MONDAY, DECEMBER 9, 2019

Volume 6, Number 243

EIR Daily Alert Service

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

• The World Is in a Pickle
• China’s Yang Jiechi Tells Mike Pompeo, ‘Stop Gross Interference in China’s Internal Affairs’
• Russia Is Ready To Immediately Extend New START Treaty, Putin Affirms
• Putin Is Serious About Implementing Minsk Accords, Resolving Ukraine Conflict in Paris
• Will Pensacola Shooting Lead to New U.S.-Saudi Relationship?
• House Speaker Pelosi Insists Impeachment Is Not About Ukraine, But Against Russia
• Trump Postpones Terrorist Designation For Mexican Drug Cartels, at Mexico’s Request
• Peterson Institute Economist Assesses, U.S. Economy Will Lose by Decoupling From China
• U.S. Shale Oil/Gas Has Lost More Than $250 Billion in Six Years
• Global Measles Resurgence Cost 140,000 Lives in 2018, With Poverty and Superstition Major Factors
• China’s Politburo Emphasizes 2020 ‘Breakthroughs in Scientific and Technological Innovation’

EDITORIAL

The World Is in a Pickle

Dec. 8 (EIRNS)—If we take a step back from the daily assault and battery by the Establishment media that Americans, like many others around the world, are being subjected to—running the gamut from lies about the impeachment of President Donald Trump, to lies about Russia and China, to lies about the state of the economy, to lies about what most Americans think—the real problems facing the planet come into clearer focus.

Civilization is indeed in deep trouble, Helga Zepp-LaRouche emphasized in a discussion with associates on Dec. 7. First, the single most important relationship among nations on the planet, and the key to reversing the economic collapse underway in the West—that between the U.S. and China—is in very bad shape, and getting worse by the day. Congress has passed provocative anti-Chinese legislation supposedly defending “democracy and human rights” in Hong Kong and Xinjiang province, which President Trump has felt politically obligated to sign. And economic relations between the two countries remain mired in Wall Street-sponsored confrontation. Zepp-LaRouche reported that, during her recent trip to China, she found that Chinese scholars and officials she met with, viewed current U.S.-China relations as very bad, and only likely to get worse.

That same conclusion must be drawn from yesterday’s unusual phone call to Secretary of State Mike Pompeo by China’s top foreign policy official, Yang Jiechi, which we report below.

As Mrs. Zepp-LaRouche emphasized, there is zero possibility of LaRouche’s Four Power alliance among the U.S., China, Russia and India emerging, if the U.S. (and European nations) remain on their current confrontational trajectory with both China and Russia.

That brings us to the second vital issue, which is closely related to the first: the ongoing coup d’état against President Trump, because he has sought positive relations with both China and Russia, among other reasons. That coup, disguised unconvincingly as an “impeachment,” is proceeding on a fast track, undeterred by the fact that there is no basis whatsoever in real events in the real world for this gravest of Constitutional remedies. The perpetrators of the coup are also undeterred—in fact, they are probably emboldened—by the predictable political consequence that the U.S. will be further polarized, perhaps to the point of violence, should they succeed. The only beneficiary of such a turn of events would be the British Empire, whose entire financial and geopolitical system now faces extinction.

The trajectory at this point is towards a House impeachment as early as this week, followed by a Senate trial in January, which will do huge damage to the nation—the very least of which will be the brainwashing of the population with daily soap opera episodes from Washington, and the huge distraction from the actual pressing issues of the day: replacing the bankrupt and genocidal trans-Atlantic financial system with a just new world economic order, built around China’s BRI and based on the universal principles of the American System of economics, of which Lyndon LaRouche is the leading modern exponent and champion.

But trajectories in politics and economics are meant to be changed, not obediently followed, especially when they demonstrably lead to such catastrophes. A critical flank that is available to alter that trajectory and define a new one, is the wide circulation of EIR’s Special Report, “Stop the McCarthyite Witch Hunt Against China and President Trump,” as part of a broad mobilization to stop the coup. That pamphlet addresses the deadly prejudices head on, which many Americans have bought into. For instance: The fact is that there will be no competent defense of the U.S. Presidency by anybody who disagrees with the content of that pamphlet, and the need for the United States to join with the Belt and Road Initiative.

Helga Zepp-LaRouche stressed in her Dec. 7 discussion that China is functioning today based on a 5,000-year principally Confucian civilization and tradition, not some ossified “Marxist” ideology. The problem we in the West are facing is not them, but us. It is we in the West who have moved away from our own best traditions, of the European Renaissance, the German Classics, the American Revolution—each and all of which are fully consonant with what China is doing today.

That central point indicates the way for the world to get out of its current pickle.

STRATEGIC WAR DANGER

China’s Yang Jiechi Tells Mike Pompeo, ‘Stop Gross Interference in China’s Internal Affairs’

Dec. 8 (EIRNS)—China’s top foreign affairs official, Yang Jiechi, member of the Political Bureau of the Communist Party of China (CPC) Central Committee and director of the Office of the Foreign Affairs Commission of the CPC Central Committee, “held a phone conversation with U.S. Secretary of State Mike Pompeo on Saturday,” according to a Dec. 7 Xinhua wire. That formulation would seem to indicate that Yang initiated the call; the content of the conversation—a very strongly-worded protest over the recent U.S. passage of the Hong Kong Human Rights and Democracy Act and the Uyghur Human Rights Policy Act—confirm that this was a very high-level Chinese government initiative. It also underscores the evaluation of Helga Zepp-LaRouche, who recently returned from a trip to China, that Chinese officials are very upset about attacks on the country around Hong Kong, the Uyghurs, the trade talks, and so on, and believe that overall U.S.-China relations are currently bad, and will probably remain so for some time.

According to the Xinhua account of the call with Pompeo, “Yang said U.S. officials have repeatedly made statements that distort and attack China’s political system and internal and external policies. Those are gross interference in China’s internal affairs and a serious violation of the international law, the basic norms of international relations and the will of the Chinese and U.S. people as well as the international community, Yang said. ‘China firmly opposes and strongly condemns these acts,’ he said,” Xinhua reported.

Yang then lectured Pompeo on China’s “great achievements” over the last 70 years, which have gained it worldwide praise. He further explained that “the Chinese people have a high degree of confidence in their own development path, theory, system and culture and will unswervingly follow their own development path, and no force can stop the Chinese people from marching forward, Yang said. China’s determination to defend national sovereignty, security and development interests is unwavering and no one should expect China to swallow anything that undermines its own interests, Yang said. Yang said that China urges the U.S. side to come to a clear assessment of the situation, correct its mistakes and immediately stop slandering China and interfering in China’s internal affairs.”

Russia Is Ready To Immediately Extend New START Treaty, Putin Affirms

Dec. 6 (EIRNS)—Russian President Vladimir Putin said: “Russia is ready to extend the New START Treaty without delay, as soon as possible, before the end of this year without any preconditions. I say that formally to ensure that there is no double or triple interpretation of our stance.” He made his remarks in Sochi, on Dec. 5, during the last of two days of meetings with the leadership of the Defense Ministry and other departments, as well as defense industry enterprises. “All our proposals regarding the extension the New START Treaty are on the table. We have so far received no response from our partners,” he said.

After outlining the previous day’s discussions, and the current day’s agenda, including that “Successful research and development in the aforementioned high-tech areas are of crucial importance for the development of civilian sector, for increasing thecompetitiveness of the national science, and creating advanced industries and infrastructure for the digital economy,” and “to discuss measures to counter potential threats stemming from the United States’ withdrawal from the INF Treaty,” the Russian President stressed: “To reiterate, Russia is not interested in launching an arms race or deploying missiles in environments where no missiles are currently deployed. As you may be aware, we announced a unilateral moratorium on deploying such [intermediate- and shorter-range] missiles and invited our colleagues in Europe and the United States to join in. So far, only the President of the French Republic, Mr. Macron, has responded. There is no response from our other partners. This forces us to take measures to counter these threats.”

The day before Putin announced willingness to extend New START, U.S. Undersecretary of Defense for Policy John Rood was telling reporters why the Pentagon wants low-yield nuclear warheads on some of its submarine-launched ballistic missiles. Rood said the need for the new low-yield weapons came from intelligence reports of Russian emphasis on use of nuclear weapons early on in a conflict, “and the mistaken belief that they have the ability to use a low-yield nuclear weapon earlier in the conflict in a way to deter response.” His reference was to the alleged Russian “escalate-to-de-escalate” doctrine.

“We saw the need of aggressive action to restore deterrence, which had gotten weaker than we would like with these supplemental capabilities” that would show “we had a variety of capabilities that were more survivable than the existing low-yield weapons” that our aircraft delivered. “We see this as very stabilizing” and in no way supporting the concept of early use of low-yield nuclear weapons, Rood said, countering the warnings from arms-control advocates.

Russian officials and a number of experts on nuclear weapons policy have repeatedly refuted that Russia has an “escalate to de-escalate” policy in its military doctrine over the past two or more years, but the notion lives on in Pentagon documents which provide the basis for U.S. nuclear doctrine and force structure.

Putin Is Serious about Implementing Minsk Accords, Resolving Ukraine Conflict in Paris

Dec. 7 (EIRNS)—Kremlin spokesman Dmitry Peskov told TASS on Dec. 6 that on the sidelines of the Dec. 9 Paris “Normandy Four” talks, President Vladimir Putin plans “to hold important bilateral meetings with President Macron, German Chancellor Merkel and Ukrainian President Zelensky. [Putin’s] attitude is serious, the only expectation is to facilitate efforts to resolve the domestic conflict in southeastern Ukraine, ensure a common understanding that there is no alternative to implementing the Minsk Agreements and prevent attempts to dilute them.”

Confirming that he will meet the Russian President, Ukraine’s President Volodymyr Zelensky told Ukrainian TV in an interview: “Yes, all the Presidents will have bilateral meetings,” and he that he “wants to come back with meaningful results” and bring to Ukraine “the comprehension and understanding that all [the negotiators] seek to eventually put an end to this tragic war.”

Commenting on the Dec. 9 summit Russian Foreign Minister Sergey Lavrov, who was at the Mediterranean Dialogues conference in Rome, on Dec. 6, said: “We will expect additional agreements, which will make it possible to end that conflict, which will ensure people’s safety in Donbas, ensure their rights, which are enshrined in the Minsk agreements, the so-called special status law, and which will help to put an endto that conflict.”

Will Pensacola Shooting Lead to New U.S.-Saudi Relationship?

Dec. 8 (EIRNS)—The deadly shooting at the Pensacola Naval Base in Florida on Friday, Dec. 6, which led to three deaths was carried out by Saudi military trainee Mohammed Alshamrani, according to authorities. USA Today reported that “the FBI investigates the shooter’s motivations, including allegations that he posted anti-American sentiments on social media before the rampage. The shooter … was one of 852 Saudi nationals in the U.S. for military training provided under a security cooperation agreement with Saudi Arabia…. The FBI is examining tweets that Alshamrani may have posted on Friday morning, railing against the United States for its support of Israel and for purported crimes against Muslims, including the detention of suspects in Guantanamo Bay.”

Rep. Matt Gaetz (R-FL) said the incident was a “planned terrorist attack” and questioned the program that allows Saudi military students to come to the U.S. “This event demonstrates a serious failure in the vetting process and in the way in which we invite these people to our community.”  He also said that he was very pleased with the President’s cooperation with him, in dealing with this event.

This has triggered discussion of the nature of the U.S. relationship with Saudi Arabia, especially in light of their proven role in 9/11.

Yesterday, intelligence analyst Col. Pat Lang’s “Sic Semper Tyrannis” blog published a plea for a reconsideration of United States policy toward Saudi Arabia (“Saudi Arabia—A Family Holding Company, Not a Friend.”). The author, who signed as “PL” (i.e., Pat Lang), described himself as having 40 years of experience in Mideast affairs teaching at West Point, as a diplomat, and a Pentagon intelligence officer. He challenged reports of Saudi “modernization,” claiming that the Royal family remains committed to “an extreme form of Wahhabi fanatic Islam based on the Hanbali school of Sunni Islam as reinforced by the extremist medieval scholar Ibn Taimmiya.” He concluded by warning U.S. President Donald Trump and the Israeli government against believing they can benefit from Saudi cooperation, and called for a “re-appraisal of our relationships.”

U.S. POLITICAL AND ECONOMIC

House Speaker Pelosi Insists Impeachment Is Not about Ukraine, But against Russia

Dec. 6 (EIRNS)—In case anyone has forgotten about the purported evils of Russian President Vladimir Putin, House Speaker Nancy Pelosi went to great lengths yesterday in her press conference to remind us all that the attempt to impeach President Donald Trump has nothing to do with Ukraine. It’s all about Russia.

Just because the Democrats have been harping on this subject for almost three months, it doesn’t matter, she said. The Ukraine issue is just the continuation of the Russia investigation. After all, it was Russia which benefitted from Trump “withholding” military aid to Ukraine. “Russia invaded Eastern Ukraine,” and 10,000-13,000 people died because of that, Pelosi insisted. “All roads lead to Russia…. Sometimes people say, I don’t know about Ukraine, I don’t know that much about Ukraine—well our adversary in this is Russia.”

Perhaps Pelosi has figured out that the Ukraine story doesn’t hold water, so better to dredge up Russia again. A number of conservative media comment on the fact that the appearance of three Resistance “legal scholars” at this week’s Judiciary Committee hearing has hurt, not helped, the Democrats. There is deep concern among freshman Democrats in swing states that they’re likely to lose reelection because of the impeachment issue. Asked yesterday whether she were concerned about moderates pushing back on impeachment, Pelosi retorted: “This has absolutely nothing to do with politics.”

Yesterday, CNN reported, New Jersey Democrat Jeff Van Drew announced he will not vote for articles of impeachment, “unless there’s something that I haven’t seen, haven’t heard before.” He warned Democrats to “be careful what you wish for,” because impeachment is “tearing the nation apart.” When asked how he would vote, Minnesota Democrat Colin Peterson replied, “I don’t have any idea what they’re doing.”

Constitutional scholar Jonathan Turley reported in an op-ed in The Hill that after his Dec. 4 testimony before the Judiciary Committee, his home and office phone were inundated with threatening messages, with demands that he be fired from George Washington University Law School because he had argued that the case for impeachment hasn’t been made. He slammed Washington Post columnist Dana Milbank, and MSNBC’s Rachel Maddow for attacking his credibility. “There is an intense ‘rancor and rage’ and ‘stifling intolerance’ that blinds people to opposing views,” he wrote. “My call for greater civility and dialogue may have been the least successful argument I made to the committee.”

Trump Postpones Terrorist Designation for Mexican Drug Cartels, at Mexico’s Request

Dec. 7 (EIRNS)—After receiving a report from Attorney General William Barr on his discussions the day before with the President of Mexico, President Donald Trump tweeted on Dec. 6, that: “All necessary work has been completed to declare Mexican Cartels terrorist organizations. Statutorily we are ready to do so. However, at the request of a man who I like and respect, and has worked so well with us, President Andrés Manuel López Obrador we will temporarily hold off this designation and step up our joint efforts to deal decisively with these vicious and ever-growing organizations!”

Mexican Foreign Minister Marcelo Ebrard quickly thanked President Trump in the name of the Mexican government for the decision, and declared that “cooperation won out, and there will be good results.”

President López Obrador today gave his personal thanks to President Trump, while touring work being done on installations of the national oil company, Pemex, in the state of Tabasco (including construction of the first new refinery in years in Mexico). He called the decision to put off the designation “very good … because we must work, as he said, in a coordinated way….

“I, too, very much respect President Donald Trump, because he is demonstrating by his actions that he is respectful of Mexico, of our people, and of our national sovereignty,” said Mexico’s President. López Obrador then thanked him “for having chosen to maintain a Good Neighbor policy,” referring to Franklin Delano Roosevelt’s policy, under which Mexican and U.S. relations had flourished.

Although López Obrador reiterated the dubious proposition that economic development alone, without military action, can defeat cartel “violence”—the policy on which he successfully campaigned, as he reminds people regularly—but cooperative work on the crucial flank of shutting down the illegal weapons trafficking upon which the cartels depend, continues. Both governments agree, as U.S. Ambassador to Mexico Christopher Landau tweeted after Barr’s meetings with President López Obrador, his security cabinet and Mexico’s Attorney General on Dec. 4: “We have to strengthen cooperation to halt the illegal flows of drugs, weapons and money. Together we can!”

COLLAPSING WESTERN FINANCIAL SYSTEM

Peterson Institute Economist Assesses, U.S. Economy Will Lose by Decoupling from China

Dec. 8 (EIRNS)—Most countries are expanding their economic ties with China, Peterson Institute senior researcher Nicholas Lardy told a Dec. 7 New York conference organized by the China Institute, Xinhua reported. Foreign direct investment (FDI) to China continues to grow strongly, according to Lardy: “Thousands and thousands of new foreign firms are being established every month,” because they see the Chinese economy as a strong market. In the January-August 2019 period, total FDI expanded 6.9% year on year to about $85.36 billion—notable especially because global FDI flows have declined for three consecutive years. Xinhua reported that “the United States has never been a big investor in China, [and] Lardy pointed out that most of China’s foreign investments come from other places. ‘If there is decoupling, it’s going to be decoupling of the United States from the rest of the world, because other countries are not decoupling from China,’ Lardy said.”

Speaking at the same forum, Wei Shangjin, professor of finance and economics at Columbia University and former chief economist of the Asian Development Bank, “said that the two economies are well integrated with each other,” Xinhua reported. “Economic decoupling from China means that the United States would see an increase of costs and loss in competitiveness, Wei said.”

U.S. Shale Oil/Gas Has Lost More than $250 Billion in Six Years

Dec. 6 (EIRNS)—In the huge corporate debt bubble, the oil shale sector of leveraged lending is looking particularly bad. A Dec. 2 article in OilPrice.com reported 32 bankruptcies of firms in the oil exploration and oil field services sector in the third quarter. The total of shale oil/gas bankruptcies since 2015 is about 200, so there is clearly a much faster pace of collapse now. OilPrice.com pointed out that this is occurring with a completely stable, even slightly rising oil price, in contrast to the last, 2013-14, burst of bankruptcies when that price plunged from roughly $100/barrel to $30.

This time it is occurring because mounting failures of the so-called revolutionary technology of fracking, to provide productivity which matches or even approximates the tremendous rise in indebtedness it imposes on oil companies of all sizes. This industry’s cumulative losses now exceed $250 billion since 2014, the news site reports.

A major investor in the sector is Steve Schlotterbeck, the former CEO of a very large gas producer, EQT. Schlotterbeck told the Fourth Annual North East Petrochemical Conference and Exhibition back on June 21: “The shale gas revolution has frankly been an unmitigated disaster … with very few limited exceptions. In fact, I’m not aware of another case of a disruptive technological change that has done so much harm to the industry that created the change.” He says the average shale company has obliterated 80% of its market value in the past decade.

Fatally, these companies have now begun issuing new debt as “shale bonds”; this means they are creating asset-backed securities, securitizing their oil and gas revenue. Recent shale bond issuers have had to pay 6% as well as selling off the revenue, more or less guaranteeing even bigger waves of bankruptcies, and bond market losses to follow the leveraged lending market losses.

Global Measles Resurgence Cost 140,000 Lives in 2018, with Poverty and Superstition Major Factors

Dec. 6 (EIRNS)—There have been more than 140,000 deaths in 2018 from the resurgence of measles, according to the report released yesterday by the World Health Organization (WHO) and the U.S. Centers for Disease Control and Prevention (CDC). Thousands more people have survived, but weakened or permanently impaired by complications from measles, including pneumonia, encephalitis, ear infection including loss of hearing, or loss of sight. Most deaths have occurred in children under the age of five years.

The direct causal factor is the lack of inoculation with the anti-measles vaccine, which was developed 50 years ago. In most places, this results from lack of resources for public health, and related conditions of poverty. But a contributing factor, is the wave of superstition against inoculation, which has grown in the United States and Europe in recent decades, and has resulted in many measles outbreaks.

The WHO recommends that populations have 95% vaccination coverage, which involves two doses of vaccine, at 12-15 months of age, with a second dose not less than 4 weeks later, often at 4-6 years of age.

The worst-hit nations over 2018, with the highest incidence rate of the disease, were the Democratic Republic of the Congo, Liberia, Madagascar, Somalia and Ukraine. These five nations accounted for about half of measles deaths worldwide in 2018.

The nations, where measles, once considered eliminated, has now returned, are: Albania, Czechia, Greece and the United Kingdom. A country is classified as no longer measles-free, if the virus returns and transmission is sustained continuously for more than a year.

THE NEW GLOBAL ECONOMIC ORDER

China’s Politburo Emphasizes 2020 ‘Breakthroughs in Scientific and Technological Innovation’

Dec. 8 (EIRNS)—In a meeting presided over by President Xi Jinping, the Politburo of the Communist Party of China discussed the economic perspective for 2020. According Xinhua, Xi told the meeting that, although China faces a “complicated situation of rising risks and challenges both at home and abroad this year, China has maintained sustained and sound economic and social development.” Xinhua further reported that the meeting emphasized that “Major steps have been taken in reform and opening-up with deepened supply-side structural reform, and breakthroughs have been made in scientific and technological innovation…. The year 2020 will be the year to finish building a moderately prosperous society in all respects, and it is also the final year for the 13th Five-Year Plan. China shall achieve its first centenary goal.”

Meanwhile, a research fellow at China’s Ministry of Commerce penned an op-ed in Global Times which argued that “it’s necessary for China to re-emphasize exports, particularly for its high-tech industries…. China should remain prepared for a prolonged fight against pressure from the [global] slowdown…. High-tech and innovative industries are the pillars of China’s industrial upgrading and sustainable economic growth. They are also the focus of the bruising China-U.S. trade war. China should focus on promoting its exports of high-tech products. The nation’s high-tech industries have seen great investment in fixed assets during an overall weak investment environment. If these high-tech industries encounter obstacles in sales and the supply of key parts, investments in the sector over recent years will become bad assets, impacting China’s financial system.”

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