Volume 30, No. 21 - May 26, 2016
Putin’s Latest Flank: The Russian “Asia Pivot”
Gains Strategic Momentum
Russian President Vladimir Putin is executing an “Asia pivot”
that not only further aligns Moscow with China’s One Belt One
Road initiative, but also draws in other Asian nations to a larger
paradigm shift of great strategic import.
In just two weeks’ time, Putin met with Japanese Prime Minister
Shinzo Abe, opening up a potentially powerful bilateral cooperation
that already has altered the landscape of Northeast
Asia, and also hosted all of the ten ASEAN heads of state in
Sochi, where signifi cant political and economic agreements were
reached, including the prospect of creating a free trade zone
encompassing the Eurasian Economic Union (EEU) and ASEAN.
The Putin-Abe summit of May 6 was particularly signifi cant,
in light of the fact that Barack Obama had personally pressured
Abe to cancel the visit, as part of Washington and NATO’s persistent
targeting of Russia. But Abe refused, and as a result,
Russian-Japanese relations have moved to a fundamentally
new level. Following the summit, the Russian government offered
Japanese investors a priority stake in a number of largescale
development projects in the Russian Far East. This issue
will be taken up further at the East Asia Economic Forum in
Vladivostok next September, which Abe intends to attend.
Furthermore, both Russian and Japanese sources confi rmed
after the Putin-Abe meeting that the two countries are now
re-engaged in diplomatic talks, aimed at resolving the dispute
over the four northern islands.
The Russia-ASEAN summit in Sochi on May 19-20 was, by
all accounts, a tremendous success. The title of the event --
“Towards Strategic Partnership for the Sake of the Common
Good” -- is a clear reference to the rejection of geopolitics. It
resulted in billions of dollars in new deals, and in deep discussions
about creating the framework for huge increases in trade
between the EEU and ASEAN (Brunei, Cambodia, Indonesia,
Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand,
Vietnam).
The President of the Asian Infrastructure Development Bank
(AIIB) Jin Liquin also attended the summit, where he met with
Putin . Russia has submitted 16 projects in the Far East for
funding by the new bank initiated by China.
While this dynamic is gaining momentum, President Obama
began on May 22 a trip to Vietnam and Japan, where he is attempting
to hold together his own “Asia pivot”, which is openly
and aggresively directed against China.
During his stay in Vietnam, Barack Obama announced the
lifting of the arms embargo which has been in force since the
atrocious Vietnam War, but that may not be enough to prevent
the government from moving forward with its recent overtures
to both Moscow and Beijing.
At the same time, the Abe government’s outreach to Moscow
indicates that it is no longer willing to become a geopolitical
pawn in that game. Another indication is that a new Japanese
ambassador has been appointed to Beijing, who is a well-known
China specialist and supporter of greater Sino-Japanese cooperation
in all fi elds, security as well as economic.
On the U.S. side, Obama’s arrogant remarks to Japanese TV
on the eve of his visit, saying he could understand why U.S.
President Harry Truman had dropped the atomic bombs on
Hiroshima and Nagasaki, were not conducive to improving relations.
Moscow Reiterates Call for Joint Offensive
against Jihadi Extremists
In addition to consolidating relations in Asia, the Russian government
is preparing another major move in South-West Asia.
In a press conference on May 19, Russian Defense Minister
Sergei Shoigu called upon the United States to join Russia in
launching a major air campaign against the Nusra Front, and
against the smuggling networks still bringing weapons and
other materials across the Turkish border into the ISIS and
Nusra enclaves in northern Syria.
We quote: “We’re proposing to the United States as a cochairman
of the International Syria Support Group to start
joint operations of the Russian air task force and the U.S.-led
aviation from May 25 to plan and deliver strikes against Jabhat
al-Nusra groups, illegal armed formations that are rejecting
the ceasefi re regime, and also against the caravans with
weapons and ammunition, armed units illegally crossing the
Syrian-Turkish border and in these operations exclude strikes
against civilian facilities and populated areas.”
Shoigu also urged the US to get the rebel factions that are
signatories to the UN ceasefi re agreement to withdraw their
forces from Nusra territory, to avoid being hit. The defense
minister made clear that, with or without the collaboration of
Washington, Russia will launch “unilateral strikes” against those
named targets as of May 25. According to sources, air traffi c at
the Russian airbase in Latakia has exponentially increased over
the days leading to the deadline.
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2 WEEKLY NEWSLETTER N° 21/ 2016
Russia has also pressed for two Saudi-backed Salafi st factions,
Ahrar al-Sham and Jaish al-Islam, to be placed on the
UN terrorism list, because they are, in reality, indistinguishable
from Nusra, and have engaged repeatedly in joint military
operations with Nusra. So far, the U.S. has blocked UN action
against the two groups.
Back in Washington, Pentagon spokesman Navy Capt. Jeff
Davis announced Barack Obama’s summary rejection of any cooperation
on May 20, stating “We do not collaborate or coordinate
with the Russians on any operations in Syria.”
However, indications are that the U.S. coalition and Kurdish
YPG (People’s Protection Units) are preparing an offensive to
retake Raqqa. And ISIS is using force to prevent civilians from
leaving so that any battle to free the city will be at the cost of
massive civilian casualties.
Europe Needs to Cooperate with Russia
ISIS Threats to European Championships. Patrick Calvar,
the head of the French domestic intelligence agency DGSI, has
launched a public warning that the country is facing a rash of
ISIS blind terror attacks, and identifi ed the upcoming Euro
2016 soccer tournament as a likely target. The soccer championship
begins June 10 and runs for a month at stadiums
throughout France.
Calvar noted that ISIS has plenty of forces to activate. There
are, he said according to Reuters, 645 French nationals now
in Syria and Iraq and over 400 are involved in combat with
various jihadist groups. In addition, there are 201 other French
nationals traveling back and forth between the Middle East and
Europe. Calvar particularly warned of bombs being planted at
crowded locations -- like the soccer matches.
Last November, on the same day as the murderous attack
at the Bataclan concert in Paris which claimed 130 lives, another
bloodbath was avoided at the last minute as a bomb was
planned to go off almost simultaneously at the nearby packed
stadium of Saint Denis, which was only foiled when the jihadi
wearing the explosive belt was denied access by security.
The question this poses is obvious: since Russia is determined
to eliminate the Islamic State and similar groups, why is Europe,
at the behest of Washington, refusing to cooperate with
Moscow?
Welcome Putin Back to Europe. The Hamburg weekly Stern
ran a story last week underscoring that cooperation with Russia
and President Putin is the only means to end the chaos in
Syria and resolve the refugee crisis. Just as Chancellor Merkel
was again attempting to salvage the EU rotten deal with Turkey,
Stern pointed out that “Vladimir Putin is more predictable,
sociable and right-minded than the irrational Turk Recep Tayyip
Erdogan. Angela Merkel got a clear idea about it in conversations
with both of them.”
The shameful deal with Turkey to stop the refugee fl ow is
already falling apart, due to Erdogan’s irrational behavior and
demands. “There is a growing conviction in the West about
Russia’s importance. In a political sense, it means quickly turning
toward Putin, stopping the arms race in the East as well as
putting an end to sanctions against Russia. At least partially.”
Better Glass-Steagall than the Volcker Rule,
Chicago Economist Argues
On the list of the 100 most infl uential thinkers drafted by Foreign
Policy in 2012, there were only two Italians. One is University
of Chicago economist Luigi Zingales. The other is Mario
Draghi. Both have been free-market economists, but whereas
the current head of the ECB sticks to the wrong policy, Zingales
is now campaigning for a more reasonable one.
At a conference of the Minneapolis Federal Reserve Bank on
May 16, Zingales presented a strong case for scrapping the
Volcker Rule, the alleged ban on proprietary trading by commercial
banks, and restoring Glass-Steagall. His presentation
to the second session provoked much more controversy and
attempted “push-back” from the Fed/IMF/Economist audience,
than the previous one had.
The noted conservative economist stated bluntly that the
Volcker Rule of the Dodd-Frank Act is not implementable, and
that those who promoted it in 2010 knew that, and also knew
that “the public wanted Glass-Steagall.”
This was one of fi ve reasons Dr. Zingales presented for reenacting
Glass-Steagall, but it had the most force. He said that
other schemes for fi nancial stability that purport to be “better
than Glass-Steagall” are all too complex to implement, are
not redundant in protection, lack history of effectiveness and
therefore public support, and can be picked apart by fi nancial
interests to undermine the whole system.
That was confi rmed during the Q&A period by an expert who
helped the original Volcker Rule, which was only three pages
long, but then became 30 pages in the Frank-Dodd bill, then,
together with the implementation rules, 300 pages!
Zingales noted that Glass-Steagall had reduced banks’ political
power, fragmenting their interests and power. After its
repeal, fi nancial fi rms all pushed the same interests and were
much more powerful, as evidenced in the disastrous 2005 reform
of U.S. bankruptcy law, which gave derivatives and credit
card debt priority over other claims.
He also said that Glass-Steagall demonstrably promoted the
development of U.S. stock markets, while its abrogation immediately
promoted the hegemony of securities/derivatives/repo
markets with “OTC” characteristics. These are increased leverage,
fewer permitted players and less competition, opaqueness,
and increased profi ts for fi nancial fi rms.
Finally, Zingales cited “the alcohol rule.” His mother never
used any disinfectant other than alcohol, he said, so that she
could tell it was working by her children’s reaction. “The banks
being regulated should scream,” he said, “or it isn’t working.”
Note that the head of the Minneapolis Federal Reserve Neil
Kashkari, a strong proponent of Glass-Steagall, is holding a
series of conferences on “Ending Too Big To Fail Banks” (cf.
SAS 8, 15/16).
Chinese Leadership Firmly Rejects Talk of
New Cultural Revolution
May 16 marked the 50th anniversary of the launching of China’s
disastrous Great Proletarian Cultural Revolution in 1966.
The occasion was used by the usual anti-China networks to accuse
current President Xi Jinping of attempting to launch a new
Cultural Revolution of his own, essentially interpreting his anticorruption
campaign and strict measures to prevent a color
revolution as moves to set up tyrannical rule and a “personality
cult” like that of Mao Zedong. Some domestic forces have also
fed into the nostalgia for the ferment of that era.
The newspaper of the Communist Party, People’s Daily,
fi rmly rejected all such talk on May 17, writing that China
would never “allow a re-enactment of a mistake like the Cultural
Revolution,” which infl icted “comprehensive and severe”
harm. And further, “History has amply demonstrated that the
Cultural Revolution was totally wrong in theory and practice. In
EIR STRATEGIC ALERT
N°21 / 2016 WEEKLY NEWSLETTER 3
no sense was it, or could it have been, revolutionary or socially
progressive.”
The Global Times, a daily under the auspices of the People’s
Daily, also published an editorial on May 17 under the title “Society
Firmly Rejects Cultural Revolution.” It stated bluntly that
the “decade-long internal chaos was a huge disaster.”
“China’s development in recent decades started from complete
denial of the Cultural Revolution in theory and shifting
the focus of the country to economic construction in practice.
In the over 30 years, we strived to recover from the losses.
The shared goal has provided strong momentum for the country’s
progress.... No matter whether it is the anti-corruption
campaign and advancing rule of law, or developing the public’s
livelihood and reducing social gaps, we must stick to the path
of socialism with Chinese characteristics.
“We have bid farewell to the Cultural Revolution. We can say
it once again today, that the Cultural Revolution cannot and will
not come back. There is no place for it in today’s China.”
Indeed, the megaprojects for infrastructure development
adopted by the Chinese leadership under Xi Jinping (New Silk
Road /One Belt One Road projets) are based on an entirely different
approach. It is useful to recall that, during the Cultural
Revolution, Xi Jinping’s father was purged, and later jailed in
1968, and he himself, as a child, was sent to a rural area to
work for several years.
Break-out in the U.S. Senate on Exposing
British-Saudi Hand in 9/11 Attacks
On May 17, the United States Senate passed unanimously, on
a voice vote, the Justice Against Sponsors of Terrorism Act
(JASTA), which would allow the families of victims of terrorist
attacks on U.S. territory to sue foreign states which sponsored
and funded the perpetrators. The bill applies in particular to
victims of the 9/11 attacks whose lawsuits against the Saudi
government for its implication fi led in New York have been
blocked by diplomatic immunity.
The text now goes to the House of Representatives. After the
Senate vote, the White House announced President Obama’s
intention to “kill” (veto) it, a position he has consistently defended.
Exposing his own policy, he claims that if the U.S. citizens
are authorized to sue foreign governments for supporting
terrorist attacks, then other countries could similarly take the
U.S. government or assets to court for the same reason.
Riyadh immediately reacted to the vote, sending a 104 page
memo to all members of the Congress, detailing their counterterrorism
efforts, but reportedly containing nary a word on
Saudi activities before 9/11.
The vote came amid a growing campaign to obtain declassifi
cation of the 28 pages of the Congressional Joint Inquiry
Report dealing with the role of the House of Saud and Saudi
individuals in backing the terrorists, which we have amply reported.
Since just prior to President Obama’s recent visit to
Riyadh, there has been an explosion of media coverage on the
subject, which strongly contributed to the Senate vote, as constituents
are up in arms over the cover-up.
The resolution introduced in the House by Walter Jones calling
on the White House to declassify those pages has now been
signed by 58 representatives, 16 of them in the past days. And
a growing number of Congressmen have requested the right
to read them.
For the record, the conditions for doing so are ridiculously
stringent: access to a tightly guarded underground vault, prohibition
to take notes or reveal the contents, etc. Virtually all
the elected offi cials who have read the pages call for their
disclosure.
What must also be brought fully to light is the role of the FBI
in sabotaging the investigations at the time, and still today, by
protecting its own informants, withholding crucial documents
and outright lying, in addition to the usual FBI incompetence.
In fact, FBI offi cials warned former Senator Bob Graham, who
headed the joint inquiry commission, to drop his campaign to
have the Saudi role exposed, or else.
However, Graham recognizes that the blame ultimately falls
on Obama, as he stated in an interview to the Daily Beast on
May 18: “A clear directive had gone out from the White House
to avoid embarrassing the Saudis because the CIA. FBI, Department
of Justice, Department of Treasury, Department of State,
all these agencies wouldn’t be playing off the same sheet of
music if the composer didn’t want it, and the composer lives at
1600 Pennsylvania Avenue.”
As Lyndon LaRouche has stressed from the beginning, behind
the Saudis, and the Turks today as well, there is the “British
Empire”, which has been running and funding all kinds of criminal
networks, including international terrorism, with funds
from oil proceeds. As concerns Saudi Arabia in particular, he
has stressed, there is really no separation between Riyadh and
London. That is what must be exposed.
Israeli Defense Minister Resigns As Netanyahu
Undermines New Effort for Peace Talks
The resignation of Israeli defense minister and former Chief of
the Israel Defense Force, Moshe Ya’alon from the government
of Benjamin Netanyahu signals that the latter and his British
masters are preparing a new major confl ict in South West Asia
that could very well go beyond the Israeli- Palestinian cycle of
violence.
At the press conference announcing his resignation, which
was actually forced upon him by Netanyahu, Ya’alon denounced
the government for its extremism and opportunism at the expense
of Israel’s security. Confi rming that charge, Netanyahu
named the notorious Avigdor Lieberman, who provocatively
lives in a West Bank settlement, to hold the defense portfolio,
as part of a deal that has brought the right-wing Yisrael
Beteinu party into the government, making it the most reactionary
in the history of Israel.
Less reported is that Ya’alon’s was fi nally forced out within
days of a major initiative launched by Egyptian President
Abdel Fattah al Sisi, who offered to mediate between Hamas
and the Palestinian authority as a fi rst step toward opening
Israel-Palestinian peace talks. This announcement, made in a
public speech in Cairo, was part of a broader initiative taken
in tandem with French President François Hollande, who has
proposed to hold a peace conference in Paris in June.
The move had the support of the Israel security establishment,
which sees the situation in the occupied territories on
the verge of an explosion. Israeli commentator Alex Fishman,
writing in Ynetnews.com (May 20) reported that there has
been secret discussion taking place between the Israelis and
Egyptians on this issue but with the resignation of Ya’alon this
initiative is all but dead.
According to well-known peace activist Yuri Avnery, the immediate
reason for kicking Ya’alon out may well have been
the controversy around the court martial of an Israeli soldier
for killing a wounded Palestinian by shooting him in the head,
which is a Class A war crime. While Ya’alon fully supported the
decision for the court martial, Netanyahu and several of the
EIR STRATEGIC ALERT
4 WEEKLY NEWSLETTER N°21 / 2016
government ministers as well as Lieberman openly supported
the soldier and rebuked the Defense Minister.
That led Ya’alon to charge during his press conference that
“Fundamentalist infl uences have taken over Likud”, the party
of Netanyahu. “This is not the same Likud that I joined…I
fought with all my strength against the phenomena of extremism,
violence and racism in Israeli society that threatens our
might and also permeates the IDF [Defense Forces], and has
already damaged it.”
Avnery, in his May 21 column in Gush Shalom, launched
a solemn warning against the racist bills already adopted or
discussed in the Knesset, which “strongly resembles the laws
adopted by the Reichstag in the early days of the Nazi regime.”
A similar warning had been issued by Deputy Chief of Stadff of
the IDS, Maj. Gen. Yair Golan.
9/11 Families Blast Barack Obama
for Blocking JASTA
The organization September 11th Advocates, created by families
of the victims of the attacks on the World Trade Center,
responded in their own statement to Barack Obama’s decision
to veto the JASTA. They take issue with the fact that the White
House said he would “seek additional changes to the measure
or try to get it killed in the House.” The organizations respectfully
requested that “the Administration refrain from using such
violent language when opposing legislation specifi cally designed
and intended to help victims of terrorism.
“For us, whose loved ones were killed, there is simply no
room for the word ‘killed’ in this dialogue. Obama and his
speechwriters and spokespeople ought to know that. Moreover,
we would also like to encourage President Obama to recalibrate
his priorities by placing American citizens and victims
of terrorism ahead of nations like the Kingdom of Saudi Arabia
who fund terrorists that want to kill Americans. We are tired
of witnessing President Obama block our path to justice. We
do not appreciate such behavior being exhibited by a President
who has the audacity to pride himself on holding such lofty
principles of constitutionality, openness, transparency and accountability
-- not to mention being a recipient of the Nobel
Peace Prize.
“Furthermore, over the weekend, at Rutgers University,
President Obama stated the following: ‘In politics and in life,
ignorance is not a virtue. It’s not cool to not know what you’re
talking about. That’s not keeping it real or telling it like it is.’
In the spirit of keeping things real, we would like to draw Mr.
Obama’s attention to his own deliberate decision not to read
the 28 pages of the Joint Inquiry of Congress’ Final Report
into the 9/11 attacks. Perhaps if Mr. Obama had bothered to
read the 28 pages, he would more rightfully comprehend and
appreciate the need for JASTA. Ignorance is NOT bliss.... “
An Engineering Masterpiece:
Switzerland’s New Gotthard Tunnel
The 57 kilometer long, just completed Gotthard Base Tunnel
(GBT) in Switzerland is the world’s longest railway tunnel – and
also its deepest, at over 2 km underground The opening of the
twin tunnels for regular train service will take place in a major
ceremony on June 1, celebrating the completion of 17 years of
drilling across the base of the formidable Swiss Alps.
In a Europe which basically gave up on prodigious infrastructure
projects years ago in the name of speculation and deindustrialization,
this is a real breath of fresh air. The project – for all
of its apparent technical diffi culties – was not only completed
ahead of schedule, but within budget constraints! That shows
what it is possible to achieve when the will and the means are
there.
The GBT will now handle both freight and passenger traffi
c between Europe’s north and south, at maximal speeds of
250 km/hour. To cite just one advantage, travel time between
Zürich and Lugano will be shortened by 45 minutes, to just 2
hours.
The high-speed service is possible because, unlike the older
tunnels, the GBT is entirely fl at and straight with no curves,
and compared to the old system, it cuts the distance through
the Alps by 30 km.
The new twin tunnels will be able to handle up to 260 freight
trains per day, a signifi cant increase over the 180 trains that
now use the original tunnel. That will make it possible to reduce
the transportation of freight by road from the current
level of 1.2 million tons annually, by almost half, to 650,000
tons. As for passanger transit, it is expected to increase from
9,000 travellers to 15,000 by the year 2020.
Progress on the “Iron Silk Road” in Europe
The GBT is part of Corridor 1, the North-South connection of
the original Trans European Network original plan, but it will
also connect to two East-West corridors north and south of
the Alps, considerably reducing travelling time between Europe
and Asia. North of the Alps, the connection is already running,
as on April 21, the fi rst Chinese cargo train arrived in Lyon,
France, after travelling the 11,300 km from Yiwu (China), via
Kazakhstan, Russia, Belarus, Poland, Germany and then on to
France (cf. SAS 17/16) . The trip took only 15 days, as against
the 45 days required per ship.
South of the Alps, the connection between Lyon and Turin,
Italy, via the Monceniso Basis Tunnel for high-speed rail, is being
built. That stretches eastwards through Trieste into the
southern corridor of the New Silk Road, and will be connected
to the northern Silk Road route through the GBT.
In that context, the “Forum of the New Silk Road Cities”
just opened its central European offi ce in Turin on May 5. It is
part of the MIR Initiative (Moscow, Istanbul, Rome), chaired
by Ernest Sultanov, and aims at involving cities on the main
nodal points of the Eurasian corridors, knowing that „mobility
is not just physical transportation, but also social and cultural
mobility.“
In Trieste, the eastern Italian terminal of the New Silk Road,
a conference organized by the European Bank for Reconstruction
and Development took place on May 21-22, with the participation
of Chinese dignitaries and government offi cials from
Italy and the Balkan countries, to discuss the opportunities offered
by the One Road One Belt perspective.
E.I.R. STRATEGIC ALERT www.eir.de
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Verantwortl. f. d. Inhalt: Dean Andromidas, Claudio Celani
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