EIR Daily Alert Service, TUESDAY, JULY 10, 2018

TUESDAY, JULY 10, 2018

Volume 5, Number 136

EIR Daily Alert Service

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

EDITORIAL

Trump Seeks Game-Changing Solutions, but Trade War Does Not Lead to Solutions

July 9 (EIRNS)—President Donald Trump’s insistence on a personal summit with Russian President Putin looks stronger than ever, with the welcome breakdown of the most violent opponent of that summit—and the center of geopolitical war schemes—the British government. Russian-American collaboration is central to the possible end to 25 years’ perpetual regime-change wars and terrorism, allowing, then, the possibility of economic development spreading across Southwest Asia and North Africa. Better, a four-power collaboration of American, Russia, India and China can provide a new, non-geopolitical strategic framework for peace. Lyndon LaRouche showed already more than two decades ago that there is no reason for the existence of NATO, and that this four-powers collaboration is the new basis for security and peace.

President Trump, as candidate and President, has pursued changing the entire geopolitical game in order to go for peace on the Korean Peninsula, in Syria, Afghanistan, and elsewhere. To do it, he has fought the British and U.S. intelligence agencies’ drive to “Russiagate” and impeach him out of office to a standstill, with the critical aid of EIR’s and LaRouche PAC’s devastating exposés of Robert Mueller’s “legal assassination” operation.

But the name of peace, ultimately, is economic development. Trade war with China does not lead to such solutions as the Trump is seeking for the United States. What does lead to those solutions—including solutions to unprecedented migration flows? The answer is cooperation among the major powers on the most important great projects of new infrastructure to support new levels of productivity and economic growth, worldwide. It has been initiated and is being carried forward by China’s Belt and Road Initiative or “New Silk Road,” and by the Schiller Institute.

The Institute’s June 30-July 1 conference “On the Urgent Need for a New Paradigm in International Relations” set the standard. It presented the plans and the political leadership for the redevelopment of Southwest Asia and Africa through collaboration of the Atlantic powers with China, which has become Africa’s recognized champion.

Just as pursuing this new paradigm in Europe requires rejecting London and “the City,” pursuing it in Trump’s United States means breaking up Wall Street’s megabanks before they crash again; establishing a national institution to issue massive infrastructure credits for this great-power economic collaboration; not counting on private enterprise to make policy for what only great nations can do in science and in space. It’s the hard way, but it’s what leads to the solutions we need to campaign for.

COLLAPSING WESTERN FINANCIAL SYSTEM

Effects of U.S.-China Tariffs So Far Are Not Good

July 9 (EIRNS)—A U.S.-China economic confrontation was warned of by President Trump in a tweet today which addressed negotiations with North Korea. “We agreed to the denuclearization of North Korea. China, on the other hand, may be exerting negative pressure on a deal because of our posture on Chinese Trade—Hope Not!” But the selective exchange of tariffs with China, initiated by the Trump Administration, appears to have begun exerting “negative pressure” on both nations’ economies.

China’s investment in the U.S. economy has stopped. In the first six months of 2018 there was a 90% drop in new foreign direct investment (FDI) by China in the United States, down to $1.8 billion. There was also a withdrawal (sale) of $9.6 billion in investments, and so a net negative FDI. Part of this is Chinese government crackdown on speculative (real estate) investment. But decisions of the Committee on Foreign Investment in the United States (CFIUS), and Congressional pressure to “toughen” them against China, are a factor; so are the tariffs and tariff threats.

CFIUS finally approved, on July 6, the COSCO (China Ocean Shipping Co.) takeover/merger with Orient Overseas (International) Ltd, OOIL, another global container ports management company, based in Hong Kong, but whose responsibilities include the Long Beach, California container port. But the approval required that COSCO divest Long Beach immediately, putting it in a trust until it is sold. In effect, COSCO has been barred from United States, where port connectivity with intermodal transport is a major national infrastructure problem COSCO could help solve.

One outspoken Republican governor estimated China’s imports of meat and soybeans from the United States are going to drop by two-thirds from July-August, although they had been artificially high during the Spring, in anticipation. (China’s purchases of meat and soybeans from Russia increased dramatically in June, essentially replacing U.S. product.)

Gov. Asa Hutchinson of Arkansas made his two-thirds estimate in a CNBC interview. “We give a lot of confidence and latitude to the President [on trade]. But we hope we can bring an end to this trade war,” Hutchinson said, calling for compromise: “We don’t need to be in a position where somebody has got to say uncle.” He went on, “I continue to support the President. But we feel it’s appropriate to say there is a point that you should not squeeze us further.” Agriculture is Arkansas’ leading economic sector.

Some global companies with relatively long-term production of consumer goods in China will start moving parts of their production to elsewhere in Asia, causing unemployment in China. China can easily find replacement sources for the U.S. exports on which it imposed tariffs. But Chinese companies which make equipment—including medical diagnostics such as magnetic resonance imaging devices, or machine tools or electronics—are likely suffering significant U.S. sales losses and cuts to their business, and perhaps even leaving those product lines entirely so as not to lose money; while prices for this equipment will rise in the United States. This is the attack on “Made in China 2025.”

U.S. POLITICAL AND ECONOMIC

Mueller’s Number-Two, Weissmann, Leaked Information on Manafort to AP Reporters

July 9 (EIRNS)—Documents released July 6 show that Justice Department attorney Andrew Weissmann, known as Robert Mueller’s “pit bull,” arranged a meeting with journalists from Associated Press (AP) to discuss an investigation into Paul Manafort, President Trump’s former campaign manager, Chuck Ross reported in the Daily CallerJuly 8. This now-documented deputization of the press as government agents blows the lid off many so-called “national security reporters” who are nothing but willing scribes and actors in intelligence agency operations.

It is noteworthy that a similar process took place in the 1980s Federal prosecution of Lyndon LaRouche. First, based on a British demand for action, journalists were assembled under the tutelage of New York investment banker and CIA asset John Train for a series of salons aimed at destroying LaRouche’s reputation through a coordinated defamation campaign. Other longstanding government-connected opponents of LaRouche also attended the meetings, setting out story lines for reporters. Having set the terroristic and fear-laden climate, the FBI and Justice Department then moved in to urge ostracized LaRouche supporters to “compose” an altered version of events.

In a similar revelation, Marcy Wheeler, a national security reporter who has the Emptywheel blog, purportedly critical of widespread surveillance of American citizens, confessed to ratting out a source to the FBI who told her that Trump was attempting, post-inauguration, to set up a back channel to the Russians concerning Syria, and that Michael Flynn would be responsible. Wheeler’s confession was published on Emptywheel on July 3rd, stating that she had broken the cardinal rule of journalism, reporting a source to the FBI. Having become a witness for Robert Mueller, Wheeler is being widely praised by other complicit fake news journalists for “following her conscience.” There is much more to this story than meets the eye, and EIR will be digging.

The Weissmann-AP meeting occurred on April 11, 2017, one month before Mueller was appointed Special Counsel.

The meeting came to light via a letter sent to Deputy Attorney General Rod Rosenstein from House Intelligence Committee Chair Devin Nunes late in 2017. Nunes’s letter asserted that the DOJ was “researching records related to the details of an April 2017 meeting between DOJ attorney Andrew Weissmann (now the senior attorney for Special Counsel Robert Mueller) and the media,” and asked that the records be provided to the Intelligence Committee.

Manafort’s lawyers obtained the documents on June 29, 2018, and revealed them in a motion filed in Federal court in Virginia, in support of a hearing into what they charge are “possible leaks of secret grand jury information, false information, and potentially classified materials from the [April 11, 2017] meeting,” writes the Daily Caller. “The meeting raises serious concerns about whether a violation of grand jury secrecy occurred,” Manafort lawyer Kevin Downing wrote, in demanding a hearing. Mueller named Weissmann as general counsel to the FBI when Mueller was FBI Director.

The meeting between AP reporters and DOJ officials was first reported in January 2018. The government confirmed it for the first time in a pre-trial hearing in the Manafort case on June 29.

At that hearing, FBI Special Agent Jeffrey Pfeiffer said that the FBI, based on a tip from AP reporters, may have conducted a May 2017 raid of a storage locker Manafort was renting. He also said the purpose of the meeting with the AP reporters on April 11, 2017, was for the DOJ and FBI to obtain information, the Daily Caller reported.

The June 29 court filing includes two reports about the April 11, 2017, meeting, one written by FBI agent Pfeiffer and another written by Supervisory Special Agent Karen Greenaway, who wrote that “The meeting was arranged by Andrew Weissmann,” and that Weissmann provided guidance to the reporters for their investigation, suggesting that they ask Cypriot money-laundering authorities if they had provided the U.S. Treasury Department with all the documents regarding Manafort.

AP had previously and categorically denied to journalist Sara Carter, in January 2017, that AP would ever voluntarily serve as a source for a government agency.

President Trump’s Entourage to Helsinki Summit

July 9 (EIRNS)—U.S. Ambassador to Russia Jon Huntsman announced that President Trump’s meetings with Russian President Putin would begin with a one-on-one meeting limited to the two Presidents.

President Trump’s entourage to the Helsinki Summit July 16 includes White House Chief of Staff John Kelly, who is rumored to be leaving soon; Deputy Chief of Staff Zack Fuentes; National Security Advisor John Bolton, and his chief of staff Fred Fleitz; Policy Advisor Stephen Miller; Social Media Director Dan Scavino; Press Secretary Sarah Huckabee Sanders, and, of course, First Lady Melania Trump and her staffers, Lindsay Reynolds and Stephanie Grisham, among others.

Newcomer to the White House, communications director Bill Shine, is also part of the delegation, which Politico reads as a sign of the “new power center” he will represent.

Trump’s daughter Ivanka Trump, and son-in-law Jared Kushner, are not traveling to Helsinki.

THE NEW GLOBAL ECONOMIC ORDER

‘Belt and Road’ Plans for Rebuilding in Southwest Asia Expected

July 9 (EIRNS)—The eighth ministerial conference of the Chinese-Arab States Cooperation Forum (CASCF), convenes July 10 in Beijing, hosted by Foreign Minister and State Councillor Wang Yi, and involving ministers and representatives of the 22 Arab nations. Gulf News reported July 8 that China’s Deputy Foreign Minister Chen Xiaodong said meeting will adopt “documents [that] will show a clear road map for the joint construction of the Belt and Road Initiative in the future.”

Quoting Gulf News report, “Chen also said President Xi is going to bring to light new proposals on future cooperation related mainly to the Belt and Road Initiative between the two sides.” The Chinese President will address the opening ceremonies at the Great Hall of the People tomorrow.

The International Schiller Institute and its founder and president Helga Zepp-LaRouche have consistently identified “bringing the New Silk Road through the Southwest Asia and into Africa” as the means for reconstruction from nearly three decades of devastating wars in those regions.

STRATEGIC WAR DANGER

NATO Has No Purpose But Its Own Stability

July 9 (EIRNS)—In the middle of all of the hysteria and hand wringing leading up to the NATO summit on July 11, retired Army Lt. Gen. Ben Hodges is doing his best to play up the Russian bogeyman. The former commander of the U.S. Army in Europe is claiming in a new report “Securing the Suwalki Corridor: Strategy, Statecraft, Deterrence, and Defense,” released this month by the Center for European Policy Analysis, that Russian President Vladimir Putin is taking aim at the so-called Suwalki Gap, a corridor made up of the Poland-Lithuania border that happens to stretch between Belarus and the Russian exclave of Kaliningrad. This corridor “serves as the only land link between NATO and its three Baltic members, Estonia, Latvia, and Lithuania,” Hodges says in the report, which Defense One website previews. “If Russian forces ever established control over this Corridor, or even threatened the free movement of NATO forces and material through it, they could cut the Baltic States off from the rest of the Alliance and potentially obstruct allied reinforcements advancing by land through Poland.”

But Hodges doesn’t argue that Russia plans to invade Poland and the Baltic countries—even he knows that’s ludicrous. Rather, “if you accept Putin’s goal is to destabilize the NATO alliance and convince some members or unaligned countries to join Russia’s sphere of influence, then it becomes easier to imagine Putin engineering some sort of crisis to make the alliance look impotent or irrelevant to its members’ security, and that’s what has Hodges worried,” Defense One reports.

While intending to do the opposite, Hodges actually appears to be making the argument that NATO has no purpose because he has to make one up. Russia has no plans to invade Poland and the Baltic states, which even he admits—Russia doesn’t have the power against NATO’s 29 members that the Soviet Union confronted NATO with during the Cold War—but nonetheless, NATO has to reinforce the Baltic States; because, in effect, the purpose of NATO is to keep Russia from destabilizing NATO.

SCIENCE AND INFRASTRUCTURE

Argentina’s Heavy-Water Plant in Danger of Closing, as Nuclear Sector Is Jeopardized

July 9 (EIRNS)—The decision by Argentine President Mauricio Macri to cancel construction of the country’s fourth nuclear reactor, Atucha III, and postpone construction of a fifth until 2022, is jeopardizing the continued operation of the Industrial Heavy Water Plant (PIAP) in the Patagonian province of Neuquén. PIAP is one of the most important such facilities worldwide, and is a jewel among Argentina’s many scientific and technological achievements.

Atucha III was to have been based on Candu technology, requiring heavy water. Now, PIAP is almost paralyzed, jeopardizing the jobs of 400 highly-skilled workers, and hundreds more who are employed indirectly. This is just one more element in Macri’s all-out assault on Argentina’s nuclear and high-tech capabilities, whose destruction the British Empire has always sought. Aside from PIAP workers, another 5,000 jobs are jeopardized as a result of Atucha III’s cancellation.

Macri claimed his decision was based on the country’s financial crisis and need to cut back on infrastructure spending—which the International Monetary Fund ordered as a conditionality for its $50 billion standby loan. But the China National Nuclear Corp. (CNNC), which was to have built Atucha III, generously offered to provide 85% of the total $9 billion in financing, with an eight-year grace period before loans would have had to been repaid. Adrian Delao, secretary-general of the union of workers employed by NASA, the state-run company that builds reactors, had told the daily Canal Abierto back on May 29 that Macri’s decision was “purely political, directly linked to the government’s relations with the IMF. To build Atucha III, Argentina wouldn’t have spent a single peso.”

The Argentine Senate’s Mining, Energy and Fuel committees met with representatives of PIAP’s workers on July 4 to discuss other possible uses of the heavy water plant, such as production of nitrogenized fertilizer based on use of urea. Julian Gadano, the Energy Ministry’s Undersecretary for Nuclear Energy, told the committees that in the immediate future there is no market for heavy water, El Periódico de Rincón reported July 5. Neuquén’s Energy Minister Alejandro Monteiro warned that PIAP’s closing would negatively impact the operations of the Engineering Services Company, which provides skilled personnel to PIAP, as well as the state-sector INVAP company, which was involved in PIAP’s operations.

South China Morning Post Covers China’s Plans To Accelerate Its Nuclear Power

July 9 (EIRNS)—Hong Kong’s South China Morning Post reported today that China’s rapid expansion of nuclear power capacity, followed by other “renewable” energy sources, is enabling it to wean its economy off coal and reduced carbon emissions while continuing strong economic growth. China will double its nuclear capacity by 2040, the paper reports, “even if this requires importing technology”—as well as building China’s own Hualong reactors.

In June, “China National Nuclear Corp. reached two deals with its Russian counterpart Rosatom for four nuclear power units at the Xudabao and Tianwan plants,” involving “cutting-edge reactors.”

The only thing slowing China’s nuclear progress seems to be cost-overruns and technical delays involving Western firms: Westinghouse’s AP1000 reactors, because of its bankruptcy, and Areva’s European Pressurized Reactors, or EPR, because of its cash-flow problems.

SCMP wrote that “the country’s energy needs are so great … that China has no choice but to continue developing nuclear power alongside renewables.”

OTHER

May’s Brexit Fiasco Three Ministers To Exit Shaky Government

July 9 (EIRNS)—On July 6, following a day-long cabinet meeting at the prime minister’s official country residence Chequers, British Prime Minister Theresa May announced her cabinet was in full agreement with her Brexit strategy. Yet 48 hours later, three of her ministers resigned in quick succession. The resignations were led by May’s top Brexit negotiator David Davis, who said he did not agree with the cabinet decision, which he considered a “soft” Brexit. His resignation was followed by his deputy at the Department for Exiting the EU, Minister Steve Baker. Within a few hours, Foreign Secretary Boris Johnson handed in his resignation. The Guardian reported that after the Chequers meeting, Johnson had characterized efforts to sell May’s Brexit plan as “polishing a turd.”

Davis’s resignation letter said he would not be a reluctant conscript to the plan agreed at Chequers, which he said was “certainly not returning control of our laws in any real sense.” May named Housing Secretary Dominic Raab to replace Davis. She has yet to name the new Foreign Secretary.

While May claims to be confident about the survival of her government, the Guardian writes that the stage could be set for at least 48 MPs to send letters to Sir Graham Brady, the chair of a powerful backbench committee, which could lead to a call for a vote of no confidence.

The leader of the opposition Labour Party, Jeremy Corbyn, questioned whether May could or should survive. Corbyn tweeted: “David Davis resigning at such a crucial time shows @Theresa_May has no authority left and is incapable of delivering Brexit. With her Government in chaos, if she clings on, it’s clear she’s more interested in hanging on for her own sake than serving the people of our country.”

Tom Watson, Deputy Labour Party leader said the twin resignations of Davis and Johnson showed the government is in “meltdown,” and that “This is complete and utter chaos. The country is at a standstill with a divided and shambolic government. The Prime Minister can’t deliver Brexit and has zero authority left.”

And Nicola Sturgeon, leader of the Scottish National Party and Scotland’s First Minister, tweeted: “The Chequers unity didn’t last long. This U.K. government is in utter chaos and ebbing authority by the day. What a shambles.”

Today, in an afternoon address to Parliament, and debate, presenting her rather unconvincing commitment to negotiating a Brexit, May received a delightful roasting by Corbyn. Of the 600 or so MPs present at the start, odds and ends kept departing after each question she answered, to the point that within two hours, only a few dozen MPs remained in the Parliament chamber. She admitted to a waning audience that the negotiating deadline might not be reached and there might not be a Brexit agreement.

Speculation that more ministers will resign abounds.

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