, which mean that mankind is going to get in a condition which is human, worthwhile of the name of being human?...
Maybe this is now the opportunity to put the idea of a just new world economic order, back on the agenda: Because, why should we accept poverty? Why should we accept that the majority of the human race is living in a condition which none of the people in Western Europe or the United States who are well-to-do, would ever accept?...
PREPARE FOR THE NEW WORLD ECONOMIC ORDER
And I think what we have to do, also, with this discussion group, and similar circles, is to prepare: What can be put on the table, in the moment of the maximum crisis? Which is the New Bretton Woods idea, combined with the proposal which Mr. LaRouche made this morning, which is an addition to the old-standing New Bretton Woods idea of LaRouche, namely, to have, as part of this package, a rational agreement about the raw material distribution of mankind for the next 50 or more years to come, so that there is no war over raw materials, as part of the picture.
And each government should be induced and encouraged, to make feasibility studies about this soon-to-come eventuality. Very soon, you will see, the dollar collapse will continue, all the bubbles will start to bust, and there will come a moment of utmost crisis, but also of utmost chance...
Now, let me just say, one last thing: I think-and even if this is not the usual kind of discussion at seminars and strategic discussions and so forth-but, I think we will not get out of this without love. Look: If you want to have a just new world economic order, it's not a technocratic question; it's not a question of a new financial system, a new economic system: It's a question of a passionate idea, of the idea of the international community of people. That you have to not be able to stomach it, one more day, that the world is in this wretched condition! And you have to have a vision of how the world could look like, once we make it human. Blooming gardens in places where there are deserts right now. People living decent human lives. Africa being totally, infrastructurally developed. Eurasia infrastructurally developed. Thousands of new cities we want to build-beautiful cities!
Not just Houston models, but why not take the beautiful architecture of China? Of India? And make new cities along the Eurasian Land-Bridge, and in Africa, and Latin America, using the beautiful architecture? Making them modern, with maglev trains, connected with module construction underground, so that they are totally modern, but you can make them beautiful!
I think that what is needed, is really a vision. And a love of people for mankind... So, I think we need to have the discussion on this level, and put the new world economic order, back on the agenda.
Helga Zepp-LaRouche Renews Calls for New Bretton Woods
In April 2005, the president and founder of the Schiller Institute, Helga Zepp-LaRouche, renews the call for a New Bretton Woods, issuing an international petition signed by leading elected officials and government figure, including numerous members of the Italian Parliament who had sponsored resolutions in support of the New Bretton Woods, as well economists from several western and central European countries. The petition states:
The following measures must be implemented if we are to alter the mistaken course that we have followed since President Nixon did away with fixed exchange-rates in 1971, a course that has led to the present upsurge of a grotesque and predatory form of capitalism, thanks to unchecked 'globalization' after the fall of the U.S.S.R. The New Bretton Woods Conference shall decide as follows -
1. There shall immediately be re-established fixed exchange rates
2. A treaty shall be enacted between governments, forbidding speculation in derivative products.
3. The debt shall either be cancelled, or reorganized.
4. New credit lines shall be opened by the State, to create full employment by investing in critical infrastructure and technological innovation.
5. The building of the Eurasian Land-Bridge, as the keystone for rebuilding the world economy, is the vision that will bring about not only a new economic miracle, but peace in the 21st Century.
6. A new Peace of Westphalia will ensure that for no less than the coming half-century, raw materials shall be extracted and processed for the benefit of every nation on this planet.
We, the undersigned, believe that so-called 'globalization,' this predatory form of capitalism, has shown itself beyond all doubt to be bankrupt on every front. It is Man who must stand at the center of the economy, and accordingly, the economy must serve the common weal. The purpose of a new world economic order is to guarantee the inalienable rights of Man.
Ad-Hoc Comittee for a New Bretton Woods Agreement
The paradigm shift of the last four decades, a period in which the world economy increasingly abandoned manufacturing and gave itself over untrammelled speculation, now draws to an end. The world financial system is about to implode. Gross production worldwide stands at a mere forty trillion dollars, over which looms gigantic a bubble fifty times that size, viz., two thousand trillion dollars' worth of financial liabilities. The impending bankruptcy of General Motors and potentially, of the entire U.S. automobile industry, is but one of many factors that could well lead to the collapse of the U.S. dollar, and thereby, that of the entire financial system.
To prevent the world's people from suffering the untold harm that the breakdown of the system would unleash, we the undersigned demand that an emergency conference be convened, to agree upon a new financial architecture along the lines of the Bretton Woods System launched at Franklin D. Roosevelt's initiative in 1944. We stress that Lyndon LaRouche is the economist who has best grasped the causes of the systemic crisis, and who has, moreover, put forward a package of measures that would adequately deal with it: a New Bretton Woods agreement.
We the undersigned further stress that the Italian Parliament has taken up LaRouche's proposal, and on April 6th 2005, voted up acalling for "an international conference at Heads of State level, in order to lay the basis for a new and just world monetary and financial system."
The following measures must be implemented if we are to alter the mistaken course that we have followed since President Nixon did away with fixed exchange-rates in 1971, a course that has led to the present upsurge of a grotesque and predatory form of capitalism, thanks to unchecked "globalization," after the fall of the U.S.S.R. The new Bretton Woods Conference shall decide as follows.
1. There shall immediately be re-established fixed exchange rates.
2. A treaty shall be enacted between Governments, forbidding speculation in derivative products.
3. The debt shall either be cancelled, or reorganized.
4. Fresh credit lines shall be opened by the State, to create full employment by investing in critical infrastructure and technological innovation.
5. The building of the Eurasian Land-Bridge, as the keystone for rebuilding the world economy, is the vision that will bring about not only a new "Wirtschaftswunder," (economic miracle) but peace in the 21st Century.
6. A new Peace of Westphalia will ensure that for no less than the coming half-century, raw materials shall be extracted and processed for the benefit of every nation on this planet.
We the undersigned believe that so-called "globalization," this predatory form of capitalism, has shown itself beyond all doubt to be bankrupt on every front, whether economic, financial, or moral. It is Man who must stand at the center of the economy, and accordingly, the economy must serve the common weal. The purpose of a new world economic order is to guarantee the inalienable rights of Man.
Argentine Foreign Minister Calls For New Bretton Woods at United Nations
On September 14, 2005, during a speech to the United Nations General Assembly, the Foreign Minister of Argentina Rafael Bielsa calls for:
"...an international conference of heads of state, similar to the 1944 Bretton Woods conference, to rebuild a more just global monetary and financial architecture which eliminates financial bubbles and concentrates on supporting the real economy."
This speech, prepared in direct coordination with the Argentine president Nestor Kirchner, comes in the wake of Argentina's victory over the international vulture funds, forcing them to renegotiate Argentina's debt and accept a vast write-down of the face value of their claims against Argentina. Refusing to give into the threats and 'conditionalities' of the IMF, Argentine President Nestor Kirchner delivered a speech in April in which he declared:
"There is life after the IMF, and it's a very good life. And remember, being in the embrace of the IMF isn't exactly like being in heaven. I received an Argentina devastated by an economic program supported by the International Monetary Fund: The placing of private interests over the general interest was the expression of a specific model of society which led to generalized poverty, uncertainty, isolation, and impoverishment of life at all levels...
"As it operates today, the IMF has no future, and the developed world has to understand this. Argentina is prepared to work actively and constructively on behalf of a new world economic order."
2006: Argentine President Kirchner Calls for New Financial Architecture at UN
Nestor Kirchner, the President of Argentina, delivers a speech before the United Nations General Assembly on September 21, 2006, in which he calls for a "new financial architecture" to replace the failed and destructive IMF system. Denouncing the violation of national sovereignty and prevention of economic development that the IMF 'conditionalities' regime represents, Kirchner declares:
"There is sufficient empirical evidence to demonstrate that the participation of the international financial organizations in the promotion of development of poorer nations has not been successful, and in many cases, with their conditionalities, they have acted in a contrary sense, preventing development... That is why, together with the majority of countries, we support the reform of the international financial architecture, such that it will lead to the progress of the poorest nations. In noting the scant willingness of these international financial organizations to produce a real change in their policies, we deem it necessary to make this change, and to consider the creation of new international financial instruments that will permit the building of development projects to combat poverty and hunger in the world and to provide real options for advancement."
Nestor Kirchner ˇ UN General Assembly, Sept. 21, 2006
The world will only achieve peace to the extent that it promotes equality and fights to eradicate poverty and exclusion. This is as valid for the global system as it is for each individual country. Argentina supports the building of more just, more equitable societies, with a better system for distributing the benefits of economic growth. We also believe that each nation has the right to seek its own model of development, without foreign conditionalities.
We not only aspire to generate sustained development, but we also want this to reach everyone. There must be harmonious growth translated into balanced income distribution, because we know that development for a few, rather than for a country as a whole, simply doesn't work....
The economic situation in the [Argentine] Republic is very different from what it was when we began our administration.... Uninterrupted high rates of growth at between 8-9%; growing participation of investment in the GNP; record local rates of savings; resurrection of local industry; a fiscal surplus at historic levels; unimpeded access of our industrial exports to the world; systematic reduction of the domestic and foreign public debt; preventive accumulation of reserves; less foreign exposure; strong reduction of unemployment; strengthening of wage-earners' and retirees' incomes; an important decline in poverty....
I am forced to emphasize that these achievements have not been supported by the International Monetary Fund, which has denied us any assistance, and-I feel compelled to say this-in many cases, we have achieved this progress by ignoring, if not completely opposing, its recommendations and conditionalities.
There is sufficient empirical evidence to demonstrate that the participation of the international financial organizations in the promotion of development of poorer nations has not been successful, and in many cases, with their conditionalities, they have acted in a contrary sense, preventing development.
The world has changed, but these organizations have not. With their ill-conceived intervention, they insist on jeopardizing progress. That is why, together with the majority of countries, we support the reform of the international financial architecture, such that it will lead to the progress of the poorest nations. In noting the scant willingness of these international financial organizations to produce a real change in their policies, we deem it necessary to make this change, and to consider the creation of new international financial instruments that will permit the building of development projects to combat poverty and hunger in the world and to provide real options for advancement.
2007: International Conference in Moscow Demands Bering Strait Tunnel
Lyndon LaRouche is invited to participate in a conference on April 24, 2007 in Moscow, Russia called "Megaprojects of Russia's East: A Transcontinental Eurasia-America Transport Link via the Bering Strait" organized by the Russian Academy of Sciences Council for the Study of Productive Forces (SOPS), in conjunction with the Russian Ministry of Economic Development and Trade (MERT), the Russian Ministry of Transport, the state-owned company Russian Railroads, and several regional governments in Siberia and the Russian Far East. Lyndon LaRouche speech, prepared and submitted to the conference, is titled "The World's Political Map Changes: Mendelyev Would Have Agreed" [PDF] in which he states:
"This onrushing collapse of the world's presently hyperinflated, disintegrating world monetary-financial system, requires early concerted emergency action by responsible leading nations... These must include the U.S.A., Russia, China, and India, as the rallying-point for a new, spreading partnership among perfectly sovereign nation-state economies. In such cooperation, the development of a great network of modern successors to old forms of rail transport, must be spread across continental Eurasia, and across the Bering Strait into the Americas... The bridging of the Bering Strait becomes, thus, now, the navel of a new birth of a new world economy."
Lyndon LaRouche ˇ April 24, 2007
The intention to create a trans-Siberian rail system, implicitly extended, across the Bering Strait, to North America, dates implicitly from the visit of Dmitri Ivanovich Mendeleyev to the 1876 U.S. Centennial Exposition in Philadelphia. The defeat of Lord Palmerston's scheme for destroying the United States, by U.S. President Abraham Lincoln's leadership, spread the influence of what was called The American System of political-economy into Russia, as also the Germany reforms under Bismarck, the industrialization of Japan, and elsewhere. These global, so-called geopolitical developments of the post-1865-1876 interval, have been the focal issue of all of the spread of great wars throughout the world from the British orchestration of the first war of Japan against China, in 1894-95, until the 1945 death of U.S. President Franklin Roosevelt.
Throughout the ebbs and flows of global economic and geo-political history, up the present day, the realization of Mendeleyev's intentions for the development of Russia remains a crucial feature of that continuing history of the post-1865-1876 world to the present moment. The revival of the intention launched by him, now, is presently renewed as a crucial quality of included feature of crucial importance for the world as a whole today.
The same impulse toward new world wars persists in new guises today. At the present moment, the world is gripped by what threatens to be, very soon, the greatest global monetary-financial collapse in the entirety of modern history to date. The spread of warfare and related conflict out of Southwest Asia is nothing other than a reflection of the same, continuing, so-called geo-political impulse which has prompted all of the world's major wars since the 1763 Treaty of Paris, but, more emphatically, the rise of the U.S.A.'s 1865-76 challenge to the Anglo-Dutch Liberal monetary-system.
This onrushing collapse of the world's presently hyper-inflated, disintegrating world monetary-financial system, requires early concerted emergency action by responsible leading nations. A sudden change in U.S. political trends, back to the traditions of President Franklin D. Roosevelt, is urgently needed for this purpose. Such a change in U.S. policy must be realized through emergency cooperation which would be led by a concert of leading world powers. These must include the U.S.A., Russia, China, and India, as the rallying-point for a new, spreading partnership among perfectly sovereign nation-state economies.
In such cooperation, the development of a great network of modern successors to old forms of rail transport, must be spread across continental Eurasia, and across the Bering Strait into the Americas. The economically efficient development of presently barren and otherwise forbidding regions in entry into the urgently needed future development of the planet as a whole.
Such a plan was already crafted, during 1990-1992, under the direction of my wife, Helga Zepp-LaRouche, who remains the principal political and cultural leader among my associates in Europe and beyond. This perspective must now be revived to become a global actuality.
Technologically, the leading thrust of scientific development is located in the succession of the work of such exemplary figures as Mendeleyev and Academician V.I. Vernadsky, and the work of the relevant, but too little heralded leader in the same field, the American pioneer William Draper Harkins.
This requires the creation of long-term diplomatic agreements among nations, creating a new system of relatively fixed-exchange-rate treaty-agreements, at very low prime interest-rates, over forward-looking intervals of between a quarter to half century. These present periods covering the economic-financial half-life-span of principal long-term investments in the development of that basic economic infrastructure which the needs of the present and coming generations of the peoples of these natures require.
We have thus entered a time, measured by the clock of nuclear-fission and thermonuclear power's development, when the long history of the domination over the land-masses of the planet by actually or implicitly imperial maritime powers, is no longer an acceptable practical proposition. Instead, the science-driven, capital-intensive mode of development of the basic economic infrastructure and standard of living of the populations, will dominate any successful form of civilized development of relations among the sovereign nations of the planet. To this end, the tundras and deserts of our planet must be conquered by the forces of science-driven technological development of the increased productive powers of labor. Development must now proceed from the Arctic rim, southwards, toward Antarctica.
The bridging of the Bering Strait becomes, thus, now, the navel of a new birth of a new world economy.
LaRouche Invited to Moscow as Featured Guest of Academy of Sciences
Lyndon LaRouche is invited to Moscow to attend a celebration sponsored by the Russian Academy of Science of the 80th birthday of Stanislav Mikhailovich Menshikov, a prominent Russian economist. The celebration is also attended by Academician Alexander Granberg who sponsored the Bering Strait forum earlier in the year, and Dr. Sergei Glazyev, also a member of the Academy of Sciences. Lyndon LaRouche makes remarks to the gathering, in which he says:
"The United States must change its behavior, by approaching Russia, China, and India, in order to create a new order of relations in the world, bringing all the smaller nations in to cooperate with them. I think we can do it: We can change history."
During his visit to Moscow, LaRouche is interviewed by several Russian media, both television and print, including by economist Mikhail Khazin [PDF] during which LaRouche reviews the history of his role in shaping the economic policy relations between the United States and Russia:
"From 1994 on, since I was visiting Russia, in that period, my concern, which I shared with many of my Russian friends in high positions, was to try to get an understanding with President Clinton, and people in Russia. So, some of the key people here in Russia organized a meeting which I addressed in Moscow. They were prepared, through me, because they knew my connection to Clinton, to open a new channel of economic understanding and cooperation with the United States. [Academician Gennadi] Osipov was one of the leaders of that group, to organize it. The former Prime Minister, [Valentin] Pavlov, was part of it. But the Vice President of the United States, Al Gore, was a close friend of Yeltsin, and they put pressure on Clinton not to do it. Finally, in 1998, in August and September, Clinton recognized I had been right... We must have a dialogue between Russia and the United States, involving other countries, like China, India, and so on, who understand that we believe the same thing about the present world crisis, and can understand what we must do for the next 50 years."
Russian President Calls for 'New International Economic Architecture'
At the annual gathering in Russia for the St. Petersburg International Economic Forum on June 10, 2007, attended by almost 10,000 people from over 65 nations (including nine Presidents, four Premiers, 44 ministers, and 40 ambassadors), Russian President Vladimir Putin issues a call for a "new international architecture of economic relations" between nations. Putin highlights the increasingly dominant role being played by the developing countries in the world economy, and states that the existing international financial organizations are in need of "serious restructuring" and that the former paradigm of international economic relations has become archaic.
President Putin declares:
"If we want to achieve sustainable development we need to create a new architecture of international economic relations based on trust and mutually beneficial integration. We cannot ignore the importance of healthy competition, but at the same time, we need to move towards forming common and interdependent interests and ties... The new architecture of economic relations implies a principally new approach to the work of international organizations."
Vladimir Putin ˇ St. Petersburg, June 10, 2007
The world is changing literally before our very eyes. Countries that seemed hopelessly backward only yesterday are becoming the world's fastest growing economies today. Fifty years ago, the G7 countries accounted for 60 percent of the world's GDP, but today this situation has been reversed and 60 percent of the world's GDP is now produced outside the G7 countries. The developing countries are more and more active in establishing niches for themselves not just in the trade of goods but also of services. New players, including in the high-technology and science-intensive sectors, are bringing greater competition to the market...
If we want to achieve sustainable development we need to create a new architecture of international economic relations based on trust and mutually beneficial integration. We cannot ignore the importance of healthy competition, but at the same time, we need to move towards forming common and interdependent interests and ties... In an open economy, most countries depend on international trade and on how stable and sustainable are their exports and imports. Economic partners can feel a sense of security only when they have reliable and predictable relations and when buyers and sellers guarantee fulfillment of their respective commitments.
The new architecture of economic relations implies a principally new approach to the work of international organizations. It has become increasingly apparent of late that the existing organizations are not always up to the measure in regulating global international relations and the global market. Organizations originally designed with only a small number of active players in mind sometimes look archaic, undemocratic and unwieldy in today's conditions. They are far from taking into consideration the balance of force that has emerged in the world today. This means that the old decision-making methods do not always work...
The international financial organizations are also in need of serious restructuring and modernization. They were established at a time when the world looked very different and are having difficulty adapting to the new situation of stable economic growth in the majority of developing countries and growing markets... Fluctuations of these [reserve] currencies have a negative impact on the financial reserves of countries and on the development of different branches of the world economy in general. There is only one answer to this challenge: introduction of several world currencies and several financial centers. that is why it is today necessary to create prerequisites for the diversification of assets in the world's financial systems.
Lyndon LaRouche Forecasts the Financial Crash of 2007
On July 25, 2007, during an international webcast in Washington DC, Lyndon LaRouche went on record stating that the banking system had reached the point where a catastrophic collapse could no longer be avoided and must be expected to occur in the immediate future. Three days later, Bear Stearns went under, triggering a chain reaction crisis throughout the entire global financial system.
Lyndon LaRouche stated:
"There is no possibility of a non-collapse of the present financial system-none! It's finished, now! The present financial system can not continue to exist under any circumstances, under any Presidency, under any leadership, or any leadership of nations. Only a fundamental and sudden change in the world monetary financial system will prevent a general, immediate chain reaction type of collapse. At what speed we don't know, but it will go on, and it will be unstoppable. And the longer it goes on before coming to an end, the worse things will get."
Lyndon LaRouche ˇ Washington DC, July 25, 2007
First of all, this occurs at a time when the world monetary financial system is actually now currently in the process of disintegrating. There's nothing mysterious about this; I've talked about it for some time, it's been in progress, it's not abating. What's listed as stock values and market values in the financial markets internationally is bunk! These are purely fictitious beliefs. There's no truth to it; the fakery is enormous. There is no possibility of a non-collapse of the present financial system-none! It's finished, now!
The present financial system can not continue to exist under any circumstances, under any Presidency, under any leadership, or any leadership of nations. Only a fundamental and sudden change in the world monetary financial system will prevent a general, immediate chain-reaction type of collapse. At what speed we don't know, but it will go on, and it will be unstoppable! And the longer it goes on before coming to an end, the worse things will get. And there is no one in the present institutions of government who is competent to deal with this. The Congress, the Senate, the House of Representatives, is not currently competent to deal with this. And if the Congress goes on recess, and leaves Cheney free, then you might be kissing the United States and much more good-bye by September....
You have to change the world monetary-financial system immediately, and you can not do that with a couple of small nations. You can only do that from the top. You have to pull together the might of the world, the major powers of the world and those who will support them, and say, "We're going to change immediately the world monetary system. We're going to get rid of the floating-exchange-rate monetary system. We're going back immediately to a fixed-exchange-rate system." Because if we do not go back to a fixed-exchange-rate system, of the Franklin Roosevelt prototype, then there's no possibility of preventing a general collapse and disintegration of the world economy. It can't be done. Therefore, you have to have a power group which says, "We're going to save this planet from Hell."
One of the things which we're going to do, which is a trigger point, is to get something done in Southwest Asia: to get the U.S. troops out of the target range, and pull them into a holding position where they become a factor in negotiating the peaceful reconstruction of the region. That will not work by itself unless you have a power group which includes four powerful nations of this planet, and others, who decide that that's going to work. A power group which agrees that we're going back to a fixed-exchange-rate system, by government decree, as made by governments in concert. We're going to stop the floating-exchange-rate system, we're going to take steps to clean up the financial mess.
Most of the financial claims and the financial assets and obligations in the world today, are worthless. You have play money; the stock market is a fraud. The Treasury Department is committing a fraud. Most governments are committing fraud, and the British government is the worst of them all. The British government and the British system is the worst offender that we have to deal with on this planet. They organized this war, they organized most of the evil that is done in the world today. So, they will not be considered as having any veto rights in this matter.
But the major powers are going to say: We're going to have to go back to a fixed-exchange-rate system. We're going to do it immediately, by treaty agreement, by signed agreement among countries. We're going to freeze a lot of things, and we're going make sure that things that have to be paid, things that have to go on, go on. That production is not cut; farming proceeds, food is produced, infrastructure is built, and so forth. And we'll have to build our way out of this process with steps which begin with these measures. And the measures are a matter of the will of a powerful group of nations, not just the four, but a powerful group of nations who agree that this has to be done, because Hell on Earth has to be prevented. And that's the only way it is going to happen....
The United States is disintegrating. If a depression occurs, the United States will see conditions you won't believe. Nothing in the past century, no depression, is comparable to what will hit the United States if this system collapses now....
Helga LaRouche: Landbridge Is The Cornerstone of New Economic Order
The Schiller Institute sponsors a conference in Kiedrich, Germany on September 14-15 attended by 350 people from 40 nations, including a prominent delegation of Russian academicians and political figures, including Prof. Stanislav Menshikov of the Russian Academy of Sciences; Victor Razbegin, deputy chairman of the Council for the Study of Productive Forces (SOPS); and Dr. Sergei Cherkasov and Academician Dmitri Rundqvist, both of the Vernadsky State Geological Museum. Lyndon LaRouche delivers the keynote to conference, calling for an urgent bankruptcy reorganization of the world financial system:
"The only peaceful remedy for the present world situation, today, would be by actions which, in effect, place the present world monetary-financial system into a process of reorganization of bankruptcy; and a return to a design consistent with what U.S. President Franklin Roosevelt had intended for the Bretton Woods System, had he lived. No possible solution for this crisis exists within the structures of the present world financial-monetary system. Only a political reform of the world system, as it must be promoted by the initiative of a relevant leading group of powerful nation-states, could turn the tide of horror now gripping the fate of this planet as a whole."
Helga LaRouche addresses the conference and states that the gathering is intended to be a creation of a global forum of dialogue for the purpose of achieving a just new world economic order:
"This conference is supposed to be the beginning of a worldwide dialogue, and forum, of people who want to reconstruct the world; of putting together the combination of people who want to fight for the old idea, which used to be the agenda, for example, of the Non-Aligned Movement, to build a just new world economic order. And the key to this is building the Eurasian Land-Bridge, which, from the beginning, never was meant to be limited to Eurasia, but the cornerstone of a global reconstruction program... We have reached a situation where either we establish a new world economic order based on the Eurasian Land-Bridge, and go for global reconstruction, or we will plunge into a dark age... The question of the new world economic order has been our life's work, and it is now the time to implement it.
I want to welcome you again, distinguished guests from many countries, and I'm actually glad to report that we have, so far, people from 29 countries assembled in this conference. This conference is taking place at a truly awesome moment in history, where even the financial media cannot fail to report that the global financial system is in an advanced stage of disintegration, of a complete meltdown of the entire system. And naturally, this is not disconnected from the fact that we are in a world situation of a heightened danger of a new war, this time against Iran. If this would happen, it would be the beginning of global asymmetric warfare, and therefore a plunge of the entire civilization into a dark age.
So, while I don't want to play down the dangers which come from these two immediate situations, the actual purpose of this conference is a very optimistic one. We will hear in many presentations and discussions, how easy it would be to reconstruct the world. And that, provided we get through this immediate danger zone, mankind can enter a completely different phase, having rational discussions about how to build things; how to overcome bottlenecks; how to overcome poverty; how to build industries, agriculture; how to bloom and green the deserts. And the purpose of this conference is to get people optimistic, not only in the two days of this discussion, but beyond. Because this conference is supposed to be the beginning of a worldwide dialogue, and forum, of people who want to reconstruct the world; of putting together the combination of people who want to fight for the old idea, which used to be the agenda, for example, of the Non-Aligned Movement, to build a just new world economic order.
And the key to this is, obviously, the building of the Eurasian Land-Bridge, which, from the beginning, never was meant to be limited to Eurasia, but we always thought the Eurasian Land-Bridge to be the cornerstone of a global reconstruction program.
Now, to situate the conference, let me just briefly remind you of what happened in the recent weeks, which were truly dramatic.
The present world financial system is bankrupt beyond repair. And all the beautiful, creative financial instruments given to the world by Alan Greenspan-the hedge funds, the private equity funds, the conduits, the investment vehicles and whatever they're all called-they are all basically worthless paper. Or not even paper, they're just e-paper, electronic paper, and you can eliminate them by pushing the delete button on the computer, because they don't exist; they're just virtual.
Now, how many trillions of dollars are out there, nobody knows. Not one government, not one central bank-the efforts by the German government at the last G-8 meeting to at least get transparency, failed, so we are still sitting in a situation where nobody knows the exact amount of money which is presently unpayable. But what one can say is, this is several magnitudes beyond the entire physical GDP of world production. And we have now reached a situation where if the banks are trying to bail out the hedge funds and other funds, they themselves will go bankrupt.
Now Mr. LaRouche, of course, has forecast that this present financial system would end sometime in a systemic crisis. And I'm sure that there is nobody right now, of any significance in the financial world, who, when you have a crash of a hedge fund, when you have new figures of collapse, who is not thinking of this gentleman. Because he is like the incarnation of the warning that the present system cannot function.
Now, in May, when Mr. LaRouche and I were in Moscow at the beautiful occasion of the 80th birthday of Professor Menshikov, who is here today, together with his wife, he said that he expected a major financial crisis for his birthday, which is in this month of September. We took his words seriously, and I thought it would be good to have a conference around this time, so that basically we could discuss what would be the alternative. And so, here we are.
Mr. LaRouche, then, on the 25th of July, made an historic webcast in Washington, where he declared that the system had already collapsed, and that we are only seeing the aftermath, the playing out of this collapse. And he also said that American infrastructure is completely rotten, and falling apart.
And exactly two or three days later, the first hedge funds of Bear Stearns went under, as a consequence of the collapse of the subprime mortgage market in the United States. And at the same time, the bridge in Minnesota collapsed. So, he was truly prophetic. Then, also, the Japanese yen carry trade started to come to an end, and you had at that point, the trigger of what Mr. LaRouche called the "two bookends" of a reverse-leverage collapse process, and then you had unfolding what is generally called the "cluster risk": that, because all market segments are interconnected, you had the beginning of a systemic collapse...
We need a New Deal. We need a Bretton Woods system. And Mr. LaRouche has called for a Four-Power agreement, and I'm sure he will speak about that himself: that you need a changed United States, plus Russia, plus China, plus India, because only if you put together the four most powerful nations of this world, do you have any chance to solve this problem.
Now, I want to turn to the actual subject of this conference.
THE EURASIAN LANDBRIDGE SOLUTION
The Eurasian Land-Bridge is becoming a reality. Exactly at the moment when globalization is failing, the global alternative is taking shape. This is something we have been fighting for since the fall of the Wall, in 1989-90. When the Berlin Wall came down, we proposed, and especially Mr. LaRouche proposed, the idea of a Productive Triangle, which was supposed to be the area between Paris, Berlin, and Vienna, which is the largest industrial concentration in the world, still; and to use high-technology investments in this region-high-temperature reactors, maglev trains, and similar things-to develop so-called corridors to Eastern Europe.
Now, if that had been implemented, it would have been quite a different situation than what then happened, because then you had truly the possibility to put the East-West relationship on a completely different basis.
In '91, when the Soviet Union collapsed, we proposed the development of the Eurasian Land-Bridge [Figures 1 and 2], which was the idea to connect the industrial and population centers of Europe, with the population and industrial centers of Eurasia, through so-called development corridors. Which was the idea to take the transport arteries along the Trans-Siberian railway, and the old Silk Road, and build so-called development corridors of 100-kilometer width, where you would put in energy production and distribution, and communication, to then have in these development corridors, the condition previously found only in the non-landlocked areas of the world, so that you would open up Eurasia for development.
This idea we proposed in hundreds of conferences and seminars, and, in 1996, we participated in a big conference in Beijing, which was organized on our suggestion, by the Chinese government, with the participation of 34 countries, to discuss the economic development among the regions of Eurasia. At that point, the Chinese government declared this program to be the long-term perspective of China, until the year 2010, and as you can see, this was 11 years ago. Then several setbacks occurred: the Asia crisis of 1997, so-called; then the fact that the Chinese government, for a long period, did not want to risk their relationship to the United States by going in this direction. But then came the Bush Administration and Sept. 11 in 2001. And following, you had the war against Afghanistan and Iraq.
And then something happened which is really extremely interesting, in terms of how historical processes actually develop. Because of the policies of the Bush Administration, to turn the republic of the United States, into an empire, or at least attempting to do so, by insisting on the "unitary executive" conception of the Presidency, by trying to run world politics in a unilateral way, the countries of Eurasia moved together much more quickly than would have otherwise occurred. And a strategic partnership happened between China, Russia, and India, and the Shanghai Cooperation Organization included many more countries of Eurasia.
At the same time, you had the economic integration and cooperation in Latin America, with respect to a new Bank of the South.
So, now we have a dramatic situation, where for a long time, we were only talking about these projects, but now because the collapse of the system is becoming obvious, because it is clear that we are in a complete transformation of the historic period, all these projects are now becoming a reality.
On the 10th of April, President Putin had a Cabinet meeting in which he decided to make the railway development of Russia a priority of his Presidency. Then on the 24th of April, a conference took place in Moscow on the development of the Bering Strait, which is the idea which Mr. LaRouche has been pushing since the '70s, which is the idea to connect Alaska, through the Bering Strait, with Siberia.
Now, this is a fantastic project. It involves, from the Russian side, the intention to build 6,000 kilometers of railway, and a 100-kilometer tunnel underneath the Bering Strait, and it obviously involves the development of the vast resources of Siberia and the Far East under permafrost conditions. In this region, you have the richest raw materials of any part of the world. But the idea is not just to loot them, but to use the tremendous scientific potential of Russia, to apply the ideas of Mendeleyev and Vernadsky to develop new raw materials, new isotopes, and really go into a science-driver for the world economy as a whole.
This is not only a fantastic project, which would really be a science-driver for the world economy already by itself, but it was put on the agenda very consciously by the Russian government as a war-avoidance policy....
Now, we have reached a historic moment, where the neo-liberal system of the free-market economy, and the unbridled free-market system, is coming to an end. Globalization, which is just another word for the Anglo-American empire, has attempted to turn the world into a global plantation to the advantage of a small oligarchy, while turning the vast majority of people into poor people, having slave labor, and cheap labor production places. And they have actually committed gigantic crimes. Don't kid yourself! What the hedge fund system, the system of global looting which goes with that, has done in terms of crimes, in terms of killing people, has been absolutely gigantic. But this system is now coming to an end.
So, we have reached a situation where either we establish a new world economic order based on the Eurasian Land-Bridge, and go for global reconstruction, or we will plunge into a dark age. Now, we are committed to put the Eurasian Land-Bridge on the agenda in this period, as a war-avoidance policy, and establish a political order which is worthy of the dignity of man: a political order which is in cohesion with the laws of the universe. And I want to show you now a video from a speech which José López Portillo, the President of Mexico, gave on the first of October 1982 to the United Nations.
The prehistory of that video which you will see now, is that in the Summer of 1982, President López Portillo called Mr. LaRouche to come to Mexico, and he asked him to defend the Mexican economy, which was under massive attack at that point, because there was an organized capital flight out of the peso. So, Mr. LaRouche, after meeting with President López Portillo, not only wrote a program for the defense of Mexico, but for the integration of Latin America as a continent, which López Portillo then implemented on the 1st of September of 1982. At that point, there would have been the chance to have an orderly reorganization of the banking system, which actually was the proposal.
This did not function at that point, despite the fact that López Portillo implemented these measures for Mexico as a country, because at that point, Argentina and Brazil did not act in solidarity with Mexico. So 25 years have been lost. But as you can see, the question of the new world economic order has been our life's work, and it is now the time to implement it.
Full speech: The Eurasian Landbridge Is Becoming Reality
2008: Helga LaRouche In Rhodes: A New Westphalian World Economic Order
During the week of October 9-13, 2008, Helga Zepp-LaRouche was invited to participate as a keynote speaker at the Sixth General Meeting of the World Public Forum's 'Dialogue of Civilizations' conference, held in Rhodes, with more than 700 people from 70 countries attending. The World Public Forum was founded and chaired by Vladimir Yakunin, chairman of Russian Railways, and brings together political, religious, and intellectual leaders from around the globe for annual conferences. Helga LaRouche's speech is titled "For a New World Economic Order in the Tradition of the Peace of Westphalia" [PDF] in which she states:
"An emergency conference, modelled on the Bretton Woods Conference of 1944, has long been proposed by Lyndon LaRouche... In order for this new system to have credibility and integrity, the initiating powers-the U.S.A., Russia, China, and India-have to build the core of a representative group of nations which, in the tradition and spirit of the Treaty of the Peace of Westphalia, decide on a multicultural and multinational credit system, even while the current monetary and financial system is put through an orderly bankruptcy process.... The most important principle of the Westphalia Treaty, upon which international human rights are based, was the idea that, in the interest of peace, all foreign policy must be oriented to the "advantage of the other."
Helga Zepp-LaRouche ˇ Rhodes, October 9, 2008
This conference is taking place at a time when even the previous advocates of the thesis that "there in no alternative to globalization," acknowledge in terror that we are in the midst of the meltdown of this globalization, and in the midst of a chain reaction of events that threaten, in a very short time, to bring most of world production and trade to a standstill.
It is therefore a very important step in the right direction, that French President Nicolas Sarkozy, at a meeting last Saturday [Oct. 4] with the heads of government of Germany, Italy, and Great Britain, and European Union representatives, announced the convening of an international conference, using the precedent of the conference convened by Franklin Roosevelt in 1944 in Bretton Woods, to lay the basic foundations for a new financial architecture. Nothing is more urgent than this. It is also long overdue that this must be a meeting of the so-called G-14 states, and that, among others, China, India, Brazil, and South Africa should be incorporated.
It is now thus all the more important to reach a common understanding of the theoretical fundamentals and principles, upon which the new financial architecture must be built if it is to be successful. Anybody who thinks it is sufficient merely to have a few "new rules" for the hedge funds and rating agencies, suspension of the EU's Maastricht Stabilization Pact in order to clean up the banks, and punitive reduction of the income of executives of failed companies, is mistaken.
If the world is to escape the danger of a collapse into a New Dark Age comparable only with that of the 14th Century, then the new financial system must be constructed on the basis of a qualitatively different paradigm than that of failed globalization. To attempt just to remove the most obvious, wild excesses, so as to find the quickest shortcut for returning to the old maximization of profit, can only end in catastrophe.
The parallels to the financial collapse of the 14th Century and the ensuing Dark Age certainly merit reflection: At that time, banking houses like the Bardi, Peruzzi, or Acciaiuoli had taken over all aspects of economic life: from financing the court of the King of England and the aristocracy, to the military, agricultural production, and trade. They operated according to the principle of profit maximization, without the slightest regard for the community, which they plundered beyond the point at which it could survive. They acted like a cancer which grows by taking over more and more of its victim, until the patient dies. In the end, the English King Edward III canceled repayment of the accumulated debts: That was the straw that broke the camel's back, and the banking houses collapsed.
A collapse of civilization resulted, decimating one-third of the population from India to Iceland. The combination of the Black Plague, failed harvests, hunger, superstition, witch hunts, and Flagellants meant a collapse that became known as the "New Dark Age." The paintings of Hieronymus Bosch vividly convey the insanity which dominated this era.
In the era of globalization, the methods of the investment banks, the hedge funds, and the private equity firms are, doubtless, orders of magnitude more complex and sophisticated, due to the advances of the electronic age. But though they operate "globally," the principle has remained the same: the highest possible profit through control of scarcity. The principle "buy cheap, sell dear," and the maximum extraction of profit in the "shareholder value" society, have led to, on the one side, thousands of billionaires and over 10 million millionaires; but on the other side, billions of humans living below the subsistence level.
Additionally, since the invention of "creative financial instruments" by Alan Greenspan, massive sums have come into being, whose dimensions seem to belong to the domain of astronomy: three-digit trillions or perhaps quadrillions in outstanding obligations. Due to a lack of transparency, in particular with respect to over-the-counter (OTC) trades, no government or central bank has an accurate picture.
Most recently, since the outbreak of the so-called mortgage crisis in the United States 14 months ago, it has become clear to most insiders that a large part of these 16-digit-plus "assets" is in fact "toxic waste." The French magazine Marianne has just released figures only previously publicized by Executive Intelligence Review: The $1,400 trillion market in derivatives is 50 times the size of the combined GDP of all the world's nations! The attempt to honor this financial paper at 100% value, as the U.S. Administration is now trying to do with the Paulson plan (which is by no means limited to $700 billion, and is actually open-ended), can only lead to a rapid hyperinflationary disintegration of the world financial system. The events in Germany of 1923 now threaten to play out on a global scale!
Even if you take into account the impressive degree of incompetence of the greed-blinded investors, it must have been clear to the chief culprits that the unrestrained granting of mortgages to people without any down payment, would necessarily lead to a collapse of the mortgage and real estate markets, as soon as interest rates rose on the credit markets. And now it is also clear to them that hyperinflation will destroy the savings and living standards of the majority of the population, and threatens famine on an unprecedented scale. If this problem is not immediately solved through a reorganization based on the right principles, it threatens to bring on a collapse of humanity into a dark age in which billions could be victims.
LAROUCHE'S NEW BRETTON WOODS
Now, it is a well-documented fact, that my husband, the American economist Lyndon LaRouche, has for a long time, and at every branching point, correctly forecast the accelerating tendency towards a systemic collapse of the financial system, on the basis of the axiomatically flawed decisions that were made; these include the promotion of consumerism in the U.S. of the 1950s, the elimination of fixed exchange rates and of the Bretton Woods System by Nixon in 1971, and the crashes of 1987 and 1997. On July 25, 2007, three days before the outbreak of the mortgage crisis, he explained in his now famous webcast, that the financial system had already collapsed and was hopelessly bankrupt, and that from then on, we would see various aspects of the bankruptcy rising to the surface.
I mention this, because in a situation so dangerous for humanity as this, it is better to listen to the solutions proposed by the economist who for decades has correctly analyzed the problem, rather than to those who, until recently, denied the systemic character of the crisis, or who still in August were saying, "The worst is already behind us."
Such an emergency conference, modelled on the Bretton Woods Conference of 1944, has long been proposed by Lyndon LaRouche, but he emphasized the difference in the conception of Bretton Woods intended by Franklin Delano Roosevelt, and what was implemented by Truman after Roosevelt's death, which was, in principle, a Keynesian system. It was Roosevelt's intention to use the Bretton Woods System to end forever the colonialism of the British Empire. It is precisely this intention of Roosevelt that must be implemented today with the New Bretton Woods.
In order for this new system to have credibility and integrity, the initiating powers-the U.S.A., Russia, China, and India-have to build the core of a representative group of nations which, in the tradion and spirit of the Treaty of the Peace of Westphalia, decide on a multicultural and multinational credit system, even while the current monetary and financial system is put through an orderly bankruptcy process.
Because of the above-mentioned volume of outstanding obligations, it cannot be merely a matter of "new rules" for hedge funds and rating agencies. Instead, the financial system must be put through an orderly bankruptcy proceeding; most debts and speculative contractual obligations must be written off. Simultaneously, a system of fixed exchange rates must be established, along with National Banks for the creation of credit for productive investment.
The key to success of the reorganization, is that the new system, as a credit system, orient itself to the right that is anchored in the U.S. Constitution, to sovereign government creation of state credit, as demonstrated by the first Treasury Secretary of the United States, Alexander Hamilton, and his founding of the National Bank of the United States. In the U.S. the government can, through the Treasury, and with the authorization of the Congress, create credit, which thus becomes a legal means of payment.
The second way for credit creation to occur is by means of international treaties, which are also voted upon by Congress. Such treaty agreements by a group of leading nations, with the United States, would become formally the turning point upon which to build the alternative to the ever more dramatically escalating crisis. If a representative group of nations agrees upon a new system of credit, customs, and trade agreements, that is already a "New Bretton Woods System"-and the last chance to prevent the risk of chaotic collapse that is becoming more dramatic every day.
The new system must be based on fundamentally different principles than the just-collapsed system of "globalization." The outsourcing of highly qualified jobs and production capacities to so-called "cheap labor countries," with significantly lower wages, poorer infrastructure, lower taxes, and lower standards of living, has not paid off for either the industrial nations or the developing countries. For example, the United States, as a result of this policy, no longer has medium-sized industries, while China, which has produced so much for export to the U.S., cannot cover the real costs of its total national production with its export earnings.
Thus, despite China's high growth rates of recent years, almost 70% of the population has not yet been freed from relative poverty, and China is not being paid enough for its exported goods, either to cover the costs of its cheap labor, or to cover part of the costs for the reproduction of society as a whole. And not only is the Chinese export market in the U.S. and elsewhere now endangered, but the escalation of the crisis threatens a massive loss in the value of the export earnings that have accumulated as currency reserves.
That was exactly how "market prices" ruled under conditions of globalization for most nations, but especially those subjected to diverse forms of monocultures, which meant de facto "primitive accumulation" of the national economy as a whole. The new system, therefore, must define "fair prices," which not only make possible a strong, protected internal market for industry and agriculture by means of protective tariffs, but also take into account the costs of optimal health and educational systems.
In contrast to the insane and recently failed assumptions of the free traders, the real source of wealth in society is exclusively the creative capacity of man, which continually empowers him, through the discovery of new physical principles, to expand his knowledge of the laws of the universe. When this scientific and technological knowledge is applied to the production process, it leads to an increase in the productive powers of labor and production capacities, which in turn leads to an increase in the standard of living and life expectancy.
The fact that a world population of a few million people in hunting and gathering societies, could develop to today's six and a half billion human beings, is proof that by the application of these discovered universal principles in production processes, productivity increases by magnitudes that are significantly higher than the costs of the discovery and the investment in its application. Certainly, the general principle of progress is also required, since at every stage of development, natural resources are relatively limited, and new resources can only be defined through a new, qualitatively higher discovery.
Human creativity is thus the motor for the increase of relative potential population-density, which in turn is the necessary precondition for the long-term survival of human species. The increase in relative potential population-density is therefore the measuring rod for economic policy decisions. The Russian physicist Pobisk Kuznetsov once said that discoveries are always named after their author, such as "watt" and "ampere," so the concept of relative potential population-density, as an economic measure, would go down in history as the "La," for LaRouche.
The paradigm of the new system must therefore be centered on the maximum promotion of human creativity. A nation oriented to the common good will see as its most self-evident interest, the promotion of the creative capabilities of all its citizens, and above all, its children and youth. Such an orientation would not only promote those scientific and technological areas which, as "science drivers," optimize the character of the economy, but it would also expand the role in the universe of what scientist V.I. Vernadsky called the Noösphere. That means, it would further the process of the human race "growing up."
The New Bretton Woods must also be built upon the principles of the Peace of Westphalia, which, in 1648, ended a 150-year period of European wars, including the Thirty Years War. The most important principle of this treaty, upon which international human rights are based, was the idea that, in the interest of peace, all foreign policy must be oriented to the "advantage of the other." The warring parties had realized that, were the war to continue-a war in which whole areas of Europe had been decimated-nobody would be left to enjoy a victory.
Earlier, Nicolaus of Cusa, in the 15th Century, had laid the philosophical foundations for interntional law, in particular with the idea that harmony in the macrocosm can only exist when all microcosms can develop in the best of all possible ways, including viewing the development of other microcosms as in their own interest. Accordingly, peace in the world can only be achieved when all nations have the chance to realize the potential within them and their citizens, and simultaneously to promote the development of other nations. That was the same core idea upon which John Quincy Adams based his foreign policy of a Community of Principle among fully sovereign republics, which are allied by a higher interest of humanity.
We have now arrived at a point in history, at which we are confronted with the challenge with which Alexander Hamilton, in the Federalist Papers, was confronted with respect to the United States: namely, whether we are capable of giving ourselves a government and a political order which functions and is worthy of human dignity-but this time, for the whole world. At a point where the possible collapse of humanity confronts us all too clearly, can we act together in time, to give the world a political and economic order that is in harmony with the Creation and the laws of the universe?
I think we can, and that this is the purpose of the individual, and of humanity!
Lyndon LaRouche Promotes Four Power Alliance in New Delhi, India
Both Lyndon and Helga LaRouche attend a seminar in New Delhi, India in December 2008, sponsored by the Forum for Strategic Security Studies (FSSS), a leading military think tank, in addition to participating in extensive private meetings on the subject of organizing a Four Powers alliance between India, China, Russia, and the United States to lead in creating a new global political and economic order [PDF]. LaRouche states in his speech to the forum:
"There are four nations on this planet, which are significantly large and important enough, that they could, if willing, make a decision which would eventually change the direction of affairs on the planet... How do we expand the capacity for carrying the world's population in a stable, growing way, which can't be done under the present monetary syste? If these four nations agree to form a nucleus, in recognition of defense against this crisis, then we can change the world... These four governments, the United States, India, Russia, China, can sponsor the idea of an agreement to deal with this particular crisi by creating a new credit system to replace the present bankrupt monetary system.
Helga Zepp-LaRouche: 'We Need A New World Economic Order, Now!'
Helga LaRouche issues a renewed call for a new international economic order [PDF], specifying eight specific points which must serve as the foundation for such a new system:
An emergency conference must be called, at the level of heads of state, to establish a new financial architecture. This emergency conference for a New Bretton Woods must resolve that:
1. The present world financial system must be declared hopelessly bankrupt, and replaced by a new one.
2. It must promptly set up a fixed-exchange-rate monetary system, so that long-term investments in international infrastructure projects are possible, under predictable conditions.
3. Derivatives speculation and speculation in food, energy, and raw materials must be banned by treaty among governments.
4. There must be an immediate reorganization, including, for example, cancellation of debts.
5. In a New Deal for the world economy, in the tradition of Alexander Hamilton, Friedrich List, Henry Carey, and FDR, new credit lines must be made available for investments in basic infrastructure and technological renovation.
6. Building the Eurasian Land-Bridge, as the core project for reconstruction of the world economy, is therefore the vision that can not only bring a new economic miracle, but also bring peace to the 21st Century.
7. Food production must be doubled worldwide in the coming years
8. A new "Peace of Westphalia" must, within at least 50 years, secure the availability and development of raw materials for all nations on this planet.
We maintain that the system of globalization, with its brutal, predatory capitalism, is economically, financially and morally wrecked. Instead, man must be placed at the center again, and the economy must serve the common good. The new world economic order must guarantee the inalienable rights of all men on this planet.
2009: LaRouche: Banking Reorganization According to Glass-Steagall Standard
In October 2009, Lyndon LaRouche outlines a program for bankruptcy reorganization of the financial system [PDF], specifying that, through the application of the "Glass-Steagall standard," fictitious values of speculative debt will be distinguished from productive debt with legitimate economic value. LaRouche asserts that the speculative debt must not be honored or bailed out, while the legitimate productive debt must be protected and reorganized as was done by Alexander Hamilton.
"What is required is to put all regular commercial banks through reorganization in bankruptcy... The accounts which are in commercial banks will be put into reorganization in bankruptcy, such that those accounts which correspond to a Glass-Steagall standard will receive full protection and will be assigned protection under the category of a Glass-Steagall qualified account. These banks, which we will clean up in that way, have to be under bankruptcy protection, even though they've been purged of this garbage... We're going to put the commercial banking system through a Glass-Steagall-standard reorganization; we're going to use the end-product of that reorganization to reestablish the full support of the Federal system, as a credit system, not a monetary system."
Schiller Institute Conference, Rüsselsheim, Germany February 2009
Lyndon LaRouche Attends World Public Forum in Rhodes, Greece
Lyndon and Helga LaRouche are both invited to attend the seventh annual conference of the World Public Forum in Rhodes, Greece, attended by over 500 academics, religious leaders, economists, politicians, artists, and journalists, from 60 countries. Lyndon LaRouche gives an address titled "A Four-Power Agreement Can Create a New World Credit System" [PDF] in which he states:
"The task is for Russia, and the United States, and China, and India, to agree, as a group of countries, to initiate and force a reorganization of the world financial and credit system, under those conditions, with long-term agreements, of the same type that Franklin Roosevelt had uttered before his death... The United States, Russia, China, and India, must become a bloc of countries, which each have different characteristics, but if they recognize among themselves, that they have a common interest, they will adapt to each other and respect each other's different characteristics. The result of this, will be the elimination of the monetary system of the world that has been dominating European civilization since the Peloponnesian War."
Helga Zepp-LaRouche's speech is titled "New Alliances for a New World System" [PDF], which she concludes by saying:
"We must open a new era of humanity, one in which oligarchical and imperial designs have been defeated once and for all, replaced with an alliance of republics which are perfectly sovereign, yet, which are united through the higher interest of mankind as a whole. It is possible to bring this about, but it will require interventions by courageous individuals who are fired by a passionate love for mankind."
Helga LaRouche ˇ Rhodes, October 7, 2009
Video: Helga Zepp-LaRouche Address to 2009 Rhodes Conference
Ladies and Gentlemen,
There were many important issues discussed during the last days, but I agree with Professor Dallmayr, that we cannot conclude this conference without focusing again on the reality that we, as a civilization are on the verge of thermonuclear war. The possibility of a military attack on Iran, the escalation of the situation between Syria and Turkey, the deployment of U.S. aircraft carriers in the Western Pacific close to these contested islands, and Hillary Clinton's statement that any attack on these islands would bring the U.S.-Japan military treaty into play, the agreement of the Spanish government to participate in the NATO anti-missile defense shield, all of these developments demonstrate that we are in mortal danger.
During the last weeks, the existential danger in which the human species now finds itself has become clear for all thinking people. The almost continuous policy of "regime change," which after the collapse of the Soviet Union, "bombed Iraq back to the stone age," plunged Libya into anarchy, turned Afghanistan into a nightmare, and victimized the secular state of Syria with foreign intervention and religious warfare, in the case of military operations against Iran, could lead to an uncontrollable worldwide wildfire. The Near and Middle East threatens to become a new Balkans, in which existing alliances like those before World War I lead to a conflagration. The unthinkable could occur, that Mutual Assured Destruction no longer functions as a deterrent, but becomes the consequence of a war in which thermonuclear weapons are deployed, leading to the extinction of the human race. Not at some possible time - but within the next weeks.
The dynamic which is driving the war danger, is accentuated by the accelerating collapse of the transatlantic financial system. Bernanke's euphemistically named "quantitative easing III" liquidity expansion is just as hyperinflationary as Mario Draghi's "whatever it takes," unlimited purchase of state bonds through the European Central Bank. Hyperinflationary money printing, in connection with brutal austerity - in the tradition of Reichschancellor Brüning - against the population and real economy has already had a life shortening effect upon millions of people in Greece, Italy, Spain, and Portugal and threatens to plunge Europe into a firestorm of social chaos.
Humanity is in the process of crashing into a brick wall at full speed. The question which we urgently must answer is whether the human species, confronted with its own self-destruction, is intelligent enough to change course in time, from the presently ruinous paradigm of attempting the consolidation of a world empire and the feigned legitimation for resolution of geopolitical conflicts by means of war, and replacing it with another, which is viable for humanity?
To solve this problem, we have to address an epistomological problem: We must repudiate the relics of the methods of thinking that are anchored in the oligarchical system, including deductive, positivist, empiricist, monetarist or linear statistic projection concepts expressing a bad infinity, as they belong to a worldview that has nothing to do with the laws of the real physical universe, nor the creativity of human reason.
Instead we must craft with the same creativity and love of humanity, as that of Nicholas of Cusa, Johannes Kepler, Gottfried Leibniz, Johann Sebastian Bach, Ludwig van Beethoven, Friedrich Schiller, Vladimir Vernadsky, or Albert Einstein, to name but a few, a vision of a better future for mankind, which of course can only be realized only when enough forces unite themselves for this good cause.
Such a vision can never be the result of Aristotelian thinking, or become a "consensus" of solutions for many small side issues, i.e., thinking from "below," but comes from thinking "from above." Nicholas of Cusa had, with his method of Coincidentia Oppositorum, the Coinicidence of Opposites, whereby the One has a higher order of power than the Many, laid the cornerstone on which not only the Priniciple of the Peace of Wesphalia and International Law were built, but also a universal method of problem and conflict solving, which is still valid today. This means we must begin with the definition of the common aims of mankind. What could be more important than the ontological question of "esse," being, that we are able to secure the prolonged sustainable existence of the human species?
By virtue of the anti-entropic lawfulness of the physical universe, the enduring existence of humanity requires a constant rise in the potential relative population density and a continually expanding energy flux density in production processes. If we want to find a solution to the twofold existential threat to mankind, the danger of thermonuclear world war and the systemic economic crisis, then the new paradigm must bring itself into cohesion with the order of creation. We need a plan for peace for the 21st century, a vision, which simultaneously inspires the imagination of hopes of man.
Despite having all the scientific and technological means at hand to guarantee humane conditions of life, while there are over 1 billion people subject to hunger and malnourishment, while 25,000 children - a small city - die daily from hunger, while 3 billion live in poverty and are denied their human rights, is it not then our sacred duty to actually deploy those means? We need a large-scale development strategy, building on the ideas of the United Nations Development Decades of the 1950s and '60s, rejecting completely the paradigm change of the past 40-50 years as the wrong track, and thus reviving the idea of "Peace Through Development."
Such a vision could be the implemention of the World Land-Bridge with its many great projects like NAWAPA, the tunnel under the Bering Strait, the development of the Artic, expansion of the Eurasian Land-Bridge, above all into the Near and Middle East and the Indian Subcontinent, including linking Africa to the World Land-Bridge through tunnels, under the Strait of Gilbratar linking Spain and Morocco, and also between Sicily and Tunisia.
There are two large regions of this planet where lack of development cries for vengeance, one being the African continent, that was never allowed to recuperate from the centuries-long colonial exploitation; and the second being the Near and Middle East, which are currently way behind their golden periods, when Baghdad was the center of world culture, or when Pamyra Tadmur in Syria was a pearl on the ancient Silk Road. We must put on the agenda for discussion a vision for an economic and cultural Renaissance for these regions, representing an element of reason at a higher level than the local, ethnic, and historic conflicts. Were the representatives of a group of large nations to bring such a message to the world community, showing that in fact, there is a real alternative that would make possible the survival of all people on this planet, then that element of hope could be brought into the debate, which is presently completely lacking.
The same kind of thinking using the standpoint of Coincidentia Oppositorum, thinking from "above," as applied to overcoming the underdevelopment on Earth with the World Land-Bridge, we also need for defense from the dangers to all of us on the planet which come from space. Russia, with its project for Strategic Defense of the Earth, SDE, has made a proposal for the cooperation of Russia and the U.S.A., and potentially more countries, for joint missile defense and the protection of Earth from asteroid and comet impact, which can replace the current geopolitical confrontation and the existential threat of its escalation. The SDE project is in the tradition of the SDI, the Strategic Defense Initiative, the proposal for overcoming the nuclear threat and division of the world into military blocs, which my husband Lyndon LaRouche developed over 30 years ago and which President Ronald Reagan made the official policy of the American government in 1983.
The SDE project, which includes early warning systems for manmade and natural catastrophes, as well as cooperation in manned space flight, is the absolutely necessary economic science driver that the crisis-ridden world economy needs in order to achieve higher levels of productivity and create the new scientific and technological capacities that are also needed for the solution to the problems on Earth. Joint manned space travel is the necessary next step for the evolution of mankind, and with this "Extraterrestial Imperative," as called for by renowned scientist and rocket engineer Krafft A. Ehricke, mankind can now enter into an age of adulthood, leaving behind itself, like childhood diseases, the solving of conflicts through war.
If we promptly succeed in unifying ourselves around the vision of achieving the common aims of mankind, and consciously present this perspective as a war-avoidance strategy, then it can inspire the imagination of the younger generation, which is now threatened worldwide by mass unemployment and desperate hopelessness. If the young people develop the same passion and elevated concepts as the pioneers of space travel once had, who now are encouraged with the instruments which the Mars rover Curiosity is deploying, and which has now "shifted the sense experience of Man," admittedly, with a 14-minute delay, the world has entered a new phase space; if young people develop that passion, then we have won. In the next phase of mankind, man will think like scientists and the composers of great works of Classical art.
We either act now, in this moment of existential danger, on the common aims of mankind, or we will not exist.
2010: LaRouche: 'A Revolutionary Change in International Financial Policy'
At a private seminar in Washington DC, attended by numerous representatives of the international diplomatic community, Lyndon LaRouche delivers a speech [PDF] in which he calls for a "revolutionary change" in the economic system of the planet to "eliminate the tyranny of international finance." LaRouche states:
"We need a revolutionary change in international monetary financial policy. We can not live on the kind of trends in economic policy, financial policy, which have ruled the United States since October 1987. We have to go back to a fixed-exchange-rate system of the type that Franklin Roosevelt intended... We must eliminate the tyranny of international finance, which preys upon and sucks the blood of mankind now. The authority for creation of credit lies with the sovereign nation-states. But the sovereign nation-states must have agreements among themselves, which are fixed-exchange-rate agreements..."
"This is the worst crisis in modern history; it's also the greatest opportunity in modern history, and it depends upon consciousness and will to do some simple things in terms of policy which will fix it. And bring the trans-Atlantic region and the trans-Pacific region into harmony with each other."
2012: BRICS Leaders Demand New International Financial Architecture
At their fourth summit in New Delhi on March 29, 2012, the leaders of the BRICS - Brazil, Russia, India, China, and South Africa - issue a statement calling for "a more representative international financial architecture, and the establishment and improvement of a just international monetary system that can serve the interests of all countries and support the development of emerging and developing economies."
The New Delhi Declaration of the BRICS announces:
"We have considered the possibility of setting up a new Development Bank for mobilizing resources for infrastructure in BRICS and other emerging economies and developing countries. We direct our Finance Ministers to examine the feasibility and viability of such an initiative, set up a joint working group for further study, and report back to us by the next Summit."
Fourth BRICS Summit ˇ New Delhi Declaration
We, the leaders of the Federative Republic of Brazil, the Russian Federation, the Republic of India, the People's Republic of China and the Republic of South Africa, met in New Delhi, India, on 29 March 2012 at the Fourth BRICS Summit. Our discussions, under the overarching theme, "BRICS Partnership for Global Stability, Security and Prosperity", were conducted in an atmosphere of cordiality and warmth and inspired by a shared desire to further strengthen our partnership for common development and take our cooperation forward on the basis of openness, solidarity, mutual understanding and trust...
BRICS is a platform for dialogue and cooperation amongst countries that represent 43% of the world's population, for the promotion of peace, security and development in a multi-polar, inter-dependent and increasingly complex, globalizing world. Coming, as we do, from Asia, Africa, Europe and Latin America, the transcontinental dimension of our interaction adds to its value and significance.
We envision a future marked by global peace, economic and social progress and enlightened scientific temper. We stand ready to work with others, developed and developing countries together, on the basis of universally recognized norms of international law and multilateral decision making, to deal with the challenges and the opportunities before the world today.
We are concerned over the current global economic situation. While the BRICS recovered relatively quickly from the global crisis, growth prospects worldwide have again got dampened by market instability especially in the euro zone. The build-up of sovereign debt and concerns over medium to long-term fiscal adjustment in advanced countries are creating an uncertain environment for global growth. Further, excessive liquidity from the aggressive policy actions taken by central banks to stabilize their domestic economies have been spilling over into emerging market economies, fostering excessive volatility in capital flows and commodity prices.
We believe that it is critical for advanced economies to adopt responsible macroeconomic and financial policies, avoid creating excessive global liquidity and undertake structural reforms to lift growth that create jobs. We draw attention to the risks of large and volatile cross-border capital flows being faced by the emerging economies. We call for further international financial regulatory oversight and reform, strengthening policy coordination and financial regulation and supervision cooperation, and promoting the sound development of global financial markets and banking systems...
We recognize the importance of the global financial architecture in maintaining the stability and integrity of the global monetary and financial system. We therefore call for a more representative international financial architecture, with an increase in the voice and representation of developing countries and the establishment and improvement of a just international monetary system that can serve the interests of all countries and support the development of emerging and developing economies. Moreover, these economies having experienced broad-based growth are now significant contributors to global recovery....
We have considered the possibility of setting up a new Development Bank for mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries, to supplement the existing efforts of multilateral and regional financial institutions for global growth and development. We direct our Finance Ministers to examine the feasibility and viability of such an initiative, set up a joint working group for further study, and report back to us by the next Summit...
EIR Publishes Special Report: 'There Is Life After The Euro!'
Executive Intelligence Review publishes a special report titled "There Is Life After The Euro: Economic Miracle For Southern Europe & Mediterranean" [PDF] which details the development programs which could be built to reconstruct Europe if the European nations were to free themselves from the collapsing Euro system. In the introduction to the report, Helga Zepp-LaRouche says:
"The euro system, and the entire trans-Atlantic financial system, are in the process of total disintegration... A solution does exist. That solution, however, is absolutely impossible within our current system. The hopelessly bankrupt system of globalization, and today's casino economy, must be replaced by a credit system that is oriented exclusively toward future investment into the real economy, with high energy-flux densities. We must return to national currencies, fixed exchange rates, and an economic reconstruction program for Southern Europe, the Mediterranean region, and the African continent...
"By implementing a two-tier banking system in the exact tradition of the Glass-Steagall standard established by Franklin D. Roosevelt in 1933, commercial banks would be put under state protection as a first step, while the entire array of 'creative financial instruments' and derivatives contracts would have to be struck from the books. A moratorium must be declared on all state debt, and the portion of indebtedness stemming from financing all sorts of bailout measures, would likewise be wiped from the books."
Helga Zepp-LaRouche ˇ June 2012
All of us-every nation in Europe, along with its citizens-now face a doubly existential crisis: The euro system, and the entire trans-Atlantic financial system, are in the process of total disintegration, which can be put off only for a few more weeks, by means of hyperinflationary injections of liquidity. This is the result of the failed system of the British Empire, which also, on the basis of the so-called Blair Doctrine, now threatens to draw us into a thermonuclear confrontation with Russia and China.
A solution does exist. That solution, however, is absolutely impossible within our current system. The hopelessly bankrupt system of globalization, and today's casino economy, must be replaced by a credit system that is oriented exclusively toward future investment into the real economy, with high energy-flux densities. Re-attaining national sovereignty is the absolute prerequisite for both economic recovery and the preservation of peace. We need to immediately establish a two-tier banking system in the tradition of Franklin D. Roosevelt, along with a credit system in the tradition of Alexander Hamilton and the FDR-era Reconstruction Finance Corporation, and we must return to national currencies, fixed exchange rates, and an economic reconstruction program for Southern Europe, the Mediterranean region, and the African continent.
THE EURO HAS CREATED A MONSTER
One might well paraphrase the title of Francisco Goya's famous etching to describe the result of the European Union's current policies: "The sleep of economic reason has produced monsters." For who could still have any doubt that the euro is a failed experiment? The situation in Greece, Spain, Portugal, Italy, and also in the Balkan states, is, in fact, hideous, and is already costing many human lives. This is not the fault of these countries' citizens; rather it is the result of the European currency union's flawed policies, and of the monetarist policies of the EU and of Europe's governments, which, especially following the outbreak of the financial crisis in July 2007, have merely continued a policy favoring speculators and banks, against the interests of the General Welfare.
The Eurozone, even from its birth, was not an "optimal currency zone." It ought to have been clear from the very outset to anyone with any economic common sense, that states with such divergent economic structures, and diverse languages and cultures, as Germany, Finland, Greece, and Portugal, could not develop harmoniously into a single currency union.
As is well known, the euro was not born out of solid economic considerations, but rather out of the geopolitical intention to bind the reunified Germany into the corset of the EU, and to force it to abandon the deutschemark. François Mitterrand's former advisor Jacques Attali later admitted that it was clear to all participants at the time, that a currency union could not function without political union, and that this birth defect of the euro had been intentionally designed to force Europe into political union later on! Precisely that is what we are witnessing now, with the advocates of union now attempting, under extreme crisis conditions, to use the introduction of eurobonds as a final step toward a federal EU state.
The extensive powers which the European Stability Mechanism is to be granted-its governing council and directorate would enjoy lifelong immunity, and no accountability-would turn such a federal state into a total dictatorship serving the interests of the banks and the City of London. It would guarantee Europe's plunge into economic, political, and social chaos.
Twenty years after the signing of the Maastricht Treaty, a monster has been created; and 11 years after the introduction of the euro, many Eurozone nations are in danger of descending into African-level conditions-social collapse, rising death rates, infrastructure no longer maintained, most economic activity ground to a halt, one in two or three young persons unemployed, and skilled workers fleeing their homelands because they see no future there. The alleged boom in the Eurozone's so-called catch-up nations was in fact a bubble-and now that bubble has popped. When the flow of tourists begins to dry up, and when people can no longer afford second vacation homes, it will become clear that there was no increase in social wealth in these countries, and that there's still no adequate infrastructure and industrial capacity. Greece, for example, does not have a single rail connection to the rest of Europe, or to Asia!
But even the citizens of the so-called profiteer of the euro, Germany, have been left empty-handed. During its 11 years with the euro, its domestic market has shrunk, real incomes have declined, purchasing power has gone down, its health-care system has grown considerably worse, and the spectrum of its employment structure has worsened in the direction of cheap labor. Its ostensible special position as the "world champion of exports"-which primarily benefited the DAX 500 corporations, and much less, the small and medium-sized industrial firms-is quite understandably collapsing, just at the point when its export markets are drying up.
The EU's policies have not secured peace in Europe, as the propagandists of European integration would have us believe; rather, enmity among nations has never been greater since World War II. Instead of fostering the General Welfare and a sense of community, the Law of the Jungle is spreading its influence, with each out to save his own skin. A continuation of this policy, whether it be through brutal austerity in the tradition of Brüning, or in the form of a hyperinflationary collectivization of debt, represents high treason against the very idea of Europe in the Christian-humanist tradition...
TWO-TIER BANKING AND CREDIT SYSTEM
Once we have psychologically digested the fact that today's trans-Atlantic monetary system is beyond salvation-either it will disintegrate in a sudden chain reaction, or else it will obliterate everyone's assets in Europe and North America in a hyperinflationary explosion, such as occurred in Germany in 1923-only then will our minds be equipped to turn to constructive solutions. By implementing a two-tier banking system in the exact tradition of the Glass-Steagall standard established by Franklin D. Roosevelt in 1933, commercial banks would be put under state protection as a first step, while the entire array of "creative financial instruments" and derivatives contracts would have to be struck from the books. A moratorium must be declared on all state debt, and the portion of indebtedness stemming from financing all sorts of bailout measures, would likewise be wiped from the books.
The EU treaties, from Maastricht to Lisbon, must be canceled, and national sovereignty over monetary and economic policy must be re-established. Competent feasibility studies for a "Plan B," comprising technical preparations for, and execution of an exit from the euro, have already been worked out by such experts as Prof. Dirk Meyer at the Federal Military College in Hamburg. An extended weekend could be utilized as a bank holiday to prepare the currency conversion, and to deal with account balances in checking and savings banks. German citizens, resident aliens, and foreign firms with German branches could have their cash assets stamped with magnetic ink. Time-limited controls on capital transfer and border traffic could prevent "non-sector" euros from being brought in, and procedures for timely reporting of assets could be adopted in the interest of preserving public order.
The exit from the euro must be followed by a transfer of the monetary sovereignty that was handed over to the EU, back to the respective national states; this can be accomplished by a quickly drawn-up resolution adopted by the European Council. A new national currency law could then legislate the adoption of the New Deutschemark, and likewise for other respective national currencies. The euro could continue to be utilized as a unit of accounting among national banks, as was done earlier with the European Currency Unit.
Our return to national currencies would generally be simpler, because we can make use of the experiences and procedures from the euro's introduction. The resulting costs are relatively small, compared with what would happen with a chaotic disintegration of the Eurozone.
In the United States, Roosevelt, with the help of a package of measures-the Glass-Steagall legislation, the Pecora Commission, the New Deal, the Reconstruction Finance Corporation, and the Tennessee Valley Authority-successfully led his country out of the Depression. But meanwhile, as we know, Germany took the route of Brüning's austerity policy, into Hjalmar Schacht and Hitler. Germany's government, however, has apparently not learned anything from these various examples, and the infamous Troika-the ECB, EC, and IMF-is imposing the same policy which led to catastrophe in Germany, only now on all of Europe...
THE CREDIT SYSTEM
In 1923, Germans had to learn from bitter experience that money has no intrinsic value. Within a few short months, they saw their entire life's work swept away, even though, nominally, they were billionaires, or even trillionaires. Today, in the age of electronic money multiplication, securitization, and derivatives contracts, the evanescent nature of most of our money is even more obvious. The bursting of various bubbles in the new market, the secondary mortgage market in the United States, Lehmann Brothers and AIG, and the imminent bankruptcy of countless banks which would have long ago gone belly-up, had it not been for "bailout packages": In all these cases, the losses have been of virtual money, and thus they are, in fact, imaginary losses. Something that you have never actually owned, and which has only a virtual value, you're actually not losing at all.
Today's monetarist system has accumulated such a gigantic volume of these debt instruments in the form of outstanding derivatives contracts, securitizations, etc., that any attempt to honor all this past debt would invariably lead to hyperinflation. The only difference between now, and Weimar Germany in 1923, is that this time, we're dealing not with just one country, but with the entire trans-Atlantic region.
The credit system which must replace this bankrupt monetarist system is based on completely different principles. Money per se has a function in payment transactions, but much more important, is the credit which a sovereign state's national bank will issue toward future production. The goal of this credit issuance is to build up the real economy, to create full employment, and to increase the entire labor force's productivity, by means of a scientific driver and targeted fundamental research. It is an application of the principles of physical economy, as these have been developed by Leibniz, List, Carey, Witte, leading up to Lyndon LaRouche.
The issued credits are directed toward future production-a real value, in which human productive ability, refined raw materials, and industrial capacity, create a surplus value which increases in tandem with the scientific and technological level on which that production takes place. Each country shall also create a national bank in the tradition of the first U.S. Treasury Secretary, Alexander Hamilton. This bank shall issue open lines of credit for financing well-defined projects, such as NAWAPA (the North American Water and Power Alliance), the building of a tunnel under the Bering Strait, the reconstruction program for Southern Europe, the Africa Pass, Transaqua, and so forth (see following articles). Via local and regional commercial banks, these credits will then be issued to the firms participating in these projects, and they, in turn, will contract with suppliers and hire employees, who will, in their turn, spend their income for the normal items required to sustain their living standard.
And thus, above and beyond the stimulation of production resulting directly from the projects, there will be a secondary revival of the economy as a whole. Given the large scope of the above-named and similar projects, full and lasting productive employment will be achieved, while at the same time, the employment spectrum will be shifted away from the services sector and into productive jobs in industry, research, and agriculture.
The historical examples of cases where this method of productive credit creation has been applied, demonstrate that the benefits reaped by the general economic upswing created thereby, along with the concomitant rise in tax revenues, will far surpass the volume of the originally issued credits. Contrary to the creation of money for retiring the monetarist system's old debt, the credits issued as we have outlined here, will have an anti-inflationary effect, because the emphasis on scientific and technological progress will increase productivity.
FOR FUTURE GENERATIONS
But we are also speaking here about great projects which will improve the lives of human beings for many generations to come. For those people in the virtual stockbroker's world, who would rather indulge in hedonistic dancing around the Golden Calf, it might come as a surprising thought, but, in fact, the underlying purpose of an economy is to guarantee the long-term survival of the human species on a level that increases from generation to generation. The purpose of a credit system is to take the wealth created by past generations and "pass it onward, increased and enriched, to future generations," as Friedrich Schiller defined the meaning of universal history.
Mankind is not merely another species of animal which reproduces itself on the same level of development over the course of centuries and millennia; rather, man is the only species with the capacity for creativity, i.e., the capacity to develop its own natural resources to an ever higher level of organization. With our creativity, we can create something that outlasts our own lifespan: We invest in something which will benefit future generations, something which will afford them a degree of material and spiritual freedom which extends far beyond what we, as initiators, have achieved during our own lives.
The idea of a credit system is therefore by no means merely a technical improvement in our banking system; rather it is a harmonization of the financial side of our economy, with the continued existence of humanity for many generations into the future. Therefore it has, if you will, a spiritual dimension. The credit system is thus the instrumentarium which aids us in passing the value created by one generation, and enriched by us, onward to following generations. In order to make it clear that a credit system must be thought of as a human concept, one which places mankind at the very center of the economy, let me quote the concluding sentences from Friedrich Schiller's essay "What Is, and To What End, Do We Study Universal History?"
"There must burn within us a noble yearning to take the rich legacy of truth, morality, and freedom which we inherited from our forebears, and to pass this onward, richly increased, to the future world, and also to make a contribution of our own, and to firmly link our own fleeting existence to the eternal chain that winds through all human generations. As diverse as the future careers may be awaiting you in society, you can all put something toward this! Every action of merit opens up a pathway to immortality-to true immortality, I say, where the deed lives on and speeds its way along, even if its originator's name be left behind."
The crisis of civilization that is plunging us into a collapse of the trans-Atlantic financial system, ought to make it clear to even the most dull-headed among us, that we must bring our political and economic affairs into harmony with the ordering of the physical universe-if, that is, we are to avoid the fate which led to the extinction of earlier species. The universe, however, is not a closed system, with a "budget that needs to be balanced," but rather it is an anti-entropically developing, creative universe, whose energy-flux density and complexity of organizational structure is always increasing. And it is high time that we adapt our human economy to these underlying laws of the universe.
The concrete task of the credit system for reconstructing Southern Europe, the Mediterranean region, and Africa, flows directly from this universal task. On the one hand, national banking systems in each participating state must finance the projects described in the following sections of this report, by creating the required lines of credit. At the same time, long-term cooperation treaties must be concluded between sovereign states for joint work on international projects which straddle national boundaries, such as the extension of the Eurasian Land-Bridge's transport corridors into the Middle East, and, via bridges and tunnels, into Europe and Africa. These treaties shall have realistic durations of from one or two generations.
If we abandon the idea of quick profit, and instead dedicate ourselves to the task of eliminating the wretched condition of underdevelopment, by means of a program of reconstruction that will form the crucial basis for expansion of infrastructure and for economic drivers, then, out of the present collapse crisis, together with such projects as NAWAPA and the construction of the World Land-Bridge, we can set into motion the greatest economic miracle in human history. A new era of humanity can then begin.
Schiller Institute Launches 'New Paradigm for Civilization' Conferences
The Schiller Institute sponsors a conference in November 2012 near Frankfurt, Germany titled 'A New Paradigm for Civilization' as the first in a series of international conferences [VIDEO]. The conference is attended by over 300 participants from 25 countries in Europe, and Middle East, Asia, and the United States. Helga Zepp-LaRouche introduces the new EIR report 'There Is Life After The Euro' and stresses that only by adopting a development program in the common interests of mankind can global war be averted.
See Website: Forum For A New Paradigm
Lyndon LaRouche's remarks to the conference [PDF] feature the specific steps that must be taken to reorganize the bankrupt financial system:
"1. The first of the three essential preconditions for recovery is that the relevant, combined leading nations of both the United States and the leading parts of Eurasia, must immediately enact the Glass-Steagall law...
2. A recovery of the economy of the relevant nations depends upon the actual creation of a set of systems based on the principle of national credit, among respective nations. This means that the future investments must be those rightly deemed physically worthy of the credit which is uttered under the authority provided by the credit systems of the respective sovereign nations...
3. It must be recognized, that it is the increase of physical wealth which must be made practicable by the respective nations' extension of systems of public credit. The future wealth of nations and of the enterprises must warrant the extension of national credit, within and among cooperating nations. That economic policy shall serve for both the public and private investment, in the creation of that which will exist only through the means of the productive future of the nation and mankind in general."
Lyndon LaRouche ˇ November 25, 2012
For PDF: The Crucial Issue of This Crisis
My subject is "The Crucial Issue of This Crisis," and I proceed as follows:
The set of trans-Atlantic nations, and beyond, is now gripped, by the most immediate and most menacing crisis in modern history. There are three, physical qualities of economic issues to be considered:
First, we must end the current commitment to an accelerating, monetarist hyperinflation.
Second, we must end an already deep and still-deepening collapse of physical economy.
And third, we must end the presently immediate threat of the outbreak of a general thermonuclear war. That would be a war, which, if it occurs, is already an early and immediate threat to destroy civilization worldwide. Such a war, during such a brief required lapse of time, of approximately an hour and a half of thermonuclear warfare, would send the leading powers of the world to an obliteration of civilization.
These three categories of present threats to mankind are to be traced to the effects of the presently continuing, and presently accelerating, hyperinflationary policy of the United States, and the nations of the Western and Central European regions. These present trends in North America and Europe have created a presently hopelessly accelerating, hyperinflationary system. And this leads to a consideration of three conditions.
There are first, therefore, three conditions which must be adopted immediately, if the danger of an early outbreak of a thermonuclear phase of the present acceleration of a march to war is to be prevented, and if true economic recovery is to be launched instead.
The first of the three essential preconditions for recovery is that the relevant, combined leading nations of both the United States and the leading parts of Eurasia, must immediately enact the Glass-Steagall law, which is to be modeled on the successful economic recovery action launched originally by United States President Franklin Roosevelt, during the 1930s. The enacting of that Glass-Steagall law, will suffice to halt the hyperinflation which is now leading the principal nations of the north trans-Atlantic region. This will prevent them from leading into a hyperinflationary collapse, and an increasingly probable certainty of thermonuclear warfare.
Second: A recovery of the economy of the relevant nations depends upon the actual creation of a set of systems based on the principle of national credit, among respective nations. This means that the future investments must be those rightly deemed physically worthy of the credit which is uttered under the authority provided by the credit systems of the respective sovereign nations. The presently accelerating rate of trans-Atlantic-centered hyperinflation must be terminated with the appropriate full force of appropriate measures of physical reforms.
Under such a reform, the composition of national funding of sovereign national economies, will be composed of a combination of existing and supplementary modes of credit extension of the physical-economic advances for, and by, the respective nation-states as such. Think this through as follows: There exists presently a widespread practice which locates wealth, mistakenly, in money as such, or in terms of similarly fictitious assets, rather than the physically effective credit systems of the economy.
Whereas, any actual recovery will demand that presently hyperinflationary practices among nations, must be superseded by national systems, of national physical credit, from both within and among those cooperating nations.
Third: It must be recognized, that it is the increase of physical wealth which must be made practicable by the respective nations' extension of systems of public credit. This must be a system of credit, which is duly warranted as an investment in the creation of future, physically productive, rather than merely nominalist forms of monetarist wealth, per capita and per square kilometer. The future wealth of nations and of the enterprises must warrant the extension of national credit, within and among cooperating nations. That economic policy shall serve for both the public and private investment, in the creation of that which will exist only through the means of the productive future of the nation and mankind in general.
THE UNIQUE QUALITY OF MANKIND
Now, as to essential facts for mankind on this question. The essential fact, which must be added to economic reforms among nations, is that mankind can no longer isolate itself to life on Earth alone. Furthermore, the known history of the evolutionary process of all manifest imaginations, viable ones, of living species, has thus always depended upon the relative increase of the characteristic energy-flux density of the existing categories of surviving species. The fact is, that mankind is the only living species known to us, as depending for its power to exist, through the willful development of progressively higher evolutionary states of existence of leading creatures.
The relative fact is, that for mankind, the successful future of any living species, depends absolutely on perpetual and accelerating increases in the energy-flux density, per capita, as this is expressed by the progress of the human species, to higher levels of energy-flux density. Mankind is the only known species whose existence is defined by the controlled use of fire. Mankind's prospect of a continued existence depends hereafter on progressing beyond the limits of mere sense-perception to increasing power to command mankind's growing, willful role, within regions beyond Earth and Mars, to other planets in the Solar System and beyond. Any contrary policy would promise to lead our human species, implicitly, through the hazards of asteroids and comets, toward the prospective human species extinction.
Now, there are certain economic trends to be considered. In the meantime, during the period since the launching of the worse-than-useless U.S. war in Indo-China, a war which was launched by means of the assassination of U.S. President John F. Kennedy-even despite the progress which had been embodied in President John F. Kennedy's launching of the famous space program of the U.S.A-since that war in Indo-China, the general trend in the United States, and the economies of Western and Central Europe alike, in particular, has been the increasingly downward movement in net effects, measured per capita, over the course of the subsequent decades.
The loss of physical-economic potential by formerly leading nations, has been accelerating in terms of loss of actively productive skills, as measured in crucial terms of what is known as energy-flux density, over the entire span, since the assassination of President John F. Kennedy. That has produced the effect of a greater rate of net decline of physical productivity in nations, per capita, than in useful additions to productive employment made by a total labor force.
STRATEGIC DEFENSE OF EARTH
In addition to those considerations just stated, mankind's existence is now in peril from the threats from the roles of both asteroids and comets, within the region between the orbits of Mars and Venus. We must create the needed means of program defense.
Russia's scientists have properly referenced the need for intention of a Strategic Defense of Earth, the SDE policy, on this account. These just indicated challenges typify the necessity for those kinds of specific, physical-economic reforms, on which the avoidance of thermonuclear warfare, and that of more general kinds of threats and economic catastrophe for mankind, must be included, because they are to be considered as matters of primary means for both the defense and the improvement of the conditions on which the continued existence of human life now depends.
In particular, it is now urgent that the United States, among others, return to an expanded version of a space program, not only for reasons associated with an improved space program including defense as such, but, with the urgency of a great, and early, great leap forward in technology, in physical space generally.
Progress is not an option. The continued survival of the human species demands it, now, more than ever.
In conclusion, our policy must be as follows: Science is no longer to be limited to operations within the bounds of sense-perception. We must enter that higher domain of physical principles, which exist only beyond the reach of mere sense-perception, and thus, into the true domain of the human mind, into the domain of the discovery of true principles as such, those which reign beyond the reach of mere sense-perception. We must now enter, as Bernhard Riemann had emphasized in the closing sentence of his habilitation dissertation, into the inclusive quality of the domain of mind, as proposed by the collaboration on that specific subject, of an all-inclusive physical conception of mind, which had been implied in the pioneering collaboration between Max Planck and Wolfgang Köhler.
2013: LaRouche Interviewed In Chinese Press: 'Change The Direction of History'
Lyndon LaRouche is interviewed by Xinhua, the official news agency of the People's Republic of China, on July 27, 2013 [PDF]. During the interview, the interviewer Zhang Mian states "as an economist, you've committed yourself to establish a new world economic order" and asks him what is required to accomplish this goal. LaRouche replies:
"We have to create a new world, a new world which is based on a commitment to high technology, because only by increasing the technological potential of the nations of the planet, can we possibly work our way out of this problem. That could be done. China is potentially a very important part of this new world system. We can create an agreement among leading nations of the world, to change the general direction of the history of this planet in modern times - and China is a key nation in this whole process... The important thing is to turn conflict into a source of alliances, on this issue. And that issue will only work if we are actually promoting technologically progressive improvements in productivity."
January 26, 2013 Schiller Institute: "A New Paradigm To Save Mankind", New York City
March 23, 2013 Schiller Institute: "After Thirty Years: The Need for the Principle of the SDI Today!", Sterling, VA
Chinese President Xi Jingping Announces 'New Silk Road Economic Belt'
On his way to a meeting of the Shanghai Cooperation Organization (SCO), Chinese President Xi Jingping visits Kazakhstan on September 7, 2013 and announces his policy to push the rapid development of a 'New Silk Road Economic Belt' stretching "from the Pacific Ocean to the Baltic Sea." While speaking at Nazarbayev University in Astana, President Xi states:
"To forge closer economic ties, deepen cooperation and expand development in the Euro-Asia region, we should take an innovative approach and jointly build an 'economic belt' along the Silk Road. This will be a great undertaking benefitting the people of all countries along the route... We must expand the development of Eurasia, creating an economic belt along the Silk Road. China and the Central Asian countries are at a crucial stage; we need a broader vision for cooperation. The peoples of this ancient Silk Road together can compose a wonderful new chapter in the much-told story. Now is a golden opportunity for development."
Helga LaRouche to UN: New Economic Order Begins With New Silk Road
Helga Zepp-LaRouche publishes an appeal to the United Nations [PDF] stating that Xi Jingping's adoption of the Silk Road policy creates the opportunity to "put the legitimate demand of the Non-Aligned Movement for a just world economic order back on the agenda." Helga LaRouche writes:
"We all know that the current economic order in the world only allows a very small percentage of the population to live a life of luxury, that only a relatively small percentage live decently, that many languish in inhumane poverty, while what Pope Francis called "hidden euthanasia" is widespread...
"It is high time to put the legitimate demand of the Non-Aligned Movement for a just world economic order back on the agenda. Such a new order could begin with the proposal of Chinese President Xi Jinping at the latest SCO conference, to build the new Silk Road as the basis for peaceful cooperation among all the countries along that route. This proposal is totally in line with the proposal for a Eurasian Land-Bridge that the Schiller Institute advanced beginning in 1991, in reaction to the disintegration of the Soviet Union. That concept has been expanded, in the meantime, to a World Land-Bridge to bring people together, which has gained many friends and supporters throughout the world. Such a worldwide infrastructure and development program would hoist us onto the next higher economic platform, where hunger and underdevelopment could be eliminated forever."
Helga LaRouche Appeal to UN ˇ September 30, 2013
We all know that the current economic order in the world only allows a very small percentage of the population to live a life of luxury, that only a relatively small percentage live decently, that many languish in inhumane poverty, while what Pope Francis called "hidden euthanasia" is widespread.
Only a few people know that, just a few weeks ago, mankind avoided, by a hair's breadth, the danger of extinction in a thermonuclear war, because that would have been the consequence of an escalation following a U.S. military strike against Syria.
Both of these dangers, which threaten the very existence of the human species, are ultimately the result of the economic system of globalization, in which "anonymous decisions"-signed by high-level officials-sacrifice man's unique dignity and his life to Mammon, the god of lucre.
The diplomatic initiative around Syria raises the hope that the danger of a regional, and possibly, world war has been once again averted. But as urgent as war-avoidance is, it is not enough. If we, as a species, are to have a future, we need a real perspective for peace, a completely new paradigm, that leaves behind, once and for all, the geometry of solving crises through war, and replaces it by defining the common aims of mankind.
Is it not in the interest of all people on this planet to ensure energy security and raw-material security as quickly as possible, and by so doing to overcome an essential cause of hunger, and of the danger of war? Is it therefore not in the interest of all people and all nations to launch the best possible crash program for the use of thermonuclear fusion, along the lines of the "Manhattan Project" for developing the atomic bomb during the Second World War, but this time for peaceful purposes, and for the good of all mankind?
Likewise, it is high time to put the legitimate demand of the Non-Aligned Movement for a just world economic order back on the agenda. Such a new order could begin with the proposal of Chinese President Xi Jinping at the latest SCO conference, to build the new Silk Road as the basis for peaceful cooperation among all the countries along that route. This proposal is totally in line with the proposal for a Eurasian Land-Bridge that the Schiller Institute advanced beginning in 1991, in reaction to the disintegration of the Soviet Union. That concept has been expanded, in the meantime, to a World Land-Bridge to bring people together, which has gained many friends and supporters throughout the world. Such a worldwide infrastructure and development program would hoist us onto the next higher economic platform, where hunger and underdevelopment could be eliminated forever.
If the nations united in the UN General Assembly decide to replace the profoundly immoral and unjust system of globalization by an order based on an alliance of sovereign republics-in the tradition of John Quincy Adams-to work together in the common interests of mankind, our civilization can enter, consciously, into the next phase of evolution.
Why should that not be possible? We are the only creatures who, thanks to human creativity, can consciously improve the basis of our existence through scientific and technological innovation, and thus raise our living standards and life expectancy. Likewise, we are the only species which can scientifically determine with precision where the next step of research into the physical order of Creation must lie, to ensure the continued existence of our species in the universe.
The Earth is not a closed, entropic system of finite resources. Our Solar System and our galaxy are only a tiny part of the Universe, which develops itself anti-entropically. What is wonderful about our order of Creation is that there exists a verifiable concordance between the laws of the macrocosmos-the Universe-and of the microcosmos-our creative reason-which is expressed in the physical power of our immaterial ideas.
What we need today, more than anything else, is a tender love for mankind, an audacious vision for the future which looks at our planet from the perspective of astronauts and cosmonauts who see no borders, but only one mankind, while at the same time looking to the stars.
Friedrich Schiller said as much in his poem, and Ludwig van Beethoven in his 9th Symphony put those words to music:
Every man becomes a brother, ...
Take this kiss throughout the world!
Brothers o'er the stars unfurl'd
Must reside a loving father.
Our tormented mankind needs courageous leaders, committed to the mission of leading the world out of the danger zones of destruction into a better future, which is within reach!
LaRouche Movement Publishes Video Detailing Thailand 'Kra Canal' Policy
On September 23, a feature video is published by the LaRouchePAC detailing the thirty-year history of the LaRouche movement's leadership in the campaign to build a sea-canal across the Kra Isthmus in Thailand to connect the Gulf of Thailand with the Indian Ocean as a keystone project for the development of the Southeast Asian region. The video also reviews other key economic development projects for this region, including the development of nuclear power and rail transport. A transcript of this video is featured in Executive Intelligence Review magazine [PDF].
A Chinese-language journal Fortune Times contacts LaRouche a few months later to interview him on the Kra Canal [PDF], in which LaRouche states:
"The great boost to economic development of the South-Asia development, the massive economic advantage, and relative simplicity, of the undertaking, fulfillment, would be the exceptionally massive economic benefits such a canal represents for all of the nations of East and South Asia. There are two truly great nations in Asia: India, and the more populous China. The sheer volume of maritime trade between the two great nations of Asia, and their connections through the South Asia maritime regions, make the canal probably the most potentially beneficial, and also efficient project for the entire region of the Pacific and Indian Ocean regions, and the co-development of the major regions of Planet Earth as a whole."
LaRouche is interviewed by a Chinese language journal Fortune Times in May 2014, in which he states:
From my active interest in this subject, during the course of the 1970-1980 interval, I do have specific, professional knowledge concerning the importance and feasibility of such an undertaking, and its profound implications for the entirety of major neighboring regions such as, most prominently, China and India, but also the development process throughout the Pacific region generally.
1. Soon, the potential role of a well-developed Kra Canal must be among the presently best-known and most strategically important options in the underbelly of the Indian Ocean and closely related areas.
2. During a past period of my most excellent relations with Thailand, and of supporting actions pre-arranged, but disrupted, between Thailand and Mitsubishi during that past time, the feasibility and rich benefits of the completion of the Kra Canal, were among the greatest potential benefits available throughout the region of the Western Pacific and Indian Ocean waterways throughout all of Asia's coastal regions. I had enjoyed excellent practical relations with the nations immediately associated with that project at that time.
3. Until I was targeted for virtual political elimination, by British-imperial and Wall Street interests (on the issue of an SDI agreement with the Soviet government), until a pro-British interest gained access to the Soviet system's control, I had enjoyed often excellent cooperation with U.S. circles who had maintained close affinities with the tradition of President Franklin Roosevelt, as in opposition to enemies such as the infamous Dulles Brothers, who still tend to be represented by British-Empire-dominated interests, especially Wall Street branches of British imperial interests which have dominated the U.S. Presidency under the Bush-Cheney and Obama affinities to the British world empire today. The infamous "9-11" attack on the United States, which had been actually launched by Wall Street and British agencies through British-directed Saudi influences, remains a crucial strategic factor bearing on Asia's future presently, for this same reason.
Under the consequent circumstances, my active connections to relevant circles in East Asia have since been greatly reduced, but, my broader strategic understanding of the East-South Asia region persists. Respecting your interest in the matter of the implications of a Kra Canal development, my broad strategic-economic competence remains relevant today.
4. Divide the maritime region of East and South Asia into three principal categories: China, a giant; India, a giant; and the maritime connection, throughout Southeast Asia's maritime regions, today. Add the impact of such triadic maritime and related connections, to the physical-economic relations to the Americas to the East, and the Middle East's underbelly and Africa. Then, the potency of a Kra Canal development appears not only as an eminently feasible feature, but a strategic political-economic force for the planet.
That is sufficient to present the practical, immediate, also, globally strategic considerations.
a.) The studies of the Thai government and Mitsubishi have demonstrated both the economic feasibility and awesome benefits of the completion of the Kra project. The immediate prospect of difficulties, is predominantly political, and that itself, specifically British-imperial manipulations of governmental and financial-economic interests. On the U.S.A. side, the sources to be regarded as hostile can be traced to the history of the Dulles Brothers and the Bush-Cheney-Obama, British imperial-controlled regimes (e.g., Wall Street) in the United States still today.
b.) From an engineering vantage-point, the project is probably the most feasible, most efficient, and relatively most beneficial measure for the entire underbelly of the Indian Ocean.
The most common opposition to the Kra Canal, from within that region itself, is located precisely in Singapore. The chief source of resistance from Singapore, is entirely, global, British-imperial military-strategic interests. The completion of the Kra Canal, is not technologically difficult, if and when we take into account the massively beneficial impact of the creation of such a project; it is principally the British imperial-strategic interests in the entire Indian-Ocean region, which has long remained the principal obstacle to the Kra during modern times.
c.) The great boost to economic development of the South-Asia development, the massive economic advantage, and relative simplicity, of the undertaking, fulfillment, would be the exceptionally massive economic benefits such a canal represents for all of the nations of East and South Asia. There are two truly great nations in Asia: India, and the more populous China. The sheer volume of maritime trade between the two great nations of Asia, and their connections through the South Asia maritime regions, make the canal probably the most potentially beneficial, and also efficient project for the entire region of the Pacific and Indian Ocean regions, and the co-development of the major regions of Planet Earth as a whole. Water is still the most economically efficient mode of economic transport among the regions of the planet.
Singapore itself, when freed from British strategic imperatives, will benefit far more from the success of the Kra Canal development, than without the development of the Kra!
d.) The planet as a whole, is now entering both the feasibility, and indispensably leading role represented by a Helium-3 enhanced thermonuclear fusion, development program.
Under such development of Helium-3, augmented developments of thermonuclear fusion modes, the access of mankind to control and exploitation of the immediate vicinity of the Earth orbit comes rather quickly to a mankind which inhabits Earth, but exerts increasingly efficient control over both the defense of Earth against menacing factors in the vicinity of the Earth orbit, and also the incorporation of the advantages from such developments for the development of human residence on Earth and also operations, on behalf of Earth, from nearby, and even, more distant objectives.
It is the accelerated increase of mankind's power to act productively on, and for Earth, and that in the vicinity of Earth, which best serves the greater interest for all mankind, Singapore included.
Thank you for your question.
President Xi Jingping Calls for 'Maritime Silk Road of the 21st Century'
Less than a month after calling for a 'Silk Road Economic Belt' through central Asia during his trip to Kazakhstan, Chinese President Xi Jingping follows this up with a call for the creation of a 'Maritime Silk Road of the 21st Century' during a speech to the Indonesian Parliament on October 3, 2013. This policy proposal would be for the maritime development of East and Southeast Asia in tandem with the policy for land development of Central Asia that he had announced the week before. During the speech, Xi also announces the creation of an Asian Infrastructure Investment Bank (AIIB) to fund these projects.
President Xi states:
"Southeast Asia has since ancient times s been an important hub along the ancient Maritime Silk Road. China will strengthen maritime cooperation with ASEAN countries to vigorously develop maritime partnership in a joint effort to build the Maritime Silk Road of the 21st Century. China is ready to expand its practical cooperation with ASEAN countries across the board, supplying each other's needs and complementing each other's strengths.
2014: Helga Zepp-LaRouche Returns to China to Promote 'New Silk Road'
In February 2014, Helga Zepp-LaRouche returns to Chine for the first time since 1996 to participate in over a dozen seminars, conferences, and television interviews on the subject of the New Silk Road. The trip was occasioned by the announcement by President Xi Jingping of his 'Silk Road Economic Belt' policy, which precipitated numerous invitations to Helga LaRouche from academics and policy makers familiar with her leadership role since the early 1990s in promoting the Eurasian Landbridge.
During her trip, Helga LaRouche is featured in a half-hour interview on the prime-time CCTV 'Dialogue' program by Yang Rui, a prominent journalist in China who has interviewed numerous world leaders and heads of state. He begins by introducing Helga LaRouche as the person "who first advocated the idea of a Eurasian Land-Bridge more than 20 years ago" and is referred to as the New Silk Road Lady. In the interview, she stresses that the extended Eurasian Landbridge can serve as the foundation for "a peace order for the 21st century" and create a paradigm shift away from perpetual war:
"We have to move away from geopolitics, because geopolitics gave the world two world wars in the 20th Century. If we stay with geopolitics, we are on the verge of a Third World War. The conception of the Eurasian Land-Bridge is larger than only the Silk Road, because it also involves the building of a corridor along the Trans-Siberian Railway, and it has many routes going all the way to Indonesia, into Africa. We are really talking about the Silk Road being the beginning of a World Land-Bridge... It is extremely important to put a peace order for the 21st Century on the table and create a level of reason, where everybody who participates has a benefit, so that historical conflicts, past wars, and all these problems are put behind us, if you build the Eurasian Land-Bridge as a totality."
Helga LaRouche was also interviewed on China Radio International's 'People In The Know' program [PDF], in which she stressed that the New Silk Road can serve as the pathway to "a new system of credit among sovereign nations" to replace the current collapsing financial system:
"The New Silk Road idea, which is really identical with our Eurasian Land-Bridge proposal of 24 years ago, would have large projects, building corridors, building fast-speed railways, building water projects to overcome the deserts. And these are projects which would be international. So you need to have international mutual credit agreements among different nations, to build these over the long term. Meaning that you cannot expect profit in two months, but you would plan these projects over 10, 20, 40, even 50 years, and you make credit arrangements among sovereign countries to accomplish that. So, we need to think about how to replace the present collapsing financial system, with a new system of credit among sovereign nations."
Helga Zepp-LaRouche ˇ CCTV February 20, 2014
Yang Rui: Plans for a New Silk Road for the 21st Century are being promoted by Chinese President Xi Jinping: He imagines an economic belt along the route of the Silk Road traveled more than 2,000 years ago. The proposal has attracted widespread support, as a means of boosting trade and cooperation across the two continents.
One of the keenest supporters is an international thinktank, the Schiller Institute, led by its President, Mrs. Helga Zepp-LaRouche, who first advocated the idea of a Eurasian Land-Bridge more than 20 years ago. She joins us now in the video studio to discuss the importance of a modern Silk Road.
What differences will it make to Central Asia and the world? Will Eurasia emerge as a new economic power, and what impact would it have on China, and the Asia-pacific region?
Before we start our interview, let's look at this background report.
Camel caravans traversing the vast landmass of Eurasia. Chinese tradesmen ventured out from as early as the Han dynasty more than 2. 000 years ago. From Xi'an, the heart of the central plains, it traveled to India, Iran and as far as Europe, laden with goods, the rich cultural legacies found in both written records and artifacts.
Not only do goods travel the long-distance routes, so do technologies, religions and philosophies. Cultural transfer took place as the Chinese learned from other societies, especially India, the home of Bhuddism. And the travelers brought their cultures to distant lands. Thriving in their new homes, newcomers mixed with locals and have absorbed other groups that followed.
Exchanges between China and the West facilitated the spread of technologies and ideas. The impact is far reaching. It's essential that countries learn from each other to contribute to the harmony and development of the world.
Professor Wong believes the Silk Road has a practical significance. The ancient routes stood witness to the exchange and merging of different cultures. Once again there lies importance of cooperation and tolerance - values still needed in a closely intertwined world.
The Silk Road has facilitated the exchange of goods, people and technology. It's a time when China opens up to other societies. This tolerance of religions, ideas and cultures has thus become the biggest legacy of these ancient routes.
Yang: Welcome to Dialogue, Madam.
Helga Zepp-LaRouche: Hello.
Yang: Helga, you have been promoting the idea of constructing a so-called Eurasian Land-Bridge, which is very similar to the brainchild of Mr. Xi Jinping-the Silk Road that goes through the Central Asia region. Now, you're sometimes referred to as the New Silk Road Lady. Is that a title you're proud of?
Zepp-LaRouche: Yes. I don't remember who exactly came up with this idea, but I think it was because I organized hundreds of conferences and seminars in the last 24 years for this concept.
Yang: So, you enjoy the copyright.
Zepp-LaRouche: Well, yes, so to speak.
Yang: In 1917, if my memory is correct, Dr. Sun Yat-sen, President of the Republic of China, was the first to follow the idea of building the Eurasian Land-Bridge, hopefully to connect China with Russia, because he put forward the idea of getting united with the Russians, the Soviets, the Communist Party, workers and farmers. What do you think of his brainchild, and have you gotten any inspiration from his proposals?
Zepp-LaRouche: Yes. Because Dr. Sun Yat-sen was obviously very much concerned about the well-being of the population, and he also saw in the railway connection between all these different countries, a way to preserve peace. And that has been exactly what has been inspiring us to go with the Eurasian Land-Bridge, because it was meant, from the beginning, after the collapse of the Soviet Union, as a peace order for the 21st Century.
Yang: So, do you think that the well-being of the people should be the vital problem of China in those days? That's the title of a book written by Dr. Sun Yat-sen [The Vital Problem of China, 1917-ed.].
Zepp-LaRouche: Yes. He was very much inspired also by Lincoln, and the idea of government by the people, for the people, and of the people, and therefore I think that that is what we have to think about today too.
Yang: What's the relevance between Abraham Lincoln and the New Silk Road?
Zepp-LaRouche: Well, because it is a system of physical-economy. Nowadays, we are very much in monetarist terms. People think about profit, and that has led the world to its present terrible crisis of a threatened collapse of the financial system. And we have to go back to the idea of physical-economy, which is associated with the industrial revolution of America, which was the result of the policies of Lincoln, who also created a land-bridge across America.
So, we have to go back to the ideas of a system of protectionism, of taking as the only source of wealth the creativity of the people, and not think about buying cheap, selling dear, the idea that's associated with free trade.
So, if the whole world wants to get out of the present crisis, it has to be based on the ideas which already led to industrial revolutions in the past.
Yang: All politics are local. Therefore, trade protectionism, whatever the label you use to describe protectionism-it's domestic politics.
Let's get back to examining the history of the ancient Silk Road. I wonder if you can brief us about how the Silk Road involves much of Asia, and parts of Europe.
Zepp-LaRouche: In the ancient times, or now?
Yang: Ancient times.
Zepp-LaRouche: Well, 2,000 years ago, the ancient Silk Road connected cultures and people, and there were all kinds of modes of traveling: horses, camels, ships; and it did create the basis for a tremendous increase of wealth of all the countries which participated in the Silk Road. So, I think if we revive this conception, it will be to the benefit of all participating countries.
Yang: Central Asia is the bridge linking the European countries with the Asia-Pacific economies. However, do you think the economic belt that President Xi Jinping raised when he was attending a summit meeting for the Shanghai Cooperation Organization in Kazakhstan would help the region of Central Asia to prosper, and enjoy true prosperity?
Zepp-LaRouche: These countries suffer still from the monoculture [agriculture] of the Soviet Union. Many countries have a lack of water. So when we are talking about the expansion of the Eurasian Land-Bridge, or the New Silk Road, it's not just railways, or means of transport; it is a new economic platform, which transforms the entire economy of the region into a much higher productivity.
It also involves the question of corridors. You know, we have developed the idea that the Silk Road should probably have 100-kilometer width. You put in new energy production and distribution, communications, and this way you make areas which are landlocked, and don't have access to the sea or rivers, investment-friendly, like countries which are on the seaside or on river systems.
It basically means that the landlocked areas of all of Eurasia will enjoy the same benefits as countries on the maritime coasts. And this will lead to a new era of economics. The Land-Bridge, or Silk Road, conception is not just more cooperation among countries. If you think back, evolution of civilization happened first by cultures and countries settled at the coasts; then they would move through the rivers-
Yang: And even through the Opium War, and the slave trade, to begin with, the success story, the early part of the economic success story of the European powers. I hope you can understand that there's a sense of victimhood by many Asians.
Central Asia used to be the backyard of the former Soviet Union. Therefore, do understand the geopolitical concerns of the Russians, when it comes to the future of, say, the New Silk Road, or the economic belt, that threaten to connect China to Central Asia with the developed European part.
Zepp-LaRouche: I think we have to move away from geopolitics. Because geopolitics gave the world two world wars in the 20th Century. And if we stay with geopolitics, I think we are on the verge of a Third World War. And therefore, I think the conception of the Eurasian Land-Bridge, which is, in a certain sense, a little bit larger than only the Silk Road, because it also involves the building of a corridor along the Trans-Siberian Railway, and it has many routes going all the way to Indonesia, into Africa. We are really talking about the Silk Road being the beginning of a World Land-Bridge.
And I'm very happy to tell you that my friends in Russia recently communicated to me that while they thought a couple of years ago that this conception would be too big, that now, under the impression of both the dangers in Ukraine, but also the positive experience of Sochi-and I don't mean the Olympic Games, but I mean the fact that Russia has developed the Sochi region as a model for the transformation of other parts of Russia-they are very, very positive about the future perspective of cooperating with the Silk Road, and the Chinese government.
And also, President Putin has expressed very clearly that he seeks such cooperation, so therefore I think there's a very good prospect that this can succeed.
Yang: However, a few days ago, when I was interviewing the Russian Ambassador, Mr. Andrey Avetisyan, he said that what is called the New Silk Road, or economic belt, remains largely a concept. It's not in operation now. At the same, our friends in the Shanghai Cooperation Organization, namely, the Central Asian nations, enjoy very much the Chinese investment. So, do you see the subtle difference in the attitudes of both the Central Asian government, and Russia?
Zepp-LaRouche: Well, I think what counts is the attitude of President Putin, and some of the other people who I'm in contact with, because I don't think that everybody has already moved away from such concerns as the ambassador expressed. Right now we are at an incredibly dangerous moment of history, and either we get our act together as a civilization which can consciously go into a new era of mankind, or we may not exist. If we don't change the way things are going now, we may end up in a Third World War.
So, I think it is extremely important to put a peace order for the 21st Century on the table, and create a level of reason, where everybody who participates has a benefit. So that historical conflicts, past wars, and ethnic conflicts and all these problems are put behind us, because if you build the Eurasian Land-Bridge as a totality, from all of Europe to Asia-
Yang: We must adopt a holistic view about the prospects of the Eurasian Land-Bridge, so you sound very rational, reasonable, and correct.
Perhaps so far we are discussing the prospects of a Silk Road only from the Russian and Chinese perspective. In this process we may have ignored the important role that the Persian state of Iran plays, because it's a very important littoral state of the Caspian Sea. It enjoys the oil deposits. So, what do you think of the current process of rapprochement between the Western countries and the Islamic Republic of Iran, when it come to energy collaboration between China and the volatile Middle Eastern region?
Zepp-LaRouche: Well, we have created actually a development program as part of the Eurasian Land-Bridge, which encompases the entire region from Afghanistan, Pakistan, all the way to the Caucasus, to Syria, to the Gulf. To take this region as one area, which right now is torn apart by terrible poverty, by terrorism, by the effects of the drug trade. And if you want to have peace, right now this region is one of the many potential powderkegs which could lead to a Third World War eruption. It's like the Balkan wars before World War I.
The only way to stabilize this region, especially with the perspective of American and NATO troops leaving Afghanistan, or at least a large part of them, you need to put in a real development perspective. And we have developed a program which involves greening the deserts-because most of the region is desert. You can use the water of aquifers. You can redirect certain rivers, which right now flow into the Arctic in Siberia. You can redirect them to the Aral Sea. You can use that water basically to develop all of Central Asia in terms of water. Link pipelines into Iran, and then have as a second phase, the peaceful use of nuclear energy for large demands of desalination of ocean water, and start to green the desert.
We want to put in infrastructure essentially as it is, for example, in western Europe. Germany, for example, enjoys infrastructure which is rivers, railways, highways, which are all interconnected, and infrastructure is always the precondition for economic development.
Yang: Very much so. It is in this area that Chinese investment is highly expected by all the markets in that particular-
Let's look at Afghanistan. It currently remains an observer partner of the Shanghai Cooperation Organization. Following the military drawdown of the U.S. and NATO troops by the end of this year, postwar reconstruction in this landlocked, impoverished country will become a major concern for the rest of the world, as part of the exit strategy, and China will be an integral part of the postwar reconstruction. To my poor knowledge about this country, it used to depend, and perhaps it currently also depends, on drug cultivation and drug trafficking for much of its livelihood. There is also a lot of tribal rivalry between different warlords and landlords and tribal rivalries of different kinds.
What do you think of the difficulties lying ahead for major members of the SCO to get involved in the postwar reconstruction, so that countries along the Silk Road will enjoy true prosperity?
Zepp-LaRouche: The drug production has increased 40 times since NATO started the war in Afghanistan 12 years ago. This has become the major security problem for Russia, which is losing right now 100,000 people per year, and the Russian drug czar, Viktor Ivanov, has called on the West, and other countries, to cooperate to deal with that.
Now, we know that the drug traffic from Afghanistan and the laundering of drug money is the main source for the financing of terrorism, of al-Qaeda, al-Nusra, and similar groupings. But many of the people who have been recruited to this-not because they are radical jihadists, but because they are poor. And if they are offered $500 a month, then they join this, and therefore the key question would be, first to eradicate the drug production-which is very easy: With modern technology you can eradicate it. You can spot the routes of the money laundering. NSA has proven that from satellites, you can spot every plant, if you want, so the question of both stopping the production, and the laundering, is technically no problem.
And then, naturally, you have to put in an alternative, a vast development program for the population, so that they have an incentive to go in a different direction. And I have said for a very long time, if the neighbor countries-Russia, China, Iran, India, Pakistan-would all cooperate in such a regional development conception, then you can get Afghanistan going in a peaceful direction.
But only if you do it as a totality. It does not function if you only take it as one country. There has to be a genuine development of the entire Eurasian Land-Bridge, and then you can contain, and overcome this problem.
Yang: What do you think of the idea of a maritime Silk Road?
Zepp-LaRouche: It's a very good idea, because in Southeast Asia, there is the largest concentration of population in the world, and the present Strait of Malacca, for example, is completely overloaded, and therefore you need to develop new maritime trade routes. For example, we have proposed as part of this Eurasian Land-Bridge, the building of the Kra Canal, which would be parallel to the Strait of Malacca, and open this region for more trade.
If we go in the direction of the Eurasian Land-Bridge, the production of real wealth will increase dramatically, and therefore, you need new trade routes to integrate all of these countries together. And we wrote, for example, many years ago, a plan for a 50-year development of the Pacific region, which already had all of these projects.
But many of these projects are ready to start tomorrow.
Yang: Congratulations. Congratulations on your blueprint, and your vision for the prosperity of the Asian-Pacific region.
So far, I believe you are tyring to look at these issue from the European perspective, which might be acceptable by the parties involved. However, what do you think of the Chinese brainchild of taking over [construction of] the Gwadar deep-water port in Pakistan, and helping construct a port in Myanmar, so that a pipeline could be built to connect the shipments from the seas to Xinjiang, in the case of Pakistan, and through Myanmar to China one way or another?
This is the blueprint of Mr. Xi Jinping and his predecessors.
Zepp-LaRouche: Well, I know that some people may be concerned about China-
Yang: Do you know subcontext for the Chinese brainchildren? Because of the legacy of the Cold War, most Chinese don't quite trust the security umbrella the U.S. provides, because they are afraid of China sharing the center stage in the 21st Century. It's largely a challenge coming from newcomers to the existing international political and economic order. The U.S. is not ready yet; therefore China has to consider its own alternative.
Zepp-LaRouche: But there are also people who say you should not be afraid of the economic prosperity of China. For example, the U.S. Chairman of the Joint Chiefs of Staff, General Martin Dempsey, has made many speeches where he warned the West of falling into the "Thucydides trap." Thucydides was this Greek historian who wrote about the Pelopponesian War, and he said that this war occurred because the Athenians were afraid of the economic growth of Sparta. And he said the growth of China should not lead to such a Thucydides trap.
And in a certain sense, I don't think that is the main problem. The main problem of the world right now is that the entire trans-Atlantic region is collapsing. The U.S. economy is collapsing. The European Union is suffering a terrible crisis in southern Europe. The financial system of the trans-Atlantic region is about to blow out.
Yang: What do you think of the importance of having U.S. support for both a land Silk Road and a maritime Silk Road? Because I hate to always go to geopolitical issues, but don't you think that economic issues and geopolitical issues are quite interwoven?
Zepp-LaRouche: I think we need to have a change in American policy for it to support the Silk Road. Because right now the United States is not in conformity with its own Constitution, in terms of its policy. There is a lot of criticism of President Obama, even from the Congress, because this is the case, so we need a change in American policy. But there are fortunately many patriots in the country who are thinking exactly about such a change.
We are in a crisis. We are in an existential crisis of civilization right now, and what we are proposing, and President Xi Jinping is proposing, is a vision of the future. And a lot of the geopolitical thinking is of the past. And if you cannot move to the next phase, the next era of civilization, we may not exist.
Right now we are on the verge of World War III. The developments in the Ukraine are extremely dangerous, and could really lead to a terrible confrontation.
Yang: Do you take the political upheaval in Ukraine as a part of their appealing for democratic transformation, or do you think this is largely a geopolitical legacy between the Russians and the European Union, in how to reallocate the political resources in that poor country?
Zepp-LaRouche: No, I think this is the result of a [Western] policy of regime-change, which started when the Soviet Union collapsed. The first phase of this was the Orange Revolution, where the West had put in 2,200 NGOs, which selected a network of people based on their anti-Russian profile. This was in 2004. But now it's much worse, because what we have now is that the hardcore violence is conducted by Nazis. Svoboda is a Nazi party. They have a swastika as their party logo. And it's completely scandalous that the EU and the United States are supporting such violent networks.
Yang: Well, Ukraine could be part of the broad spectrum of the Silk Road, that goes through Central Asia connecting with much of Europe. Whether the emerging markets or labor markets of the Silk Road will benefit from President Xi Jinping's idea, largely depends on whether the Chinese economy could be sustained, whether we will enjoy sustainable prosperity. So, by the end of this conversation, which I think is very enlightening, what do you think of the future of the Chinese economy, and of the new leadership of President Xi Jinping and Prime Minister Li Keziang?
Zepp-LaRouche: I think they're doing an excellent job. From my standpoint, also Prime Minister Li went to Romania, met with 15 heads of state, and promised that China would build a five-track train system in Eastern and Central Europe. This is all very, very good.
The problem is that the financial system of the trans-Atlantic zone is collapsing. And we need in a change in the monetary system-that's why we propose for the United States and Europe the return to the banking separation which was implemented by President Roosevelt in 1933.
Yang: Thank you for your participation. I truly appreciate it.
Helga Zepp-LaRouche ˇ China Radio International
Helga Zepp-LaRouche is the founder and President of the Schiller Institute, an influential economic and political think-tank with headquarters in the U.S. and Germany.
During her many years as a political activist, Zepp-LaRouche developed an acute sense for world politics. She has been a strong advocate for such policies as the "Oasis Plan," a Middle East peace agreement based on Arab-Israeli collaboration on major water projects.
She also strongly proposed the building of a Eurasian Land-Bridge, which she believed was vital in transforming the newly freed Eastern European nations into a thriving engine for global economic development. Zepp-LaRouche has also had multiple dealings with China.
As early as 1971, she traveled for many months through China as one of the first European journalists to work in the country.
So what are Zepp-LaRouche's thoughts on some of the world's most pressing issues today? How does she interpret the many ideas that she has been trying to promote over the years, such as the Eurasian Land-Bridge?
Zheng Chenguang: Nihao, you're listening to "People in the Know," bringing you insights into the headlines in China and around the world. I'm Zheng Chenguang in Beijing. In this edition of the program, we speak to Helga Zepp-LaRouche, the founder and President of the Schiller Institute. Mrs. LaRouche, welcome to the program.
Helga Zepp-LaRouche: Thank you.
Zheng: We understand that you founded the Schiller Institute, which has become a rather influential economic and political think-tank both in the U.S. and in Europe. What prompted you to establish this institute in the first place?
Zepp-LaRouche: It was, in general, the realization that foreign relations among nations are not on the right footing. If you go beyond diplomacy and media news in the West, the reality is many times rather subversion, manipulation, and even coups; and I said no: We have to have relations among nations which are on a completely different basis. Each nation should relate to the best traditions of the other one, and vice versa. And only in that way, can we have peace. And that is why I gave the effort the name of Friedrich Schiller, who, as you know, is the German "Poet of Freedom," and he has an image of man which is very beautiful. And I thought that we need to have such a humanist conception defining foreign relations.
Now some people may think this is idealistic, which it is, but I think what distinguishes human beings from animals is that we are capable of having beautiful visions to shape the future. So I'm optimistic that the work we have been doing for many decades now-and the Schiller Institute will have its 30th anniversary this year-that we can eventually win with our ideas.
Zheng: We understand that you and your husband [Lyndon LaRouche] are strong advocates for the revival of a global Glass-Steagall and also for the building of the Eurasian Land-Bridge. Why are these things so vital to you, and do you think that they are realistic goals for our human community to achieve, given the growing political differences among the world's major powers?
Zepp-LaRouche: Well, Glass-Steagall is the only way you can stop this present "casino economy." As you can see, after the collapse of Lehman Brothers in 2008, what the G20 countries did was to just bail out the bankrupt banks, pay the speculators for their losses, and transform private gambling debt into public state debt. And that has now reached a point where the additional measure of quantitative easing, which was simply pumping money into the system, is no longer functioning.
So now they are talking about "bail-in," which is the so-called Cyprus model, that we would just take a "hair cut" of all the accounts in the banks. And if you would now do that, which is actively planned by the U.S. Federal Reserve and the EU Commission, you blow out the system. You would have a sudden, traumatic social explosion, a collapse of the financial system, and unforeseeable consequences coming out of that.
So therefore, what we propose instead, is to do what Franklin D. Roosevelt did in 1933, when he also had to deal with the Depression and the crisis of the 1930s. And he did the Glass-Steagall Act, which was the separation of the banks, which then, together with the New Deal, led to the economic recovery of the United States from the Great Depression.
Now we want to do the same thing today. We have already organized more than 80 Congressmen, 11 Senators, and 26 states out of 50, pushing Glass-Steagall with resolutions and bills. And we want to bankrupt Wall Street. Because this casino economy has to stop, because it has increased the gap between rich and poor in an unbelievable way. Recently a report was published showing that 85 individuals own as much wealth as 3.5 billion people. And that is obviously not just that the rich people have the privilege, but 2 billion people in the world are going hungry every day, and we just think that this is not tenable.
Zheng: You talk about the QE [quantitative easing] measures fueling inflation, or even hyperinflation, in the U.S., but lately we have seen that the Federal Reserve has decided to taper these measures, and [Fed chairman] Janet Yellen, in her first testimony, also said that the Fed will stick to the QE tapering measures. Would you say that this is a wise move for the U.S. to do? And do you think that tapering of QE actually signals the start of a steady recovery in the U.S. economy going forward?
Zepp-LaRouche: Earlier, there was a debate in the Federal Reserve and elsewhere, that it would be impossible to do the tapering because the quantitative easing has created a gigantic bubble, and if you stop feeding this bubble with more liquidity, it pops. So there were people who were saying that you can't top quantitative easing, because you run the risk of complete disintegration of the financial system, and that is exactly what we are seeing right now. And the tapering started to go back from $85 billion per month liquidity injection, to $75 billion, to $65 billion.
Now you see that the emerging markets are collapsing. You have a capital flight from these emerging markets back to the United States and back to Europe, and this is the immediate threat of a blowout of the system. This was even mentioned in a report by the Bank for International Settlements, who warned about this. This is just the tip of the iceberg. The too-big-to-fail banks are hopelessly bankrupt. And one of the proponents of Glass-Steagall, Thomas Hoenig, who is the vice-chairman of the FDIC, said-and I fully agree with him-that if one of the too-big-to-fail banks would collapse now, it would not be one bank, but that the whole system would blow out. And we are on the verge of exactly that.
Zheng: Do you think that the financial industry, the bankers and the financiers in Wall Street, have actually learned their lesson from late 2007, when the financial crisis started?
Zepp-LaRouche: No. I think they are incapable of learning, because they are so driven by their greed and by their possession of power, that I don't think they are salvageable. The only way you can solve it is by closing down the casino, implement Glass-Steagall, and write off the virtual money. The former Italian Economics Minister Giulio Tremonti once said that what you own virtually, you cannot lose, because you never owned it in the first place. So if you write off the derivatives and the "creative" financial instruments, you are not losing anything.
However, then you must go into the second step, which is creating a credit system in the tradition of the American System of Economy, going back to the tradition of Alexander Hamilton, who created the First National Bank in the United States; in the tradition of Lincoln, of [Franklin] Roosevelt, of John F. Kennedy; and then you can create a new credit system extending credits to well-defined projects. You are no longer creating money just for gambling or for other virtual activities, but credit will be issued only to restart the real economy. And we have worked out very concrete proposals for how that can be done immediately.
For example, for the United States we have proposed the North America water-management program, NAWAPA, which is the largest water project in history, ever. It would take the water which is now flowing unused into the Arctic Ocean in Alaska and Canada, and it would bring it through a system of canals along the Rocky Mountains all the way to Mexico. And that way, you would create new vegetation, agriculture, forestry, in an area which is now desert.
And, as you know, in California and in Texas, there is a tremendous drought which is threatening the food supply for the American population, and therefore, such water projects are extremely urgent for the United States, for China, for Africa, for large parts of Central Asia, for the Middle East.
So we really want to create credit for productive purposes and no longer for the profit of a few speculators.
Zheng: How about the European economy, across the Atlantic? Last year we've seen some encouraging signs in Europe. Several European Union countries have implemented the program, and Britain is reported to be taking the lead in the recovery, and it is expected that this country is going to become the largest economy in Europe, as some British economists believe. What do you think? Do you think that the European economy is finally out of the woods?
Zepp-LaRouche: No, not at all. I think the euro crisis is just hidden, because if you look at the condition of the southern European countries: Look at Greece. They have 65% youth unemployment; Spain, over 65% youth unemployment. And the only country which is relatively still functioning is Germany; but the famous export champion, Germany, is only an export champion because it can export to Asia.
For example, normally, the majority of German experts would go to the European Union, but the South is collapsing. France is in a terrible condition. So the only reason why Germany is doing relatively well is because it could compensate the losses to the European Union through exports to Asia. But it's totally volatile.
Zheng: Before the Second World War, I think the European countries were constantly at odds with each other, fighting with each other. That was why the European project was first brought up by Robert Schumann [father of the EU], in an effort to make European countries at peace with each other. So, do you think that the EU project really works in terms of avoiding wars, and bringing peace to the continent?
Zepp-LaRouche: No. I think there is a fundamental difference from what people in the immediate post-war period intended. For example, the cooperation between Adenauer and de Gaulle, which did overcome the war and the hostility between the French and the Germans. This was very good, and we want to go back to that kind of tradition, of collaboration among the European fatherlands.
But what we have now, since the Maastricht Treaty, we have a supranational structure which has taken on a life of its own, which is in fundamental opposition to the interests of its member-states.
Zheng: Let's now take a look at the Asia-Pacific region. Let's talk about China. We understand that you first visited China in 1971, and at that time, I think, many Chinese people were still wondering where their next meal is. But today, I think, people are wondering what car to buy, or which fancy handbag to purchase, so I think that China has undergone profound changes in the past decades.
As we speak at this moment, China is also facing a new transition period. We understand that GDP growth is slowing down. Consumption is growing as a driver of growth-this is gaining strength. What do you make of the Chinese economy going forward? Do you think that this will continue, the economic miracle that it has created in the last two decades?
Zepp-LaRouche: I think what President Xi Jingping has announced with the New Silk Road is the promise that China can do that. However, there will be, in the immediate future, the problem that if the U.S. and European export markets collapse-which they will if we do not get Glass-Steagall-then, naturally, China will have severe consequences from the collapse in the trans-Atlantic system. So, therefore, it is all the more urgent to go in the direction of, not only Glass-Steagall in the United States and in Europe, but to also think about a new credit system, a new credit system in the tradition of Bretton Woods.
For example, the New Silk Road idea, which is really identical with our Eurasian Land-Bridge proposal of 24 years ago, would have large projects, building corridors, building fast-speed railways, building waterways, building, for example, water projects to overcome the deserts. And these are projects which would be international. So you need to have international mutual credit agreements among different nations, to build these over the long term. Meaning that you cannot expect profit in two months, but you would plan these projects over 10, 20, 40, even 50 years, and you make credit arrangements among sovereign countries to accomplish that.
So, I think we need to think about how to replace the present collapsing financial system, with a new system of credit among sovereign nations. And then I think China can have a fantastic future, because China is on the right course. I mean, the present difference between the trans-Atlantic world, which is collapsing, and the Asian world, is gigantic. Because Europe is becoming green-totally Malthusian population reduction-while if you look at China, and Russia, India, Korea, these countries may have problems, but they go in the right direction. They go in the right direction of having higher energy-flux densities in their production.
For example, the recent landing on the Moon by China with the Jade Rabbit [lunar rover] is a very promising sign for the future of not only China, but of the whole world, because the intention to mine helium-3 on the Moon for a future fusion-based economy on Earth-that is exactly the right policy. And therefore, I think if China sticks to this, then the future of China can be very bright.
Zheng: You give us a very promising economic prospect in Asia. But I think strategically, in security terms, the crisis is looming in the Asia-Pacific region, especially with this territorial dispute escalating between Japan and China, and Southeast Asian nations like the Philippines. In April, U.S. President Barack Obama is going to visit Asia, and he will go to Japan, and the Philippines. Both are entangled in territorial disputes with China. Do you think that China should be concerned that it is being encircled strategically by the United States?
Zepp-LaRouche: Yes. I think so. Because we are right now, as a matter of fact, on the verge of the danger of a deterioration of world relations into a world war. For the Pacific is, unfortunately, the Asia-Pivot policy of the United States, and the Air-Sea Battle doctrine, which is the same utopian conception that it would be possible to take out the second-strike capability of China. And also, China has made very clear, this is unacceptable and foolish. The danger of both the U.S. missile defense doctrine and the Air-Sea Battle doctrine is that they are inviting the other side to go for a first strike, because if you wait, it may be too late.
So, we are sitting on a volcano which is extremely dangerous, and this is why we are fighting very hard in the United States to cause changes inside the United States-that the United States goes back to their Constitution, and does not pursue these kinds of policies.
Zheng: I think one more immediate risk is the potential dispute or conflict between China and Japan. And the beef that China has with Japan, is that China thinks that Japan has never apologized sincerely for its wartime atrocities. I think in this sense, Germany and Japan were in the same position historically, but Germany was really sincere in terms of apologizing for what it has done in the Second World War. What do you make of Japan's unwillingness to admit what they have done during the war? And also their latest rhetoric, to whitewash the Second World War atrocities?
Zepp-LaRouche: Well, this is obviously very stupid, and very dangerous. But I think you cannot take what Japan is doing out of the context of its alliance with the United States. Because it is really the U.S. expansion into the Pacific which gives room for Japan to do that. We hope that there are some people in Japan, who, in time, will come to their senses, and go in a different direction. Because Japan, like Germany, is a country which has almost no raw materials. And it's highly dependent upon exports. So therefore, the only way we can solve all of these things, is by a conception like the World Land-Bridge, where you have economic cooperation among all countries, which is so much more to the benefit and interest of all, than the local conflicts.
We have some good friends and contacts in Japan who want to have a good relationship with China, and we are hoping that they can become the dominant force.
Zheng: I think U.S. leaders, including Secretary of State John Kerry, have said, more than once, that the U.S. welcomes the rise of China, and the U.S. would accommodate a stronger China in the Asia-Pacific region. Do you think that actually they mean what they are preaching?
Zepp-LaRouche: It's very difficult to judge, because Mr. Kerry has said the opposite many times, and it leaves you to an interpretation of what is actually policy. I think actually, if Kerry is acting on his own, he probably means it, but unfortunately, in the United States, you have a big faction fight right now, between those people who say that the principle of sovereignty should be respected. Like, for example, General Dempsey [chairman of the Joint Chiefs of Staff] is a very positive factor, who has said many times that the rise of the China should not worry people. He said the rise of China today should not be a worry leading to war against China. He said that many, many times.
I know that there are many patriots of the United States like him, who really believe that the future of foreign relations must be in the tradition of John Quincy Adams, who advocated the alliance of perfectly sovereign republics around the world, where none would be dominating the other one.
But unfortunately, there are also other people in the United States who believe in the Blair doctrine, which is the idea of the "responsibility to protect." They have even a whole office in the United States where they have all the human rights violations around the globe, and people like [National Security Advisor] Susan Rice and others-unfortunately Obama, as well-they believe that they should intervene with the pretext of humanitarian reasons, militarily, around the globe. This is the doctrine of Tony Blair, which he announced in 1999 in Chicago, and we strongly hope that the patriots in the United States will win this battle.
Zheng: So, you are saying that China-U.S. relations are growing increasingly complicated, especially in the Pacific region. What kind of concrete steps do you think that these two nations can take to avoid miscalculations, and build the Asia-Pacific region into a region of peace and cooperation, rather than confrontation, going forward?
Zepp-LaRouche: Again, I think we need to concentrate on the common aims of mankind. We are sitting right now on a powderkeg of potential extinction, so if we continue on the present course-with globalization, with imperial extension, with TPP [Trans-Pacific Partnership] and TTIP [Transatlantic Trade and Investment Partnership]-this is a nightmare.
First of all, the system will never get there, because it is collapsing now, but their idea is to eliminate national sovereignty, for the advantage of the large corporations which then would basically rule the world. Now, if this is happening, I think we are crashing against the wall. This is a terrible danger.
So, therefore, we must now, in front of the danger of the potential extinction of civilization, agree that we have common interests as human beings. That there are many, many problems we should focus on to solve together. One is: We have to get rid of nuclear weapons. We have to get a missile defense system, including all nations, so that security can be established, and that we declare nuclear weapons obsolete.
Secondly, we have to think about what are the threats: drug production. Even the fact that this terrorism problem is real, and it threatens the security of all countries-we should have international cooperation to wipe out drugs, to wipe terrorism, and to go for development. Because if you don't put an alternative on the table for real economic development-improving the living standard of the population-we cannot stop this problem.
So, my proposal has been for a long time, that if you want to have peace in the region of the whole Middle and Near East, Southwest Asia, the countries of Russia, China, India, Iran, and hopefully, the United States, and hopefully, some European countries-that they work together to develop this region. Because the poverty in this area is such that it nourishes terrorism.
There are also other common aims of mankind. For example, right now, we are not set up to protect the planet against the danger of asteroids. So, why not concentrate on issues like defense of the planet against objects from space? Earthquakes and tsunamis and volcano predictions? There are so many areas where we could, in a useful way, work together.
So, then, many areas of such cooperation, which I believe we are now at a point where either we go into a completely new paradigm, which corresponds to the dignity and creative identity of the human species, or we will not make it. So, we are confronted with a total choice: We must have a new era of cooperation. And then I'm very optimistic, and I think that we are still at an embryonic point, where if we get our act together, and behave like human beings, we can envision a future which is completely different than what we had in the past.
Zheng: Mrs. LaRouche, thank you very much indeed for sharing with us your insights.
Zepp-LaRouche: Thank you.
China and Russia Establish Historic Strategic-Economic Relationship
Chinese President Xi Jingping and Russian President Vladimir Putin hold an historic summit on May 22, 2014 in which they significantly upgrade and solidify the strategic and economic relationship between their two nations. The two leaders issue a joint declaration giving clear support to each other's economic development initiatives, the President Xi's 'Silk Road Economic Belt' and President Putin's 'Eurasian Economic Union', pledging to merge their efforts for mutual development.
At the core of the agreement is the finalization of a 30-year natural gas deal in which Russia will provide China with 38 billion cubic meters of natural gas annually in exchange for Chinese financing of necessary pipeline construction and oil field development. The economic agreements also include mutual investment in transportation, infrastructure, mineral development and "increases in the effectiveness of cooperation in areas of high technology, developing collaboration in the realization of priority projects such as the international use of nuclear energy, civil aviation, and in the program of cooperation on fundamental space research, satellite monitoring of the Earth, satellite navigation, and the study of deep space and human astronautics."
Russia, Kazakhstan, and Belarus Create Eurasian Economic Union
At a meeting on May 29 in Astana, Kazakhstan, the presidents of Russia, Kazakhstan, and Belarus sign a treaty creating the Eurasian Economic Union [PDF]. President Putin of Russia emphasizes at a press conference that this economic union will facilitate the creation of trans-Eurasian "transport-logistic routes" of global importance:
"The Treaty we signed is one of truly epoch-making, historic importance. It opens up the broadest possible prospects for economic development and improvement of the welfare of the citizens of our countries. Russia, Belarus, and Kazakhstan are moving to a fundamentally new level of cooperation, creating a common area. Our three countries will be able to conduct a coordinated policy in key economic areas such as energy, industry, agriculture, and transport. energy, industry, agriculture, and transport... The geographical position permits us to create transport logistic routes of not only regional, but also global importance that permit attracting massive trade flows in Europe and Asia."
President Nazerbayev of Kazakhstan emphasizes that the Eurasian Union will become a new model of relations between sovereign states:
"A new geopolitical reality of the 21st Century is born fundamentally new model for good neighborly relations and interaction between peoples in the great Eurasian space."
Majority of Planet Unites Behind Argentina's Resistance to Vulture Funds
In response to a ruling by a New York court in favor of 'hold-out' vulture fund NML Capital's usurious debt-claim against Argentina at 1,608% profit, a majority of the world's nations united in support of Argentina's refusal to pay. Argentine President Cristina Fernández de Kirchner makes a speech to the G77 Summit in Bolivia in which she states:
"In this kind of anarcho-capitalism, where a small group of financiers runs the rest of humanity, a group known as 'vulture funds' obtained debt instruments at absurdly low prices. This small group of vulture funds is endangering not only Argentina. In reality what is at stake is the international financial system, and the international economic system more than the financial system. This is financial capitalism and the appearance of what is called financial derivatives, which began to generate, or at least make the world believe that they were generating, money without going through the cycle of the production of goods and services, which is impossible and obviously generate astronomically high profits, but also the existence of fictitious money."
The entire Group of 77 (G-77), representing 133 nations and a total of 5.6 billion people, or 78% of the world's population, largely overlapping in terms of membership with the nations of the Non-Aligned Movement, votes unanimously to support Argentina and stand in solidarity against the vulture funds.
President Fernández de Kirchner welcomes the international outpouring of support and stresses:
"Today the vulture funds endanger the international financial system. This is not a matter of North or South, but of a productive economic against a speculative one."
At an emergency meeting in Washington D.C. of the Organization of American States (OAS), the acting Foreign Minister of Guyana Robeson Benn calls for a return to Glass-Steagall to defend nations from the usury typified by the vulture funds [PDF]:
"I would like to pose the question as to whether we should not, out of this imbroglio, re-look at the overall question of the repeal of the Glass-Steagall Act in 1999 in the United States, which related to the activity of the banking system, the international financial institutions, mainly resident in the United States and in the United Kingdom. President Roosevelt, of the United States of America, established a banking act, signed off on the Banking Act of 1933, which set up firewalls between the activities of the banks, and on the questions of speculation in the financial system. There is, perhaps, the need now to take a look at putting back in place important sections of the Glass-Steagall Act which was repealed in 1999... We need to review the question, or call upon U.S. legislators to pursue efforts to put back in place the type of regulation in the banking system which would prevent vulture funds, which would prevent this 'modern-day piracy' which has serious implications for the world economy."
Helga LaRouche: New Silk Road Is Creating New World Economic Order
On the eve of the BRICS Summit in Fortaleza, Brazil, Helga Zepp-LaRouche publishes an article titled "The New Silk Road Is Creating a New Just World Economic Order" [PDF] in which she states:
"A strategic realignment of a large number of states is currently taking place... The core of this positive change is the emergence of an economic platform to develop the New Silk Road which China has made a priority of its foreign policy. Chinese President Xi Jinping and numerous government officials have repeatedly emphasized in international forums, the principles on which the New Silk Road economic zone is based: mutual development, non-confrontation, mutual respect and dialogue, respect for the other's choice of social system, support for the strategic interests of the other state, absolute respect for sovereignty, and renunciation of any form of hegemonism...
"Various aspects of the Silk Road policy are already on the agenda: connections along the historic route in Central Asia; the maritime Silk Road, including construction of a "second Panama Canal" in Nicaragua, with Chinese help; and the strategic cooperation between Russia and China which was adopted at the summit in May between Presidents Vladimir Putin and Xi Jinping. The principle also includes the offer by Prime Minister Li Keqiang, that China is ready to connect all the African capitals by high speed rail.
"It is expected that at the summit of the BRICS countries in Fortaleza, Brazil on July 13-14, not only will the five member states intensify their cooperation according to the "Silk Road" concept, but there will also be various bilateral and multilateral meetings be tween their leaders and those of Latin America, at which large projects and contracts will be agreed upon, constituting, in combination, the beginning of a new world economic order. A BRICS Development Bank is to be established, with a starting capital of $100 billion, as well as a foreign exchange pool to better protect participating developing countries from currency turbulence. In addition, China is preparing the ground work for an Asian Infrastructure Investment Bank (AIIB), with initial capital equivalent to $50 billion. The goal of these new institutions is also to reduce dependence on the dollar and move toward trade in the respective national currencies...
"The new international economic order is coming into existence through China's New Silk Road policy."
BRICS Summit: Half of Humanity Launches New World Economic Order
The leaders of the BRICS nations (Brazil, Russia, India, China, and South Africa) meet on July 16 in Fortaleza, Brazil for the Sixth BRICS Summit and take actions establishing a New International Economic Order. The BRICS Summit issued a 72-point Fortaleza Declaration announcing the formation of the New Development Bank (NDB), directly echoing the proposal by Lyndon LaRouche from nearly four decades before to create an International Development Bank (IDB) to create long-term, low-interest credit for capital investment into the so-called developing sector in order to overcome the underdevelopment of Africa, Latin America, and large parts of Asia. The Declaration also announces the establishment of a Contingent Reserve Requirement (CRA) to protect nations from currency speculation and financial manipulations.
President Putin of Russia highlights these two initiatives in his address to the conference:
"We are united by a desire to act from unified positions in all issues of global development and the formation of the global financial and economic architecture... We have been able to achieve significant successes. I want to stress that all the plans we set for ourselves a year ago have come to fruition. I am referring, first and foremost, to our plans to create a new Development Bank and a Currency Reserve Pool for BRICS nations. Today, we have confirmed their founding documents. The BRICS bank will become one of the largest multilateral financial development institutions in the world. Its stated capital will be $100 billion. The scale of possible operations within the framework of the Currency Reserve Pool may also reach $100 billion. This mechanism creates the prerequisites for effectively protecting our countries from financial market crises. The bank and the Currency Pool, with combined resources of $200 billion, lay the foundation for coordinating a macroeconomic policy between our nations."
Newly elected Indian Prime Minister Narendra Modi celebrates the leadership significance of the BRICS as defining the future, saying:
"The vision of a New Development Bank, at the Delhi Summit two years ago, has been translated into a reality, in Fortaleza. It will benefit BRICS nations, but will also support other developing nations... The uniqueness of BRICS as an international institution is that for the first time, it brings together a group of nations on the parameter of 'future potential' rather than existing prosperity or shared identities. The very idea of BRICS is thus forward-looking... We have an opportunity to define the future - of not just our countries, but the world at large. Coming from a land where the idea of Vasudhaiva Kutumbakam - the 'whole world being one family' - is rooted deep in our ethos; I take this is as a great responsibility."
Immediately following the BRICS summit, the five heads of state hold a follow-on summit with the Union of South American Nations (UNASUR). Argentine President Cristina Fernández de Kirchner speaks to the gathering and declares the establishment of a new international financial order:
"It is with great pleasure that we salute this decision of the BRICs to create a development bank, focused on infrastructure... We are posing a new global financial order, one that is not jut fair and equitable, but indispensable. What we demand from the world, is precisely the creation of a new global financial order which will permit sustainable and global economic growth.... Thus, the appeal to all nations is to join forces in this real crusade for a new global political, economic and financial organization that will have positive social, political, economic, and cultural consequences for our nations."
BRICS Fortaleza Declaration ˇ July 16, 2014
...We call for an international financial architecture that is more conducive to overcoming development challenges. We have been very active in improving the international financial architecture through our multilateral coordination and through our financial cooperation initiatives, which will, in a complementary manner, increase the diversity and availability of resources for promoting development and ensuring stability in the global economy." But the document also notes that "We will continue to pursue our fruitful coordination and to promote our development goals within the international economic system and financial architecture...
BRICS, as well as other Emerging Market Developing Countries, continue to face significant financing constraints to address infrastructure gaps and sustainable development needs. With this in mind, we are pleased to announce the signing of the Agreement establishing the New Development Bank (NDB), with the purpose of mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging and developing economies. We appreciate the work undertaken by our Finance Ministers. Based on sound banking principles, the NDB will strengthen the cooperation among our countries and will supplement the efforts of multilateral and regional financial institutions for global development, thus contributing to our collective commitments for achieving the goal of strong, sustainable and balanced growth.
The Bank shall have an initial authorized capital of US$ 100 billion. The initial subscribed capital shall be of US$ 50 billion, equally shared among founding members. The first chair of the Board of Governors shall be from Russia. The first chair of the Board of Directors shall be from Brazil. The first President of the Bank shall be from India. The headquarters of the Bank shall be located in Shanghai. The New Development Bank Africa Regional Center shall be established in South Africa concurrently with the headquarters. We direct our Finance Ministers to work out the modalities for its operationalization.
We are pleased to announce the signing of the Treaty for the establishment of the BRICS Contingent Reserve Arrangement (CRA) with an initial size of US$ 100 billion. This arrangement will have a positive precautionary effect, help countries forestall short-term liquidity pressures, promote further BRICS cooperation, strengthen the global financial safety net and complement existing international arrangements. We appreciate the work undertaken by our Finance Ministers and Central Bank Governors. The Agreement is a framework for the provision of liquidity through currency swaps in response to actual or potential short-term balance of payments pressures.
We also welcome the signing of the Memorandum of Understanding on Cooperation among BRICS Export Credit and Guarantees Agencies that will improve the support environment for increasing trade opportunities among our nations.
We appreciate the progress our Development Banks have made in enhancing and strengthening the financial ties among BRICS countries. Given the importance of adopting innovation initiatives, we welcome the conclusion of the Cooperation Agreement on Innovation within the BRICS Interbank Cooperation Mechanism.
Vladimir Putin ˇ Fortaleza, Brazil, July 16, 2014
We have a common interest in broadening multidimensional cooperation, strengthening trust, and mutual understanding.
BRICS holds a unique place in the global economy. It is the largest market in the world. Moreover, our combined gross domestic product has reached 21% of the global volume and continues to grow steadily.
Our nations play an increasingly significant role in the global political arena as well. It is thanks to Russia and China's firm stance in the UN Security Council, with support from other BRICS participants, that we were able to rally most international dialogue participants-including the European Union and the United States-and prevent a foreign invasion in Syria, achieving the elimination of Syrian chemical weapons.
It is important that we are united by a desire to act from unified positions in all issues of global development and the formation of the global financial and economic architecture. BRICS nations are cooperating constructively within the framework of the G20, actively contributing to substantively enhancing the G20's agenda, developing agreements aimed at accelerating global economic growth and trade and resolving employment problems. We are working together to move forward on one of the most difficult problems in global governance: IMF reform.
In the time that has passed since the Durban summit [March 2013], we have been able to achieve significant successes. I want to stress that all the plans we set for ourselves a year ago have come to fruition. I am referring, first and foremost, to our plans to create a new Development Bank and a Currency Reserve Pool for BRICS nations. Today, we have confirmed their founding documents.
The BRICS bank will become one of the largest multilateral financial development institutions in the world. Its stated capital will be $100 billion.
The scale of possible operations within the framework of the Currency Reserve Pool may also reach $100 billion. This mechanism creates the prerequisites for effectively protecting our countries from financial market crises.
The bank and the Currency Pool, with combined resources of $200 billion, lay the foundation for coordinating a macroeconomic policy between our nations.
I am confident that closer economic and financial cooperation between BRICS countries will allow us to implement truly large-scale joint programmes with the aim of securely developing our nations.
In the conditions of increased international competition, the challenge of activating trade and investment cooperation between our nations becomes particularly important. This will allow us to realize the advantages resulting from the complementary nature of our economies, and to reduce the vulnerability of each BRICS nation to adverse global trends.
Russia, Brazil, India, China, and South Africa already account for 11% of accumulated investment and nearly 20% of global trade. Trade between BRICS nations is growing. In the last five years, this indicator has nearly doubled.
The Russian side has prepared a draft BRICS Strategy for Multilateral Economic Cooperation. We are submitting it for discussion. We feel it would be useful to create a special high-level working group to work in depth on developing the draft Strategy.
The Strategy's key positions are specified in another document prepared by the Russian side: the Roadmap for Investment Cooperation. It includes 37 projects in various areas, from high technologies to the humanitarian sector. Please allow me to highlight just a few of the most important ones.
We propose the establishment of the BRICS Energy Association. We could create a Fuel Reserve Bank and a BRICS Energy Policy Institute under its roof. These steps would allow us to strengthen our nations' energy security and prepare us for the creation of new instruments and new institutes to trade energy resources.
The joint use of the Russian global navigation system, GLONASS, in a wide range of areas-transport, public safety, and agriculture-seems very promising. According to expert assessments, the use of the GLONASS system in agriculture alone will allow for a 30-50% increase in crop capacity. A similar effect, and even better, is expected in other areas.
BRICS nations should cooperate more closely in commodities markets. We have a unique resource base; our nations hold 30-60% of global reserves of various resources. Therefore, we believe it is imperative to develop cooperation in mining and processing, and organize a center for training experts in the metals industries in BRICS nations.
We believe it is important to broaden humanitarian contacts and form parliamentary, civic, trade union, and youth dimensions within BRICS. We propose signing an Agreement on cooperation in culture and creating a BRICS network university that will include our nations leading schools...
Vladimir Putin ˇ Press Conference, July 17, 2014
I would like to remind you of something we have already mentioned: the BRICS states account for over 40% of the world's population and 21% of the global GDP. However, it is not the share that is so important, but the fact that these countries have been posting very significant growth rates.
In the past 10 years the GDP of countries with developed economies grew by 60%, while that of the BRICS states increased four-fold. We have to bear in mind, of course, that the 60% growth was in comparison to a large volume, a large starting point, while our four-fold growth was in regard to a smaller base; how ever, such are the rates.
These are all young states, and the future belongs to the young. Naturally, we should restore our presence in this fascinating and very promising part of the world.
What we have done is we signed some very important documents, and all this was implemented in a very short period, within a year. I am referring here to the creation of the New Development Bank. Each participant will contribute $2 billion. I believe this will be a very good, efficient, new, modern market tool for the development of our economies.
The Currency Reserve Pool is also a very good instrument that can influence the macro-economy of our states to a certain extent. Russia intends to invest up to $18 billion. I believe, as I have said, that this may be a good instrument for the stabilization of our economies and, of course, for the rational distribution of our states reserves.
Narendra Modi ˇ Fortaleza, Brazil, July 16, 2014
This Summit takes place at a crucial juncture. The World is facing a high level of economic and political turmoil. Conflict and instability are growing in many key regions.
This increases the challenges of tackling poverty, making growth more inclusive, and evolving a sustainable model of development.
Restoring a climate of peace and stability is an urgent global need. This calls for newer avenues of cooperation and collaboration.
I believe BRICS can answer this call. This I do because of the uniqueness of BRICS as an international institution. For the first time it brings together a group of nations on the parameter of 'future potential'; rather than existing prosperity or shared identities. The very idea of BRICS is thus forward-looking.
I therefore believe it can add fresh perspectives and mechanisms, to existing international institutions.
Thus, we must ensure that the future development of our partnerships, and institutions, stays true to this original idea.
BRICS must provide a united and clear voice in shaping a peaceful, balanced, and stable World.
BRICS must also play a proactive role in shaping the global discourse on growth and development. This includes shaping the post-2015 Development Agenda to keep the central focus on tackling poverty.
We must seek urgent reforms of global institutions of governance like the UN Security Council and international financial institutions.
We must help shape the WTO regime. An open trading regime is critical for strong, balanced and sustain able global economic growth.
This must address the development aspirations of the developing world.
It must also accommodate the special needs of the weak especially in areas such as Food Security....
The vision of a New Development Bank, at the Delhi Summit two years ago, has been translated into a reality, in Fortaleza. It will benefit BRICS nations. But will also support other developing nations. And, it will be rooted in our own experiences, as developing countries.
The BRICS Contingent Reserve Arrangement gives BRICS nations a new instrument for safeguarding their economic stability. This is an important initiative at a time of high volatility in global financial markets.
The MoU on Cooperation between Export Credit Guarantee Agencies, and the inter-Bank Cooperation Agreement on Innovation are other tangible steps that will spur cooperation among BRICS countries.
I believe we have now reached a level where we should be even more ambitious. We should focus on more such tangible mechanisms and outcomes. Make BRICS a platform of impact.
Excellencies, we have an opportunity, to define the future-of not just our countries, but the world at large. Coming from a land where the idea of Vasudhaiva Kutumbakam-the "whole world being one family"-is rooted deep in our ethos; I take this is as a great responsibility.Our steps must reinforce the hopes, aspirations and confidence, of the developing world.
Xi Jinping ˇ Fortaleza, Brazil, July 16, 2014
The world is full of instability. The international financial crisis has a profound global influence. The uncertain, unstable elements in the world economy are increasing. The imbalance in global development is escalating. Hegemonism, power politics, and a new interventionism are increasing. Regional turbulence occurs frequently. Global issues such as food security, energy resources security, and cyber-security cannot be ignored.
Pushing for multipolarization, democracy in international relations, realizing sustainable development of the world economy, and maintaining diversification of the world's cultures have become important global issues. Fairness and justice are the uppermost goals for all people in the world in the pursuit of international relations. However, fairness and justice are far from being realized in international relations nowadays.
We need to adjust our economic structure, achieve development of better quality, build closer economic partnership, boost the building of an open world economy and establish a global development partnership.
Human beings have only one Earth. All countries share one world. History tells us the law of the jungle isn't the way of human coexistence. Military aggression can't bring us a wonderful world. Every nation should obey the principle of equality, mutual trust, learning from each other, cooperating and seeking joint benefits. They should jointly safeguard and protect international fairness and justice and push for the construction of a harmonious world, sustained peace, and joint prosperity.
Cristina Fernández Kirchner ˇ Fortaleza, Brazil, July 16, 2014
It is with great pleasure that we salute this decision of the BRICs to create a development bank, focused on trade, infrastructure and also on bringing order to international finances which are absolutely out of control. Often, we have demanded, in this forum and in broader ones, such as the United Nations Organization and the G-20 as well, the indispensable reform of multilateral credit agencies and multilateral political agencies, such as the United Nations or the Security Council, etc.
These demands, however, were really not heeded, and I think it is a very positive sign-no one can interpret this BRICS initiative as something negative, but rather as an alternative proposal related to the lack of response that all the citizens of the world should have already had...
That is why we feel that the BRICS' decision to create a development bank is a more than appropriate response.
And perhaps Argentina, more than anyone, can speak of this issue at a time when we're under a very strong speculative attack by the so-called vulture funds...
We're talking about sustainable development, about investments to create jobs and employment. We're talking about investments in trade...
So, we're faced with a situation that goes far beyond global financial questions. We're asking if this isn't a matter of geopolitics . . . or issues of domination, and of not understanding that there is a multipolar world different from the one that existed in 1989, when some believed that history had come to an end. But history doesn't end. History continues because nations continue, and the emerging nations here in South America, and those of other regions, were able to emerge from their own situations and incorporate millions of their compatriots, [providing them with] health, education, housing and fundamental rights...
We, sirs, are posing then, a new global financial order, one that is not just fair and equitable, but indispensable. And we are saying that Argentina is not going to default, because Argentina is going to pay its debt as it has done, and it is not Argentina that is preventing the legitimate bond-holders from receiving their money, because once Argentina deposited that money, it was no longer the owner of those resources; they are the legal and legitimate property of the bondholders from 2005 and 2010.
Therefore, Argentina is not going to default on its debt. Argentina pays, and what we demand from the multilateral organizations, what we demand from the world, is precisely the creation of a new global financial order which will permit sustainable and global economic growth.
We congratulate the BRICS on this initiative, and we should also say that we are also net payers to the World Bank, and now the Inter-American Development Bank. What does that mean? [It means] that we are paying more than what we receive in loans.
We call on all those of us here who have a commitment to our people and our history, to promoting their welfare-countries which for so long had the most severe difficulties, some due to indebtedness, others as a result of their own historical avatars, but which had sufficient strength to overcome that indebtedness and those historical avatars or lack of democracy, which many of us in this South American region have lived through, and in democracy and peace were able to guarantee, not just economic growth, but economic growth with social inclusion.
Thus, the appeal to all nations is to join forces in this real crusade for a new global political, economic, and financial organization that will have positive social, political, and cultural consequences for our nations.
EIR Publishes Updated Special Report on World Landbridge
In her introduction to a newly published special report on the World Landbridge project from Executive Intelligence Review, titled "The New Silk Road Leads To The Future Of Mankind" [PDF], Helga Zepp-LaRouche writes:
"In less than one year, an alliance of nations has been created, which has built a parallel economic order with giant steps, one which is dedicated exclusively to the building of the real economy, in opposition to the maximization of speculative monetary profit, and which now includes more than half of mankind. This new community of nations represents a power center based on economic growth, and above all, on leading-edge technology, one which belongs to the future...
"A new strategy for mankind means the ability, from now on, to see the human species as a unity, and to see that unity in the process of mutual development... This also signifies a new model of cooperation among the nations of the world. It means that all potential treaty organizations and alliances must be inclusive, that they cannot be for the security and economic interests of some nations, while excluding others. While the support of mutual development is the premise, they must nonetheless respect the different levels of development, history, culture, and social systems, and above all, respect national sovereignty. That is Nicholas of Cusa's idea of unity in multiplicity, and it must be inspired by a tender love for the idea of the community of nations, for the idea of mankind as the creative species."
Helga Zepp-LaRouche ˇ August 2014
When the authors of this study decided last year to set out a new concept for peace in the 21st Century, by producing a revised version of the World Land-Bridge program-23 years after the first proposal for the Eurasian Land-Bridge-it was their intention not only to provide a concept for reconstruction of the world economy, but to present a war-avoidance strategy in the context of an acute strategic crisis at the same time. For in the intervening years, the danger of an intentional-or even an accidental-thermonuclear world war has grown dramatically. The attempt, fed by geopolitical motives, to associate Ukraine with the EU, and thus bring it, de facto, into the NATO sphere of influence, has triggered a series of escalating confrontations, which, in the worst case, could end in the extinction of the human race.
But in addition, nearly the entire Near and Middle East is burning; set off by wars built on lies, against so-called rogue states, the seeds of violence were sown which have called to life a million-headed hydra, which has not only leveled the Cradle of Civilization to the ground, and created there a Hell on Earth, but has also become an existential threat to the West.
The consequences of this policy of "regime change" have long thrown large parts of Africa into chaos, and overrun the continent with wars of terror and civil wars. But there are also geostrategic conflicts breeding in the Pacific, which have the potential to set loose regional wars and beyond. And since absolutely nothing has been done to remedy the causes for the collapse of Lehman Brothers in 2008, the TBTF (too-big-to-fail) banks are, on average, 30-40% bigger today than they were then, the indebtedness still more massive, and the derivatives bubble grown to nearly $2 quadrillion; so that a new systemic crisis could result at any moment, this time, given the strategic situation we have sketched here, with the danger that chaos will be triggered, making a strategic catastrophe unavoidable.
The entire world thus finds itself in such an alarming condition that one can only wonder how those responsible for the so-called Western community of values could have let things get to this point.
Pope Francis, who has characterized the global financial and economic system as "intolerable," recently put it this way, in an interview with the Spanish newspaper La Vanguardia: "In order for the system to continue, wars must be waged, as great empires have always done. But mankind cannot bear a third world war, and so it seizes on regional wars."
Though one could not put it better than the Pope has done, in this case, he underestimates the satanic energy of the system of globalization, which is ready to defend its privileges with all weapons available. One hundred years after the First World War, we find ourselves in a very similar geopolitical situation, except that this time there are thermonuclear weapons whose use would wipe out the human race.
Meanwhile, an alternative to the collapsing trans-Atlantic system has been created; the attempts of that system to use supranational institutions such as the IMF, World Bank, WTO, TTP, TTIP, and similar monetarist instruments of globalization, to extend a worldwide imperium, have produced an opposition which might not have been expected to manifest itself as it has.
In less than one year, an alliance of nations has been created, which has built a parallel economic order with giant steps, one which is dedicated exclusively to the building of the real economy, in opposition to the maximization of speculative monetary profit, and which now includes more than half of mankind. This new community of nations represents a power center based on economic growth, and above all, on leading-edge technology, one which belongs to the future, as shown above all by the success of the Chinese lunar exploration program, focused on the idea of bringing large quantities of helium-3 from the Moon back to Earth, for the future economy of thermonuclear fusion power. It points the way to a scientific and technological revolution which will increase, by orders of magnitude, the energy-flux density, both in production processes on Earth, and in fuels for space travel, and thereby introduce a completely new phase in the evolution of the human species.
The first step in the direction of a new economic world order was the announcement by Chinese President Xi Jinping at a conference in Kazakstan in July of last year, that China would build a new Silk Road Economic Belt, through Central Asia to Europe, in the tradition of the ancient Silk Road. Then, in October, in a trip to Indonesia and Malaysia, Xi took the initiative to involve all of Southeast Asia in the construction of the Maritime Silk Road.
At the summit meeting between Russian President Vladimir Putin and Chinese President Xi, on May 20 in Shanghai, and Putin's state visit to China on the occasion of the 4th Summit of the Conference on Interaction and Confidence-Building Measures in Asia (CICA) in Shanghai on May 21, extensive plans for collaboration of the two great powers were signed, including a 30-year natural gas agreement, and 46 additional bilateral accords. At the end of the summit, the two heads of state published a common declaration of intent, stating that both countries wished to create a new economic architecture in the Asia-Pacific region, oppose interference in the internal affairs of other nations, and intend to coordinate, as much as possible, their responses to important foreign policy questions on which they agree.
They named, among others, one goal of this collaboration as follows: "Increasing the effectiveness of collaboration in high-technology areas, priority projects in the international use of nuclear energy, civil aviation, and a program of cooperation in basic research on space flight, satellite observation of the Earth, satellite navigation, and research into deep space and manned space travel." A further militarization of space should, on the contrary, be prevented, and the unilateral stationing of missile defense installations was judged to be a "destabilizing factor for the world." Other goals include innovative research, improvement of agricultural techniques, and increasing agricultural production. They also expressed the intention to reform the international financial architecture.
The 30-year Russia-China natural gas treaty, with a total value of $400 billion, can be called historic. The two countries' cooperation in the petroleum field is also to be deepened; coal mines in Russia will be jointly developed; additional power plants will be built in Russia to supply electricity to China; and there will be collaboration on many other projects in infrastructure, transportation, water, and nature conservation.
Of still greater importance is President Putin's support for President Xi's strategic initiative to expand the New Silk Road. Their common statement says:
"Russia recognizes the enormous significance of the Chinese initiative for the building of the 'Silk Road Economic Belt,' and particularly appreciates the readiness of the Chinese side to take Russian interests into account in its development and realization. Both sides will seek further opportunities to combine the perspective of the 'Silk Road Economic Belt' with the conception of the 'Eurasian Economic Union.' Toward this purpose, they intend to deepen the cooperation of the relevant agencies in the realization of both projects, especially in the development of transportation routes and infrastructure."
THE BRICS SUMMIT
Other nations were then drawn into this collaboration at the May 20-21 4th Summit Conference on Interaction and Confidence-Building Measures in Asia in Shanghai. On July 16, the 6th BRICS Summit was held in Fortaleza, Brazil; on the following day, the Latin American heads of state and government joined the conference, and thus, 48% of humanity was represented at this meeting.
At the BRICS Summit itself, and in a series of multilateral and bilateral discussions within and around this summit, the heads of state agreed on the creation of an entirely new economic and financial system, representing a fundamental alternative to the casino economy of the present system of globalization, which is based on maximized profit of the few, and impoverishment of billions of people. Included in the 72 points of the "Declaration of Fortaleza" is the real thunderbolt: the announcement of the creation of a new financial architecture. The new architecture was launched with the formation of a New Development Bank with an initial capitalization of $50 billion, and a Currency Reserve Agreement (CRA) with an initial capacity of $100 billion to help participating nations defend themselves against capital flight and other forms of financial warfare.
China had already previously decided to found an "Asian Infrastructure Investment Bank," the AIIB, to have an initial capitalization of $100 billion, with the invited participation from the start of more than 30 countries. Xinhua quoted Jin Liqun, under whose direction the Chinese Finance Ministry placed the founding of the Bank:
"The means of the Asian Development Bank and the World Bank fall far short of satisfying the hunger for more infrastructure.... The Bank will open a new financing channel for developing countries, especially for those with low income.... In October 2013, during a visit to Indonesia, China's President Xi Jinping proposed an Asian Infrastructure Investment Bank to support economic integration."
The general secretary of the Chinese Center for International Economic Exchanges emphasized that the AIIB is to be an open and freely accessible platform, welcoming not only nations in Asia, but also others, such as the United States and the European countries. Up to this point, the nations of ASEAN, at a summit in Myanmar, on Aug. 9, agreed to deepen their cooperation with China on "New Silk Road" development projects, while Thailand and Singapore agreed to join the AIIB as charter members, as has Bangladesh. South Korea, despite direct U.S. pressure not to join, is considering charter membership, and requested that Seoul be considered as a possible location for the Bank.
In the course of this series of summits, collaboration was decided upon, among the various states, in a large number of projects, above all, the development of nuclear energy in Russia, China, India, Brazil, Argentina, and South Africa, and also, such groundbreaking projects as a second Panama Canal to be built by China through Nicaragua, and a transcontinental high-speed rail connection from Brazil to Peru.
The multiplicity of projects decided on among this community of nations in the areas of infrastructure, energy, industry, agriculture, research, and education, has reached a dimension which dwarfs the investments made by the U.S.A. and Europe in the same spheres over the past 30 years. The claims that Russia is only a "regional power," and China only a "cheap-production country," as was said at hastily arranged seminars at various thinktanks on the theme of the allegedly minor significance of the BRICS nations, have rather the character of whistling past the graveyard.
For in reality, there are now two economic and financial systems built on completely different principles. One, the trans-Atlantic system, as an imperial structure, seeks constantly to extend the boundaries of its sphere of power through supranational structures which threaten the sovereignty of other nations. It forces regime change against governments it disapproves of, insists on submission to a "consensus," and in the process, uses methods which do indeed produce an aura of domination for a while, and the feeling of powerlessness among the populations dominated in this way, but it ultimately goes the way of all empires. The moment this aura of power fades, whether because the imperial financial system is bankrupt, or because the people realize the hollowness of the values handed down, then the capability for intimidation disappears.
The newly arising system of the BRICS nations and the countries associated with them, bases itself on entirely different principles. Indian Prime Minister Narendra Modi formulated it most expressively at the plenary session of the summit: "BRICS is unique as an international institution. In the first instance, it unifies a group of nations, not on the basis of their existing prosperity or common identities, but rather their future potentials. The idea of the BRICS itself is thus already aligned with the future."
Modi stressed that the high percentage of young people, in India for example, represents an enormous potential for the future, and proposed forming a BRICS forum for young scientists, and a school of languages "offering language training in all of our languages." Modi made an appeal: "Excellencies, we have an opportunity to define the future-not only for our countries, but for the entire world.... I conceive that as a great challenge."
Nicholas of Cusa, the founder of modern natural science and a revolutionary scientific method, came to the conclusion, in the 15th Century, that every human being who strives to do so must be capable of reproducing virtually the entire evolution of the universe in its essential qualitative levels of development, and that this standpoint makes it possible to determine the necessary next step in scientific progress.
Today, this necessary next discovery, which defines the future for the entire world, is the conquest of the energy source that will bestow energy and raw materials security on mankind for thousands of years into the future: the utilization of thermonuclear fusion power on the basis of helium-3.
Therefore, the success of the Chinese Chang'e-3 mission this past December, in achieving a soft landing of the "Jade Rabbit" rover on the Moon, was a milestone in achieving this goal. The Chang'e-4 mission will follow immediately this year, in preparation for Chang'e-5 in 2017, which can start the phase of flight back and forth between the Earth and the Moon, in preparation for the future industrial exploitation of the Moon. This will bring within reach, the separation of the helium-3 found on the Moon in great quantities, for the nuclear fusion economy on Earth.
In the scientific collaboration among the BRICS nations, but above all, among Russia, China, and India, helium-3 plays a prominent role, because as a fuel for fusion, in contradistinction to deuterium-tritium, it does not produce energetic neutrons, which are very problematic for the reactor materials, but instead produces positively charged protons, which makes possible a revolution in energy generation. Instead of producing energy through the customary method via steam and turbines, in which there is a great energy loss, it will become possible to convert the energy of fusion reactions directly into electricity, at much higher efficiencies.
But Russia, too, according to the Russian space agency Roskosmos, plans a mission between 2016 and 2025, which is intended to create the basis for the industrial exploitation of the Moon. In the first phase, this involves robotic infrastructure for work on the Moon, thus, among other things mobile cranes, dredges, and cable-laying machines. After the landing probe "Luna Globe 1" in 2015, and the orbital module "Luna Globe 2" in 2016, then in 2017 the hard-landing apparatus "Luna Resource," developed together with the Indian Space Research Agency, will reach the lunar surface and, among other tasks, convey the Indian lunar vehicle onto the Moon.
The collaboration among China, Russia, and India is paradigmatic for the new area of mankind, in which we-instead of plunging ourselves into geopolitical wars-will concentrate on the common aims of mankind. With the attainment of energy security for at least 10,000 years on the basis of helium-3-fed thermonuclear fusion power, and with the technologies associated with this, such as the fusion torch technique which will enable raw materials security by reducing waste and all types of materials into isotopes which can be recomposed as needed, mankind will reach a completely new economic platform on the basis of a very high energy-flux density. This new economic platform begins a new age of mankind. The utilization of helium-3 sources for the fusion economy will be the game-changer which will revolutionize all relationships in science, economy, and politics on the Earth and in the Solar System.
It is obvious that a continuation of the geopolitical thinking which already led to two world wars in the 20th Century, into a third, and this time, a thermonuclear world war, will cause the extinction of mankind. Instead of seeing the rise of China as a threat to the West's supposed geopolitical interests-and thus, as the American Joint Chiefs Chairman Gen. Martin Dempsey has repeatedly warned, groping around in a new "Thucydides Trap"-we need a new conception, a new paradigm which considers the development perspective of mankind as a whole.
A NEW ECONOMIC ORDER
The late German-American space pioneer Krafft Ehricke described the long arc of evolution as an upward development, in which, at first, life spread from the sea to the continents by means of photosynthesis in plant world, and then led gradually to the rise of biological species of high complexity and metabolism with higher energy-flux density. He described how the human species, as the highest expression of this evolution up to now, initially settled on the coasts and the shores of rivers, and then along roads and canals, and finally along railroads and modern infrastructure, making the landlocked regions of the continents more and more accessible.
This process is still not completed-and exactly this is the goal of the World Land-Bridge presented in this study, to achieve the infrastructural development of the continents of the Earth. krafft Ehricke saw, in space travel and the colonization of the universe, the natural next phase of the evolution of mankind, and saw in the industrialization of the Moon, in particular, the springboard for excursions of human beings into the Solar System and potentially beyond. He was convinced that the evolution of the human species would only effectively reach adulthood with manned space travel; that only the "great challenge of the extraterrestrial imperative," as Krafft Ehricke called it, will raise mankind to its true purpose and destiny: namely, representing through its power of reason, the only creative species (known up to now), to act on verifiable universal principles, and not on the illusory world of sense-perceptions
By doing so, the human species will achieve a considerable advance in bringing its relationships to this planet and to near-Earth space, into harmony with the cosmic order. Perhaps the most important contribution of Lyndon LaRouche consists in that by the further development of the Leibnizian term "physical economy," he has created a theory of scientific economy which corresponds to the real laws of development of the physical universe.
One of its basic concepts is that it is indispensable for the continuously sustained existence of the human race that its relative potential population density should increase on the basis of rising energy-flux densities in the production process, because at any arbitrary stage of economic development, there is a relative exhaustion of resources. The entire history of human development, particularly the most recent 10,000 years, in which the population potential has risen from a few millions to presently over 7 billion, demonstrates the correlation of the anti-entropic character of human creativity with the knowable universal principles of the physical universe.
The use of the helium-3 resources on the Moon for the fusion economy on the Earth also recalls in an interesting way the controversy between Plato and Nicholas of Cusa, over whether ideas possess an existence already effectively present in the objective universe, independent of mankind, or whether it is only with human creativity that these ideas are created. Helium-3 supplies on the Moon are, in the first instance, only deposits in the upper layer of the regolith. Only human creativity, in mastering thermonuclear fusion power, makes these isotopes into the fuel which can even exceed the power of nuclear fusion in the Sun!
But mankind has reached a phase-change not only from the scientific standpoint, but also from that of universal history; that is, the end of geopolitics is necessary for the survival of the species. Shortly before the Berlin Wall fell, LaRouche proposed the "Productive Triangle Paris-Berlin-Vienna" infrastructure program, and thereby, the plan to make this triangle the scientific motor and starting point for development corridors for the transformation of the Comecon states (the then-Soviet Union and Eastern Europe).
When the Soviet Union disintegrated in 1991, and thus the Iron Curtain disappeared, Schiller Institute teams further elaborated this program into the conception of the Eurasian Land-Bridge. Thus the idea was developed of linking the population and industrial centers of Europe with Asia by so-called development corridors, and thus providing the landlocked regions of Eurasia with the same site-characteristics which the regions with ocean or river access already had.
In the 23 years which have passed since then, this idea has not only been presented in innumerable conferences and seminars in cities around the world, but also further filled out into the idea of the World Land-Bridge. The linking of peoples through this World Land-Bridge is now the realistic perspective emerging from the collaboration of the BRICS nations, Latin America, and the ASEAN nations, and in which the U.S.A., Europe, and Africa must urgently participate.
A new strategy for mankind means the ability, from now on, to see the human species as a unity, and to see that unity in the process of mutual development. Thus, along with Friedrich Schiller, we see no contradiction whatsoever between the inviolability of national sovereignty, which is guaranteed by the law of nations and by the United Nations Charter, and the rationality of the world citizen who has in view the interests of mankind as a whole. For this unity lies in the higher development of all; the concordance of the macrocosm requires the maximal development of all microcosms to their reciprocal benefit, as Nicholas of Cusa said.
This also signifies a new model of cooperation among the nations of the world. It means that all potential treaty organizations and alliances must be inclusive, that they cannot be for the security and economic interests of some nations, while excluding others. While the support of mutual development is the premise, they must nonetheless respect the different levels of development, history, culture, and social systems, and above all, respect national sovereignty. That is Cusa's idea of unity in multiplicity, and it must be inspired by a tender love for the idea of the community of nations, for the idea of mankind as the creative species.
We must learn to view this mankind from the same perspective as the astronauts, cosmonauts, and Taikonauts have seen it, as so wonderfully expressed by one of the Apollo astronauts who walked on the Moon:
"The fact is that evolution is now taking place in space, as much as on Earth. Man has shown that as a species mankind was willing to commit itself to living in environments that were completely different than those in which the species evolved-with a shield of life around ourselves in order to protect the life within. But the willingness to go out there, is there. We've shown that. The curve of human evolution has been bent."
Helga Zepp-LaRouche Tours Silk Road Route on Return Visit to China
Helga Zepp-LaRouche is invited to return again to China to tour the Silk Road route and address several high-level conferences on the Silk Road Economic Belt initiative of Xi Jingping. On September 5, 2014 she addresses a high-level forum in Beijing on the topic "One Belt, One Road" [PDF] along with Col. Bao Shixiu, Professor (Emeritus) of Military Science at the People's Liberation Army Academy of Military Science who emphasized in his speech the leading role of both Helga and Lyndon LaRouche in the campaign for the New Silk Road since the beginning of the 1990's [PDF]. The event, sponsored by China Investment magazine, which is an arm of the National Development and Reform Commission, the main economic policy planning commission under the State Council of the Chinese government, was the first of what is intended to become an annual event bringing together researchers from many Chinese think-tanks tasked with the mission of developing a program for President Xi Jinping's Silk Road Economic Belt.
Helga LaRouche is also a participant in an international conference on the New Silk Road at Lanzhou University attended by representatives of the Chinese Ministry of Foreign Affairs and by the president of Russian Railways Vladimir Yakunin. Additionally, she is interviewed twice on the prime-time CCTV 'Dialogue' show, as well as on Chinese Radio International [PDF]. During the latter interview she states:
"In these six months, tremendous developments have taken place. You had the strategically extremely important summit between President Xi Jinping and President Putin in Shanghai in May, and then in July, the equally important BRICS meeting in Brazil, which was followed by a summit between the BRICS countries and the heads of state of Latin America. And what has emerged out of this series of meetings is a fantastic development, namely, the shaping of a new financial order and a new economic system. And this is extremely important, because this has given tremendous hope to many other countries to finally go for the kind of development which is in their self-interest."
Helga Zepp-LaRouche ˇ Beijing, September 5, 2014
The New Silk Road, as it was proposed by Chinese President Xi Jinping one year ago, and as it has developed momentum through the BRICS Summit in July in Brazil, followed by the BRICS-Latin American Heads of State Summit the next day, has already changed the world. As a result of this New Silk Road dynamic, numerous large projects have been agreed upon through-out the world, for example, the second Panama Canal through Nicaragua, a transcontinental railway from Brazil to Peru, and numerous nuclear cooperation agreements among various countries.
There is a sudden explosion of optimism, where countries dare to assert their sovereignty, and start realizing projects which have been on the shelf for decades,
but which were discouraged before by the conditionalities of international financial institutions, even coming from countries which are not yet formally part of the BRICS [Brazil, Russia, India, China, South Africa] or the Silk Road, such as, for example, Egypt, which has unleashed a spectacular program of national economic buildup; or Argentina, which has courageously resisted an attempted assault by the vulture funds.
There is a completely new, culturally optimistic sense of identity of the larger part of mankind, based on the idea that mankind, as the only known creative species, can think and do things it has never done before.
There's also the beginning of a new financial architecture, such as the Asia Infrastructure Investment Bank, the New Development Bank, and a fund to defend countries against speculative attacks. Chinese experts stress that those new banks are not to replace the IMF, World Bank, or Asian Development Bank, but that they are complementary.
However, if the New Silk Road perspective is to succeed, several challenges and lessons of the past 23 years must be addressed. When the Soviet Union disintegrated in 1991, and the Iron Curtain between East and West came down, the Schiller Institute proposed the Eurasian Land-Bridge as the idea to connect the population and industrial centers of Europe with those of Asia through development corridors, the Eurasian Land-Bridge/New Silk Road program. We proposed this program, which was actually meant to be a peace order for the 21st Century, to various governments in Eurasia. But unfortunately, the United States government and Great Britain's government decided to go for the NATO expansion, culminating in the present crisis we have over Ukraine with Russia.
THE EURASIAN LANDBRIDGE
But then, in 1996, the Chinese government organized a very big conference in Beijing with the title, "The Development of the Regions Along the Eurasian Land-Bridge," with the participation of 34 countries, and I was one of the speakers at that conference. China, at that time, declared building the Eurasian Land-Bridge as the strategic long-term perspective until the year 2010. But instead of proceeding on that path, various crises intervened: There was the Asia financial crisis of '97, largely the result of speculative attacks by such people as George Soros, which caused the collapse of various Asian currencies. As a consequence, there was the Russian GKO state bankruptcy in '98, as well as the LTCM, Long Term Capital Management, crisis in '98. All this blocked the Silk Road policy for the time being.
In 2007, the global financial crisis began in earnest, with the U.S. secondary mortgage market blowing out, and then, the collapse of Lehman Brothers and AIG in September 2008. Now, the trans-Atlantic financial sector is hopelessly bankrupt and is facing a new blowout much worse than 2008. The fact is, that the too-big-to-fail banks are hopelessly bankrupt. As top insiders privately insist, the elephant in the room is the moral hazard: The government bailout simply transformed private gambling debt into public state debt, and encouraged bad behavior of banks, and so, did everything to make a future crisis more likely and more grave.
This led to a significant abandoning of sound banking practice. In the past, central banks would not provide money to do bailouts. If banks could not hold onto their loans, they had to write them off. Now, the distinction between expected and unexpected losses is gone; banks hold onto their bad debts, and even worse, they continue trading with them! There is no concern for the future consequences of these practices, except the expectation that trading revenues will continue to grow. Normally, one would sell bad assets for reduced amounts, or if they were kept on the books, they would be counted against the bank.
All of this is papered over by the so-called instruments of the toolbox, which led to massive bailouts and quantitative easing by the Fed, and now even the ECB, which lowered its interest rate to almost zero today, to do the same. And as a result, the bubble has grown, the too-big-to-fail banks are 40% larger, and they're holding more questionable assets, the exposure risk is growing, and they all pretend not to see it.
Institutional experts, like the FDIC vice chairman in the United States, Thomas Hoenig, have warned that if one too-big-to-fail bank blows, the entire system comes down. The total of outstanding derivatives contracts at this point is $2 quadrillion: This can never be paid. The only way to deal with that, is exactly the same way as Franklin D. Roosevelt did it in 1933, in response to the financial crisis then: the Glass-Steagall banking separation law. In the U.S. Congress and in the Senate, there is legislation introduced, supported presently by over 80 Congressmen and 11 Senators, and more than 200 national organizations, to reintroduce theGlass-Steagall legislation. My husband, Mr. Lyndon LaRouche, who is the only economist who has forecast this crisis at every relevant crossroad, proposed four laws which together could remedy the situation.
First, there must be an immediate reintroduction of Glass-Steagall, the separation of commercial and investment banks.Secondly, one has to go back to the American System of economy established by the first Secretary of the Treasury, Alexander Hamilton, who created a National Bank, where the only power to create credit lies with the sovereign government, and not with private banks.
Third, create a credit system whose credit is generated entirely for future production of the real economy, but it must be based on scientific principles of physical economy and for no other purpose. And that has to be done in every country: Every country needs a national bank, with the sovereignty to create credit, to finance the projects of the New Silk Road, and for that we need multilateral, long-term credit arrangements among the participating countries of the New Silk Road, over 20, 30, 40, 50 years.
There must be also, fourthly, a science-driver introduced into the economy, leading to higher energy-flux densities in the production process. Today, that means there must be a crash program for the realization of thermonuclear fusion power, as the absolutely necessary next higher level of energy-flux density. This is why the Chinese lunar mission Chang'e-3, Chang'e-4, and Chang'e-5 are of absolutely crucial importance for the future existence of humanity; why the breakthrough of the Yutu rover leading to the landing on the Moon last December, with the intention to mine helium-3 on the Moon for a future fusion economy on the Earth, is absolutely essential to finding a solution to the present crisis.
Thermonuclear fusion power based on helium-3 will not only give mankind energy security for millions of years; helium-3 on the Moon as the basis for fuel, means also raw materials security. The fusion torch technology will turn waste into all kinds of new raw materials through isotope separation, but also the use of helium-3 represents a new scientific revolution, since the fusion reaction product is not a neutron, which is very damaging for the reactor material, but a proton, which means it can be controlled and directed using magnetic fields, and in this way, it can be used for direct energy conversion, which has a 70% efficiency.
This will create a completely new economic platform on Earth, and for space propulsion which will allow 1-gravity constant acceleration, and allow space travel to Mars and other celestial bodies. The mastering of fusion power based on helium-3 will allow the defense of the planet against asteroids, meteorites, comets, Sun storms, and similar things.
Now, what has this to do with the New Silk Road?
The New Silk Road means a shift away from geopolitical interests of nations and groups of nations, and focuses on the common aims of mankind. It focuses on the question, not what is my advantage in this or that region, but where will mankind be in 100 years from now, or even in 10,000 years from now? The New Silk Road will become a World Land-Bridge, uniting and connecting all nations and cultures into one, one humankind. It will be, as President Xi Jinping said, inclusive for all humanity and it will bring forth the true identity of mankind, as the creative species in the universe.
Col. Bao Shixiu ˇ Beijing, September 5, 2014
I would like to extend my greetings and my gratitude to Dr. Xiao Jingqiu for inviting me here. At the same time, I have to say that studies concerning the Silk Road are a very big issue, and I'm not the top-notch researcher in this field. So I'd just like to share with you my very shallow thoughts about it, and please feel free to contribute all your insights and criticisms to me.
The topic of my speech is the realization of the new Chinese Dream by the New Silk Road. Two thousand years ago: The ancient Silk Road can be dated to this era, which had started a political and economic dialogue between the East and the West. Many different objects of the arts and of technology have been promoted through the process which has attained great fame, and been transcribed in the annals of history.
Today, in the 21st Century, China is trying to build a New Silk Road. The world economic map is looking forward to some new dynamics and the realization of the new Chinese Dream. How can we make the two things promote each other? And how can we achieve the Chinese Dream? I think these are the challenges that have been put forward to all of us by the director of China Investment magazine. So taking into consideration the geopolitical situation, as well as economic conditions, as well as other factors, we do have the necessity of talking about this issue.
This is a long and very dynamic Silk Road. The concept of the New Silk Road was put forward by the Chinese leader in 2013 and now we have had one year full of the development of the dynamics, and I believe that this is a new concept that will make a great contribution to global governance, or the new world order. And it also concerns the role of China. What role does China want to play in the world?
I would like to talk about two points. The first is that the concept of the New Silk Road is making a contribution to global governance theory. This concept has reflected the canon of a new global governance theory, and it has provided tangible theoretical support for a new type of world order. Actually, we are looking forward to a new type of thinking mode, when we are dealing with international or global governance.
After the Second World War, we have measured almost a century, and what is the economic situation of today's world with multipolarization and economic globalization? Countries in the world have become increasingly interconnected and dependent on one another on a daily basis. Many developing countries around the world and billions of people are working towards modernization per se. An era of cooperation, collaboration, and win-win situation is continuing to mount.
However, we still face the problem of development. The world economy has suffered from the financial crisis and stagnation in the process of reflected the systematic failure of the financial system, as well as challenges and crises such as climate change, food safety, security, and many other issues, which have reflected the fact that today's global governance system still has its weaknesses, and is in need of improvement.
In such an era of great change, we are all waiting for all sorts of upgrades, of positive reforms. So the demand for a new type of concept is very strong at the moment.
Therefore, we have the "One Belt and One Road" concept, which has been welcomed and well received by many countries in the world because it is based on mutual respect, friendly relationships, a win-win situation, and cooperation. Therefore it created a new sort of atmosphere, which reflects the actual interests of the relevant countries, as well as a new dynamic in the global governance of the 21st Century. So this is a very good raw material, so to speak, for the development of the new global governance system.
In the Autumn of 2013, we had some movements from President Xi Jinping's visit to Kazakstan and to other countries, and I think the core concept of this "One Belt, One Road" is a type of concept in which China is seeking the common interests of many countries, instead of the interests of itself alone. And President Xi Jinping has said that China will enhance its friendly relations with Central and Eastern Asian countries and work together with relevant countries to make contributions to the world. He also believes that as long as we adopt a rule of mutual respect, as well as a cooperative perspective, countries of different cultural backgrounds and ideologies can share prosperity and peace.
While visiting Indonesia, President Xi Jinping came up with the idea that the host and guest countries should become each other's good neighbors and good partners. And work together to build a China-ASEAN common destiny, actually, the concept of a New Silk Road as regional, innovative economic cooperation, which builds a platform for such cooperation and East-West cultural integration.
The development of this new concept will refine the radiance of the Silk Road and make the East Asian and Central Asian economies more integrated than ever and leave a deep influence on the world.
THE ROLE OF HELGA AND LYNDON LAROUCHE
The new concept of the Silk Road has been given very high praise by many intellectual leaders. And this new concept is trying to absorb new contributions and insights from scholars and from people in academia-actually, many people of great knowledge have made contributions. But I think it is very important for us to mention the deans of the Schiller Institute in the United States, Mrs. Helga Zepp-LaRouche, and her husband Lyndon LaRouche.
In order to change the decades-long irrational global governance system, and to make the global governance system and the global order more sound and healthy, the couple, as early as the 1990s, had come up with a new idea about building a tunnel under the Bering Strait, as well as establishing a Eurasian LandBridge to connect the world, so that people of all countries and continents can benefit from this new connection. So common prosperity is the basis for a new global governance system.
These two dignitaries, who have been making contributions to the establishment of a new global order and a governance system, have paid special attention to the role of China and Asia in establishing this kind of new order.
Mrs. LaRouche, as early as 1997, published an article about the Eurasian Land-Bridge as the most important geopolitical issue in the world, and has made a great effort in introducing China to the world.
When, in the Fall of last year, she heard the news of President Xi Jinping's visit in Indonesia and Kazakstan, she was thrilled. She thought this new idea promoted by President Xi Jinping would actually produce prosperity in this part of the world and improve people's living standards. Now we have a common consensus in the world, which is that the New Silk Road is only the first step of economic integration of the world and the first light in the darkness toward a new human civilization.
Helga LaRouche ˇ September 4, 2014
ANNOUNCER: This is People in the Know, a weekday forum for in-depth coverage of the news shaping China, the world, and your life. Now here's your host Zheng Chenguang.
ZHENG CHENGUANG: The world is now undergoing some profound changes. Nowhere are these changes more prominent than in the global financial order as well as regional and world security.
BRICS countries are now taking the initiative to establish their own development bank as reforms on the governing structure of the IMF and the World Bank still leave a lot to be desired.
The infamous rise of ISIS in Iraq, which has drawn in a large number of fighters from the West, notably Britain, the U.S., Australia and Belgium, has prompted U.S. President Obama to order air strikes to halt its further advancement. While Britain has become the first major Western country to raise security levels on their home soil.
In Ukraine, the meddling of U.S.-led NATO has precipitated strong reaction from Russia. As of Wednesday [Sept. 3], Russia and Ukraine have reached a long-term cease-fire deal over the fighting in eastern Ukraine. But the future is still far from certain.
While in the East China Sea, the growing assertiveness of Japan militarily is now putting itself and China on a collision course.
So what risks are these highly fluid issues posing to regional and global security? How can we contain the potential crisis that arises from them?
Ni Hao, you're listening to "People in the Know," presenting you with insights into the headlines news in China, and around the world; I'm Zheng Chenguang in Beijing.
In this edition of the program, we speak to Helga Zepp-LaRouche, founder of the Schiller Institute, an international political and economic think tank.
Helga, welcome again to CRI.
HELGA ZEPP-LAROUCHE: Yes, hello.
ZHENG CHENGUANG: You were here almost half a year ago. Tell us what have you been doing in the past six months, especially with the Schiller Institute?
ZEPP-LAROUCHE: Well, in these six months, tremendous developments have taken place. You had the strategically extremely important summit between President Xi Jinping and President Putin in Shanghai in May, and then you had in July, the equally important BRICS meeting in Brazil, which was then followed by a summit between the BRICS countries and the heads of state of Latin America. And what has emerged out of this series of meetings is a fantastic development, namely, the shaping of a new financial order and a new economic system. And this is extremely important, because this has given tremendous hope to many other countries to finally go for the kind of development which is in their self-interest. Like, for example, Egypt: The new government of el-Sisi is now making a new widening of the Suez Canal, they're building agro-industrial complexes, new cities, a nuclear plant on the coast for power and irrigation.
Also many other countries are now building projects, like China is helping Nicaragua to build a second Panama Canal through Nicaragua. Many countries have agreed to cooperate with China, Russia, and India on the development of nuclear energy. It's almost like a tremendous revolution is taking place, where countries who have been intimidated by the IMF and the World Bank not to do these things and to fulfill all kinds of conditionalities, they somehow basically say, "No, we are not being afraid any more, we are now doing finally what is in our self-interest."
So what the Schiller Institute has been doing in this period, first of all, we were extremely happy, because if you look at our earlier reports from the '70s and early '80s, these were all projects which were on our books. And now, it's happening! So we were so enthusiastic, about the New Silk Road, about the BRICS countries, and what we have been trying to do is to try to convince the United States, Germany, France, Italy, to join the BRICS and to support this development and not be hostile to it. Fortunately, there is some hope that that may be possible, because, for example, German industry right now would like to join this developments.
ZHENG CHENGUANG: You singled out the establishment of some new global financial institutions as one of the major development in the past six months, and I assume you're talking about the AIIB in Asia, and the BRICS Development Bank worldwide. But how would you look at the feasibility, and especially financially speaking, for these banks to really get off the ground? And now we have the IMF and the World Bank in existence for several decades: How would you see the future relationship between the financial institutions spearheaded by BRICS countries and all these already-established institutions?
ZEPP-LAROUCHE: First of all, there are many people in Europe and in the United States who are pointing to the fact that the so-called "too big to fail" banks are today more bankrupt than in 2008 before the Lehman Brothers crisis. They have 40% more debt, they have outstanding derivatives of $2 quadrillion, which is a sum which is so unbelievably big, it never can be paid. So these banks are in terrible shape, and the critics of the AIIB and the New Development Bank are saying it's too small, it takes too long, who should pay all of this? But that is a wrong thinking, because it is sovereign government to create credit for production. And what is so good about the AIIB and the New Development Bank is that they are entirely devoted to the financing of projects, not speculation, and that will prove in the future that they are the superior financial system. And we are trying to get the United States to go back to their own American System of economy, which was established by the first Secretary of the Treasury, Alexander Hamilton, who created a National Bank, and that National Bank had the power to give credit for production.
ZHENG CHENGUANG: And you also talked about Europe. Are you saying that Europeans should also establish another bank to help with other projects? We understand the IMF is controlled by the European side.
ZEPP-LAROUCHE: Yeah, I mean, the problem is that this financial present system which is associated with globalization is finished. They are so bankrupt; what is happening right now is a swindle. You can see it in the case of the fight between Argentina and the vulture funds. Now, the NML [Capital] vulture fund bought in 2001 Argentine bonds for a dumping price, of I think altogether $48 million. And after six years, they want to have $850 million from the Argentine government, which would mean a profit of 1,608%, which is usury! I mean, they have not worked for that money, they have just invested in speculation, and they're now trying to bankrupt Argentina. And fortunately Argentina, which is inspired by the BRICS development and by the summit which took place in Argentina and also the visit of President Xi Jinping, Argentina is insisting on its sovereign right to pay the debt according to terms which allow the survival of Argentina. So this is very good.
But it is interesting that the same vulture funds have brought up similar bonds, in Portugal, in Spain, in Italy, and they're trying to give the European nations the same treatment as they are trying to do with Argentina.
So, I think this will head to a confrontation and a dramatic change, because there is no way how the nations can survive if they capitulate to these vultures!
ZHENG CHENGUANG: Let's talk about global security and the political situations: We are seeing many things taking place in today's Arab world - it's really worrisome. Notably the rampant military groups and terrorism; the rise of ISIS, which is not just comprised of the Arab terrorists, but also people with Australian, British, and American passports! Many entities are blaming the U.S. for these existing problems in the Arab world because of this Iraq War and the interventions, say in Syria and Libya. What is your take?
ZEPP-LAROUCHE: Well, this is the curse of the evil deed, that it must permanently create more evil deeds. It was the war initiated by Tony Blair and George Bush against Saddam Hussein which was based on lies. There were no weapons of mass destruction, there was no threat to cities around the world in 45 minutes, it was all based on lies which were produced under the guidance of Tony Blair by MI6 at the time, and this was basically part of the effort of regime change against any country which would not be submissive to the idea of globalization.
Now, that war has caused tremendous hardship, not only for Iraq, but if you look at the long series of wars, look at Afghanistan today, look at Libya, look at the situation in Syria, look at the Gaza Strip, look how this terrorism has spread to most of Africa: Northern Africa into Central Africa. You can say that that entire policy, even from a narrow American interest, is a complete failure.
So now, basically, the problem exists: ISIS is having American weapons, you know, where do they have these American weapons from? This was, that is at least a good hypothesis, these were the weapons which were given by the CIA from Libya to the Syrian opposition, and then they fell into the hands of these even more radical elements, more radical even than al-Qaeda, and now it's a big problem.
So I think that this shows that the present confrontation, which is pushed by NATO and the U.S., and the EU against Russia, is very stupid. Because there must be an international cooperation between Russia, China, India, Iran, the United States, and Europe; they all have to work together to solve such a problem. So I think that when Xi Jinping talked about that a security order must be inclusive, that you cannot have peace for some countries and chaos in other countries, that is absolutely correct: There must be an inclusive security architecture.
ZHENG CHENGUANG: So far for all these Western governments, the only available solution to solve the ISIS is just bomb them, but that will not solve the problem its roots. So you were talking about some more cooperation and coordination from different countries to solve the problem. Can you put your finger on some of the more concrete efforts that can be made to contain...
ZEPP-LAROUCHE: Well, already in November 2012, the Schiller Institute organized a conference in Frankfurt, where we presented a comprehensive peace and development plan for the entire region, from the Caucasus in Central Asia to Afghanistan to the Gulf, to the Mediterranean. So this entire region must be taken as one. Then the Silk Road must be extended to all of these countries. And if Russia, China, India, Iran, hopefully the United States, the European countries, cooperate and declare a war on the desert - like if you look at the map you can see that from the Atlantic coast in Africa, the Sahel zone, Sahara, the Saudi Peninsula, Iran, to China, you have one big strip of desert. This is practically not livable for people, there is no agriculture, no cities.
So we have prepared a development plan, which basically would extend the Silk Road, or as we sometimes call it, the Eurasian Land-Bridge, into this area to develop the desert by three methods: You can use the water from the aquifers, you can redirect some rivers, you make dams, but most importantly, you have to have peaceful nuclear energy for large-scale desalination of ocean water, and then use this desalinated water to green the deserts. And that way, you can have also agriculture, industry, you need to build up infrastructure in this entire region, as densely as it is, for example, in Germany. Germany is a very good example of well-coordinated infrastructure, where rivers, canals, high-speed rail and roads are integrated, which is very good for industry and cities.
So if you have that kind of approach, that way you give a perspective of future economic prosperity for the young people in this region, because many of them would not be joining the terrorists if they had some economic hope for the future. So the solution has to be peace through development. And the only hopeful thing I can say, that the present policies of Egypt is very, very quickly moving in this direction already: So, between Iran, Egypt, there are already polls of hope in this region.
ZHENG CHENGUANG: We'll be back right after this...
ANNOUNCER: "People in the Know," the in-depth current affairs show with insights on the news that shapes China and the world. People in the Know wants you to know the world better.
ZHENG CHENGUANG: Ni Hao, you are listening to People in the Know, offering you insights into the headline news in China, and around the world. I'm Zheng Chenguang in Beijing. In this edition of the program we are taking a look at the prominent changes taking place in the world financial and security order. Now we continue our discussion with Helga Zepp-LaRouche, founder of the Schiller Institute, an international political and economic think tank.
This Eurasia bridge has been, you know, proposed a long time ago. Last year, we're seeing the Chinese President Xi Jinping also proposed this New Silk Road economic belt, connecting China all the way through Eurasia and then to East Europe and perhaps to West Europe, taking Rotterdam, as the final sea out [?]
How would you look at this proposal? Do you think that this has some similarities with the Eurasia Land-Bridge?
ZEPP-LAROUCHE: Absolutely. I think the New Silk Road is the basis for a peace order of the 21st century. As you know, we have proposed the Eurasian Land-Bridge when the Soviet Union collapsed, because then the Iron Curtain was no longer existing, and we proposed at the time, to combine the population and industry centers of Europe with those of Asia, through development corridors. Therefore, we were extremely happy, when Xi Jinping announced the New Silk Road last year, because this is what we have been fighting for for 25 years, and in the meantime, we did not only have hundreds of conferences and seminars about it, but we have developed it further to become the World Land-Bridge. I know China has already expressed interest to contribute to building the tunnel under the Bering Strait, and other projects which are part, really, of a World Land-Bridge, like the Second Panama Canal in Nicaragua, that is part of a World Land-Bridge.
So the way to think about the New Silk Road is not just some connection through Central Asia, but it is the next form of the evolution of mankind, by bringing infrastructure to all the landlocked areas of the world, and in that way, uplift the productivity of the population in that region. So it is really something which needs to be done for mankind to reach the next level. So we really are of the opinion that China is doing the best policy on the planet right now.
ZHENG CHENGUANG: All right. We were just talking about Central Eurasia, and one thing, very potential destabilizing in the region is Ukraine, the conflicts in Ukraine has inflicted a huge loss and pain on the Ukrainian people and the crisis seems nowhere near the end, and the EU is threatening more sanctions against Moscow.
Where do you see that this crisis will end? Is this crisis a reflection of today's political schism, or confrontation between Russia and the West? And do you think the West should accommodate the interests of Russia, because they are all interconnected: Russia is the major provider of energy sources which will produce heat to help the Europeans get over this cold winter?
ZEPP-LAROUCHE: Well, these sanctions are extremely damaging, not only to Russia, but to Europe! It hurts Germany's industry, which is why there is a rebellion among not only the German industry, the French industry, the Italian industry; the European Business Association just came out absolutely warning against it. But, I blame entirely NATO and the EU for this crisis: You know, even the Council on Foreign Relations of the United States, and many articles now have appeared, which have the same opinion, that this crisis was caused by the breaking of the promises which were given to Gorbachov and Yeltsin at the time, that NATO would never extend its troops up to the Russian border; this was promised in '91 to Russia, and that promise was broken. In '91, there was no reason to create a security architecture which was exclusive of Russia; it would have been very easy to integrate Russia into any kind of security alliance, but because at that time, you had in America the neo-cons, and Margaret Thatcher, and they decided to go for world empire - globalization is only another word for world empire - that they step by step decided to extend the borders of NATO closer to Russia, to expand the EU, to encircle Russia, and to make the color revolutions.
There was recently a security conference in Moscow, where the Russia military stated very clearly that the color revolutions are a form of war even if it's not declared. If you are trying to buy with money, activists in a country, with the aim to topple the government, it is a form of war. So the toppling of the Ukrainian government in 2004, the so-called Orange Revolution, was already war, and what they did with trying to make an ultimatum to Ukraine last November, with the EU Association Agreement, was really an effort to make Russia indefensible. Because if you kick the Black Sea Fleet out of the Black Sea and Crimea, Russia is not defensible.
And therefore, this policy is very dangerous and what they will try to do this week, on Thursday, with the NATO summit in Wales, is to try to turn NATO into a complete war machine against Russia.
ZHENG CHENGUANG: Hmm, right. Now, let's get down to talk about China-U.S.: Last year when the Chinese President and the U.S. President met at Sunnylands [retreat in California], they agreed to establish this new model of major country relations, and overall the relationship can be regarded as stable. But are a few hiccoughs: For instance, the U.S. issued an arrest warrant for Chinese military officials, accusing them of launching cyber attacks against the United States, even as the Snowden case is still, you know, being talked about extensively here in China and beyond. Another thing is the U.S. is recent intensifying its reconnaissance operations, along the Chinese borderlines, which has prompted strong opposition from the Chinese side. And more importantly, is the China-Japan relations: It seems for many Chinese people, the U.S. is abetting Japan to take on China! Do you think that the U.S. should act as a more responsible player, to stabilize the region, rather than destabilize or rocking the boat, in the region.
ZEPP-LAROUCHE: Yeah! I think that the model which was proposed by China for the new relationship among major powers is a wonderful model, where each country should respect the sovereignty of the other one, respect the different social system, non-interference. Now, I think the United States right now is pursuing a course which is dictated by Wall Street, so it's not in the American interest. Because Wall Street historically was always the dépendance [ph] of the British Empire. If you go back in history, Wall Street was financing the Confederacy against Lincoln. So Wall Street right now is not really an American institution, but it is part of this empire faction of globalization, and I that there is right now a big motion in the U.S. Congress to implement the Glass-Steagall law which was implemented by Franklin D. Roosevelt in 1933, in reaction to the world financial crisis of the '30s. And there are many congressmen and senators right now, who are moving in this direction. And the LaRouche PAC movement is mobilizing the whole country to do that before the crash occurs. Because if the financial crash occurs, which could happen any moment, we could have a blowout of the financial system worse than 2008, so it really is a race against time.
So I think there will be a big battle in the United States, right now: Will the United States go back to being a republic, and obey the Constitution, or does America want to be an empire together with the British? And that battle will decide if there will be world peace or not.
ZHENG CHENGUANG: All right. Helga, thank you very much indeed, for joining us in the studio and talking to us face to face.
ZEPP-LAROUCHE: Thank you.
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