E.I.R.STRATEGIC ALERT WEEKLY NEWSLETTER

E.I.R.STRATEGIC ALERT
WEEKLY NEWSLETTER
Volume 28, No. 34 - August 21, 2014
LaRouche Proposes a “Global Coalition
to Crush the British Empire”
The United States is on the threshold of a major change, according
to Lyndon LaRouche. “A large group of people in the
United States decided to move in and to bankrupt most of the
system”, LaRouche announced at the weekly LaRouche PAC
webcast of Aug. 15, on the 43rd anniversary of the collapse of
the Bretton Woods System. In similar statements, LaRouche
explained that “there is a new system coming into existence.
Responsible, powerful people have acted. So don’t waste any
more time or effort on worthless things -- such as Wall Street
and everything it represents. Just get rid of it. It’s time to take
out the garbage.”
“Under the new system, the BRICS and allied nations -- such
as South America, Egypt, and others -- those responsible people
have discarded the system of market prices. There are now
no fixed values; there are only the new values being created.
And this new system of values is being run by people who are
saying publicly that the old system is all crap. In certain layers
in the U.S. and elsewhere, there are some indications of
comprehension, and although their understanding isn’t perfect,
they are coming closer to reality. There are responsible people
in this business, who understand an approximation of what
estimated value must be.”
A new system of market pricing, run by responsible, powerful
people, is being set up, LaRouche went on, which is independent
of the Wall Street-City of London crowd. “That is our
club. And we will dump those who are not in our club. We will
play loyally with those people who are, but we are saying “no”
to the sharpies with all their crazy schemes.”
LaRouche then called for “a global coalition of nations” on
Aug. 17, to crush what he calls the “British Empire”, i.e. the
City of London-centered global system of financial looting and
war policies. “That’s the only solution. Otherwise you are going
to have a piecemeal kind of warfare, and you don’t want that.
Those who don’t do that, are the criminals, because they are
causing a war by their actions, and they are to be blamed, and
held to account for it.”
Iraq and the UNO Intervention:
Stop the Hypocrisy, Says Askary
Hussein Askary, chairman of the Swedish European Labour
Party, characterized as “not only hypocritical, but criminal” calls
from Western leaders for a UN military intervention into Iraq.
Askary, who is Iraqi-born, singled out specific statements by
Swedish Prime Minister Fredrik Reinfeldt and Foreign minister
Carl Bildt, but his remarks apply to all European governments.
For Western politicians “to capitalize politically on this situation
without pointing out or admitting the real causes of this humanitarian
crisis, and without changing the policy that created
it, we will never be able get out of this hell of a new dark age”,
Askary wrote.
“The existence of ISIS and its expansion is the result of their
own support, and the support of other European Union and
NATO nations and their friends in Saudi Arabia, Qatar, and Kuwait
to the British-American ``regime-change’’ policy that started
in Iraq (2003), Libya (2011), and Syria (since 2011). That
policy was pronounced by Tony Blair in 1999 and defended by
him in 2004 as the end of the Westphalian Treaty system of
sovereign nation-states.
“It was the assault on those nation-states’ sovereignty and
independence, and the destruction of their relatively modern
state institutions such as the army, police, and security forces,
and relevant general infrastructure, that created the chaos and
vacuum later occupied by such terror groups as Al-Qaeda, Ansar
Al-Sharia, Jabhat Al-Nusra, and the Islamic State which has
metamorphosed from ISIS.
“There has been a conscious and clearly-defined policy in the
U.S. and Britain to allow these groups to get control, weapons,
financial, and media support either directly through the American
CIA, British MI6 and Special Forces (SAS), or indirectly,
through the agents and clients of the U.S. and Britain in the
region, such as Saudi Arabia, Qatar, other Gulf States, Jordan,
and NATO-member Turkey.” It is absurd to think that ISIS can
be eliminated in Iraq, while supporting at the same time their
allied and co-thinkers in Syria.
The British-American argument, Askary went on, that “the
Western community’s failure to react in time to prevent the
blood bath in Syria has pulled Iraq into violent quagmire,’’ is
worse than absurd, Askary insists. In Lybia, the West reacted
“in time” to remove Qaddafi from power. What is the result?
“The Al-Qaeda’s brothers in arms, and ISIS’s ideological Takfiri
twins are wrecking havoc in Tripoli and Benghazi now”.
Last but not least: How could one “have the guts to ask the
UNSC, where Russia is a key factor, to unite against the ISIS,
when Sweden, like the U.S. and the EU, is supporting a Nazi
regime in Kiev that is involved in a genocide against Russianspeaking
people in eastern Ukraine?”
“It is time to stop the hypocrisy”, Askary warns. “The Nuremberg
Tribunal set a new legal standard to prevent genocide by
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2 WEEKLY NEWSLETTER n°34 / 2014
powerful nations and groups: ‘Knew or should have known’’.
The same standard has to be applied today against the powers
and individuals who created the conditions for the genocide in
Syria, Iraq, and eastern Ukraine, if we are to live in a human
world community worthy of the name.”
Helga Zepp-LaRouche: Leave NATO
Before It’s Too Late!
In light of the radically changed character of the North Atlantic
Treaty Organization, and of the intention to replace the original
NATO Treaty with a new Charter at the upcoming summit in
the Wales, Schiller Institute founder Helga Zepp-LaRouche has
called for Germany to leave the alliance.
While the mainstream Western media demonize Russian
President Putin, she wrote, “it is in reality the British and the
US governments, NATO and the EU that are escalating a confrontation
strategy against Russia, at the end of which, unless
we stop it, there is only a thermonuclear war and the extinction
of humanity.”
“The fact is, that there is only one way out for Germany: We
must leave the Alliance immediately, if we do not wish to dig
our own graves, and become complicit in the preparations for
a war of aggression.”
The new NATO Charter is supposed to allow forward positioning
of weapon systems and troops, which was explicitly forbidden
in the 1997 Founding Act of the NATO-Russia partnership.
“On this, the British government has taken the high command,
primarily because of the beleaguered state of Obama. British
Prime Minister David Cameron is spreading propaganda, in the
best tradition of Tony Blair’s lies prior to the Iraq War, about
an alleged threat to the Baltic States coming from Russia.” And
Deputy Supreme Allied Commander, Gen. Sir Adrian Bradshaw,
has called for the creation of a rapid deployment force against
Russia, despite the restraint shown by Russia.
The original character of NATO has been changed step by
step, Zepp-LaRouche points out, to the point that no strategic
discussion takes place any longer, and officers are told only
to obey orders. Such is the function of an imperial army, as
described by Samuel Hungtington. The expansion of NATO
and the EU eastward does not only aim at “regime change”
in Russia and China, but at “the complete takeover of their
territory”.
Therefore, “should Germany sign the new Charter at the
Sept. 4 NATO summit, it would be an absolute kamikaze-act.
We call upon citizens now to support the exit from NATO!
http://www.solidaritaet.com/neuesol/2014/33/hzl.htm
Eurozone Enters New Phase of Collapse
The physical collapse of the Eurozone, which Eurocrats had so
far confined to the “periphery”, has now hit the center. With
Italy, the third largest economy, already in a deflationary spiral,
and France, the second largest economy, reporting zero
growth for the second quarter in a row, it was only a matter of
time before Germany would be hit by the collapse of its main
trade partners. That was confirmed by the statistics released
Aug. 13, showing a industrial downturn of 0.3% in the Eurozone
in May, and a negative German GDP of 0.2%.
Those figures highlight the trajectory which the Eurozone
has been on since at least 2008, which it cannot get off while
remaining in the current system. The sanctions on Russia have
just worsened the situation, in particular in Germany, where
imports have increased more than exports.
The economic downturn in Italy is dramatic. Given the
negative GDP growth for the second consecutive quarter, the
country is technically in a recession. Production and prices are
falling, while the debt soars. More than 4,000 firms have disappeared
since the beginning of the year, and those that survive
are producing abroad.
According to Mediobanca’s yearly report, industrial firms
with over 500 employees, which represent half of manufacturing
output, produce 67% abroad. Total real unemployment
is above 25%, according to the Confindustria industrialist association.
Due to falling demand, consumer prices in July have
plunged, with fruit and vegetables down by 10% on a yearly
basis. In the first six months of 2014, government debt increased
by €99.1 billion.
EU authorities see only the monetary side of the crisis, and
are preparing to fight deflation with inflation. Thus, the ECB is
considering anticipating the planned 400 billion LTRO, followed
by a second round in December, for a total of one trillion.
Knowing that this program will fail, as QE has universally
failed, ECB head Mario Draghi called for direct dictatorial at the
ECB press conference Aug. 7.
Draghi Summons EU Countries to
Give Up Their Sovereignty
Given the official recession in Italy, Mario Draghi proposes that
Rome surrender its sovereignty to the EU, implying that the
“Troika” (EU Commission, IMF and ECB) should run Italy’s government.
At the ECB press conference Aug. 7, Draghi claimed that the
drop in Italian GDP is due to lack of private investments, which
in turn is due to lack of “reforms”. He added explicitly that
Brussels should work out such reforms for Italy.
“There is one further area which has acquired, if anything,
even greater importance during the crisis, which is the area of
structural reforms”, Draghi said. “And that’s where I said several
times that it’s probably high time now to start sharing sovereignty
in that area as well, taking the structural reforms area
in the marketplace, product reforms, Single Market legislation,
implementation and labour market reforms, under common
union discipline – in other words, trying to replicate our success
in the budgetary area also in the structural reforms.”
It is quite surrealistic of Draghi to claim that EU budget
policies have been “successful”, whereas they have devastated
Greece, Spain, Portugal and now Italy.
That was also underscored by Antonio Maria Rinaldi, an economics
professor and chairman of the newly constituted “Riscossa
Italiana” association, in an article published on formiche.
net Aug. 10. In his view, no matter how much money the ECB
pumps into the system, it will never succeed “in pulling the
European economy out of deflation.”
In addition, Draghi has trespassed his mandate. “Nowhere
in the statute or the rules for the ECB”, Rinaldi wrote, “can
a single syllable be found, allowing the ECB chairman to call
for waiving sovereignty, even partially, of member states”. Evidently,
Draghi sees such a waiver as “the last resort before the
ultimate implosion of the euro”.
According to Rinaldi, Italian Prime minister Matteo Renzi,
although formally rejecting a Troika commissioning of the Italian
government, will use such a threat to implement the same
“insane policies” in the short term. In fact, in interviews with
La Stampa and the Financial Times on Aug. 10, Renzi as much
as agreed to Draghi’s requests.
Elsewhere, it has been reported that the government plans to
introduce a compulsory levy on private wealth (bank accounts)
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n°34 / 2014 WEEKLY NEWSLETTER 3
in order to find some missing 20 billion euros to balance the
budget in September.
French Economist Proposes France
Leave the Euro First
The growing backlash in Europe to the trans-Atlantic policy
was expressed by French economist and Russia expert Jacques
Sapir in an open letter to President Hollande posted Aug. 15
on his blog hosted by the French weekly Marianne. He confirms
the City of London fears that the French will refuse to impose
another round of austerity.
After going through the horrors provoked by the euro, Sapir
bluntly asks if France should remain in the EMU. Sapir : “Our
economy is declining, our industry is collapsing. Our armed
forces are critically poor. M. President, you have to face the
realities. Even if they are displeasing, even if they imply that
certain things in which you invested a lot turn out to be erroneous.”
Inside a Economic and Monetary Union, he argues, “no country
should have such a structural surplus as Germany has. Germany
must leave the EMU or realize the fact that it will be
France that leaves the euro, which is the most likely solution.
Be confident that France will not leave alone. (…) Once announced
and made public the fact we’re leaving, and this can
be done overnight, Italy, Spain, Portugal and Belgium will tell
us they imitate us. Greece would follow rapidly.”
If François Hollande is unwilling to follow that course, Sapir
concludes, he should resign.
Sanctions against Russia:
European Union Shoots Itself in the Foot
The Russian ban of food imports from the European Union
was the only logical retaliation for the EU’s ill-advised sanctions
against Russia which, as we have repeatedly warned, have
nothing to do with the Ukraine crisis as such.
Despite capitulation of the EU leaders, opposition to the confrontationist
policy is growing. Hungarian Prime Minister Viktor
Orban noted on Aug. 15, that the sanctions policy causes
more harm to the West than to Russia. “In politics, this is called
shooting oneself in the foot.”
A similar view was expressed by his Slovak Prime Minister
Robert Fico the same day “Why should we jeopardize the EU
economy that begins to grow? If there is a crisis situation, it
should be solved by other means than meaningless sanctions.
Who profits from [the] EU economy decreasing, Russia’s economy
having troubles and Ukraine economically on its knees?”
Thousands of farmers who now face bankruptcy have had
the same reaction. They are not blaming Vladimir Putin for the
crisis, but their own political leaders who are using language
too colorful to print.
In 2013, farmers in the EU exported €30 billion worth of
food to Russia, in particular from Eastern Europe. Poland,
the largest exporter of apples in the world, was the number
one supplier to the Russians, selling them 56% of their apple
harvest in 2013. Losses are in the range of €500 million and
up now.
As for Greece, adding to the already catastrophic conditions,
thousands of farmers face bankruptcy given the fact that up to
60% of the country’s food exports go to Russia, for a total of
more than €500 million. The 3,000 truckloads of nectarines
and peaches, carrying 3.5 million kilos were turned back at the
Russian border, and another 3.5 million kilos are rotting on the
trees or in refrigerated warehouses. 60% of the farmers in
Northern Greece are affected, as well as farmers in Cyprus.
The major agriculture producers including Spain, Italy, the
Netherlands, Denmark and France will lose billions and even in
Germany, which mainly exports industrial goods, food exports
total EU1.4 billion.
The European Commission’s response has been to “promise”
compensation from the EU emergency agriculture fund. But
that fund has only 400 million euros in it!
BRICS Develop Strategy
to Counter Western Sanctions
At their historic summit in Fortaleza, Brazil, four weeks ago,
the BRICS (Brazil, Russia, India, China, South Africa) group
forged a new alliance based on non-monetarist principles (cf.
SAS 30, 31/14). Their newly forged solidarity was quickly put
to the test by the economic “sanctions” -- in reality economic
warfare – imposed on Russia, and they withstood it.
Indeed, the four other members of the group have assured
Russia of their active support in the escalating conflict with the
West, providing both high-tech goods to the Russians which
are on the Western embargo list, and agricultural goods. China
will double its poultry exports to Russia to 45,000 tons a year,
and it is committed to massively expand cooperation in the
aerospace sector, including its military-industrial aspects. Brazil
will deliver Embraer aircraft to replace Boeing on the Russian
market, while bananas and other fruit produced in Brazil will
make up for a large part of the fruit that Russia has so far
imported from Europe.
Other states that are orienting toward the BRICS, such as
Egypt and Argentina, have pledged to deliver potatoes and
meat, while Turkey and Israel have offered fruit and vegetables
to substitute Ukrainian exports to the Russian economy. Belarus
is offering to step in for Poland and the three Baltic republics
in terms of agricultural exports to Russia. Iran is offering
exports to Russia as well, and negotiation are ongoing with
Chile and other Ibero-American countries as well as numerous
countries in Asia.
European sanctions are thus set to have a boomerang effect.
In addition to short and medium term imports from outside the
transatlantic West, high-level Russian officials and experts have
expressed their commitment to build up domestic production
in both the agricultural and high-tech industrial sectors. Statements
to this effect have been made past week by Russian Vice
Prime Minister Dmitri Rogozin, by the Agriculture Minister (..
), and the side of senior political analysts by Semyon Bagdassnov
and Pavel Svatenkov.
Tehran, for one, is looking to vastly improve ties with the
BRICS. An article in the Tehran Times of Aug. 10 under the
headline, “Can Iran Become the Second ‘I’ in the BRIICS?”
quoted Tohid Atashbar, researcher at the Department of Planning
and Budgeting of Iran’s Majlis Research Center, who revealed
that Iran is prepared to join the five other countries.
Atashbar elaborated the benefits of joining, including to neutralize
the effect of the sanctions imposed for years now by
the West.
Parallel to the Tehran Times article, Voice of America radio
quoted Liu Haifang, a professor at Peking University’s Center
for African Studies, on the subject of the New Development
Bank set up by the BRICS. He noted that developing countries
“finally got some alternative sources to get funding for infrastructure
and they do not come with these (Western) conditionalities....
African countries trying to get funding do not
have to only follow the rules of the developed world.”
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Is Egypt Ready to Join the BRICS?
Egyptian President and former army commander, Abdel Fattah
al-Sisi, has moved to join the new economic paradigm emerging
under the leadership of the BRICS (Brazil, Russia, India,
China and South Africa). Within that setting, Egypt could provide
the leadership needed to save a region that is now falling
into a new dark age.
After brokering a cease-fire in Gaza that stopped the slaughter
of Palestinians, al Sisi traveled to Sochi, Russia for a twoday
summit with Russian President Vladimir Putin. The two
leaders held wide ranging discussions for economic, scientific,
space and strategic cooperation, including establishing cooperation
between Egypt and the Eurasian Customs Union of Russia,
Belarus and Kazakhstan. They agreed to expand Russian exports
of grain to Egypt, where Russia already supplies 40% of
Egypt’s needs, and increasing imports of Egyptian fresh fruits
and vegetables. A Black Sea logistical center will be created to
handle these imports.
On Aug. 3-4, Chinese Foreign Minister Wang Yi visited Cairo,
with a message for al-Sisi from Chinese President Xi Jinping.
It was nothing less than an invitation to join in China’s strategic
conception of building the “one belt and one road” which refers
to the infrastructure and trade networks put forward by Xi
during his visit to Central Asia and South-East Asia in 2013.
This, Xi believes, corresponds to Egypt’s strategy of national
development. Foreign Minister Wang urged bilateral cooperation
in building up the Suez Economic and Trade Cooperation
Zone, as well as in modern industries and agriculture, energy,
infrastructures such as highways and tunnels, as well as aerospace
and satellite technologies.
Moreover, al-Sisi recently sent a letter to Argentine President
Cristina Fernandez de Kirchner declaring full solidarity for
Argentina’s fight against the speculators. “We, in Egypt, are
following with utmost interest the great efforts made by your
friendly country to achieve your development” and “to restore
confidence in the Argentine economy.”
Egypt Launches Second Suez Canal
On Aug. 5, Egyptian President al Sisi announced a policy of
returning to a policy of building great projects, including the
construction of the “New Suez Canal” aimed at doubling the
capacity of the current canal. Already the next day, pictures
of bulldozers and huge dump trucks appeared in the Egyptian
media as 7,500 workers began the project, which is to be completed
within one year, and not the 3 years previously planned.
Under the supervision of the Army,
Sixty-three 63 companies will dig the new 35 kilometer canal
parallel the old canal north of the Lake Timsah and the Bitter
Lake. The section of the canal below the lakes will be widened
for the length of 37 kilometers.
Only Egyptian companies will be involved in the canal project
while financing will be through issuing debt certificates which
only Egyptian citizens can buy and will be issued through Egyptian
banks. The entire project which includes the canal itself
and new roads, railroads and tunnels beneath the canal, will
cost about 60 billion Egyptian pounds (8$.4 billion). Officials
have said the new canal would boost annual revenues to $13.5
billion by 2023 from $5 billion
The second great project is the Toshka, or New Valley Project,
which promises to green the vast “waste lands” of Egypt’s
Western Desert. Begun in 1997, the project has yet to be completed
due to a lack of funding. The project envisions bringing
water from Lake Nasser, the lake formed by the Aswan Dam,
into the desert through a system of canals to irrigate up to
500,000 hectares.
China Takes Lead in Search for the
“Greatest Power We on Earth Can Command”
As we reported in the last issue, Lyndon LaRouche has called
on the world to look at China’s space program as the standard
of productivity. The Chinese program aims at mining Helium-3
on the Moon, which is the most efficient fuel for fusion reactors.
Although Helium-3 can be used only by second-generation
reactors, and the first generation is yet to be achieved, China
is correctly setting the standard for the economy of the future
and for the most powerful science driver today.
On Aug. 10, China’s State Administration of Science, Technology
and Industry announced that the next Chang’e-4 mission
will be to launch an orbiter that will circle the Moon and
then return to Earth. It will a crucial step towards the 2017
Chang’e-5 mission, which will then test the capacity to gather
samples of helium-3 on the Moon, encapsulate them and then
deliver the capsule to the spacecraft, which would bring the
samples to Earth.
Simultaneous to the announcement of the lunar mission plans,
a Chinese science publication, Kejishun (Science and Technology
Report), published a brief report on the lunar program, headlined
“Helium-3 on the Moon Can Provide Mankind’s Energy
Needs for the Next 10,000 Years.”
Reacting to the announcement, Lyndon LaRouche emphasized
that “helium-3 is the greatest power that we on Earth
command,” and while China, India and Russia are looking to
develop it, “the only hope for those who want to bring the
world out of crisis, is to work with them.”
Designs of such projects, which reflect the commitment to
develop thermonuclear fusion, evolved out of the American
Apollo program of the 1960s and later work at the University
of Wisconsin inspired by the 1970s Fusion Energy Foundation
promotion of fusion. Unfortunately, after the assassination of
President John F. Kennedy, the United States progressively
abandoned manned exploration of the stars and has all butdropped
the efforts at achieving thermonuclear fusion, including
any idea of going to the Moon to mine helium-3.
In Russia, although the entire ambitious space program of
Roscosmos has been considerably slowed down over the past
10-15 years, key aspects of the original program to establish
a standing base on the Moon and explore its surface for helium-
3 and other resources are still there. Coincident with the
announcement of the Chang’e-4 mission, Izvestia published
portions of a leaked copy of the draft new ten year plan of
Roscosmos for 2016-2025. The document reports that the
space agency will be developing the key elements of a Moon
base and will begin construction of prototypes of all of the
required modules in Russia in 2018.
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