LAROUCHEPUB’S DAILY ALERT:

TUESDAY, OCTOBER 18, 2016

Volume 3, Number 40

EIR Daily Alert Service

P.O. Box 17390, Washington, DC 20041-0390

 

 

EDITORIAL

What We Need in 2016: Alexander Hamilton’s Principles—LaRouche’s Four Laws

Oct. 17 (EIRNS)—The degradation of the U.S. presidential campaign is pressing down like a stone on the chest of, not just the American people, but the world. Americans are reporting they have “election stress” at the extreme levels usually only caused by the worst events of economic collapse or war.

The media with all its “sound and fury signifying nothing” is intentionally demoralizing Americans about their country’s future. It is intentionally driving their representatives to hide in deep partisan foxholes—who, just over a month ago, were able to unite in a great victory over Saudi/British sponsorship of Islamic terrorism, defeating President Obama’s attempts to block or veto the Justice Against Sponsors of Terrorism Act.

What the nation and the world need, instead, is to “elect principles”: the principles of economy of Alexander Hamilton on which this nation was founded.

Hamilton’s principles of economy are expressed afresh in Lyndon LaRouche’s development since 2014 of “Four Laws To Save the United States.” They are natural law applied to economics.

This is actually an international matter; the world needs to adopt Hamilton’s works, and LaRouche’s Four Laws, as China has begun to demonstrate. The “Deutsche Banks” of the trans-Atlantic countries are ready to blow out the London-centered financial system and spread worse poverty than the 2008 crash did. The threat of collapse is leading to threats of war with Russia, coming from Obama and the British.

What can prevent this, is restored economic progress and productivity around the world. Alexander Hamilton’s principles did this—uniquely—from the founding of the United States. As President George Washington noted in a 1793 letter, the effect of Hamilton’s policies “had the appearance of a miracle” in raising up the new United States from bankruptcy to rapid investment and growth.

LaRouche’s Four Laws reapply Hamilton’s principles now.

American citizens should write in LaRouche’s name at the presidential ballot box to stand for the re-adoption of Alexander Hamilton’s economic principles, as LaRouche has reclarified them.

“I’m writing in LaRouche and Alexander Hamilton, let’s get the nation to elect the right principles” will cut through the dread with which Americans are questioning each other about the approach of Election Day. The only option for survival of the United States and the world economy, is offered by Hamilton’s principles as clarified by LaRouche’s Four Laws. Decide the future.

U.S. POLITICAL AND ECONOMIC

Feel Like the Elections Are Driving You Crazy? You’re Not Alone

Oct. 17 (EIRNS)—More than half of Americans— almost 60% of Democrats and Republicans alike—say this election is “a major source of stress” for them, according to a new survey by the American Psychology Association. This level, the APA says, is usually associated with serious economic problems or with the threat of war.

Notably, America’s oldest citizens (those who remember a more civil time) and its youngest (those who have the most at stake if the country takes a wrong direction) are the age-segments reflecting the highest stress.

The last election to elicit such high stress levels? According to a psychology professor interviewed by Bloomberg, it was 1964, the year that Barry Goldwater—the man who encouraged the use of nuclear weapons in Vietnam—ran for President.

Obama Tuesday Drone-Kill Meetings Motivate Domestic Terror Threat

Oct. 17 (EIRNS)—A “secret FBI study” obtained by Oct. 11 issue ofThe Intercept found that the number-one cause of so-called “domestic” terrorism was—not the Internet, not travel to foreign countries, not even extremist madrassas—but rather, ongoing U.S. military operations in the Middle East over the Bush and Obama presidencies, especially Obama’s targetted drone killings.

The study, titled “Homegrown Violent Extremists: Survey Confirms Key Assessments, Reveals New Insights about Radicalization,” dates from December 2012, and was produced by an FBI unit called the “America’s Fusion Cell.”

While “online relationships and exposure to English-language militant propaganda and ‘ideologues’ like Anwar al-Awlaki are also cited as ‘key factors’ driving extremism,” co-authors Cora Currier and Murtaza Hussain state that, “grievances over U.S. military action ranked far above any other factor.” The secret report, which echoes findings of one done in 2011, a year earlier, notes that “between 2009 and 2012, 10 out of 16 attempted or successful terrorist attacks in the United States targeted military facilities or personnel.”

Confirming this is still the case, is the recording of the conversation between Omar Mateen, the shooter in the Orlando night club incident earlier this year, and his negotiator, tapes of which have just been released. During the conversation, Mateen repeatedly tells the person that “you have to tell America to stop bombing Syria and Iraq. They are killing a lot of innocent people,” finally declaring, “What am I to do here when my people are getting killed over there. You get what I’m saying?”

Separately, the FBI has now ramped up their own “domestic terror” operations, with the “exposure” of plots to assassinate Muslims in Kansas. Three men, belonging to a network calling themselves “the Crusaders,” a group that espoused “sovereign citizen, anti-government, anti-Muslim, and anti-immigrant extremist beliefs” were arrested on Oct. 14, after planning to go on a bombing and shooting spree Nov. 9th, the day after the Presidential and general elections.

The FBI had been “investigating” the men since February, watching them “stockpile firearms, ammunition and explosive materials,” and finally “introduced” an undercover agent, who “provided [them with] automated weapons,” before arresting them soon afterwards.

Green Party’s Jill Stein: Hillary Clinton Wants War with Russia

Oct. 17 (EIRNS)—Speaking in an interview on C-SPAN, yesterday,Jill Stein, the Green Party candidate for President, declared that, of the two major candidates, Hillary Clinton is more of a threat to world peace than Donald Trump.

“On the issue of war and nuclear weapons, it is actually Hillary’s policies which are much scarier than Donald Trump, who does not want to go to war with Russia,” Stein said. “He wants to seek modes of working together, which is the route that we need to follow not to go into confrontation and nuclear war with Russia.”

Expanding on that, Stein elaborated, “It is now Hillary Clinton that wants to start an air war with Russia over Syria by calling for a no-fly zone. We have 2,000 nuclear missiles on hair-trigger alert. They are saying we are closer to a nuclear war than we have ever been. Under Hillary Clinton, we could slide into nuclear war very quickly from her declared policy in Syria.”

THE NEW GLOBAL ECONOMIC ORDER

Philippines Should Join AIIB Now and Dump Public-Private Partnerships, Urges Finance Secretary

Oct. 17 (EIRNS)—Philippine Finance Secretary Carlos Dominguez III told the Philippine Daily Inquirer last week, published today, that the Duterte Administration has called on the Senate to ratify the country’s membership in the Chinese-initiated Asian Infrastructure Investment Bank (AIIB) this week, before Duterte’s trip to China at the end of the week. He also said that the government planned to spend $160 billion for infrastructure during the six-year term.

Two weeks ago Dominguez told a Washington audience that were the United States to cut back on its investments in the Philippines, it would be too bad for the U.S. but no problem for the Philippines, since many other nations were anxious to invest in the nation now that it has a pro-growth government.

He said they expected that membership in the AIIB would help “erase the massive public works gap that has hobbled the local economy,” and would “unlock funding for all other projects that the government would want to undertake—whether they be a new rail project, an expansion of the country’s aging road network or new airports.”

The subservience to U.S. imperial looting of the nation since the 1980s overthrow of Ferdinand Marcos has resulted in both massive poverty, a massive deficit in infrastructure, and the most expensive electricity in all of Asia.

Most importantly, Dominguez made a sharp attack on the Washington-enforced policy known as Public-Private Partnership (PPP), which was a gimmick to leave infrastructure to the private sector, but with access to government money. He said that the Aquino administration (a puppet to Obama both on the economy and militarily regarding Obama’s confrontation with China) “used incorrect borrowing cost scenarios for evaluating PPP projects, including the assumption that private sector firms would be able to fund infrastructure projects more cheaply because of efficiency considerations. They were always assuming that the private sector will be 15% cheaper than the government. Why should that be?” He pointed to specific earlier projects that the government could have done cheaper than the private firms.

Dominguez also denounced the Aquino policy of choosing the company for PPP projects which offered the highest payment (bribe) to the government up front.

If China Can Eradicate Poverty, What’s the Matter with Us?

Oct. 17 (EIRNS)—The Chinese government released a White Paper on “China’s Progress in Poverty Reduction and Human Rights” on Oct. 17, a day designated since 2014 as the annual “Day for Eradication of Poverty.” Xinhua made it available in full in English, and it is recommended reading. The Chinese strategy is premised on the principle that a government’s purpose is to “striv[e] to bring benefits and common prosperity to all”; and that only by eradicating poverty, is a country able to ensure “impoverished people’s right to life” itself.

The approach outlined in the paper is that which China put on the table at the G20 summit on Sept. 4-5: “Development is the fundamental approach to poverty eradication.” The paper documents how this approach has achieved results which it rightly asserts “will figure prominently in the history of mankind’s fight against poverty:”

“Over the past 30 years or more since the launch of reform … more than 700 million Chinese people have been raised from poverty…. The UN Millennium Development Goals Report 2015 shows that the proportion of people living in extreme poverty in China fell by half from 61% in 1990 to below 30% in 2002, and down to 4.2% in 2014. The number of citizens China has raised from poverty accounts for 70% of the world’s total.”

But to reach the government’s goal of raising all Chinese out of poverty by 2020 “will prove a hard nut to crack,” the report warns. China still has 55.75 million people—“the equivalent of the entire population of a medium-sized country”—who still live in extreme poverty, and many households who have struggled to remain free of poverty. Therefore:

“By 2020, the state is committed to ensuring that the impoverished rural population has stable access to adequate food and clothing, compulsory education, and basic medical services and housing; to realizing a growth rate of per-capita disposable income in poor rural areas higher than the national average; to achieving indices of major basic public services close to the national average levels; to ensuring that the rural population living below the current poverty threshold and all impoverished counties are all lifted out of poverty; and to solving the problems of regional poverty.”

The statistics on all fronts are stunning. Education: in the last three years alone, dormitory units have been built for 300,000 teachers and subsidies provided for over 1 million teachers in remote rural areas. Children in pre-school programs increased by 30%, through a kindergarten-building program. The annual growth rate of rural students from poor areas enrolled in key universities was kept above 10%.

In basic infrastructure: 330,000 kilometers of rural roads have been built since 2011; more than 7,700 dangerous reservoirs and sluices repaired, more than 3,900 kilometers of river embankments built or reinforced, 14,500 kilometers of new medium and small rivers improved. Safe drinking water has been secured for 115 million rural residents; and so forth.

Compare China’s strategy of “poverty alleviation through medical security” to the end of health care under Obamacare:

“Serious illness insurance for urban and rural residents has been fully implemented, covering more than 1 billion residents with a reimbursement ratio of no lower than 50%. A medical emergency relief system has been established to help people suffering from serious illnesses, and universal medical care has been further improved to cover major illnesses, significantly reducing the medical costs of rural residents. Since 2012, the central government has allocated RMB79.4 billion to support infrastructure construction at 110,000 health service units in poverty-stricken areas. Programs have been carried out to offer free medical education to rural students who will return to serve in their areas, to send general practitioners to clinics in rural areas, to pair up hospitals in urban and rural areas to enable medical assistance, and to organize state-level hospitals to help and support county-level hospitals in poverty-stricken areas.”

STRATEGIC WAR DANGER

EU Foreign Ministers Oppose Sanctions against Russia over Syria

Oct. 17 (EIRNS)—Despite bluster from British Foreign Secretary Boris Johnson, there was virtually no support for new sanctions against Russia at the EU Foreign Ministers meeting in Luxembourg today.

Prior to the meeting, Johnson had pushed the imposition of sanctions in press statements which were supported by French Foreign Minister Jean-Marc Ayrault. But the High Representative of the European Union for Foreign Affairs and Security Policy Federica Mogherini said before the meeting that no member-state had proposed sanctions.

RT reports that German Foreign Minister Frank-Walter Steinmeier said, “At present, I don’t see how sanctions, which may have a long-term impact, should help here to improve the provision of the civilian population.” Austrian Foreign Minister Sebastian Kurz also opposed sanctions: “The idea to have additional sanctions against Russia would be wrong. We do not need a further escalation.”

The Foreign Ministers of Luxembourg, Cyprus, and Greece also opposed any sanctions.

SCIENCE AND INFRASTRUCTURE

One Belt, One Road, One Heaven—While U.S. Is In The Mud

Oct. 17 (EIRNS)—The Shenzhou-11 manned mission took off from China’s Gansu province Monday morning. The launch was flawless. The taikonauts’ mission is to rendezvous with the Tiangong II space module, which is the precursor to the Tiangong III, a full-fledged space station to be launched in 2020. At that time China will have the only functioning space station in the world.

The Shenzhou-11 crew’s mission will entail the longest stay in space of any Chinese taikonauts. It will last 30 days and will study plant growth and the effects of space on the human body. The taikonauts will give each other ultrasound scans to study the effects of space radiation on their bodies’ functioning. This is a precursor to manned missions to the Moon.

In a congratulatory statement to the taikonauts, carried on state TV, President Xi Jinping said he hoped they would “vigorously advance the spirit of space travel.” He further said that this mission would “enable China to take larger and further steps in space exploration and make new contributions to build up China as a space power.”

The pictures of the launch were spectacular—millions watched in China.

The only glimpse of the Moon that citizens of the U.S. are afforded is called a Presidential debate!

COLLAPSING WESTERN FINANCIAL SYSTEM

Otmar Issing Polemicizes that European Central Bank Can’t Stop QE

Oct. 17 (EIRNS)—The former chief economist of the European Central Bank has maintained that the euro could very well collapse, and that one reason is the bank’s own quantitative easing (QE), which it is unable to stop.

“One day, the house of cards will collapse,” said Professor Issing, according to Daily Telegraph international business editor Ambrose Evans-Pritchard, who covered Issing’s interview “Otmar Issing on Why the Euro ‘House of Cards’ Is Set To Collapse,” to the quarterlyCentral Banking Journal.

Attacking the European Central Bank (ECB), Issing said, “The moral hazard [for banks and bond issuers] is overwhelming…. The ECB is now buying corporate bonds that are close to junk.”

As for QE, Issing said, “An exit from the QE policy is more and more difficult, as the consequences potentially could be disastrous. The decline in the quality of eligible collateral [which the ECB buys, or lends against to banks] is a grave problem. The ECB is now buying corporate bonds that are close to junk, and the haircuts can barely deal with a one-notch credit downgrade.”

Issing is attacking a fundamental issue; the ECB is still a bank, not a supranational government printing office. It is taking low-grade collateral from banks at only a very slight discount (“haircut”) from its face value. When interest rates rise, and/or the securities ECB has bought or taken as collateral are down-rated and drop in value, the ECB itself will suffer huge losses which would bankrupt any private bank. Therefore, the ECB must preserve its absurd negative rates by continuing QE indefinitely.

“The reputational risk of such actions by a central bank would have been unthinkable in the past,” Issing said.

“The Greeks should have been offered generous support, but only after [they] had restored exchange rate viability by returning to the drachma.” Issing said the first Greek rescue in 2010 was little more than a bail-out for German and French banks, insisting that it would have been far better to eject Greece from the euro as a salutary lesson for all.

OTHER

Oxford University Blows Fuse: Claims China’s Infrastructure Will Destroy the World!

Oct. 17 (EIRNS)—Oxford University’s Saïd Business School released a report in the Oxford Review of Economic Policy in late September arguing that the massive investment in infrastructure is the cause for an impending collapse of the Chinese economy, and a threat to the entire world! This pitiful drivel, based on classical British monetarist nonsense, is a clear reflection of the fact that the British are running up against China-inspired optimism throughout the world, giving nations the confidence to tell the British to drop dead, or to simply inform them that they are the walking dead already.

The report, “Does Infrastructure Investment Lead to Economic Growth or Economic Fragility? Evidence from China,” argues that since over half of China’s infrastructure investments are not profitable in themselves, they are therefore destroying the economy. Here’s the mindless argument proffered by one of the study’s authors, Atif Ansar, after analyzing “95 large Chinese road and rail transport projects, and 806 transport projects built in rich democracies,” reported Oxford University’s News & Events webpage on Sept. 12:

“From our sample, the evidence suggests that for over half of the infrastructure investments in China made in the last three decades the costs are larger than the benefits they generate, which means the projects destroy economic value instead of generating it,’ comments Dr. Ansar. … ‘Unless China shifts to fewer and higher-quality infrastructure investments the country is headed for an infrastructure-led national financial and economic crisis, which is likely to spread to the international economy.”

The Oxford authors apparently didn’t bother to read (or intentionally ignored) China’s own stated purposes for the infrastructure, which is Hamiltonian in nature. The return on the individual projects cannot be measured in terms of the project’s bottom line in itself, but in the increase in productivity of the nation (and/or region) as a whole, through enhanced capacity of both industries and individuals in transport (which is equally true of investments in power, water, education, health care, etc.).

Oxford University, of course, has been at this for a long time on behalf of the Bloody Queen. When Schiller Institute founder Helga Zepp-LaRouche spoke at a forum in Nigeria in 1997 on “The Success of the Chinese Economic Reform and Its Significance for Nigeria: Africa’s Secret Weapon for Peace!” she was followed by an Oxford Don, Prof. Paul Collier, head of the Center for the Study of African Economies. Obviously discomfited by Zepp-LaRouche’s vision, Collier retorted: “There are charlatans peddling prosperity. Be careful not to accept the wrong ideas.” The then-President of Nigeria, Gen. Sani Abacha, closed the forum by identifying Zepp-LaRouche’s perspective as what corresponds to Nigeria’s true needs.

Clearly this new report is intended to provide ammunition for further regime change efforts, as was seen already this year in fellow BRICS member-nation Brazil.

 

 

 

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