EIR Daily Alert Service, TUESDAY, MARCH 20, 2018

EDITORIAL

London’s Game of War, or China’s of Progress: Which Choice for America?

March 19 (EIRNS)—The British government’s now daily escalating confrontation with Russia is driven by the most corrupt of motives, and aimed above all at drawing the United States in—to what could be war, even “unsurvivable war.”

In the past 48 hours three new “narratives” of supposed Russian attacks on Britain have been put out by London, constantly escalating and changing the initial unevidenced charge that Russia—then Russians on President Putin’s personal order—attempted to assassinate an MI6 double agent in England. And the British media have made a bold “military challenge to Russia” out of an exercise of U.K. submarines, loaded with American nuclear missiles, with U.S. nuclear subs under the Arctic Ice.

What are the motives of British Foreign Secretary Boris Johnson, who looks and acts like “Col. Blimp” of the 1930s London comic strip, and Theresa May, the accidental Prime Minister who has the position Johnson thought would be his? They are imperialists of a London financial and geopolitical order militarily enforced, they expect, by the United States.

They see that geopolitical order being replaced by China’s new paradigm of cooperation of great powers for the progress of all nations and the productivity of their peoples: the Belt and Road Initiative of new infrastructure projects and poverty eradication. They want China contained, the Belt and Road put under City of London rules, but cannot make that happen. They want China’s ally Russia confronted and even challenged to fight.

They face disaffected British populations and a determined and widely-backed leader in Labour’s Jeremy Corbyn, who fights their geopolitical policies and the financial crimes of the City of London financial imperial banking center. They want Corbyn tarred a “Kremlin stooge” by the tabloids and driven out.

They continue to see strong resistance to London geopolitical shenanigans from President Donald Trump. After 18 months of non-stop attacks on Trump originating from British intelligence services, aimed to break him or remove him, he continues to favor great-power cooperation, and is gaining in American public backing.

And they face, very soon, a new crash of the London-Wall Street banking cabal worse than 2007-08. The British imperial answer to that threat has always been war.

Despite hysterically supportive major media, the “new Churchills” of London do not have the momentum they imagine for war confrontation. Not even in the U.K.—but for them, running America is always what counts most.

What is crucial now, is that President Trump and the United States choose the offer of China, the Belt and Road Initiative, and let its paradigm of productive economic progress rub off a bit.

Tax cuts, Wall Street deregulation have not and will not revive American growth from its long stagnation, or filled its huge infrastructure deficit. The actions proposed by EIR Founder Lyndon LaRouche will, starting by breaking up Wall Street with a new Glass-Steagall Act. These actions, including the first national credit institution the United States has had since Franklin Roosevelt’s Reconstruction Finance Corporation, are aimed at joining the United States into a global cooperation of sovereign nations for “the common aims of mankind.”

That means choosing China’s progress, over Britain’s war.

STRATEGIC WAR DANGER

U.K. Escalates Its War Propaganda with Every News Cycle

March 19 (EIRNS)—With every check to its initial claim of Russian poisoning on U.K. soil, Britain is escalating its charges rather than providing evidence of them to international authorities or to Russia.

Following Russia’s request, including from re-elected President Putin, to show evidence and end ultimata, British Foreign Secretary Boris “Boorish” Johnson went on BBC Sunday with a new and wilder story. “We have evidence that Russia has been investigating delivery of nerve agents and has been creating and storing Novichok, within the last decade.” Johnson said further that this was an ongoing Russian “secret program” to develop ways of using nerve agents in assassinations. He made a personal attack on former British ambassador to Uzbekistan Craig Murray for daring to continue questioning Whitehall’s stories, while Labour leader Jeremy Corbyn was called a “Kremlin stooge” by the hunting London press.

The Washington Post immediately made Johnson’s new tale its Monday lead. Then “intelligence sources” (unnamed but likely British MI5 or MI6) leaked to ABC News an entirely new claim. Now, the nerve agent was actually vented from Skripal’s BMW’s cabin air filter system; 38 people were allegedly sickened by it in total. To this Britain’s Daily Telegraph added unadorned conjecture, sounding straight out of a “briefing” by “M” to James Bond: “Security services now suspect that when Miss Skripal flew out of Moscow, her departure triggered a red flag with a hit squad that was being dispatched to assassinate Colonel Skripal. It is thought that Miss Skripal was being targeted along with her father in a clear message that traitors are not tolerated by the Kremlin. It is not clear when Miss Skripal landed in the U.K., but sources suggest the Russian team sent to kill her father was probably a day behind her.”

Also Monday, however, Austria’s Foreign Minister Karin Kneissl checked London. “It’s premature to pin the blame in the Skripal poisoning case without first conducting a proper investigation,” Kneissl said. “Our position is: First there is the need to establish a full picture of events in joint cooperation with the Chemical agency [Organization for the Prohibition of Chemical Weapons (OPCW)] and all those involved…. We don’t do fantasy politics.”

When Brussels EU headquarters proved more accepting of Johnson’s “secret stockpiling of nerve agents” line, the Russian Foreign Minister Sergey Lavrov responded, “We have nothing to disclose as is demanded by the European Union, as no agents under the name of Novichok are produced or stockpiled in Russia. Perhaps it should redirect its queries to the U.K. or other member states where such substances are evidently still being developed.”

But the London Sunday Times had more propaganda: “Spy chiefs have warned the bosses of Britain’s key power companies to boost their security amid fears of a Russian cyber-attack that could put the lights out.” Just days earlier it was American nuclear plants that were under hack attacks “thousands of times a day”; until it was pointed out that U.S. nuclear plant computers are not on the Internet.

Iran Synthesized Novichok Nerve Agent under OPCW Supervision

March 19 (EIRNS)—Craig Murray, the former British ambassador to Uzbekistan, who has been challenging the British government’s claims regarding the poisoning of British double agent Sergei Skripal, reported in a blog posting on March 17 that he had been sent “vital information” showing that in 2016 Iranian scientists synthesized Novichok nerve agents under the supervision of the Organization for the Prevention of Chemical Warfare, so that they could be added to the OPCW’s data base. “This makes complete nonsense of the Theresa May’s ‘of a type developed by Russia’ line, used to Parliament and the UN Security Council,” Murray writes. “This explains why Porton Down [Britain’s Defense Science and Technology Laboratory] have refused to cave in to governmental pressure to say the nerve agent was Russian. If Iran can make a Novichok, so can a significant number of states. [emphasis in original]

“While Iran acted absolutely responsibly in cooperating with the OPCW, there are a handful of rogue states operating outwith the rule of international law, like Israel and North Korea, which refuse to ratify the Chemical Weapons Convention, join the OPCW or destroy their chemical weapons stocks,” Murray continues. He further states that Russia, in cooperation with the OPCW, completed destruction of its chemical stocks last year. “Why nobody is even looking at the rogue states outside the OPCW is a genuine puzzle.” Murray concludes that despite what the lying media are regurgitating every day, “ ‘of a type developed by Russia’ has zero evidential value and is a politician’s weasel phrase designed deliberately to mislead the public.”

A report on the Iranian work was published in Spectroscopy Nowon Jan. 1, 2017, to which Murray provides the link.

U.S. POLITICAL AND ECONOMIC

Seoul Foreign Minister Confirms, Kim Jong-un Committed to Denuclearization

March 19 (EIRNS)—South Korea’s Foreign Minister Kang Kyung-wha told CBS News’ ”Face the Nation” that Seoul has asked the North “to indicate in clear terms the commitment to denuclearization” and she confirms Kim Jong-un has “conveyed that commitment.” She said that “he’s given his word” and it’s “the first time that the words came directly” from the North’s leader.

As reported by Britain’s Guardian, Pyongyang’s deputy director for North American affairs at the Foreign Ministry, Choe Kang-il arrived in Finland from Sweden to meet retired U.S. diplomat Kathleen Stephens, according to media reports. Choe and Foreign Minister Ri Yong-ho had been in Sweden for three days of talks with officials in Stockholm.

Meanwhile Japanese Prime Minister Shinzo Abe has requested assistance from South Korea to arrange a meeting with North Korean leader Kim Jong-Un, according to a statement from the Seoul Presidency, reported Seoul daily Dong-A Ilbo today. While Japan had not ruled out the possibility of holding the high-level meeting to discuss bilateral issues, Pyongyang’s Korean Central News Agency (KCNA) issued a statement calling on Tokyo to revise its policy on the Democratic People’s Republic of Korea.

Former FBI Official Kallstrom on Justice Corruption: ‘I Think This Goes Right to the Top’

March 19 (EIRNS)—James Kallstrom, a 27-year veteran and former Assistant Director of the FBI, was interviewed on Fox News’ ”Sunday Morning Futures with Maria Bartiromo,” March 18. As their conversation about the firing of FBI Deputy Director Andrew McCabe expanded, Kallstrom eventually stated that he believed the “collusion” of forces behind the forces involved in the vilification of Trump “went right to the top,” indicating Barack Obama.

The discussion began on the firing of FBI Deputy Director McCabe, with Kallstrom expressing that “there’s a big sigh of relief and a good feeling,” going through the FBI right now, “about the fact that an FBI element, an organization in the FBI, recommended that he be fired, as opposed to them being mute and having someone else make that recommendation. They’re [serious FBI investigators] just gnawing at the bit to actually get involved in a real investigation, not a phony investigation like Jim Comey conducted,” Kallstrom said.

“I think we have ample facts revealed to us during this last year and a half that high-ranking people throughout the government, not just the FBI—high-ranking people had a plot to not have Hillary Clinton indicted, so that she could remain the flawed candidate that she was, which in my view was stupidity.

“And they also had a … backup plan to basically frame Donald Trump, and that’s what’s been going on,” Kallstrom continued. “This whole thing in my view is just total phony.”

Kallstrom named as co-conspirators Peter Strzok, then CIA Director John Brennan, and pointed to Obama while not naming him. On Comey, Kallstrom further characterized him as “naive, with an ego the size of the Empire State building!”

Another former FBI member speaking out is Coleen Rowley, who took issue with McCabe’s weak whine that firing him was a  “war on the FBI,” writing in ConsortiumNews yesterday, that it “doesn’t make sense, considering it was the FBI’s own internal affairs office that recommended he be fired.” Like Kallstrom, she calls it a war within the FBI. Rowley, who on Feb. 21 pointed to the “culture of violence” and the “long war” drive of the neo-cons behind the rage of school shootings, put the emphasis on the collapsing empire (although she doesn’t say British). In her March 18 column in ConsortiumNews, she reprises her argument, writing: “Could the obvious chaos—some would say ‘bloodbath’—at all levels of government also be part of the ‘blowback’ from 16 years of waging ‘perpetual war’ (and from attendant war crimes and the internal corruption by which all empires rot)? … Remember how wars have a way of migrating home.”

Rand Paul Will Continue To Fight Neo-Con Nominees

March 19 (EIRNS)—Kentucky Republican Sen. Rand Paul said March 18 he will filibuster the nominations of Gina Haspel for CIA Director and Mike Pompeo for Secretary of State. Paul has usually acted on his threats. In an article in the March 19 American Conservative, he spelled out “Why I Will Continue To Fight Haspel and Pompeo.”

Paul makes the issue the “neo-con interventionists [who seek] to infiltrate our leadership and make America the purveyor of destruction.” For decades, he writes, the U.S. has “failed to bring about real peace” in the world, because, we have come to believe that “war and intervention” are the answers. “This was the battle cry of Hillary Clinton,” Paul says, reminding that “she supported military action in Iraq, Syria and Libya.”

“I supported President Trump during his campaign because he advocated for less military intervention. He opposed the Iraq War. He acknowledged that nation-building doesn’t work. He understood the damage previous foreign policy missteps have caused, including helping to strengthen ISIS….

“People already distrust the CIA. So why on Earth has this administration picked someone to run the Agency who was instrumental in running a place where people were tortured and then covered it up afterwards? Multiple undisputed accounts have detailed how Gina Haspel not only ran a CIA black site in Thailand but also destroyed video evidence of torture.”

Pompeo, Paul told on CBS News’ ”Face the Nation” Sunday, is a supporter of regime-change war, particularly now against Iran. While also mentioning Pompeo’s support of “unconstitutional spying programs,” he focused on the war issue.

Stressing that his disagreement goes beyond simple policy questions, Paul wrote in American Conservative, “If we are to avoid a future that is war-torn and mired in endless conflicts, we must do better than appointing these flawed nominees. I find them unacceptable, and … I hope the President will reconsider, too.”

COLLAPSING WESTERN FINANCIAL SYSTEM

Sheila Bair: Big Banks Bringing on Another Crash

March 19 (EIRNS)—In a Barron’s interview on March 1, former FDIC head Sheila Bair registered strong warnings about the current unsoundness of the U.S. banking system and the severe explosiveness of the corporate and household debt bubbles. Investopedia prefaces its March 5 coverage of her interview referring to Bair’s set-to with Alan Greenspan 13 years ago, over her warning then of a subprime mortgage meltdown.

Bair says that now the danger of a crisis is caused by the fact that Wall Street banks have been allowed by Treasury to lower their capital ratios over the past year, and Congress is about to allow them much larger capital reductions, as large as $26 billion for JPMorgan Chase. “To loosen capital now is just crazy. Banks won’t have the cushion to absorb the losses. Without a cushion, we will have 2008 and 2009 again.”

Investopedia repeated their report from last year that “An independent research arm of the U.S. Treasury Department has found that the financial system still would be in great peril if one or more big banks fail” (referring to Treasury Office of Financial Research, which Congress is trying to eliminate.) The site continues summarizing Bair that “soaring corporate debt with overvalued collateral: loans that finance corporate leveraged buyouts, and general corporate debt. ‘Any type of secured lending backed by an asset that is overvalued should be a concern. That is what happened with housing.’ ”

As if to illustrate, American Banker March 16 reports: “More and more nonbank lenders are taking advantage of the strong appetite for short-term, floating-rate debt to bundle bridge loans into collateral for vehicles called commercial real estate collateralized loan obligations, or CRE CLOs…. This lending is white hot.”

And Bloomberg News March 14 reported a study by Thomson Reuters that U.S. non-financial corporate debt has actually now reached $19 trillion, and that it is roughly equal to U.S. GDP for the first time in the history of such records going back to World War I.

Investopedia concludes its paraphrase, praising China: “Banks and regulators alike in China are increasingly concerned about risk management, credit quality, and nonperforming loans. Prudence and sustainable growth are becoming watchwords. ‘I’m struck by the difference in the tone of the political leadership—with Xi talking about deleveraging, constraining asset bubbles, and accepting short-term tradeoffs to growth for long-term stability. Contrast that to the U.S., where we have a move to deregulation and borrowing more.’ ”

THE NEW GLOBAL ECONOMIC ORDER

China Selects Its New Government Leadership, Who Pledge New Oath to Constitution

March 19 (EIRNS)—The National People’s Congress has completed the election of the new government leadership with a number of changes in the works.

President Xi Jinping and Premier Li Keqiang have been reelected for another term. Wang Qishan, one of the closest collaborators of President Xi, who had led the anti-corruption campaign, was elected vice-president. Foreign Minister Wang Yi will remain in the post of foreign minister, but has also been promoted to State Councillor as well. This is the first time that a sitting foreign minister has also held a post on the State Council; former Foreign Minister Yang Jiechi went to the State Council upon retiring from his ministerial post. He is now no longer in the State Council.

Wang Yi’s position on the State Council makes him senior to other ministers, and underlines the importance of foreign policy in the second Xi administration.

Minister of Commerce Zhong Shan will also remain at his post. He Lifeng, the head of the National Development and Reform Commission, will also remain in his position. Zhou Xiaochuan, the Governor of the People’s Bank of China, had reached retirement age and will be replaced by Yi Gang, a U.S.-trained economist, who has served at PBC as deputy for some years now. The real economic policy portfolio, however, will be held by Liu He. Although he does not hold a cabinet post, Liu has been named a vice minister, which gives him even more clout. He is also the head of the Leading Group for Economic and Financial Affairs within the Central Committee of the Communist Party.

China’s leading officers swore a new oath to the Constitution: “I pledge my allegiance to the Constitution of the People’s Republic of China (P.R.C.) to safeguard the Constitution’s authority, fulfill my legal obligations, be loyal to the country and the people, be committed and honest in my duty, accept the people’s supervision and work for a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious and beautiful.”

SCIENCE AND INFRASTRUCTURE

Greece Officially Forms Hellenic Space Organization

March  19 (EIRNS)—Greece has officially founded its first space agency: “The establishment and operation of the Hellenic Space Organization will be one of the most dynamic features of our course towards the modern digital economy of the future,” secretary general of Telecommunications and Post Vassilis Maglaras told the Athens-Macedonian News Agency today. “Greece is already actively involved in the European Space Agency and must be able to exploit the opportunities arising from its participation in these European organizations for the benefit of its businesses, research and all economic sectors.”

Maglaras said Greece is one of the few countries in the EU that still does not have such an organization, therefore, he said the establishment of a space organization and the attempt to organize the wider space sector is not an unnecessary luxury but an absolute necessity.

Digital Policy and Media Minister Nikos Pappas joined Maglaras in the afternoon to present the agency to the public.

OTHER

Cornell Professor Cites Alexander Hamilton, ‘Nation’s Most Visionary Founder’ on Trade

March 19 (EIRNS)—Forbes on March 13 published a column by Cornell University Law Prof. Robert Hockett, an active public supporter of reinstatement of the Glass-Steagall Act, on the subject “Make Trade Policy Strategic, Not Dogmatic.” The column generally argues for a “mixed” trade policy, in which tariffs or subsidies support long-term productivity, employment or military objectives, not the extremes of British free trade or autarchy.

But the really useful aspect of the observations of Professor Hockett, who is a professor of both Law and Public Policy, involves Alexander Hamilton’s American policy. “Our nation’s most visionary founder, Alexander Hamilton, undertook a deliberate strategy of guiding the development of the new United States toward becoming a great manufacturing and commercial, not just agricultural, republic. And so he pushed for both direct involvement in infrastructure and technological development, and for temporary protective tariffs to aid American ‘infant industry.’ The strategy worked so well that American became the world’s largest economy within a few generations. Germany then followed the American example, and shortly thereafter became a great industrial power in its own right. Later Japan, then South Korea, and now China have followed the same path—in each case, expressly citing the example of Hamilton—becoming ‘tiger economies’ in the process.” Anti-Hamiltonian Britain, he writes, declined steadily through the late 19th and 20th centuries.

On trade, Hockett cautiously concludes that “now that Gary Cohn has left the White House … the White House’s ‘economic nationalists’ might—might—prove to be one team in this White House that we can all celebrate in the end.”

Here Hockett means trade advisor Peter Navarro, Commerce Secretary Wilbur Ross, and Trade Representative Robert Lighthizer. But Hamilton, in recommending tariffs or subsidies in the Report on Manufactures and elsewhere, did not base policy on defining other trading countries as “the enemy” whose surplus had to be wiped out, as Navarro, in particular, and President Trump have done. Rather he concentrated on what was necessary to develop the productive powers of the United States.

 

 

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