EIR Daily Alert Service, TUESDAY, JUNE 19, 2018

TUESDAY, JUNE 19, 2018

Volume 5, Number 121

EIR Daily Alert Service

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


Major Changes Can Keep Coming, Trump and Xi Can Solve Both Trade and Immigration

June 18 (EIRNS)—The summit just accomplished in Singapore has already changed the relations of nations in Asia for the better, showed President Donald Trump’s unusual leadership capacity, and should be changing the way Europeans and Americans look at what is possible. The very real potential is now emerging for an early summit of Presidents Trump and Putin, absolutely critical to ending 15 years’ continuous disasters of war in Southwest Asia and North Africa. And there can be more “game-changers”—no crisis situation is fixed at this moment, if citizens and leaders will move optimistically for peace and mutual economic development.

Above all, this is a time when many should be joining with the Schiller Institute and LaRouche Political Action Committee, who for decades since the Berlin Wall fell, have held the torch for a “new paradigm” of economic and scientific progress and peace. What is happening in Asia through the New Silk Road and the Korea summits, can “break out” in Europe and the United States if there are any forceful leaders for cooperation of major nations’ cooperation—as President Trump has shown he is.

Helga Zepp-LaRouche’s call for an EU summit next week which actually solves the migrant crisis there—by European nations joining China in the economic development of Africa—is now circulating internationally in many languages; now the same solution has been proposed in China’s Global Times newspaper. Her call, “History Is Now Written in Asia: The EU Summit Must Follow the Singapore Example!” should go out far and wide, to trigger action, and action now.

The United States needs to avoid trade war with China, tariff damage to its agricultural sector, and more—it must avoid being politically polarized again over immigration from Ibero-America. It is easy for Democrats to scandalize, in order to raise funds and hope to win elections. And easy for Republicans to temporize and act upset in public. Both know that they are proposing no solution, no workable policy.

But there is a solution, breaking the static rules of party politics and geopolitics.

The President can negotiate the avoidance of trade war, by agreeing with President Xi Jinping of China that the two nations will jointly develop Ibero-America through credit for major new infrastructure projects, and agro-industrial development. In other words, join and bring in the Belt and Road. That is the only basis on which the desperation triggers for mass migration to the United States can be removed.

But more: U.S. high-technology exports to the countries of Ibero-America will take off. U.S. exports to China will rise. The insurance multinational ING has just published a study forecasting that the Belt and Road Initiative will raise global trade by 12-15%; trade of countries right on the New Silk Road transport corridors, by much more. Who needs tariffs?

The principles of Helga LaRouche’s call for action are simply the principles of the Singapore summit: The past doesn’t determine the future. The “boundary rules” which kept crises frozen for decades, don’t apply. And since President Trump has engaged the United States in Asia, where history is being made, the solutions to crises are possible everywhere.

Needed now, as she said, are the people to make them.


Echo of Helga LaRouche’s EU Summit Call Appears in Global Times

June 18 (EIRNS)—China’s Global Times newspaper today published an op-ed, “Neocolonial Europe Behind Aquarius’ Fate,” on the EU’s crisis of African migration. The Italian author, Orazio Maria Gnerre, knows the work of Lyndon and Helga LaRouche. His concluding paragraphs contain important elements of Helga Zepp-LaRouche’s June 16 call for EU-China development of African economies to be the subject of the June 28-29 EU summit—the “Singapore summit principle.”

Gnerre wrote, “Unfortunately, however, the simple solutions presented by the two sides, the government and the opposition, are not adequate. The blockade of ports will be useless if African countries remain underdeveloped in economic and suprastructural terms, and will continue to be the theater of war. It is not possible to export all the inhabitants of Africa either to Italy or Europe given the sheer demographic dimensions.

“The solution, which does not seem to be in sight of the electorate or the European parties, should involve putting an end to the neocolonial process of dispossession of the African region by Europe, perhaps to arrive at a joint economic relationship between Europe itself and Africa, according to the virtuous model that China is implementing in Central Africa. Such a development that is not predatory or politically intrusive could lay the foundation for the future of an entire continent, too often a victim of aggressive capitalism of the West.”

Gnerre has been sent Helga Zepp-LaRouche’s full call for the European Union summit of special character, as have many figures around the new Italian government for whom this is an absolutely critical matter.

Surge of Diplomacy Around New Korean Peninsula Situation

June 18 (EIRNS)—In the wake of the Trump-Kim summit in Singapore, “many summits” are being held and planned among Asian nations and at various levels, to ensure the economic development of the Korean Peninsula and its integration into the Belt and Road.

China, Japan, and South Korea plan a second summit this year, according to Yomiuri Shimbun, after not holding such a meeting for three years. The summit after Japan’s September elections would include the Korea developments, the trade conflict with the United States, RCEP (Regional Comprehensive Economic Partnership), and improved bilateral relations among the three. Russian President Vladimir Putin and South Korean President Moon Jae-in plan to discuss potential joint projects with North Korea during Moon’s visit to Moscow this week, according to Russian Deputy Foreign Minister Igor Morgulov June 18.

Between North Korea and South Korea, there will be meetings on road and rail connections on June 22, according to Korea Times today, which said they will also discuss reforestation in the North. Today in Panmunjom, sports representatives determined that North and South Korea will make a joint entrance to the Asia Games in Indonesia in August, under the “unification flag” (with the outline of a united Korea) and with the ancient folk song “Arirang” rather than either national anthem.

There will be Red Cross meetings June 22, to confirm Aug. 15, Korea’s Liberation Day (from Japan)—as the date for family reunions at Mount Geumgang.

South Korea’s Yonhap News Agency today reported that “South Korea and the United States are expected to announce the suspension of ‘large-scale’ military drills this week, with the provision that they would restart if North Korea failed to keep its promise to denuclearize.” A government source said the suspension would affect major joint exercises, not routine military training.

Yonhap quoted South Korean Foreign Minister Kang Kyung-wha that South Korea wants to sign a formal peace treaty ending the 1950-53 Korean War as soon as possible. “The goal of our government is to strive for [a formal end of the war] this year,” Kang said. She also expected U.S. Secretary of State Mike Pompeo to be meeting with North Korean officials “soon” to start concretizing the Singapore summit decisions.

Pompeo Supports Extended Afghan Eid Ceasefire, but Taliban Say No

June 18 (EIRNS)—On Saturday, Afghanistan President Ashraf Ghani ordered the extension of the government’s first three-day ceasefire with the Taliban, over the Eid al-Fitr holiday which marks the end of the holy month of Ramadan. The government also offered to provide medical treatment to injured Taliban fighters; announced that 46 Taliban prisoners had been released as a sign of official goodwill; and said the government was ready for “comprehensive peace talks.”

U.S. Secretary of State Mike Pompeo backed the Afghan Eid ceasefire in a June 16 statement, the Washington Examiner reported, quoting Pompeo: “Agreeing to begin peace talks is an expression of determination to create a unified Afghanistan in which all its citizens can live in peace and dignity. The United States stands ready to work with the Afghan government, the Taliban, and all the people of Afghanistan to reach a peace agreement and a political settlement that brings a permanent end to war.” Pompeo continued, “We support President Ghani’s offer to extend the ceasefire and begin peace talks.”

Ghani announced in a solemn speech from his palace in Kabul, June 16, that his government was ready for “comprehensive peace and talks,” and that he is willing to discuss all Taliban concerns, including “the future role of international troops in the country.” The truce did not include ISIS.

Ghani’s announcement, the Washington Post reported, built upon the “extraordinary success of the ceasefire’s first day Friday [June 16], in which thousands of fighters poured into cities and towns and joined civilians and security officials in celebrating the Eid holiday that follows Ramadan.”

Some local Taliban leaders said they supported extending the truce, but the Washington Post reported that the national Taliban leadership was split, and ended the ceasefire.

Greek Parliament President Voutsis Makes Five-Day Visit to China

June 18 (EIRNS)—Greek Parliament president from the ruling Syriza party, Nikos Voutsis, will go to Beijing and Shanghai for five days beginning June 18, for talks with Chinese officials, to strengthen bilateral political and economic relations, especially in the context of the Belt and Road Initiative.

In an interview with Xinhua, published ahead of his departure in English by the Greek Observer portal, Voutsis said: “We have excellent relations as peoples and countries, especially in recent years in the financial, trade sector. We believe we are a bridge between Europe and China for the economy, as well as for culture.”

Voutsis stated that, in the context of the China-Greece strategic partnership and the Belt and Road Initiative, Greece and China have made significant progress in recent years in their cooperation in many sectors, but more could be achieved. Interference by the European Union is the only thing that hinders Greek-Chinese relations from developing even faster than they are now, he told Xinhua: “The course and the effort that Greece is making for its relations with China are not uninterrupted. There are some obstacles which are inherent in EU rules and which on a number of occasions are enlarged in proportion to the ‘threat’ that some Europeans feel of China’s role. We know very well now which are the limits the EU allows in relationships that otherwise could develop much faster and to a greater extent,” he said.

“I was very optimistic that the entire Europe, and especially the Balkans and our country, would be open and supporting this major strategic plan, which concerns also other continents, so that there will be an agreement on the terms of trade, but also cultural products and people-to-people exchanges,” he said.

“We are consolidating our relationship with the neighboring country, F.Y.R.O.M. [Former Yugoslav Republic of Macedonia], through a deal that has a perspective and also helps to open the path for the Belt and Road also for trade,” Voutsis said. “These moves are not coincidental,” referring to the June 17 agreement between Greece and F.Y.R.O.M. to end the long-standing name dispute.


Donald Trump: A U.S. President Unbound

June 18 (EIRNS)—” ’There’s no stopping him,” from meeting with Russian President Vladimir Putin, a senior Administration official familiar with the internal deliberations on a Trump-Putin meeting told the New Yorker’s Susan Glasser, who reported that statement in her June 15 article: “He’s going to do it. He wants to have a meeting with Putin, so he’s going to have a meeting with Putin.”

Following the meeting with North Korean Chairman Kim Jong-un, President Trump is dismissing advisors’ warnings about the political dangers of such a meeting, given the Special Counsel’s investigations of Russian influence. Trump, Glasser reports, “jubilantly” declared his meeting with Kim Jong-un to be a “historic” encounter that will lead to the end of the North Korean nuclear weapons program. “Now Russia experts inside and outside the U.S. government are bracing themselves for a formal announcement of the summit, which is likely to happen as early as July, when Trump will be in Europe for the annual meeting of the NATO alliance,” Glasser writes.

Negotiations got serious after Trump ignored his aides’ “DO NOT CONGRATULATE” all-capitals warning in his post-Russian election phone call with Putin in March. Trump invited Putin to the White House, but Glasser reports that Putin didn’t want to come to Washington, preferring to meet in a third-party location. So, Putin asked Austria’s new Chancellor Sebastian Kurz to arrange the summit for Vienna, which the White House is considering. Trump has ordered his staff to plan the Putin summit soon, perhaps as soon as Trump’s July trip to Europe for the NATO summit.

“Trump’s pursuit of a one-on-one with Putin mirrors his spur-of-the-moment decision to meet with the North Korean leader; a major policy move carried out in spite of his advisors, not because of them, and with little genuine support from either Republicans or Democrats,” Glasser reports.

“Trump … has increasingly acted like a President unbound, undeterred by the troublesome politics that would make a Putin summit unimaginable at this point in any other Presidency.”

Senator on Comey, FBI Conduct: ‘None of This Is Normal, Folks’

June 18 (EIRNS)—Senators Lindsey Graham and Chuck Grassley tore into FBI Director Christopher Wray and Justice Department Inspector General Michael Horowitz in testimony before the Senate Judiciary Committee, chaired by Grassley, today. Both used the text messages by FBI case agent Peter Strzok and his lover, then Deputy Director Andrew McCabe’s lawyer Lisa Page, and other senior agents, to point out that it was a fallacy of composition to find no political bias in the original DOJ decision not to charge Hillary Clinton under the espionage statute for her use of a private email server to transmit classified information. That decision was made unilaterally by James Comey in July 2016 shortly before the Trump investigation was formally handed to the FBI by British intelligence.

The other hearing headline is IG Horowitz’s confirmation that former FBI Director James Comey is under investigation for leaking classified information after being fired from the FBI.

Grassley pointed out that the Clinton investigation, contrasted with the Trump investigation, more than demonstrated political bias. He documented how the Justice Department employed unheard-of softness in the Clinton investigation while adopting a “scorched-earth” policy against Trump. Contrary to repeated efforts by the Democrats to get Horowitz to say that he found no political bias whatsoever in the Clinton investigation, the Inspector General reiterated that he did find concerning bias in the decision to prioritize the Trump investigation in late September and October 2016, when the FBI in New York found huge numbers of new classified documents requiring reopening the Clinton investigation on Anthony Weiner’s laptop. The FBI’s senior management attempted to sit on this new information about Clinton while relentlessly pursuing Trump, and was only stopped when outraged FBI agents in New York exposed the perfidy in Washington.

Graham’s attack was most noteworthy and entertaining and his questioning of Horowitz is available on YouTube.  The Senator began: “I’m going to read this text from Page to Strzok on August 8, after he [Trump] got the nomination. She says, ‘Trump is not ever going to become president, right? Right?’ Strzok responded, ‘No, no, he’s not. We’ll stop it.’ I don’t know how you feel about that, that’s pretty unnerving. So the head guy looking at Clinton on August 8 says, ‘We have to stop Trump.’ Now, was that just idle talk? A week later, here’s what they say to each other. Strzok text message to Lisa Page: ‘I want to believe the path you threw out for consideration to Andy’s office, that there’s no way he gets elected, but I’m afraid we can’t take that risk. It’s like an insurance policy in the unlikely event you die before you’re 40.’ That’s a week later. So you have the deputy director meeting with the lead investigator of the Clinton e-mail investigation and Miss Page, who is involved somehow, meeting in Andy’s office discussing taking out an insurance policy to make sure that Donald Trump doesn’t become president. Is that what you’re telling us?”

Horowitz replied that while McCabe couldn’t remember whether he was in the meeting, Strzok said he was. “So one of them is lying,” Graham interjected. “So I want you to reopen this investigation and come back and tell us, do you believe Strzok or do you believe McCabe? … None of this is normal, folks.”

The Inspector General will appear with Director Wray before the House Judiciary Committee on Tuesday, June 19.

Calls To Reinstate Glass-Steagall Bank Separation in U.K. Press, Colonel Lang’s U.S. Blog

June 18 (EIRNS)—Britain’s daily Guardian of June 16 carried “The Case for Glass-Steagall Act, the Depression-Era Law We Need Today,” by Vanderbilt Law Professor Ganesh Sitaranam, who has long been closely tied to Sen. Elizabeth Warren. In addition, June 16 was the 85th anniversary of President Franklin Roosevelt’s signing the Act.

Sitaranam’s is the longest and most developed article arguing for Glass-Steagall reinstatement to appear in any major Western media for some time. The argument is not related by him to the clear danger of another financial crash, but rather, to the right regulation of a banking system, with separation of function and protection of commercial credit. It also cites the argument—most associated with MIT and former World Bank economist Simon Johnson—that Glass-Steagall can reduce the size and therefore the monopoly political and economic power of major megabanks.

“The end of Glass-Steagall wasn’t the proximate cause of the 2008 crash,” Sitaranam writes. “But it was a contributing factor. The watering down and ultimate repeal helped further 30-year trends in the financialization of the economy and the consolidation of the financial sector into a smaller and smaller number of dominant firms—factors, that indirectly precipitated the crisis.”

Another call for Glass-Steagall reinstatement was posted on Col. Pat Lang’s “Sic Semper Tyrannis” blog June 16 as well, by correspondent “Harper.” Entitled “Happy Anniversary, Glass-Steagall—We Miss You, Come Back,” this contribution recalls the JP Morgan use of Alan Greenspan to lead the 1984 initiation of the repeal campaign; its erosion after Greenspan’s 1987 elevation to Fed chair; the repeal’s direct causal connection to the 2008 crash through making commercial banks’ huge deposits available to investment bank speculation; the present bipartisan bills in Congress, and Trump’s Glass-Steagall policy being “gagged” by Gary Cohn.

“Harper” concludes, “Are the White House and Congress ready to act or are we heading blindly to a replay of 2008?”


Central Banks Will Trigger Crash; Evans-Pritchard Can’t Say Which One

June 18 (EIRNS)—The June 16 Telegraph carried a long op-ed by its International Business Editor Ambrose Evans-Pritchard, warning that the “Big 4” central banks’ collective end of QE by the end of 2018, and rising interest rates, will trigger a financial crash. Headlined “A Worldwide Financial Storm Is Brewing as Central Banks Pick Their Poison,” the op-ed does not determine which poison will cause the crash, but that it will come essentially from excessive debt and rising interest rates.

“The world has never been so leveraged, and therefore so sensitive to a monetary squeeze,” Evans-Pritchard writes. The Institute of International Finance says world debt reached 318% of GDP at the end of 2017, 48 percentage points higher than the pre-Lehman peak. Emerging market debt has jumped from 145% to 210%. That is where the trouble is brewing. It is a near mathematical certainty that the currency crisis in Argentina and Turkey—already nibbling at Brazil, South Africa, and Indonesia—will spread to the rest of the emerging market nexus….”

Judging that the Federal Reserve’s rundown of its assets and increasing rate hikes stem simply from overconfidence, Evans-Pritchard forecasts a “dollar shock.”

“The Bank for International Settlements estimates that offshore dollar debt—much of it borrowed by private companies in East Asia and Latin America—has jumped fivefold to $11 trillion since the early 2000s. There is a further $13 trillion in ‘equivalent’ derivatives, three-quarters with a maturity of less than one year. The nub of the matter is that a surging dollar forces global commercial banks to retrench and causes a liquidity squeeze through complex swap and hedge contracts. It is a toxic cocktail when combined with surging U.S. interest rates as well.”

By contrast, he thinks, the European Central Bank (ECB) has a particular, nasty motive—targeting Italy for the treatment Greece received: “The ECB is turning down the spigot in tandem, but largely for political reasons. The economic rationale is weak…. The Eurozone economy has slowed to stall speed….

“The end of QE in Europe is doubly treacherous because it rips away the ECB shield for Italy. Mario Draghi’s ‘do whatever it takes’ no longer holds. There is no sovereign backstop except on political conditions that Rome will not lightly accept. Bond markets are certain to test this.”


Trump ‘Cognitive Dissonance’ at National Space Council: The Moon, or Space Trash?

June 18 (EIRNS)—The National Space Council held its third meeting today, this time at the White House, and was addressed by President Trump for the first time. The President described the economic, scientific, and national security importance of the Apollo lunar landing, but also said that it was “great for the psyche of our country.” Yet, Space Directive-3, which the President signed at the meeting, has nothing to do with jobs, science, or optimism and inspiration. It is a “space traffic management” initiative, to keep track of the trash that has accumulated in Earth orbit. While the President genuinely admires and appreciates what NASA has accomplished in the past, and he wants to return to the Moon, what he has put forward contradicts that goal, with no policy, timeline, or funding for the lunar return.

“We’ve always led,” said the President, and there should be “American dominance in space.” He directed Chairman of the Joint Chiefs of Staff Gen. Joseph Dunford to create a “space force,” which, in fact, is opposed by numerous Congressmen and the Pentagon.

Regarding Mars, Trump said, addressing the “new space” companies run by “rich guys” who were present, “just go ahead. If you beat us to Mars, we’ll be very happy and you’ll be even more famous … as long as it’s an American rich person…. And we’ll save a little money … let the rich guys do it. It’s fine if they do it first.” (Elon Musk says he’ll beat NASA to Mars.)

He said that the “next chapter” will be led “by the generation of young people,” meaning those who are starting the “new space” companies, “who will lead humanity.”

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