Volume 29, No. 42 - October 15, 2015

Volume 29, No. 42 - October 15, 2015

Putin Is Out For Total Victory

in Syria and Iraq

Russia’s lightning offensive in Syria against an array of jihadist

forces, including the Islamic State, the Nusra Front and the

Saudi-created Army of Conquest, has fundamentally altered the

situation on the ground in the Middle East and globally.

In the past week, Russian air sorties have increased to an

average of nearly 70 per day, with improved ground and drone

intelligence feeding an expanding list of targets. For the fi rst

time in months, the Syrian Army, with Russian air support,

has launched offensive operations, taking back key towns from

ISIS and Nusra in the area near Latakia on the northwest coast

of Syria.

The Russian actions, far from being spontaneous, are the

result of six months of planning, in conjunction with Syria, Iraq

and Iran, although Washington and other European capitals appeared

to be caught by surprise.

The change has created a deep split in Washington, with the

Obama White House reacting with increasing hysteria over the

Russian fl anking initiatives while others quietly back it (cf. below).

It has also triggered a signifi cant shift in Europe, with a

number of German and French offi cials also calling for Western

collaboration with Russia to actually defeat the bestial IS

insurgency.

The bottom line is that Russia is out for total victory. A study

of the way that the Russian military fought the 1999 Second

Chechen War and the 2008 Georgia War should make clear

that their military doctrine is total conventional warfare, using

air, land and sea assets to crush the targeted enemy.

This is a stark contrast to the so-called notion of “permanent

warfare” using counterinsurgency limited-war methods that

perpetuate confl ict and never lead to decisive victory, known

as the “Petraeus doctrine”. The fact that the United States has

been stuck in quagmires in Afghanistan and Iraq for more than

a decade is the clearest indication of the bankruptcy of that

doctrine.

Nonetheless, Gen. David Petraeus, the man who wrote the

Army’s Counterinsurgency Manual and has been a leading proponent

of its application in Iraq and Syria, has been brought on

as a key advisor to President Obama for Iraq and Syria. He recently

called openly for an alliance with the Nusra Front, which

is a core element of the Saudi’s Army of Conquest.

Indeed, the fact that some of the jihadist groups have been

backed by the United States and other “coalition” partners, including

Saudi Arabia and Turkey, is no secret. Russian Foreign

Minister Sergei Lavrov has made clear all along that Russia is

going after the entire jihadist apparatus in Syria.

Washington is learning the hard lesson that it can no longer

have it both ways – both supporting select jihadist groups

and claiming to fi ght against ISIS, with the aim of perpetuating

chaos. Russia has changed the rules and that has upended the

entire global situation.

Regime Change Policy in South-west Asia

Under Attack in Washington

While the Pentagon and the Russian armed forces are now

engaged in deconfl iction talks, the Obama Administration has

repeatedly stated that there will be no cooperation with Russia

on any broader campaign against the Islamic State. That position

is highly controversial, in particular among the American

military establishment.

The former head of the Defense Intelligence Agency, Gen. Michael

Flynn, who was fi red in Aug. 2014 by President Obama,

is emerging as a public voice for those who favor cooperation

with Russia to defeat the IS scourge. In recent interviews with

RT and Fox News, Gen. Flynn defended the Russian actions,

noting that there are now thousands of Chechen jihadists,

fi ghting for IS and Nusra. The threat they pose to Russian

security is grave, Flynn noted, and Russia has a strong strategic

interest in defeating the Islamic State in Syria and Iraq.

Our readers will remember that, in a July 29 interview with

Al Jazeera, Gen. Flynn charged that President Obama had

“willfully” ignored DIA warnings that the jihadists supported

by Washington intended to create a caliphate on Syrian and

Iraqi territory.

Along the same lines, retired U.S. Army Colonel Lawrence

Wilkerson, former chief of staff to former Secretary of State

Colin Powell, fi rmly stated, in an Oct. 9 interview with RT, that

the top priority now in Syria must be the defeat of the Islamic

State, and nothing else. He welcomed the Russian intervention

and said he hoped that Washington would coordinate efforts

with Moscow. Asked why Barack Obama is so obsessed with

regime-change in Syria, Wilkerson pointed to UN Ambassador

Samantha Power and “others in the White House” who have

shaped the Administration’s policies.

On Oct. 9, Obama fi nally announced that the Pentagon was

abandoning its “train and equip” program in Syria, which cost

American taxpayers $500 million and was a total failure. Gen.

EIR STRATEGIC ALERT

2 WEEKLY NEWSLETTER N°42 / 2015

John Allen, the White House special envoy for Iraq and Syria

and the fi ght against IS, has reportedly resigned from that

post. Unfortunately, some sources suggest he may be replaced

by Gen. Petraeus (cf. above).

In fact, the only effective U.S. programs were those to provide

weapons and intelligence support to Kurdish fi ghters, and

some parallel operations run out of Jordan. They were all run

by the CIA.

A former MI6 Middle East specialist, Alastair Crooke, recently

noted in the Huffi ngton Post that Russia is in the process of

forging a new global counter-terrorist alliance, involving Syria,

Iraq, Iran, Hezbollah and other forces. This alliance will, at

the same time, be an alliance against regime change by NATO,

which has been a driving force behind the rise of ISIS and other

Saudi-backed jihadist forces.

Russia Demonstrates Advanced Military

Capabilities In Syria

To those who insisted that Russia did not have the capability to

project military force outside its borders, to sustain an air campaign,

and to launch cruise missiles at targets 1,500 km away

from their ships, the past few days have delivered a shock.

Between the beginning of the bombing campaign on Sept.

30 and Oct. 11, Russian tactical aircraft fl ew nearly 300 sorties

against terrorist targets all over Syria, but especially in areas

along the highway from Latakia to Aleppo and in Raqqa in eastern

Syria where ISIS has its headquarters, as well as in other

locations in southern Syria.

What has most impressed Western observers is the speed at

which the Russian deployment has progressed. The fi rst aircraft,

4 Sukhoi Su-30 SM fi ghters, arrived at the air base some 50 km

south of the city of Latakia on Sept. 18. The buildup to the full

force of 34 tactical aircraft and 16-20 attack and assault helicopters

was completed by about Sept. 28. Since then, the air group

has demonstrated an ability to build up up from about 20 sorties

per day to about 65, suggesting in-depth logistical support in

terms of aircraft maintenance, fuel and munitions.

The real surprise, however, was the launch of 26 Kalibr NK

cruise missiles from ships in the Caspian Sea at 11 targets in

Syria. Daniel Fielding, staff writer for Russia Insider, in an article

published on Oct. 7, wrote that the missile strikes confi rmed

two things: “(1) that the Russians again have demonstrated a

capability that previously only the US had demonstrated; and

(2) that the coalition they have created with Syria, Iran and Iraq

is a fully operating reality, that is able to confer and agree on

missile strikes.”

The critics complain that Russia could easily have hit the same

targets using the aircraft that it has fl ying out of Latakia, but

Fielding argued that “supplementing the aircraft strike force

with long range missiles greatly increases tactical fl exibility, enabling

a greater number of targets to be attacked.” That is, the

missiles are appropriate weapons for going after large, fi xed

targets, freeing the tactical aircraft to go after more mobile

targets such as trucks or artillery. “Subsonic cruise missiles are

exceptionally diffi cult to observe and track -- and shoot down

-- so the element of surprise is increased. The Islamic State now

knows it can be attacked anywhere and at any time -- day or

night – without warning.”

Glencore Is the Writing on the Wall

While the International Monetary Fund warns of the coming

crash in its Global Financial Stability Report, panicked commentators

discuss whether the Glencore crisis is to be compared to

the 2008 Lehman bankruptcy or to the Bear Stearns collapse

in 2007. The London Guardian headlined its coverage of the

IMF report “Next fi nancial crash is coming – and before we’ve

fi xed fl aws from last one.” And The Economist lamented that

“the system is cracking” in its Oct. 3-9 edition and called for an

all-out effort to backstop the bubble with new waves of quantitative

easing – exactly as this newsletter warned was their

intention.

However, the City of London mouthpiece does admit that

this hyperinfl ationary bailout policy may not work as it did in

2008, because the United States Congress might opt instead

for stronger regulation of the banks. The Economist studiously

avoids mentioning the feared words, “Glass-Steagall”, but it

is obviously referring to the draft bills already introduced and

backed by the growing public debate (cf. below).

At the same time, the Glencore crisis is rapidly becoming a

bond market panic (cf. SAS 41/15). Other large commodity

traders, such as Trafi gura, Vitol and Noble, are facing the same

high borrowing costs as Glencore. Such costs make commodity

trading fully unprofi table, but banks are nevertheless refi nancing

those debts, in a déjà vu pattern. In the case of Glencore

alone, it was lent money from some 60 banks, which it then

used to make anticipation loans to oil producers, based on oil

prices assumed to be $ 100 barrel or more.

The collapse of oil and commodity prices has now put all that

business in default. Quadrillions of CDS, securitizations and

other derivatives are affected in a chain-reaction.

The IMF Global Financial Stability report, by warning about

a systemic shock coming, attempts to place the blame on China

and on emerging markets, claiming their economic slowdown

created a slump on the commodity market.

In reality, China’s import bill is lower than last year, but it imported

more commodities than in 2014. The quantity of crude

oil imported actually increased by 9.8% over one year ago, but

the sharp fall in the oil price reduced the import value. China

also increased its copper-ore imports by 12% during the fi rst

eight months of the year, but the bill is lower because of the

price collapse.

The fact of the matter is: the bubble which the banks have

created is bursting, and it is bringing down the entire system.

The causes of the 2007-2008 crisis, namely the repeal of

Glass-Steagall regulations, have not been addressed and the attempt

to rescue the system will generate a hyperinfl ationary

blowout.

Update on the Trans-Atlantic Fight

for Glass-Steagall Legislation

The public debate on a Glass-Steagall separation of banks, including

in legislative arenas, took on a new intensity last week,

both in Europe and in the United States.

In the U.S., Hillary Clinton released a fact sheet on Oct. 6,

followed by an op-ed two days later in Bloomberg to state

that she does not support a clear, pre-emptive separation of

commercial and investment banks, but only an upgrade of the

(failed) Dodd-Frank bill. Hillary repeated the old line that Glass-

Steagall would not have prevented the 2007-2008 crash, as if

that were the issue. In fact, Glass-Steagall may not have prevented

the bubble and the crash, but it would have allowed

governments to let the speculators go under and prevented

bailouts.

Just a coincidence? According to a Reuters/Ipsos poll, from

Oct. 4 to 9, Clinton saw her support tumble from 51% among

Democrats to just 41%.

EIR STRATEGIC ALERT

N°42 / 2015 WEEKLY NEWSLETTER 3

Both Bernie Sanders and Martin O’Malley attacked her position

the next day, although Sanders did not mention Clinton

by name. O’Malley, as reported by the Washington Examiner,

said that her plan, he said, “falls short on what should be our

ultimate goal: preventing reckless Wall Street speculators from

backing up their bad bets with taxpayer money.” What is needed,

he underscored, is “a defi ned fi rewall between Wall Street

and taxpayers, so that we are never again forced to bail out a

bank’s reckless behavior.

Former Labor Secretary Robert Reich also took apart Hillary’s

“reform” plan, concluding that “The only way to contain

the Street’s excesses is with reforms so big, bold, and public

they can’t be watered down -- busting up the biggest banks and

resurrecting Glass-Steagall.”

Meanwhile, in Europe, the bank separation issue was raised

in a highly critical debate on the new EU Capital Market Union

which took place in the European Parliament Oct. 7. Member

of European Parliament (MEP) Marco Zanni called the CMU

plan “wretched” and stated: “For us, there is only one solution,

and that is: Banks should go back to performing their traditional

role of taking savings deposits and issuing credit, and this is

feasible only through a banking separation on the model of the

American Glass-Steagall. Only in this way can we differentiate

between those that want to freely carry out speculative activity

and those that have a much more important role, i.e. fi nancing

the real economy.”

In Sweden, for the fi fth year in a row, a motion calling for

bank separation was introduced into the Parliament. This year

a group of Left Party members led by the spokesperson for

economy, Ulla Andersson, put forward the motion, which calls

on the Parliament to direct “the government to start an investigation

promptly and prepare a law separating traditional

banking from so-called investment banking.”

TPP Free-Trade Agreement Is No “Done Deal”

in the U.S. Congress

When the Trans-Pacifi c Partnership (TPP) Ministerial negotiations

were concluded in Atlanta on Oct. 5, with an agreement,

it appeared as though President Obama was about to get his

new mega-free trade deal, which he considers as indispensable

for ensuring his “legacy,” The deal, which includes the U.S.,

Japan, and ten Pacifi c rim nations, and is a key part of Obama’s

anti-China “Asia Pivot,” now goes before the U.S. Congress.

The two chambers have a 90 day period for review, after

which a fi nal vote, which requires only a simple majority, will

be taken. However, developments in the last days make it clear

that Obama’s trade bill is NOT a done deal!

There is still strong opposition within the population. Many

see the takedown of trade barriers as benefi ting corporate cartels,

at the expense of working people. The AFL-CIO opposes

passage, and is pressing Democrats in Congress to reject it, exerting

extra pressure on those 13 Senators and 28 Representives

who voted last June with the Republicans to give Obama

the “fast track” authority he demanded. (Under the fast track

procedure, which passed in an extremely close vote, no changes

or amendments are allowed in the text the President submits,

only a straight yes or no vote.)

Groups such as Doctors Without Borders have also taken a

hard position against passage, correctly pointing out that the

TPP will insure that big pharmaceutical corporations will retain

patents for at least fi ve years, preventing affordable, generic

drugs, from being available in poorer countries.

In addition, many conservatives, including Tea Party groupings,

are adamantly opposed to the unbridled free trade provisions.

Republican Presidential candidate Donald Trump, who

continues to lead in the polls, has denounced the deal, and several

others among the 15 candidates are against it. Even a previously

strong supporter, Utah Sen. Orrin Hatch, is now saying

“I am afraid this deal appears to fall woefully short....”

The grass roots opposition, rooted in anti-Wall Street sentiment,

is a major factor in the decision this week, by Hillary

Clinton to announce she will oppose TPP, after avoiding a position

since she announced her candidacy. Two of her opponents,

Bernie Sanders, who now leads her in polls in New Hampshire

and is neck-and-neck with her in Iowa, and Martin O’Malley,

have both been on record against TPP, and were critical of Clinton’s

waffl ing.

As the vote will occur in the middle of the Presidential election

campaign, pressure will grow on Congressmen of both

parties to drop their support for Obama’s “legacy” bill.

Note that the counterpoint for Europe to the Trans-Pacifi c

Partnership is the TTIP (Trans-Atlantic Trade and Investment

Partnership), which is hotly contested as well.

Refugee Crisis: Zepp-LaRouche Calls

for Crash Integration Program in Germany

The political class and public opinion in Germany are profoundly

split over the refugee issue. On the one hand, a majority of the

population is still backing Chancellor Merkel’s position of welcoming

those fl eeing their homeland, arguing that Germany is

able to handle the problem.

On the other hand, many fear that the country will be overwhelmed

by the waves of refugees, who can never really be

integrated into society. Among this faction playing on the fears

are a number of CSU and CDU politicians, as well as the Alternative

for Germany (AfD) and the Pegida movements.

In an article written Oct. 6, Helga Zepp-LaRouche denounced

those, such as Bavarian Finance Minister Markus Söder, who

propose to change the Constitution so as to impose quotas on

the right of asylum, as a clear violation of the Geneva Convention.

By the same token, human rights organizations have

rejected Interior Minister Thomas de Maiziere’s proposal to allow

for immediate deportation of those asylum seekers whose

applications are rejected.

The crisis, Zepp-LaRouche restates, is due primarily to the

geopolitical wars of Bush and Obama in Southwest Asia and to

the IMF policy, which suppressed economic development and

thus created the breeding ground for terrorism.

While there is a solution, she wrote, “it requires a totally new

paradigm and a totally new way of thinking.” To stop the mass

migration, a comprehensive economic reconstruction program

for Southwest Asia and for Africa must be undertaken, to give

people a perspective for the future.

The blueprint for such a program was laid out in 2012 by

the Schiller Institute in its Marshall Plan for Southern Europe,

the Mediterranean region, Southwest Asia and Africa, and in

the Dec. 2014 EIR report The New Silk Road Become the

World Land-Bridge.

Meanwhile, she wrote, it is in the “fundamental interest” of

Germany to integrate the refugees as quickly as possible. They

could, for example, be employed in the emergency construction

“of a half million units of subsidized housing.” The fi nancing

could be undertaken by the Reconstruction Finance Bank

(KfW) just as it fi nanced the German economic miracle after

the Second World War, and it would have the same economic

effect.

EIR STRATEGIC ALERT

4 WEEKLY NEWSLETTER N°42/ 2015

In her view, the mere announcement of this project, in combination

with an extension of the New Silk Road toward Southwest

Asia and Africa, would eradicate the current despair and

anxiety for the future, and give way to a spirit of optimism.

The Unthinkable Becoming Thinkable?

Or Jeremy Corbyn as Prime Minister

The political elite in Great Britain has loudly insisted that the

new Labour Party leader Jeremy Corbyn has next to no chance

to make it to Number 10 Downing Street. Despite the fact

that he won a landslide victory while doubling the membership

of the party in the leadership race, he is often dismissed as a

Trotskyist, a “pro terrorist” or part of the “lunatic left”.

In fact, his call for a “kinder and gentler” politics has growing

resonance in the population, especially among the working

class, unemployed and especially young people. It certainly

contrasts sharply with the policy of Prime Minister Cameron,

and the revelations on him (“piggate”) contained in a new biography

by Conservative Party Treasurer, Lord Ashcroft.

As we have reported, he and his shadow Chancellor, John Mc-

Donnell, are long-time supporters of reinstating a Glass-Steagall

type bank separation. Laim Halligan, another Glass-Steagall

supporter but no friend of Corbyn, warned in his column in the

Daily Telegraph of Oct. 5: “There’s no chance of Jeremy Corbyn

becoming prime minister, of course. Unless, that is, there’s

another banking sector implosion with the costs, once again,

pushed on to taxpayers, while those responsible, like last time,

end up blameless and rich. In that case, even mainstream voters

could become radicalized, and all bets would be off.”

In fact, there is cross party support for a number of Corbyn’s

policies. For example, Lord Lawson, who was Chancellor of the

Exchequer under Conservative Margaret Thatcher, Vince Cable,

former Industry and Trade Minister of the Liberal Democratic

Party, are both in favor of Glass-Steagall. Similarly, Corbyn’s

call for a development bank and “people’s quantitative easing”

to fund infrastructure and small and medium sized industries

has widespread support.

On defense issues, Corbyn has called for voting against the

proposed 100 billion pound sterling program to build the UK’s

next generation of nuclear submarines and new missiles, which

comes up for a vote in Parliament next year. That led Cameron

to accuse him of being a threat to the security of the UK. Yet

his position has considerable support within the military establishment.

Vocal military opponents to renewing the Trident, include the

former commander of British forces in the Gulf War, Major

General Patrick John Cordingley, as well as General Lord Ramsbottam,

General Sir William Gerald Hugh Beach, and Field Marsahl

Lord Bramal, all retired. The latter three wrote in 2009:

“Nuclear weapons have shown themselves to be completely

useless as a deterrent to the threats and scale of violence we

currently, or are likely to, face -- particularly international terrorism;

and the more you analyse them the more unusable they

appear.”

EIR Report on the World Land-Bridge

Endorsed by Chinese Scholars

The Chinese edition of the EIR report, The New Silk Road Becomes

the World Land-Bridge was offi cially presented by Helga

Zepp-LaRouche at a symposium in Beijing on Sept. 29 (cf. SAS

41/15)

Both Wang Wen, the Executive Dean of the Chongyang Institute,

which sponsored the event, and Fu Jianming, the Vice

President of the Pheonix Publishing & Media Group which published

the Chinese version of the report in book form, made

introductory comments at the press conference.

There was considerable coverage of the symposium in the

economic press stressing the fact that this was the fi rst analysis

by American scholars of the Chinese project dubbed “One

Road, One Belt”. There was also widespread recognition in the

reports of the role of the Schiller Institute as key initiators of

this project in the early 1990s.

The presentations by Zepp-LaRouche and by William Jones

of EIR were followed by comments from eight leading Chinese

scholars, who had read the report. For space reasons, we can

only give a sample of their reactions, which are more fully available

here:

* Ding Yifan, the former deputy director of the World Development

Institute of the Development Research Center of the

State Council of the P.R.C.: “I have known the Schiller Institute

for a long time, and I have learned much from them. They have

very specifi c ideas about the world economy. The concept underlying

LaRouche’s view of the economy is that of the physical

economy. LaRouche used the term negentropy to characterize

the underlying laws of a healthy functioning economy.

He added that “Helga Zepp-LaRouche put forward the concept

of the Eurasian Land-Bridge as a war avoidance concept.’’”

The new concept of the Belt and Road has received great attention

from the whole world. ... We cannot allow capital to

control everything. Instead, we must control capital.’”

* Shi Ze from the China Institute of International Studies,

who has been a featured speaker at several Schiller Institute

events: “Geopolitics has led to the dangerous situation we have

today. The aim of the [EIR] report is to develop a concept to

replace geopolitics. And I found such a concept in this book....

On the other hand, is the economic aspect of the report, which

places the stress on creating infrastructure. We have to look

at the infrastructure needs of the other countries... I am confi

dent about the development of the Land-Bridge and I believe

Mrs. LaRouche has made great progress in her idea.

* Tao Qingmei of the Beijing Long Way Foundation: “This

book refl ects the views of U.S. experts and I really respect

them. We should rethink the world on the basis of the new

relationship between nations.”

* Liu Ying, Director of the Department of Cooperative Research

at Chongyang Institute: This report, he noted, was

written from a modern global perspective, including from a

space perspective. “This report is about predicting the future

rather than just explaining the past.”

The high-level participation in the event underlines the fact

that the EIR report has now become an authoritative source for

Chinese scholars in pursuing the “One Belt, One Road” project.

Order your copy of the report here: http://www.eirshop.de/

The-New-Silk-Road-Becomes-the-World-Land-Bridge.

E.I.R. STRATEGIC ALERT www.eir.de

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Verantwortl. f. d. Inhalt: Dean Andromidas, Claudio Celani

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