EIR Daily Alert Service, THURSDAY, January 16, 2020
THURSDAY, JANUARY 16, 2020
Volume 7, Number 11
EIR Daily Alert Service
P.O. Box 17390, Washington, DC 20041-0390
- International Day of Action for a Unique Solution: Build Peace via Emergency Trump-Putin-Xi Summit
- Putin Urges Need for New International Security Architecture To Avoid Global War
- Pompeop Pushes ‘Big Stick’ Diplomacy at Stanford University
- Rouhani Rejects Boris Johnson Proposal To Replace JCPIA With Trump Deal
- Taiwan’s Tsai Ing-Wen Probokes Beijing in BBC Interview, ‘We’re an Independent Country’
- Federal Reserve Is Working on ‘New Tools, New Paths to Liquidity’ To Forestall a Blowout
- Financial Gurus Howl Over What EIR Has Forecast for Years: Their System Is Set To Explode
- Trump and China’s Liu He Preside Over Signing Ceremony of U.S.-China Trade Deal
- U.S.-China Trade Agreement Does What No One Thought Possible, Although Many Issues Remain
- U.S. House of Representatives Votes To Send Impeachment to Senate
- BRICS Article Proposes New World Monetary System Based on Developing Infrastructure
- China Sets Up ‘World’s First Smart’ Autonomous High-Speed Railway for 2022 Olympics
Jan. 15 (EIRNS)—The Schiller Institute, founded by Helga Zepp-LaRouche, organized an international Day of Action on Jan. 15 to call for an emergency summit meeting among Presidents Trump, Putin and Xi to find a solution to the pressing danger of regional and world war, as reflected in the recent Iran developments. That Day of Action was held yesterday in dozens of cities in five continents, to awaken the population to the danger of war, its causes, and the needed solutions.
As the activities were being held, Helga Zepp-LaRouche stated in her weekly international webcast that “such a summit must occur, to get out of the danger of confrontation which is now clearly escalating, and not really resolved at all between the United States and Iran.” Many people are befuddled, disoriented, and/or fatalistic, as they try to make sense of the strategic danger following the assassination of Iranian leader Qasem Soleimani. The Schiller Institute mobilization, she said, is to “create a chorus, a chorus of people demanding that we absolutely must change the agenda” defined by the dominant trans-Atlantic financial system and British imperial geopolitics, because if things are left as they are, the situation could go completely out of control.
“This is not only our view,” Zepp-LaRouche elaborated. “Today, Russian President Vladimir Putin gave his state of the nation address before the Federal Assembly, and there he stated that we are in a situation where a regional conflict very clearly could become something affecting the whole global security situation”—a clear reference to the recent Iran crisis. Putin then called for a meeting of the five founding nations of the United Nations—the U.S., Russia, China, France and the U.K.—to “establish a new order which makes these dangers impossible, and start to discuss the principles on which such a new order has to be built.”
“I don’t disagree with that,” Zepp-LaRouche said. If you have a meeting of these five permanent members of the UN Security Council, the important thing is that you have the three most powerful nations sitting already at the table—namely, the United States, Russia, and China.”
The assassination of Iran’s Gen. Qasem Soleimani brought the world to the brink, she said. This had a very erosive effect on the international strategic situation, and it had a bad effect immediately on other nations, such as Kim Jong Un in North Korea, “because he will now remember what former National Security Adviser John Bolton had said about Kim receiving the treatment that was given to Saddam Hussein and Muammar Qaddafi.”
“And I’m not blaming Trump,” Zepp-LaRouche continued, “because Trump is in a completely difficult situation, because he’s surrounded by the same people whom he had attacked not very long ago as ‘the military-industrial complex.’ And the Articles of Impeachment will be introduced against him in the Senate today,” all of which is designed to box him into the British agenda for global showdown. Contrary to the British plan, Trump today held a positive signing of Phase One of a trade agreement with China, which strengthened his personal working relationship with President Xi—although it still leaves much to be resolved between the two nations.
The center of the problem, Zepp-LaRouche reiterated, is British geopolitics. “It all goes back to the doctrine of geopolitics, of absolutely preventing the countries of the so-called Eurasian land-mass to cooperate economically; it goes back to the ‘Great Game’ of the 19th century against Russia; it goes back to the Bernard Lewis doctrine, the Samuel Huntington ‘Clash of Civilizations,’ Brzezinski playing the Islamic card, There is a long historical tradition of trying to manipulate this region.”
The driving force behind this British geopolitical drive for war is the collapsing trans-Atlantic financial system, which even the major financial media and market gurus are finally admitting is about to fully collapse—which EIR has been telling you for years. The Wall Street Journal reported today that the Federal Reserve is so panicked that its latest round of repos on top of renewed quantitative easing is simply not working, that they are looking into “new tools, new paths to liquidity” to try to forestall a blowout. The London Telegraph fretted that “the party’s over for the biggest equities bubble in history,” and that “Some now fear the stimulus that stopped the economy sliding into an economic depression could sow the seeds of the next market crash.”
STRATEGIC WAR DANGER
Jan. 15 (EIRNS)—Russian President Vladimir Putin today issued a call for the five founding members of the United Nations—Russia, the U.S., China, the U.K., and France—to take the lead to “develop updated approaches to ensuring stability on the planet that would fully take into account the political, economic and military aspects of modern international relations.” He said that the recent developments in Southwest Asia show how “regional conflicts can rapidly grow into threats to the entire international community,” and that the 75th anniversary this year of the defeat of fascism in World War II should serve for mankind to rededicate itself to that cause. Putin has personally invited President Donald Trump to attend the celebration on May 9 in Moscow.
Putin stated: “We can see how unpredictably, uncontrollably events are developing in the world, what is happening in the Middle East and North Africa literally in recent weeks and recent days, how regional conflicts can rapidly grow into threats to the entire international community.
“I am convinced that it is high time for a serious and direct discussion about the basic principles of a stable world order and the most acute problems that humanity is facing. It is necessary to show political will, wisdom and courage. The time demands an awareness of our shared responsibility and real actions.
“The founding countries of the United Nations should set an example. It is the five nuclear powers that bear a special responsibility for the conservation and sustainable development of humankind. These five nations should first of all start with measures to remove the prerequisites for a global war and develop updated approaches to ensuring stability on the planet that would fully take into account the political, economic and military aspects of modern international relations.
“Russia is ready to enhance cooperation with all interested parties. We are not threatening anyone or seeking to impose our will on anyone. At the same time, I can assure everyone that our efforts to strengthen national security were made in a timely manner and in sufficient volume. For the first time in the history of nuclear missile weapons, including the Soviet period and modern times, we are not catching up with anyone, but, on the contrary, other leading states have yet to create the weapons that Russia already possesses.”
The translation of Russian President’s complete speech is posted to the Kremlin website.
Jan. 15 (EIRNS)—U.S. Secretary of State Mike Pompeo delivered a bombastic address to foreign service student “future policymakers” at Stanford University’s Hoover Institution Jan. 13, entitled “The Restoration of Deterrence: The Iranian Example.” Former George W. Bush Secretary of State Condoleezza Rice, another war party leader and Hoover senior fellow, presided.
Pompeo began his remarks to the poor students by stating that America had never done “enough against Iran to get the deterrence that is necessary to keep us all safe. The JCPOA itself—the nuclear deal—made things worse.” Now we have cut off roughly 80% of Iran’s revenues. And “We are determined to get that last 20% too.” He added, “If Iran escalates, we will end it on our terms. … And our sanctions will continue until the regime stops its terrorist activity and commits to never having nuclear weapons and permits a verification regime,” he said.
He cited instances in which U.S. deterrence had been weak, which he said, the Trump Administration had “re-established deterrence”: Russia’s 2014 so-called occupation of Crimea; China’s “island-building” in the South China Sea, and Russia’s alleged violation of the INF Treaty.
Pompeo attacked China for restricting access to U.S. products in its markets, and stated that it “had stolen massive quantities of American innovation … created at campuses right like this one I’m standing on.”
In the Q&A, Rice plugged Stanford faculty member Alexander George, who developed the practice of “coercive diplomacy,” the idea that “you set deterrence, and you set the terms of what’s not acceptable, but then you open pathways for diplomacy.” Pompeo warned of going into a meeting where the participants “lie to each other,” instead “We’ve tried to just be candid. We’ve said, ‘Hey look, the deals that we had with China for an awful long time, it’s on us. We allowed this to take place. No more….’ That fails … when they move past a boundary that you’ve set, it requires you to respond to that in a way that convinces them that you actually meant what you said.”
Jan. 15 (EIRNS)—The Iranian response to the European statement on referring Iran to the dispute-resolution mechanism of the 2015 nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA), and U.K. Prime Minister Boris Johnson’s suggestion to take up President Donald Trump’s proposal for the signers of the JCPOA, including Russia and China, to come together again to negotiate a new deal with Iran, have both drawn negative responses from Iran.
“Europe must choose the right path and return to the nuclear deal,” Iranian President Hassan Rouhani said in a statement shown live on state TV. “Mr. Johnson, I don’t know what he’s thinking when he says that instead of the nuclear deal, we should implement a Trump plan. Other than violate international contracts, what else has Trump done?” Iranian Foreign Minister Mohammad Javad Zarif said, “The usage of the dispute mechanism is legally baseless and a strategic mistake from a political standpoint.”
Iran, in the aftermath of the U.S. assassination of Gen. Qasem Soleimani, has also ramped up its efforts to create the conditions under which the U.S. military will be forced out of the region. While the effort is focused mainly diplomatically, the security aspect has in no way been diminished by the U.S.-Iranian climb-down from war last week. “I advise Europe and the U.S. not to fuel regional problems,” Rouhani said during a cabinet meeting today. “Today, American troops are not safe in the region, and European troops may also be insecure tomorrow,” Rouhani continued, and called on all foreign military forces to leave the region without a war, reported Tasnim news agency.
In remarks yesterday during a meeting with Syrian Prime Minister Imad Khamis in Tehran, Rouhani stressed his point that the U.S. military must leave the region. “We will never forget such a grave U.S. crime [the Soleimani assassination] and believe that regional nations should not relax until ending the military presence of the U.S. in the region and evicting those invaders,” Tasnim quoted him as saying. “Today, the Americans’ interference in the affairs of other countries and their attempts to seize Syria’s oil wells have clearly revealed that they’ve never cared about the interests of regional nations.”
Jan. 15 (EIRNS)—Following her Jan. 11 landslide re-election (hugely influenced by the chaos in Hong Kong), Taiwan’s president Tsai Ing-Wen provocatively claimed in an interview with British state-run BBC that China must now “face reality” and accept that “we don’t have a need to declare ourselves an independent state. We are an independent country already, and we call ourselves the Republic of China, Taiwan.”
As reported by Hong Kong’s South China Morning Post, Tsai warned Beijing that any military action against Taiwan would be “very costly,” and that China should respect Taiwan. Her election victory, she argued, proves there is little appetite now for the “One China concept” and the ambiguity it has created over Taiwan’s status.
“The situation has changed, and such ambiguity can no longer serve the purposes it was intended to serve,” she claimed. Taiwan’s “sovereignty” is not in doubt.
These provocative remarks aided by the British Empire’s BBC, brought an immediate response from Ma Xiaoguang, the spokesman for the State Council’s Taiwan Affairs Council, who warned, “we firmly attack and counter various forms of Taiwan independence and separatist activities in order to maintain overall peace and stability in the Taiwan Strait,” according to MSN. By refusing to accept the one-China concept and supporting and tolerating Taiwan’s pro-independence movement, he said, Tsai had “unilaterally damaged” the basis for official exchanges and cross-Strait cooperation. The one-China principle is the only basis for official talks with Taiwan, Ma emphasized. “Moving a mountain would be easier than moving the one-China principle,” he insisted. “The election does not change the fact that Taiwan is part of China.”
According to Asia Times, in the four days since the Jan. 11 election, Tsai has received three U.S. delegations and received a flood of congratulations. Among them was former Vice President Joe Biden’s message, telling Tsai that “you are stronger because of your free and open society.” The U.S., he said, “should continue strengthening our ties with Taiwan and other like-minded democracies.” Tsai also met with a delegation from the neo-con American Enterprise Institute, with which she reportedly discussed the possibility of signing a free-trade agreement with the U.S.
COLLAPSING WESTERN FINANCIAL SYSTEM
Jan. 15 (EIRNS)—The Wall Street Journal reported yesterday that the Fed had added $82 billion to the financial markets on Jan. 14, and announced that it would extend its plans to keep intervening in the markets into mid-February. The worried article continued: “Big banks’ demand for longer-term Federal Reserve liquidity flared up again on Tuesday…. The Federal Reserve Bank of New York said it intervened twice via repurchase agreements, or repos…. Collectively, the Fed added $82 billion in temporary liquidity to the financial system.”
As of Jan. 9, the Fed’s total balance sheet stood at $4.11 trillion, up from $3.8 trillion in September—clear proof that the suicidal policy of quantitative easing has resumed, with a vengeance. Even more ominous are the “new tools” that the Fed may unleash next. According to the Journal, “The Fed had initially planned to end its repo interventions at the end of the month, but continuing issues in money markets have extended the horizon for the effort. Some on Wall Street think the repo operations could continue into the early summer. Meanwhile, the Fed is weighing other options, like the adoption of new tools or new paths to liquidity, as a longer-term solution.”
Jan. 15 (EIRNS)—“The party’s over for the biggest equities bubble in history,” a distraught article by Tom Rees in today’s Telegraph pronounced. “It is a daunting task for central banks to wean the market off its stimulus addiction.” Rees reviewed the way in which the policy of quantitative easing and zero or negative interest rates pumped money into the system in the aftermath of the 2008 crisis, and then stated: “Some now fear the stimulus that stopped the economy sliding into an economic depression could sow the seeds of the next market crash. Meanwhile stocks are also being pumped up artificially by new market trends unique to the post-crisis era, from the boom in stock buybacks to the meteoric rise of passive investing. How did we reach the point where the game became fixed for stock markets? And is 2020 the year it could all turn sour?”
U.S. POLITICAL AND ECONOMIC
Jan. 15 (EIRNS)—Speaking today in the ornate East Room of the White House, President Donald Trump, standing next to Chinese Vice Premier Liu He, presided over a very upbeat signing ceremony of “Phase One” of the U.S. trade deal. Before a large audience of legislators, business executives, and other invited guests, Trump described the event as a “momentous occasion” in which the wrongs of the past were being righted and a “fair and reciprocal” and thoroughly enforceable agreement reached.
Describing Liu He as “a good friend of mine,” the President reserved special praise for his “good friend” President Xi Jinping who, he said, “is watching as we speak.” Announcing that he intends to travel to China in the “not too distant future,” Trump said of his relationship with Xi, “We’ve developed incredible cooperation throughout this process,” and that the agreement signed today represents an “incredible breakthrough.” This is a “big celebration,” he said.
Following perfunctory remarks by Vice President Mike Pence, Trump also effusively praised U.S. Ambassador to China Terry Branstad, the former Iowa Governor, who, he said, “loves China.” Trump told the story of Branstad’s meeting with a visiting agricultural official, Xi Jinping, some 35 years ago, after which Branstad remarked, “I’ve just met the future President of China.”
Trump emphasized that prior to today’s signing, “we had no deal with China … we’ve waited decades.” He recalled that he had told Xi that the U.S. didn’t blame him, but rather blamed previous U.S. administrations for allowing China to take advantage of the U.S. Now, he said, we can look forward to a future of “greater harmony between the U.S. and China, leading to stronger world peace.” The U.S. and China have made “a big investment in each other.” Trump praised Xi for helping “with North Korea,” noting that Kim Jong Un has great respect for Xi. “They help us and we help them,” he said of bilateral relations. “We’ve created a beautiful mosaic” of cooperation.
On the occasion of the signing, Liu He read a letter that Xi Jinping sent to Donald Trump, in which he underscored that the agreement signing is good for both nations. Healthy and steady growth in bilateral relations requires effort on both sides, Xi said, and in that spirit, he expressed the hope that the U.S. side will treat Chinese companies fairly, so as to build mutual trust. “I will stay in close touch with you personally,” Xi said, to ensure that things progress smoothly.
In his own remarks, Vice Premier Liu stated that today’s signing is a “tribute to both Presidents” and the teams on both sides that “didn’t give up” and brought the agreement to fruition. China and the U.S. are “two great nations with responsibility in world affairs,” he said. The agreement is a mutually beneficial one and a “win-win” for world peace and prosperity, Liu underscored. It’s an extensive agreement, and “we’ll work with the U.S. to ensure good implementation.” The world is at a “critical crossroads,” making it essential that major countries cooperate. China’s system suits its national economy, he stressed, but it can work together with the U.S. and there are many areas of cooperation. Cooperation “is the only right choice” for world peace.
Jan. 15 (EIRNS)—In presenting the U.S.-China trade deal today, President Donald Trump emphasized that the agreement does what no one thought possible, in terms of addressing such key issues as forced technology transfer, intellectual property protection, and purchases of U.S. agricultural, manufacturing, and energy products. But it still leaves many key issues unanswered.
Under the agreement, the Trump Administration eliminated tariffs originally set to take effect last December, and it also agreed to cut duties on $120 billion worth of goods to 7.5%. However, in a joint statement released yesterday, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin stated that there is no agreement to lift more than $360 billion worth of tariffs in existence since 2018.
“There are no other oral or written agreements between the United States and China on these matters, and there is no agreement for future reduction in tariffs,” they said.
Mnuchin did say that a second phase of the agreement could include more tariff relief, CNBC reported. “Just as in this deal there were certain rollbacks, in phase two there will be additional rollbacks,” he said. In today’s signing ceremony, Trump said that “as a negotiating card,” tariffs could be removed if phase two is completed. They can all come off as we finish phase two, he said. “We have a strong card.”
Other key points of the announced agreement include:
• China has agreed to setting up a comprehensive legal system of intellectual property protection and enforcement. On technology transfer, both sides stress the importance of ensuring that technology transfer occurs on voluntary, market-based terms and that forced technology transfer is a big concern. The parties are committed to taking steps to address these issues.
• During the two-year period from Jan. 1, 2020 through Dec. 31, 2021, China shall ensure that purchases and imports of U.S. manufactured goods, agricultural goods, energy products, and services exceed the corresponding 2017 baseline amount by no less than $200 billion. Under the deal, China is expected to buy a minimum of $77.7 billion more of manufactured goods, $37.9 billion more of services, $32 billion more of agricultural products and $52.4 billion more of energy products. There will be increased agricultural imports of beef, pork, poultry, seafood, dairy, rice, and potatoes.
China is also to allow U.S. financial services suppliers to apply for asset-management company licenses that would permit them to acquire non-performing loans directly from Chinese banks, beginning with provincial licenses.
Jan. 15 (EIRNS)—The U.S. House of Representatives voted 228-193 to send its impeachment articles to the Senate today. In a tweet yesterday and in her speech before the House today, Speaker Nancy Pelosi announced the two themes: Trump is a pawn of the Russians who stole the 2016 election for him; and “dismissal” is cover-up, referring to a Senate motion, co-sponsored by Senate Leader Mitch McConnell, that would allow a simple majority vote to dismiss “with prejudice for failure by the House of Representatives to prosecute such articles” if the House takes more than 25 days to send the articles to the Senate. And, on Jan. 14, Pelosi tweeted, “American elections should be decided by the American people, not by the Russian Government. Retweet if you agree!”
In her House speech, Pelosi defended her delay in sending the impeachment articles to the Senate by making claims that internal emails expressing “concerns” about Trump’s holdup on lethal aid to Ukraine to “fight the Russians” were new dynamic “evidence,” that John Bolton had come forward to offer testimony in the interim, and that Lev Parnas had significant information implicating the President directly in Rudy Giuliani’s investigation of the Bidens. Most importantly, however, she railed on about the new fake claims about the Russian GRU hacking Burisma, the Ukrainian firm where board member Hunter Biden’s name netted millions for the Biden family.
A survey of the Democratic Party literature about how to defeat Donald Trump indicates that the consensus view is a three-pronged attack: (1) prolonged impeachment proceedings with 24-hour media spin, (2) an intractable foreign war, (3) a billion-dollar negative ad campaign.
With respect to impeachment, the upshot is not in doubt, but “never Trump” Senators will provide room for plenty of mischief and prolonged proceedings. Those Senators are Susan Collins, Cory Gardner, Lisa Murkowski, Mitt Romney, Lamar Alexander, and Ben Sasse. While former never-Trumpers Lindsey Graham and Mitch McConnell have recently pledged allegiance, they are hardly trustworthy.
It is obvious that driving a wedge between Trump and Russian President Vladimir Putin furthers the second prong, an intractable war, brought about by actions which will be attributedto the President but which are, in reality, the continued machinations of the irregular and hybrid warfare introduced most prominently with the Iraq War of George W. Bush and the Arab Spring of Barack Obama, all at the behest of a British Empire apparatus which has no compunction about killing millions to reach its strategic goals.
Michael Bloomberg, the billionaire shill for Bank of England Governor Mark Carney and the international central bankers out to destroy this President and impose a fascist new green order upon the world, is providing the billion-dollar negative ad campaign. Bloomberg’s funding has not only paid for an unprecedented $180 million in negative ads targeted at battleground states. He has also put campaign offices and campaign workers on the ground in the same battleground states, bent on profiling the weaknesses of the President with his core voters and exploiting them.
THE NEW GLOBAL ECONOMIC ORDER
Jan. 15 (EIRNS)—The BRICS Information Portal today published its lead story with the banner headline, “Can the BRICS Be a Catalyst for a New International Monetary System Based on Infrastructure Development?” by Paul Gallagher of EIR and Richard A. Black of the Schiller Institute. The 2,000-word article proposes solving the current monetary meltdown by applying the economic science of Lyndon LaRouche for national development to the BRICS’ currently underused New Development Bank and EIR’s proposal for a Russian Bank for Infrastructure and Industry.
The article was submitted to the BRICS by the Russian National Committee on BRICS Research, which is affiliated with the Russian Academy of Sciences. Russia is this year’s chair of the five-nation bloc, comprised of Brazil, Russia, India, China and South Africa.
After outlining the explosive danger created by current Anglo-American monetary policy, the authors point to a solution: “Two members of the BRICS, China and Russia, are already involved in new initiatives which are breaking with the old patterns of non-investment in infrastructure: China’s Belt and Road Initiative (BRI) and the Russian Federation’s plan to ‘light up Africa’ with nuclear-power vectored electricity generation. The American physical economist, Lyndon LaRouche, had shown in research papers published over many years, that major infrastructure—high-speed railroads, third and fourth generation nuclear power, major water management systems—are the central and irreplaceable producer of added value in a national economy. LaRouche had shown that ‘the actual role of infrastructure in a viable form of economy … amplifies the productive powers of labor, a science-driven increase of physical productivity at the point of production.’ Let us examine how the New Development Bank of the BRICS could be expanded in size and in conception to become a seed-crystal for a new monetary system for development.”
The proposed creation of a Russian Bank for Infrastructure and Industry is then used as a template, showing the way for the creation of other such national banks as well as U.S. participation, based on the proven principles of Alexander Hamilton.
Jan. 15 (EIRNS)—In preparation for the 2022 Winter Olympics and Paralympics in Beijing, China has unveiled what it calls the “world’s first smart high-speed railway.” It is also the world’s fastest autonomous high-speed train and can reach speeds of 350 kph. The train will operate on the Jingzhang intercity railway, helping tourists complete a 174 km journey in 1 hour, as compared to 3 hours before. Some trains may be able to make the journey in as little as 45 minutes, reports Britain’s Guardian newspaper.
The new driverless bullet train will connect the capital to cities where some of the Olympic events will take place, such as Zhangjiakou and Taizicheng, and will also offer tourists the possibility to see the Great Wall through a stop at Badaling Changcheng. The line includes a total of 10 stops and took four years to complete.
The train will function by a rigorous timetable, stopping and leaving a station automatically. The speed between stations is monitored by sensors and the train is controlled by a computer, being fully autonomous. However, a monitoring driver will be on board to take over from the computer in case of an emergency.
In addition to speed, the new bullet train stands out for being incredibly smart. Each cabin is tech-packed, from facial recognition technology to real-time safety sensors, 5G touch screen controls and intelligent lighting. The cabins are designed with plenty of storage space for sporting equipment and removable seats for the disabled passengers’ wheelchairs, especially also for the athletes in the Paralympics in Beijing. Robots will be in use at every station, providing directions and check-in assistance.
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