EIR Daily Alert Service, Wed. Sep 6, 2017

WEDNESDAY, SEPTEMBER 6, 2017

Volume 4, Number 177

EIR Daily Alert Service

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

EDITORIAL

Make America’s Infrastructure Great Again: Join in China’s Global Initiative, Drop the War Threats

Sept. 5 (EIRNS)—The moment is still ripe for Americans to take a lesson from the immense human and economic loss of Hurricane Harvey: Build the new infrastructure which was many decades overdue, to prevent these disasters from robbing Americans of homes, jobs, untold wealth and even their lives. Reverse the slow-motion collapse of the obsolete infrastructure platforms on which the U.S. economy has been working.

Some 50 years ago the State of Texas drafted plans for a comprehensive water and flood management system that would protect its Gulf coastal cities from flooding—and its extreme southeastern coast and upper plains from drought—by linking many dams and reservoirs with a long coastal canal to move excess water between river basins. This was the same decade that JFK and RFK worked for a Western water management plan called the North American Water and Power Alliance—a dozen times the Tennessee Valley Authority—to defeat desertification and irrigate farmland.

The need for building such new and higher technology infrastructure platforms does not diminish because a Wall Street-run economy and many wars have blocked them. Another historic moment arrives when they must be done. That is the point we have been brought to, with three major U.S. cities having been entirely devastated by hurricanes in just over a decade, and losses far exceeding the costs of these great projects.

This requires more than just large expenditures voted by Congress for disaster relief—although FEMA’s available disaster funds will be gone by the end of this week, with another severe hurricane, Irma, approaching. It will be necessary to issue national infrastructure credits in the trillions in the coming few years, something that can only be done by national banking on Alexander Hamilton’s model, and by the kind of large-scale project credit provided by President Franklin Roosevelt’s Reconstruction Finance Corporation.

Congress has to be moved quickly to create both, as outlined in the LaRouchePAC National Policy Statement of Aug. 31 (published in full in EIR Daily Alert, Sept. 1). They also have to reinstate Glass-Steagall bank separation to make sure that private banks are pulled out of Wall Street speculation to take part in financing rebuilding. NASA has to be revived and play a leading role as the science-driver of the process.

This means organizing for the 2014 “Four Economic Laws To Save the Nation” of EIR Founding Editor Lyndon LaRouche. And the Belt and Road Initiative of China and the BRICS countries, for global cooperation in funding and building new great projects of infrastructure, is the framework to join.

Consider that the United States is facing three crises: Wall Street pulling it toward another financial collapse; the threat of nuclear war over the Korean Peninsula; and the collapse of the underpinnings of its economic life, infrastructure platforms. President Trump’s initial plan for his Presidency, to cooperate with Russia and China and to concentrate on rebuilding America’s infrastructure, would have led to a different, better situation than these crises. Americans have to take action, and action now, to get to that plan.

U.S. POLITICAL AND ECONOMIC

The Nation Attacks VIPS Report, Giving Coverup a Victory

Sept. 5 (EIRNS)—Buckling to tremendous pressure, The Nation on Sept. 1 posted its promised post-publication review of the Aug. 9 article by Patrick Lawrence on the Veteran Intelligence Professionals for Sanity (VIPS) memo to the President of July 24. (The Nation’s Sept. 1 article is at https://www.thenation.com/article/a-leak-or-a-hack-a-forum-on-the-vips-memo/.  See the Aug. 9 Patrick Lawrence article: https://www.thenation.com/article/a-new-report-raises-big-questions-about-last-years-dnc-hack/)

After a lengthy introduction by Nation editor Katrina vanden Heuvel, the article offers a dissent by six VIPS members who did not sign the July 24 memo: Scott Ritter, Thomas Drake, Lisa Ling, Phil Giraldi, Cian Westmoreland, and Jesselyn Radack. Their objections were followed by a rebuttal by initial authors of the July 24 memo.

Executive Intelligence Review is sponsoring a special conference on Sept. 9 featuring William Binney and Ray McGovern of the VIPS. The conference, “The Russian Hack Inside Job: Who’s Trying To Destroy the Presidency and Start A World War With Russia?” will take place at New York’s Beacon Hotel at 1:00 p.m. The event will be internationally webcast on EIR’s YouTube channel at https://www.youtube.com/watch?v=nVkJpYxqPBc or at http://bit.ly/vips-eir.

The dissenters’ objections reported by The Nation focus mostly on data transfer speeds, as though that were the only basis for the VIPS memo. The reply to the VIPS dissent, titled “Why This is Important,” written by William Binney, Skip Folden, Ed Loomis, Ray McGovern, and Kirk Wiebe, says: “For more than a year, we have been pointing out that any data acquired by a hack would have had to come across the Internet. The blanket coverage of the Internet by the NSA, its U.K. counterpart GCHQ, and others would be able to produce copies of that data, and show where the data originated and where it went. But U.S. intelligence has produced no evidence that hacking by Russia led to it acquiring the DNC emails and passing them on to WikiLeaks.” They note, “Most curiously, the FBI did not have access to the DNC computers for its own forensics, even though prominent politicians were calling the alleged Russian hack ‘an act of war.’ ”

This exchange among the VIPS is followed by a so-called “independent review” of the July 24 VIPS memo by Nathan Freitas, which attacks the VIPS’ conclusions. Freitas is director of the Tibet Action Institute, a central part of the regime-change apparatus in America. He attacks some of the claims in the VIPS memo, including the RSID evidence that Russian fingerprints were deliberately added to documents released by Guccifer 2.0. (RSIDs are identifiers that track documents across revisions.) Freitas’ errors on this issue were pointed out immediately on Twitter by Adam Carter, who has responded to the review in The Nation, specifically on the issue of RSID evidence (http://g-2.space/thenation/).

Although The Nation printed the objection authored by six VIPS members—far from a majority of the VIPS members—and the VIPS memo authors’ rebuttal to their objections, the VIPS was not allowed to respond to Freitas’ statements, who was given the “last word” in the article.

Nathan Freitas leads the Guardian Project, an open-source mobile security software project, and directs technology strategy and training at the Tibet Action Institute. He is a fellow at the Berkman Klein Center for Internet & Society at Harvard University.

It should be emphasized: 1) there is absolutely no available proof that the Democratic National Committee was hacked by Russia; 2) there is excellent evidence that Russian fingerprints were deliberately added to the documents released by Guccifer 2.0, an artificial entity created to smear any damaging documents later released by WikiLeaks, as having originated from Russian hacking.

STRATEGIC WAR DANGER

Putin Argues vs. Sanctions: North Korea Will Eat Grass Before It Abandons Nuclear Arms Program

Sept. 5 (EIRNS)—Russian President Vladimir Putin, in response to a question during his press conference at the BRICS summit in Xiamen, China, explained in very stark terms why additional sanctions against North Korea will not stop its nuclear program. “Everyone remembers well what happened to Iraq and Saddam Hussein,” he said, according to the Kremlin transcript. “Hussein abandoned the production of weapons of mass destruction. Nonetheless, under the pretext of searching for these weapons, Saddam Hussein himself and his family were killed during the well-known military operation.

“Even children died back then,” Putin went on. “His grandson, I believe, was shot to death. The country was destroyed, and Saddam Hussein was hanged. Listen, everyone is aware of it and everyone remembers it. North Koreans are also aware of it and remember it. Do you think that following the adoption of some sanctions, North Korea will abandon its course on creating weapons of mass destruction?

“Russia condemns these exercises on the part of North Korea. We believe they are provocative in nature. However, we cannot forget about what I just said about Iraq, and what happened later in Libya. Certainly, the North Koreans will not forget it.

“Sanctions of any kind are useless and ineffective in this case. As I said to one of my colleagues yesterday, they will eat grass, but they will not abandon this program unless they feel safe. [Emphasis added.]

“What can ensure security? The restoration of international law. We need to advance towards dialogue between all parties concerned. It is important for all participants in this process, including North Korea, not to have any thoughts about the threat of being destroyed; on the contrary, all sides to the conflict should cooperate. In this environment, in this situation, whipping up military hysteria is absolutely pointless; it is a dead end.”

Putin went on to point out that North Korea also has cannon and rocket artillery against which missile defenses are useless. “In this context, military hysteria will do no good, but may lead to a global, planet-wide disaster and enormous casualties,” he concluded. “Diplomacy is the only way to solve the North Korean nuclear problem.” (See http://en.kremlin.ru/events/president/news/55535.)

Syrian Army Breaks ISIS Siege of Deir Ezzor

Sept. 5 (EIRNS)—The Syrian government announced today that Syrian army units broke through the last ISIS defense around the city of Deir Ezzor, breaking the siege of that city, finally, after three years. The breakthrough apparently followed “a sudden lunge through jihadist lines,” yesterday, as Reuters reported it, up the road from Al Sukhnah which brought Syrian army units to within 3 km of ISIS defensive lines outside the city. “Islamic State is in confusion. There is no leadership or centralized control,” a commander in the military alliance supporting Syrian President Bashar al-Assad told Reuters.

The Syrian army was aided by a Russian cruise missile strike from the Admiral Essen frigate in the Mediterranean that destroyed ISIS targets in the village of Ash Sholah, along the Syrian line of advance. “The launches of Kalibr cruise missiles ensured the advance of the Syrian government forces, as well as thwarted plans of Daesh [IS/ISIS] militants in the area of Deir Ezzor,” said the Russian Defense Ministry. Lifting the siege of Deir Ezzor “will lead to the complete defeat of the most combat-effective formations of the Daesh terrorist group in Syria,” Gen. Sergei Rudskoy, the chief of the Russian General Staff’s Main Operational Directorate said during a briefing on Aug. 25, reports Sputnik.

Celebrations are reported to have broken out among Deir Ezzor’s residents.

Al Masdar News reports that now that the Syrian army has reached Deir Ezzor city, it is shifting its attention to the airport immediately to the southeast of the city. It is probably reasonable to assume that once the army has consolidated and strengthened its position in Deir Ezzor, its next phase of operations will be down the Euphrates River towards the Iraqi border.

South Korea’s Moon under Pressure To Take a Harder Line against North Korea

Sept. 5 (EIRNS)—South Korean President Moon Jae-in is under growing pressure both from within South Korea and from the United States to take a harder line on North Korea, even from his core support base of young liberals, reported Reuters yesterday. Moon spoke with U.S. President Donald Trump by phone yesterday, and they agreed to announce publicly the elimination of the payload limits on South Korea surface-to-surface missiles. Under existing agreements, South Korea’s missiles are limited to a 500 kg payload and 800 km range. Under the new agreement, the payload limitation will no longer apply. “Moon told Trump that it would be a strong warning message to Pyongyang if the two nations announce their agreement to lift the missile payload limits, and President Trump agreed with the idea,” a South Korea official said, reported the Korea Times.

Defense Minister Song Young-moo told a parliamentary defense committee yesterday that Seoul’s North Korean policies will shift to give military issues more weight as President Moon Jae-in seeks punitive measures “of the highest order” following the Sept. 3 nuclear test. This was decided, Song said, at Sunday’s National Security Council meeting. The Korea Herald also reports that Seoul and Washington are leaning toward exercises mainly involving naval and air force assets on and around the Korean Peninsula. U.S. assets considered likely to be mobilized include F-22 and F-35B fighter jets, B-1B and B-52 bombers, the aircraft carrier USS Ronald Reagan and nuclear-powered submarines stationed in Japan and Guam.

Moon nonetheless insisted, in spite of all this, during a National Security Council meeting following the Sunday nuclear test, that he had not given up on attempting to bring Pyongyang to the negotiating table, a sentiment he repeated on Sept. 4 during a telephone call with Japan’s Prime Minister Shinzo Abe. “Pressure must be strengthened until the North comes to the table for dialogue,” the Blue House quoted Moon as telling Abe.

COLLAPSING WESTERN FINANCIAL SYSTEM

New York Post Columnist: Houston and New York Ask ‘Where Is the Infrastructure Plan?’

Sept. 5 (EIRNS)—An expert from the Manhattan Institute, a well-known and generally conservative, “supply-side” think-tank, has an opinion column in today’s New York Post called “Build the ‘Dam Wall’: What Houston Needs Now.” Nicole Gelinas writes “Just as New York needs its subways, cities on the Gulf Coast can’t exist without flood protection infrastructure.”

The columnist points out that the little flood control infrastructure Houston has, the two small dams and reservoirs built in the 1940s, worked as planned—for a city of 385,000 people in 1940. But for the present city of 2.3 million people, that meant the dams released overflow after overflow directly into residential and business areas to the west, northwest, and northeast of the dams—areas still being evacuated and reflooded as of Labor Day! The Addicks and Barker Dams, only a fraction of the infrastructure plan even in 1940, are completely inadequate today. They essentially serve only the small downtown area, and at that, are inadequate to a storm like Harvey.

“After Katrina, the Federal government spent $14.5 shoring up New Orleans’ flood protection,” Gelinas says. “Long-term flood control investment is a good idea in Houston, too. But Washington should try to do this not through a chaotic post-Harvey recovery bill, but through President Trump’s campaign-season idea of a national infrastructure plan. (Whatever happened to it?)”

Trump’s Physical Economy Improved but Still Sick before Storms

Sept. 5 (EIRNS)—Before being struck by powerful tropical storms, the physical economy of the United States had shown improvement in both business capital investment and goods-producing employment since the election of President Donald Trump. But it was still shrunk, like the labor force, relative to a decade ago when Barack Obama took office.

The August 2017 U.S. Labor Department jobs report showed an unexpectedly low “adjusted” figure of about 150,000 employment growth, made still lower by 40,000 in downward revisions of previous months. Year-to-year job growth remains at about 2.1 million; as of last August it was 2.4 million; as of August 2015 it was 2.7 million. The six-month running average of job creation has dropped to 160,000/month. Hourly wages stagnated in August, and average weekly wages fell by 2.2% from July. Weekly wages are up just 2.5% (before inflation) from a year earlier.

During Trump’s presidency so far there has been turnaround growth of the major categories of goods-producing employment: construction and manufacturing by about 100,000 each, while mining has stopped falling. There has also been distinct growth, after long stagnation, in business capital spending—related to the assumption that business taxes will be lowered—and a temporary acceleration of GDP growth. The August report claimed total “goods-producing employment” growth of 70,000, despite the low overall jobs growth in the month.

However, compared to August 2008, a full decade ago, there are 300,000 fewer construction workers, 60,000 fewer mining and oil industry workers; and 900,000 fewer manufacturing workers. The labor force has grown by 5.5 million during that decade, making this productive employment shrinkage even more drastic. And the eligible population not in the work force has leaped up by a shocking 15.8 million, three times the labor force increase.

Two very major industries were showing slowdowns before the hurricanes hit. Housing starts have dropped more than 10% during July and August; auto sales have dropped to about a 16.1 million annual rate from 17.4 million (which was quite high).

SCIENCE AND INFRASTRUCTURE

Russia’s Medvedev Orders Expansion of Far East Port of Zarubino; Food Exports Surge

Sept. 5 (EIRNS)—Russia is moving ahead in its ongoing development of the strategically located port of Zarubino in the Primorye Region. In the last three years the upgrading of the port has been a joint project with China and constitutes a key port on the northeast Maritime Silk Road. Russian Prime Minister Dmitry Medvedev signed an order to build a terminal for grain cargo transshipment at the port which can be used for Chinese grain destined for southern China, and for Russian grain exports.

The terminal will be able to service ships with a capacity of up to 91,300 tonnes for the transshipment of wheat, corn, and soybean to the Asia Pacific region. It will include five piers, a warehouse, a railroad and road front, and conveyors.

While the port is ice-free year round, it lies on Trinity Bay astride the Sea of Japan and is highly strategically located at a point where the borders of Russia, China and North Korea meet. Since Zarubino is only 18 km from its border, the Chinese are cooperating with Russia to develop the port. The railway line from the port connects to railway lines running north to Vladivostok, west to Hunchun just across the border which serves also as the terminus of the high-speed railway of Jilin Province in northeast China, and south to Rajin in North Korea via Khasan.

The port is ideal for China’s Jilin Province, which otherwise would have to ship its exports to Dalian port on the other side of North Korea, nearly 1,000 km farther. Shipping through Zarubino port constitutes the shortest sea route to the U.S. and Canadian Northwest. Over the past three years regional authorities of China and Russia have been cooperating to economically integrate the two regions, the redevelopment of which have been constituted as a priority by Moscow and Beijing. It serves as a successful example of the win-win cooperation of the Belt and Road policy.

Interestingly, in the marketing year July 2016 through June 2017, Russia exported 27.8 million metric tons of wheat, more than the entire European Union, to claim first place in the world for the first time since the EU has been counted as a unit. In the current marketing year, the U.S. Department of Agriculture predicts, Russia will export 31.5 million metric tons, increasing its global lead; it’s already facing infrastructure constraints because of the fast growth. It’s also a leading exporter of corn, barley, and oats. Just three and one-half years ago, at the time of the 2014 “Ukraine sanctions,” Russia was 50% import-dependent for food.

U.S. Must ‘Collude’ with Russia Eight More Years for Rocket Engines

Sept. 5 (EIRNS)—If the United States wants its military establishment to be able to continue to launch rockets into space, it will have to “collude” with Russia for eight more years, according to the views of “government and industry officials” reported in today’s Wall Street Journal.

The Journal’s sources said the Defense Department’s expected dependence on Russia’s RD-180 rocket engines for heavy lift rockets, is being stretched out to the mid-2020s, “several years longer than originally anticipated.” The RD-180s, a batch of which were originally bought by the United States at the time of the collapse of the Soviet Union, are used by United Launch (the Lockheed-Martin/Boeing joint venture) to launch Saturn V rockets carrying most military communications and navigation satellites.

The Journal reports the further delay is in part being caused by the Obama administration priority of “promoting competition among launch providers”—bringing in Elon Musk’s Space Exploration Technologies, Inc. and Jeff Bezos’ Blue Origin LLC. This is resulting in less business for United Launch, slowing down its development of a new engine.

But there is evidently another cause for the long-time attempt to develop a replacement: superior Soviet/Russian rocket engine technology. The performance of the RD-180s were 10-15% more efficient than rocket engines produced in the United States, due to a unique technology which involved mixing oxygen into the fuel prior to preparation for launch. This produces more powerful thrust for the same amount of fuel, with a unique rocket engine design. American companies have not yet fully mastered it.

Britain’s Channel 4 TV documentary series “Equinox” aired an episode on the rocket engines back in March 2001, titled “The Engines That Came In From the Cold.” (https://www.youtube.com/watch?v=84ukJb64Gy8)

THE NEW GLOBAL ECONOMIC ORDER

China and Brazil Sign Nuclear Power Memorandum To Complete Angra 3 Reactor

Sept. 5 (EIRNS)—In the context of the BRICS summit in Xiamen, China, the chairman of the China National Nuclear Corp. (CNNC) Wang Shoujun, and executives of the Brazilian power company Eletrobras and its nuclear subsidiary Eletronuclear, signed a memorandum of understanding for the purpose of deepening bilateral cooperation for the peaceful uses of nuclear energy, according to a press release from World Nuclear News.

A key objective of the MOU, according to Eletrobras, is to “highlight the common interests in establishing a future partnership” for completion of the long-delayed 1,405 MW Angra 3 nuclear plant as well as launching future nuclear plant projects. Construction of Angra 3 began in 1984, but over the years it has suffered repeated delays for political reasons. In September 2016 it was paralyzed altogether, a victim of the London-directed “Operation Car Wash” (“Lava Jato”) phony anti-corruption witch-hunt, whose a primary goal is to take down Brazil’s vital scientific and technological capabilities.

It’s expected that CNNC will provide a large part of the $5 billion needed to complete Angra 3, which the Brazilian government doesn’t have. Currently, Angra 3’s completion is scheduled for 2023. Since President Michel Temer has announced his intention to privatize Eletrobras, the largest power utility in Ibero-America, plans are underway to split off Eletronuclear and keep it in state hands, as Brazil’s Constitution specifies that nuclear facilities must be government-controlled, Reuters reported Aug. 30.

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