E.I.R.STRATEGIC ALERT WEEKLY NEWSLETTER Volume 34, No. 23, June 4, 2020

E.I.R.STRATEGIC ALERT WEEKLY NEWSLETTER

Volume 34, No. 23, June 4, 2020

 

Call for an Emergency “Four Power” Summit “The world today is at a crossroads, which Friedrich Schiller would have identified as a punctum saliens , that is, the point in a drama where the crucial decision must be taken: either the protagonists manage to rise a higher level of sublime action and thus provide a positive solution, or they remain trapped in the geometry in which the antagonisms are seemingly insoluble, and thereby turn the drama into a tragedy. The world today is at such a point in two respects: in the crisis between the United States and China, and on a domestic level in in the United States itself.”  Such is the beginning of an article written by Helga ZeppLaRouche on May 30. To begin with the second situation, following the brutal killing of Afro-American George Floyd by a white policeman on May 25 in Minneapolis, the United States has been engulfed in a storm of violence and riots nationwide, so serious that the National Guard had to be called out to intervene. That murder followed on the recent protests against the lockdown conditions due to the Coronavirus and the economic collapse, which in turn occur on the backdrop of an extreme political polarization in the country, whipped up ever since the election of Donald Trump to the presidency. Extremists on both sides of the political spectrum are fanning the flames of what could become a civil war. Only a leap by the President onto a higher level of national mission, free of racism and partisanship, can prevent the United States from taking that path. On the first crisis, namely the relations between China and the U.S., the entire Anglo-American “war party” has been fully mobilized to prevent Donald Trump from establishing the cooperation between the two countries (and with Russia) that he had pledged. Their tactics have emphatically included surrounding him with advisers and officials who would repeat the British Empire line, of whom Secretary of State Pompeo is key. In a speech on May 29, President Trump apparently caved into the pressure for whatever reason, and repeated the usual litany of charges against China: Allowing the Coronavirus to spread worldwide; exerting total control over the WHO; engaging in industrial espionage; violating the treaty over Hong Kong; unfair trade practices, etc. (cf. more below). That speech, which sounded so much like one of Pompeo, seem to put bilateral relations on a confrontation course 

which, coupled with the war party’s military provocations, could lead to war. Chinese state media, however, have pointed to the difference between Trump’s policy and that of his neo-con entourage in Washington, while noting that he said nothing about the bilateral trade deal that is still being negotiated. Any decoupling of the two economies would hit the U.S. harder than China, but would be to neither side’s advantage (cf. SAS 21/20). In this extremely tense situation or punctum saliens , aggravated by the collapse of the trans-Atlantic system, it is crucial to get President Trump to rise above geopolitics and promote mutually beneficial international cooperation and the end of military adventures abroad as he had promised. To that end, Helga Zepp-LaRouche stresses again in her recent article the urgency of convening a four-power summit (U.S., China, Russia, India) to establish “a new international order that defends the well-being of all peoples”, in the respect of national sovereignty. All other nations, including in Europe, should contribute to bringing that about. LaRouchePAC Recovery Plan:  The World Needs 1.5 Billion Productive Jobs A growing number of people on both sides of the Atlantic are clamoring for an immediate „reopening“ of the economy, lifting the restrictions imposed by the Coronavirus. There is no doubt that many are suffering from the effects of that lockdown, having lost jobs and businesses, and being forced to severely reduce personal consumption. But a general demand to „reopen“ an economy which has undergone a series of shocks since last September ignores the reality that the problem is much more fundamental, and began well before the emergence of COVID-19. What we are dealing with are the effects of a 50 year downward spiral resulting from the dominance of British neo-liberal economic policies. It is precisely to stimulate the quality of thinking required to change those policies, that the LaRouche Political Action Committee has just released a brochure titled The LaRouche Plan to Reopen the U.S. Economy: The World Needs 1.5 Billion New Productive Jobs . It approaches the problem from the “top down”, by looking at the worldwide requirements to reverse the broad economic/financial breakdown which prevented many nations from dealing effectively with the outbreak of a pandemic. 

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The core of the problem is a lack of understanding that real wealth is not measured by money, but by physical goods production, by the ability to increase the rate at which the productivity of labor is advanced.  The neoliberal dogma on the contrary promotes an abstract idea of „freedom“ as the basis of wealth development. Thus, many people are deluded into thinking that a „return to the good old days“, of visits to nail and tattoo parlors, topless bars, sports and pop music concerts, and travel (as examples of the „freedoms“ they associate with the bygone economy) is all that is needed to produce an economic recovery. They fail to understand that the present financial downward spiral is the direct result of failing to continue the progress begun in the post-World War II period, in which productive innovations resulting from new scientific discovery, and the technologies derived from them, along with investment in new platforms of infrastructure, which cheapen the overall cost of production, were the driver of a steady increase in the rate of growth of the overall economy (both in the U.S. and Europe). Productivity Is the Key to Development The LaRouchePAC study on creating 1.5 billion jobs worldwide proves that the transformation of the work force resulting from scientific advances is the driver behind real economic development. The shift away from productive employment to the service or consumer economy is the chief cause of the downward economic spiral, that has culminated in the present bubble-dominated casino economy.  At the end of World War II in the United States, 50% of the workforce was involved in productive activity, employed in manufacturing, agriculture, mining and power, construction and transportation.  By the 1960s, in spite of the anomaly of NASA, which employed 400,000 in the Apollo Project to put a man on the Moon, this had fallen to 35%. By 2020, the percentage has dropped to only 15%. This is not the result of the emergence of the internet, Artificial Intelligence and robotics, but of the deliberate outsourcing of productive jobs to poor countries, to lower the costs of labor.  When this is combined with austerity in infrastructure spending, and the defunding of Research and Development -- which in the „new economy“ do not generate enough profit -- the result is a collapse in real profit for the economy as a whole. Lyndon LaRouche always insisted that it is a fallacy to measure profit in monetary terms, a fallacy embedded in the fake determinations of GDP, which include money turnover in speculation and other forms of gambling. Instead, real profit comes from physical economic growth, driven by science and technology, which increase the productive powers of every person who is employed.  Chapter 3 of the LaRouchePAC report, for example, discusses LaRouche‘s measures to increase labor productivity.  He argues against the neoliberal theory of free market economics, in which „cheaper is better“.  Instead, improvements in the real economy come from a simultaneous development, in which a.) the share of total production going to consumption for skilled, educated productive workers has to increase; b.) while, at the same time, the share of production to new platforms of infrastructure and capital goods must increase faster.  In other words, capital intensity of production must increase even as levels of consumption rise, to produce a surplus, to be deployed in investing in future advances.  For this 

to occur, a minimum of 5% of the workforce must be employed in R&D, which at present makes up less than 1.5%. The detailed analysis of the present collapse of the numbers employed in necessary goods production, and the failure to invest in areas which will allow future advances in productivity, makes clear why the demand for a „reopening“ of the economy, without addressing the degeneration of goods-producing sector, and the scientific/research vector of the last 50 years, will not lead to a recovery.  It is by adopting „science driver“ projects, typified by such frontier areas as space technology and development of nuclear fusion, that leaps of productivity occur, enabling a continuation of a steady rate of increase in the rate of growth of an economy -- meaning a growing population can be sustained at an ever-increasing standard of living. This LaRouchian approach, not delusional attachments to the hedonism provided by a consumer economy, will allow not just a „reopening“ of the economy, but the opening of a new era of human progress. The EU “Next Generation” Fund:  Too Little, Too Late, Counter-Productive After dealing with the “Merkron” proposal for a European Recovery Fund last week, we can report this week on another trick conjured up by the European Commission. The “Next Generation EU” is not much different from the MerkelMacron scheme: it aims to borrow €750 billion instead of 500 billion, and it promises to be a combination of loans and grants. But like the Merkron fund, Ursula von der Leyen’s plan is too little, too late and misdirected. A thorough analysis of the proposals coming from Brussels, Paris, Berlin and Frankfurt (ECB) leads to only one conclusion: the EU establishment intends to prevent serious recovery actions. In fact, such actions could only be taken by a sovereign national government, they must be of such dimensions and of such nature that the EU is simply not suited for. The most conservative estimates of GDP losses for the EU are 10%. Some countries, like Italy, will be hit harder than others. To tackle such a crisis, investments in each member country should be in the order of the entire sum of the Merkel-Macron proposal. Then, there is the time factor. The economy would need to be revamped before a general insolvency occurs, leading to depression and state bankruptcy. But, even under the best scenario, the EU “Next Generation” fund will start only in 2021, and the funds (or grants) will come in installments. Moreover, the EU Commission will decide how they are to be used and implement a quarterly supervision. In the end, they must be repaid by an increase in the EU budget and with new taxes. EU Commission Vice President Valdis Dombrovskis, who is also responsible for economic policies, made it clear that the “Next Generation EU” fund is conditioned on so-called “reforms” by member countries and will finance investments consistent with the Commission’s Green Deal policy. Speaking at a press conference on May 28, Dombrovskis clarified that “When presenting its national plan, each country will have to explain how it contributes to achieving the priorities identified in the European Semester”, a discussion between the EC and member states. That will ensure that “expenditures are well targeted and used.” Since each national plan must be approved in the European 

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Semester by the EU Commission, the money from the new fund won’t be available at the beginning of 2021 but later. In addition, member countries need to modernize their economies, he said, “to make them more agile, more dynamic, greener and more digital.” European MP Marco Zanni for one is skeptical. The ID faction leader commented on May 30: “If we analyze the reform recommendations for Italy in the past ten years, we can see that they were: Increasing VAT, increasing the retirement age, reducing budgeted retirement expenses, health privatizations and cuts, flexibilizing the labor market — all reforms that I believe won’t help Italy to grow.” EU Commission’s Plan for “Sustainable” Agriculture: Food Insecurity, Fewer Farmers On May 20, the EU Commission announced its radical ecologist “Farm to Fork” (F2F) strategy, for which it is slated to spend €100 billion by 2027. The strategy, which aims to achieve a largely “emission-neutral” agricultural sector in Europe by 2030,  is a key component of the Commission‘s Green Deal, and is being touted to the European public as part of the “recovery” plan from the pandemic. It is scheduled to be passed at the concluding half-year summit of the EU on June 18. It includes the following targets: 50% reduction in the use and risk of pesticides; at least 20% less fertilizers used in farming; 50% reduction in sales of antimicrobials used for farm animals and aquaculture; 25% of farmland to be set aside for “organic farming” (or three times more than now). Overall, the plan  is designed to promote new “environment friendly” business models to involve all actors of the food chain. In addition to all that, as the Commission’s plans now stand, the budget for the Common Agricultural Policy is to be cut by 10% compared to the current level. There has been some resistance to the F2F strategy in the European parliament. An initial attempt by the Environmental Committee to push through approval of the Commission‘s plan, was vetoed by the Agricultural Committee (AGRI) earlier this month. Four German members of that commission, including one from the Green Party, had issued a joint press statement on May 6 urging a postponement of the decision on the plan for at least one year, arguing that the consequences for farmers had not yet been discussed in detail, making the timetable unacceptable. All told, the F2F strategy is a huge provocation for farmers, tens of thousands of whom took to the streets earlier this year in many EU member countries, together with their tractors, to protest against the Commission‘s deliberate takedown of the agricultural sector (cf. SAS 11/20). While all demonstrations were then banned due to the pandemic-related lockdowns, that has not stopped the anger from growing. In Germany, protests have already begun, following the presentation on May 27 of the “Nature Report” by Environment Minister Svenja Schulze, which is fully in line with the Commission’s plan. Some 250 tractors of North Rhine Westphalian (NRW) farmers rolled into Bonn on May 28 with banners like “Enough is enough, Mrs. Schulze!”, targetting her attacks on farming. An even larger protest rally was held in Münster, in the north of NRW, with 1,000 farmers taking part. Protest actions also took place in Berlin, Würzburg, Lübeck, Wiesbaden and many others cities. 

Poverty Alleviation and Hong Kong Security High on China’s Legislative Agenda China completed its annual legislative meeting of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) on May 28, The “Two Sessions”, as they are called, are usually held at the beginning of March, but because of COVID-19, had to be delayed. One of the main issues discussed was charting the way forward  for the country as it emerges from its battle with the coronavirus, one of the first countries to do so. The economic costs of the epidemic weigh heavily on China, as on all the countries affected by it, and putting the country back to work will have to be done with appropriate caution to prevent a return of the virus. President Xi Jinping is adamant, however, that 2020 will see the complete elimination poverty alleviation. This was confirmed in the final press conference with Chinese Premier Li Keqiang on May 28, who stated “we are determined to end poverty as scheduled”, in spite of the setback due to the disease. Li also made clear that they were not going to simply flood the economy with money in order to shore up industry, but about 70% of the financial assistance will be targeted in such a way that will put more money into people’s pockets so as to increase domestic consumption, which has been made the prime motor of economic growth and to help those who  are most in need  While 20-30% of the funds will be allocated for  investment,  these will also be targeted to projects directly supportive of people’s well-being, such as water projects, energy and urban transportation. But what has attracted the greatest attention was the passage of a Hong Kong Security Law. The failure of the Hong Kong legislature to pass a new security law of its own, something which was required under the Basic Law governing Hong Kong after the handover, has forced the central government to intervene, under their prerogatives in the “one country, two systems” formula. The legislation, however, has provoked an outcry in the West, especially from American lawmakers and Administration officials, who have been using Hong Kong and its freedoms as a “wedge” to destabilize the Chinese government. In fact, American and other foreign elements have openly and directly supported the violent demonstrations and riots which have been ongoing for two years, which have led to a situation of lawlessness in Hong Kong. The proposed legislation has received majority support from those delegates from Hong Kong to the NPC and the (largely non-party) CPPCC. Over a million signatures have already been collected from Hong Kongers supporting the new law. While the Trump Administration has characterized the new law as the “death knell” of freedom in Hong Kong, the legislation still preserves the freedom of press, speech and assembly in the city, which is now greater than when it had the status of a British colony. But attempts to call for Hong Kong independence or to undermine the central government will be dealt with by the force of law. Hong Kong, Minneapolis:  Riots of Any Other Name... Last year, during the riots and arson attacks in Hong Kong, the Speaker of the U.S. House of Representatives Nancy Pelosi called them “a beautiful sight to behold.” The Chinese 

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press agency 

Xinhua couldn’t resist asking ironically on May 30 whether she is also enjoying the “beautiful sight” of dozens of American cities burning today. In the same vein, the editor-in-chief of Global Times Hu Xijin tweeted: “I want to ask Speaker Pelosi and Secretary Pompeo: Should Beijing support protests in the U.S., like you glorified rioters in Hong Kong?” Many other commentaries in the Chinese press point to the glaring difference in coverage of rioters depending on whether they are in the U.S. or in Hong Kong. The chief news editor of the South China Morning Post , for example, notes that “when Americans take to the streets in an eruption of rage against systemic racism… they are ‘rioters’ who deserve to be shot dead? But when radicals in Hong Kong go on the rampage, hurling petrol bombs, destroying public property and lynching anyone who objects to their excesses in the name of democracy, they are mighty champions of freedom? The cognitive dissonance makes one’s head spin….” The Controversy around Bill Gates  and Vaccinations: Founded or Unfounded? In the context of the Coronavirus pandemic, Bill Gates has become a prime target of those who are convinced that the measures taken to control the Coronavirus and the vaccination campaign are elements of a worldwide conspiracy to impose dictatorships. A number of supporters asked Jacques Cheminade, the president of the French party Solidarité et Progrès, to clarify his understanding of the controversy. (See http:// solidariteetprogres.org/nos-actions-20/analyses/bill-gates-etle-monde-qui-vient.html,) In his statement made May 28, he begins by noting that the Coronavirus pandemic is a reality, which made confinement a necessity in all countries which did not have the necessary medical and social means to deal with the problem otherwise. Although there is a danger that the exceptional circumstances be used to impose measures curbing freedoms or other “soft” police-state measures, Cheminade writes, this is a broader issue that does not just concern a pandemic, but must be treated in the overall political debate. On Bill Gates himself and his role, he is a representative of the policy of financial gobalization, which Cheminade’s party firmly opposes. The pharmaceutical lobby and the trust behind the Bill and Melinda Gates Foundation have adapted themselves to that policy. However, “to isolate Bill Gates from the nature of the system in which he operates, by spreading falsehoods and fantasies about his person only serves the cause of that same system, and is a trap.” On population reduction, Gates has clearly defined himself as a Malthusian, but one who believes that “better health systems in developing countries will reduce the birth rates”. A crucial point is the claim that Gates is financing a worldwide campaign of vaccination as part of an attempt to globalize public health. Even if that is true, Cheminade points out, it’s no reason to oppose the very principle of vaccination. “Vaccination has saved the lives of millions of human beings, and is based on a scientific principle.” Of course, it can be used for other purposes, but to mix up vaccination and the aims of those who use them, is to make the same type of mistake as “those who confuse nuclear energy, the most dense form of energy... that can be used to ensure economic development... with the way it might be used by narrow-minded nucleocrats 

or military-industrial complexes. This dilemma between scientific discovery, the technology to apply it and the intention of its users is the same for any human invention, since the time of the biface to today. It defines the need for political power.” Another charge against Bill Gates is the fact that because he forecast the outbreak of a pandemic some years ago, he actually provoked it. Cheminade counters that anyone who has followed the financial policies of deregulation of the past decades knows that, for cost-benefit reasons, the conditions have not been created to fight disease effectively and to promote public health. That is the real scandal that we in the trans-Atlantic world are facing today. In conclusion, Jacques Cheminade warns against making Bill Gates some kind of scapegoat, while failing to realize that it is the entire system that is to blame. The enemy is the “British Empire”, that of Wall Street and the City of London, that puts financial gain above the general welfare. Successful Launch to ISS Should  Relaunch International Cooperation On May 30, the SpaceX-NASA rocket carrying the Crew Dragon capsule was successfully launched as part of the Artemis Project‘s Moon-Mars program. This was the first time in nine years that an American rocket, launched from the United States, took American astronauts into space.  Since the shutdown of the shuttle program, Americans have been transported to the International Space Station (ISS) on Russian rockets, as the U.S. under the Bush and Obama administrations had no successor program to replace the mothballed shuttle. The following day, nineteen hours after launch, the capsule docked with the ISS, enabling two American astronauts, Bob Behnken and Doug Hurley, to join the crew already there, which includes one American and two Russians.  The theme of U.S.-Russian collaboration in space was very much on the mind of NASA Administrator Jim Bridenstine, who said of U.S.-Russian joint efforts that „our cooperation transcends above terrestrial geopolitics.“  This partnership, he added, goes back to 1975, with the Apollo-Soyuz mission, and continues to the present with the joint work on the ISS. Such comments reflect an underlying commitment of many scientists,  engineers and technicians, as well as the astronauts from many nations. Rather than seeing efforts of each spacefaring nation as competition, they often express how such missions are for the benefit of all humanity, and reflect an inherent desire to break free of geopolitical conflict in the name of science.  This was the theme of the work of the pioneering space scientist Krafft Ehricke, a collaborator of Lyndon and Helga Zepp LaRouche, who coined the term the „extraterrestrial imperative“ to describe that which propels mankind to explore space.

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