E.I.R.STRATEGIC ALERT WEEKLY NEWSLETTER

E.I.R.STRATEGIC ALERT
WEEKLY NEWSLETTER
Volume 28, No. 42-43 - October 16, 2014
“Storm over Asia” Can and Must
Be Stopped Now!
The entire Eastern Mediterranean region, and by extension, all
of Europe is looking at a catastrophe in the coming two weeks,
Lyndon LaRouche stressed on Oct. 9, which must be prevented
at all costs. “We are facing the immediate potential of a runaway
horror show.” Barack Obama is responsible for promoting
war in South-west Asia, he stressed, and Americans must
remove him from power.
As we write, the battle for the Syrian town of Kobani on
the Turkish border continues to rage between Kurdish militia
backed by U.S. air strikes and the Islamic State of Iraq and the
Levant (ISIL or IS), which is backed by NATO member Turkey.
If Kobani does fall, it will have repercussions throughout the
region and beyond. Jihadists are already conducting attacks in
Lebanon along the Syrian border, battling both the Lebanese
Army and Hezbollah. Both IS and the Nusra Front, the “official”
Al Qaeda grouping in Syria, are operating on the Golan Heights,
bordering on Israel. Jordan is another highly vulnerable front
in the region. In Germany, street battles have already taken
place between Kurds and Turkish Salafists.
There is increasing concern as well that the warfare will
spread to Russia and even China. On Oct. 9, Bloomberg News
ran an interview with a leading IS commander who goes by the
name “Omar al-Shishani” (“Omar the Chechen”). One of the
most hardened of the IS fighters, al-Shishani led the assault
on Fallujah, Iraq in January 2014 that began the IS offensive.
He is one of a reported 1,000 Russian speakers who are now
fighting in Iraq and Syria under the black flag of the IS, most
of them being Chechens and many from Pankisi in Georgia on
the border with Chechenia. They vow to ultimately return to
Russia to establish an Islamic State of the Caucasus.
While U.S. and Russian intelligence specialists are skeptical
that the Chechens have the ability to carve out an independent
region in the Caucasus, they might have the ability to sow
chaos throughout Russia, as they did in the past.
Other elements of the “jihadists without borders” from
Western China will escalate the terrorism in Xinjiang Province
where the largest concentration of Uighurs reside.
All of these developments fit into in-depth picture first presented
by LaRouche in his now famous Storm over Asia video
presentation of 1999. At that time, LaRouche warned of the
growing British-led destabilization of key parts of Eurasia,
highlighting the role of Turkey in promoting separatism, and
identifying Russia and China as the prime targets of the assault.
LaRouche warned that the greatest threat of global war, including
thermonuclear war, would arise from the looming “storm
over Asia.”
In an interview to RIA Novosti on Oct. 9, former Russian
Ambassador Vinjiamin Popov warned that the current strategy
being pursued by President Obama was guaranteed to lose,
and that the only viable approach involved cooperation with
Russia, China, Iran, Syria and others, in a genuine global effort
to defeat the jihadist scourge.
Obama’s Coalition Partners Fund the ISIL
The curious contradiction of President Obama’s coalition against
the Islamic State of Iraq and the Levant, has been widely exposed
in many countries over the past days, namely, the fact
that while part of the coalition is ineffectively throwing bombs
around Iraq and Syria, the other part is financing the ISIL.
Moreover, Turkey, a NATO member, is openly abetting the
ISIL to block creation of an autonomous Kurdish region in
Syria, bordering on the Kurdish region of Iraq which is already
quasi independent.
On Oct 9, Egyptian Foreign Affairs Minister Sameh Shouky
met with General John Allen, the American special envoy for
the anti ISIL coalition, where he made the same point we have
made from the beginning. Egypt’s idea of counter-terrorism
in the region, he said, according to Al Ahram, is to dry up the
finances of terrorist organizations.
That financing is coming from Saudi Arabia, Qatar, the Gulf
States and Turkey, as is well known. Interestingly, a number
of British security experts have been outspoken on that connection,
as British involvement in the air strikes is highly contested.
Lord Dannatt, a former Chief of the General Staff of the
British Armed Forces, told the Daily Telegraph on Oct. 5: “It is
completely unacceptable that some individuals in Qatar, Saudi
Arabia and elsewhere see advantage in channelling large sums
of money to the so-called Islamic State.” He called on the government
to stop allowing these countries to buy lucrative assets
in Britain unless they dismantle terrorist funding networks.
Former Defense Secretary Liam Fox recently wrote in the
same daily that “money has been flowing from rich individuals
in the Gulf states, if not their governments,” to the ISIL.
The Telegraph also cited a recent speech by the former head
of Britain’s MI6 intelligence service Sir Richard Dearlove, who
fingered Qatar and Saudi Arabia.
We would suggest that that figures, if they are serious, might
start at home by cleaning up “Londonistan”.
As for Turkey, the French magazine Marianne revealed that
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certain Turkish banks with branches in London are funneling
funds from private Saudi and Gulf State networks to the IS. The
jihadist financiers transfer the money to the London branches,
which in turn transfer it to front companies in Turkey, which
pass it on to the ISIL.
Obama Increasingly Battered,
Including from Democrats
With President Obama’s “strategy” against the so-called Islamic
State through air attacks failing across the board, there has
been renewed discussion of putting impeachment back on the
table. A poll taken Oct. 9, as the jihadists were closing in on Kobani,
showed that 78% of voters want the Congress to return
to Washington, to debate Obama’s plan.
Yet House Speaker John Boehner, a Republican, refuses to
bring back the lawmakers, who are in recess until the Nov. 4
elections. Republican Representative Walter Jones told a national
radio audience that Boehner would not even allow him
to make a motion to bring back the Congress.
The revolt is also brewing among a number of leading institutional
figures who have worked with the President. Following
criticisms of his dangerous foreign policy and war-making in
books written by former Defense Secretary Gates and former
Secretary of State Hillary Clinton this summer, Obama was hit
by another former Defense Secretary, Leon Panetta, who also
served as his CIA Director. Panetta described a President who
has failed to lead, who “avoids the battle, complains, and misses
opportunities.” In particular, Panetta attacked the decision to
fully withdraw from Iraq, which he warned would “endanger
the fragile stability then barely holding Iraq together.” While
Obama claims that there was an “intelligence failure” in underestimating
ISIS, Panetta made clear it was Obama’s failure.
Then there was Vice President Joe Biden, in an address at
Harvard on Oct. 2, who said that “our allies in the region were
the largest problem in Syria,” because they financed the ISISISIL
(cf. SAS 41/14). Biden’s subsequent “apology”, at the demand
of the White House, did not fool anyone.
The U.S. media has been filled with stories of Democratic
candidates distancing themselves from an Obama, who has become
a liability. Even the previously fawning media such as the
New York Times and the Washington Post, have turned over
the past months, to denounce Obama’s disconnect from reality
on any number of issues. The Post’s Kathleen Parker wrote a
stinging comment Oct. 7, which begins with Obama’s famously
jumping into a golf cart right after denouncing the beheading
of James Foley. “The relevant question is where is his mind? Is
he engaged? Does he care?”
It has taken more than five years for them to catch up with
Lyndon LaRouche, who first identified Obama in April 2009,
as being controlled through his “pathological narcissism disorder”
in April 2009, rendering him incapable of leading the
nation. How much longer will it take until they conclude that
LaRouche’s solution, impeachment, is necessary?
UN Appoints Switzerland’s Jean Ziegler
to Investigate Vulture Funds
The United Nations Human Rights Council (UNHRC) has designated
former Swiss parliamentarian Jean Ziegler, the internationally
respected human rights advocate and former UN Special
Rapporteur on the Right to Food, to head up the Council’s
special commission to investigate the activities of vulture funds.
That commission was set up in the framework of the resolution
introduced at the UNHRC by Argentina and passed on Sept.
26, condemning vulture funds’ activities as a violation of human
rights and the right to development. It is made up of 18
international experts.
The 80-year-old Ziegler has for many years investigated
banking criminality, particularly of Swiss banks, and as the
Special Rapporteur on the Right to Food, denounced the use of
food in biofuels production as “a crime against humanity.”
Discussing his new position in an Oct. 5 interview with Argentina’s
Pagina 12, Ziegler stressed that the vulture funds also
impose enormous costs on especially poor countries, which are
forced to divert funds for social welfare programs, to pay for
the cost of litigation. Their “practices on Greece and the Democratic
Republic of Congo will also be examined,” he said.
They are “financial groups that represent the highest, most
quintessential point of banking criminality. They are not investment
funds... they are unregistered, outside of international,
multilateral, and binational legality and, in many cases, outside
of national legality. All of this, of course, must be proven, and
I intend to do so.” It will be a fight, he warned, because big
“pressures” will be exerted by the U.S., the UK, and their allies
who opposed the Argentine resolution.
The key question, he added, is “who is behind” the vultures?
He pointed to such big banks as Goldman Sachs and Union Bank
of Switzerland (UBS) as worthy of investigation, underscoring
that the vultures do “the dirty work” for the financial oligarchy
by, for example, “combating the Argentine State in U.S.
courts. I’m convinced they’re not just isolated speculators, but
rather... are an important part of world financial capitalism.”
They “take on the specific job of combating sovereign states in
the restructuring of debt,” which allows banks to continue with
their “normal” activities.
EIR Intervention at World Bank Meeting
Earns Expulsion
Activists concerned with democracy and human rights in Russia
or China are advised to turn the spotlight on Western institutions
such as the International Monetary Fund and the World
Bank. Raising inconvenient truths on their premises can have
you declared Persona Non Grata – as it happened to EIR.
At the IMF/World Bank annual gathering in Washington, two
representatives of EIR challenged the group think which prevailed
on several of the forums nominally claiming to deal with
the “world’s most pressing issues.” At a World Bank event titled
“Jobs, Growth and Shared Prosperity” Oct. 9, with a panel that
included the World Bank expert on jobs creation, the head of a
Central Bank in Asia and a vice president of the Turkish Central
Bank, one EIR representative began by noting that the talk of
“bottom-up” job creation has to be looked at differently, taking
Prime Minister Narendra Modi and his India as an example of a
successful approach.
Later, the second EIR representative took up the same issue,
giving a concise explanation of the use of directed credit, as in
Egypt today, for large-scale development and job creation. He
also went into the vast expansion of nuclear power being developed
by the BRICS, and the urgency of nuclear fusion.
The combined impact of EIR interventions transformed the
event from the usual pessimistic debate on lack of funds. One
central banker fully supported EIR’s proposal, calling for scientific
development and infrastructure investment.
At the conclusion, the jobs expert from the World Bank
pointed to the fact that the Bank has to stop thinking only of
jobs for today, but rather jobs for 15 years from now—the
projects and the education needed for the long term.
EIR reps also spoke with World Bank President Jim Yong
Kim, asking him if his bank would collaborate with the Asian
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Infrastructure Investment Bank and the BRICS New Development
Bank, on which Kim waffled. He did, however, admit that
“the World Bank does not invest in nuclear power.”
The next day, EIR’s press credentials were withdrawn on the
grounds of “what you did yesterday”. In other words for bringing
a dose of reality and optimism into the deliberations.
Nonetheless, LaRouche PAC activists distributed a leaflet to
participants over the three days of the meeting, titled “A Life
and Death Choice Between Two Systems”.
Sergei Glazyev: Russia Needs a New System
of Domestic Credit
Russian economist and Presidential advisor Sergei Glazyev has
called for the creation of a new system of domestic credit, to
guarantee successful economic development, according to a report
Oct. 7 on RIA Novosti.
Speaking in Moscow at the IX National Congress “Modernization
of Russian Industry: Development Priorities,” Glazyev
emphasized that to bolster defenses against the Western sanctions,
“we need to create an internal system of credit, which is
aimed at modernizing economic growth....we need to dramatically
increase the quality, competence and efficiency of public
administration.”
Sanctions by the U.S. and Western Europe make clear, he
cautioned, that “we can no longer rely on foreign investment,
so the State is the only source which can give the necessary
amount of credit to the economy.” The government’s current
fiscal policy, which results in withdrawing more money from
the economy than it puts in, is no longer viable, he said.
“It is necessary,” he argued, “to create a domestic credit system,
and we need to do it quickly.” He also underscored the
need to introduce capital controls.
Glaziev is also the presidential aide in charge of the Eurasian
Customs Union. At a conference on Eurasian Economic Integration
Oct. 9, he noted that Ukraine’s default is becoming inevitable,
and will be “overwhelming”. GDP is expected to drop by
50%, and investments to stall. But the aid promised by the EU
and the U.S., he said, as reported by Itar-Tass, “is not enough
to cover the holes in the balance of payments”. Therefore,
Ukraine needs Russia and the Customs Union.
While the economic collapse of Ukraine was clear from the
beginning of the EU frantic push for the Association Agreement,
European leaders pushed it anyway, under pressure
from the United States, in order to weaken Russia, and in particular
its President.
Excellent Perspectives for German-Chinese
Cooperation, If EU Policy Changes
China’s Prime Minister Li Kequiang, during his two-day visit to
Germany Oct. 10-11, proposed a grand cooperation framework
along the New Silk Road not only to Germany, its largest
trade partner, but to all of Europe. Daily trade between China
and Europe has reached 1.2 billion euros, and there is, as Li
stressed, still potential for a vast expansion.
The Chinese delegation comprised no less than 14 cabinet
ministers and 120 representatives of China’s industry and
banking sectors. In Berlin, economic deals were signed totalling
a volume of 12 billion euros, with the two agreements between
Europe’s Airbus Group and several Chinese airlines being the
single-largest with a volume of 5.4 billion euros.
Airbus will deliver 70 airliners of the A320 model to China,
and the A330 model will partly be fabricated at a new joint
venture Airbus has with the Chinese, while the A350 is already
produced, largely with Chinese local content, at Tianjin. These
deals involve increased technology transfer. China hopes that
the economic cooperation with Europe and Germany, largely
limited today to trade relations, will move into mutual industrial
cooperation, either in joint ventures (preferably) or direct
European investments in production sites in China.
The EU bureaucracy’s response to the Chinese offers was
more than reserved, as demonstrated at the Hamburg “China
Meets Europe” conference Oct. 11, the . Outgoing EU trade
commissioner Karel de Gucht and other EU officials insisted
that good relations depend on China liberalizing and deregulating
its domestic market, and reducing the role of the state in
the economy. Contrary to that view, on the level of individual
corporations, the dominant view is that the role of the Chinese
state is constructive.
German Foreign Minister Frank Walter Steinmeier, who
spoke on behalf of the government in Hamburg, came out with
the usual EU mantra in his speech, but did conclude with a
reference to the 17th century German philosopher Gottfried
Wilhelm Leibniz, which is certain to be welcomed on the Chinese
side. In his Novissima Sinica of 1697, Leibniz proposed a
grand design of cooperation between Germany and China in
philosophy, astronomy, philology and in the natural sciences, to
serve the development of the entire Eurasian continent. That is
indeed, what the New Silk Road is all about today.
Euro: the Illusionist Has Failed,
the Show Is Over
As Mario Draghi’s magic can no longer save the euro, the socalled
“community of destiny” is crumbling. The French government
basically declared the Fiscal Pact dead on Oct. 1, the
ECB’s assets purchase program may never come to light, as
opposition is growing not only in Berlin but even in Paris. The
new European Commission is discredited (cf. below), while the
anti-EU party UKIP scored its first major parliamentary victory
in Great Britain.
Even the German Der Spiegel, warned Oct. 5, in an article by
Henrik Müller, that “the next great crash is only a question of
time”. Blasting central banks’ policy of bailing out the financial
system, he wrote that “Nothing has been learned from the
financial crisis; the debt burden on the global economy grows
constantly higher.” The worldwide public and private debt combined
was 107 trillion dollars in 2008, and has increased since
then to 150 trillion, about 2.5 times global GDP, he warns. The
next global crisis “will be larger still than the last one.”
Another warning came from the head of the German Savings
Bank Association (DSGV), Georg Fahrenschon, at an Oct.
11 press conference in Washington: “41 years after the end
of the Bretton Woods System and the introduction of floating
currency exchange rates, we must come to the conclusion: the
rules of the game of the world currency system are not coherent.”
He is particularly concerned that the financial economy
has decoupled from the real economy.
All this points in the direction of the unraveling of the EU. In
Germany, in particular since the Ukrainian crisis broke out, EU
policy has been increasingly rejected, including in economic and
industrial layers.
Euroskeptics Demolish Credibility
of EU Commissioners-Designate
The most remarkable grilling at the European Parliament was
reserved for the Briton Jonathan Hill, proposed to be in charge
of financial regulations, and for the Latvian Valdis Dombrovskis,
Vice-President for the Euro and Social Dialogue. Rejected
in the first hearing, Hill had to come back a second time. DomEIR
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brovskis was only approved because he promised to work on
provisions for members countries to leave the euro, only to
retract his statement the next day!
In both cases, leading the charge was MEP Marco Zanni from
Italy, who called the slate of commissioners-designate “an exercise
in political satire.” Hill’s nomination, he characterized as
“the most perverse and controversial choice,” since he is a
“friend of financial lobbies.”
“You come from a country which is dominated by the financial
sector. You have a long career as first-level lobbyist, on the
payroll of all those financial interests which you are now supposed
to regulate.”
In Dombrovskis’ hearing, Zanni led him into a trap, asking
what he intends to do regarding the absence of rules in the
Treaties for countries which might want to leave the euro.
Dombrovskis said that nobody can prevent a country from
leaving the euro, and that the Commission would provide the
necessary “technical” support to those that wish to.
The next day, evidently after being hit over the head by Jean-
Claude Juncker, Dombrovskis issued a signed statement: “I understand
that my replies in yesterday’s hearing on the issue of
the possibility for a Member State to leave the euro area may
have given rise to some misunderstanding. Membership of the
euro is irreversible, as is made clear by the Treaties.” That is
obviously not true, as no one could prevent a country from
leaving. Zanni posted the statement on his Facebook page, but
it is otherwise not public.
Otherwise, former Slovenian Prime Minister Alenka Bratusek,
designated as vice president for energy matters, was
rejected for blatant incompetence. Pierre Moscovici faced a
rough hearing as commissioner for Economic and Financial Affairs,
because as Finance Minister of France, he had breached
the EU’s budgetary rules. Then, there’s the case of the future
climate and energy commissioner, the Spaniard Miguel Arias
Canete, who, with close family ties to the oil industry, has an
obvious conflict of interest.
Although no European Commission has had a shred of credibility
from the start, this one turns out to be the most discredited
and corrupt of all.
Nicolas Sarkozy Boosts Jacques Cheminade’s
Program, Unintentionally
Former French president Nicolas Sarkozy who suffered a humiliating
defeat in the Presidential elections of 2012, and immediately
vowed he would retire from politics altogether, just stagedf
a highly mediatized political comeback in mid-September.
Since then, he has given a number of interviews, in addition
to internal briefings, on his ambitions to retake the chairmanship
the conservative UMP party, and run in the next presidential
elections in 2017. However, on each occasion, he has faced
tough questions on the scandals and indictments for corruption
that have haunted him since 2012. Among them, why he
forced the UMP to pay the €400,000 fine imposed on him
personally by the National Electoral Commission for violation
of the rules on campaign expenses.
In an apparent attempt to make light of the scandal, Sarkozy
has replied many times, including on national TV heard by 8
million Frenchmen, that the State refunded all the presidential
campaigns except his, “even” that of Jacques Cheminade, who
“called for landing on Mars”!
Finally, Le Point, one of the three main national magazines in
France, asked for Cheminade’s reaction to the reference, which
was posted Oct. 7, and later picked up on other major media
websites.
Sarkozy’s behavior, Cheminade said, “is one of a ‘little Ceasar’.
In his view, the State should reimburse campaign expenses on
the basis of the candidate’s program... He caricatures my program
although he’s never read it. It was read and approved
by people in the European Space agency. It is not a policy of
conquering space but of exploring space together, which would
gain the support of the population, and bring about greater social
justice.... Science, economic development and social justice
all go together.”
Cheminade was also asked to what he has been doing since
the end of the 2012 presidential campaign : « Fighting for a
banking reform”, he replied. That means “separating investment
banks which speculate in the markets from commercial
banks.” Three departments of France have already passed resolutions
calling for such a Glass-Steagall reform, he noted.
Moreover, “We have been developing our political party, Solidarité
& Progrès. Educating people to our policies, organizing
conferences. That works well. But we mainly lack money. Otherwise,
I go to classical music concerts and to exhibitions. I just went
to the one on the Mayas, at the Museum of Indigenous Arts.”
Calls for Glass-Steagall in Italian Senate
During the debate on the so-called “Jobs Act” Oct. 8, two senators
challenged Italian Prime minister Matteo Renzi to drop
his anti-labor reform, and instead implement a “Glass-Steagall
Act”. Both senators are members of the Lega Nord party, which
has filed one of the six bills calling for banking separation in
the Senate.
Sen. Paolo Arrigoni stated: “Exactly on the banking world,
why aren’t you doing anything, Prime Minister Renzi? Why
don’t you implement a Glass-Steagall Act, a reform of the system
in order to achieve a needed separation between investment
banks and traditional commercial banks, to prevent the
real economy (first of all, businesses which need credit) from
being continuously exposed to negative financial events?”
The same day, Arrigoni’s colleague Stefano Candiani also intervened
from the floor, saying that, in the current crisis, the
problem is “to create jobs for business, not to find modalities to
make layoffs easier.” He went on to plead for bank separation.
The six Glass-Steagall bills have been scheduled for discussion
in the Finance Committee for months, but the debate has been
repeatedly postponed as the Parliament is overwhelmed by
the government “reform” bills. The latest, the “Jobs Act”, was
passed, even though the content is unknown. To get around
strong opposition in the majority, the government called for a
confidence vote on a text which assigns to the government the
task of drafting the bill, which is supposed to lift restraints on
layoffs, as demanded by the EU.
Note to Subscribers
The Strategic Alert will not be published next week,
as the editorial board will be participating
in an international Schiller Institute conference.
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Verantwortl. f. d. Inhalt: Dean Andromidas, Claudio Celani
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