EIR Daily Alert Service, THURSDAY, February 27, 2020
THURSDAY, FEBRUARY 27, 2020
Volume 7, Number 41
EIR Daily Alert Service
P.O. Box 17390, Washington, DC 20041-0390
- Those Who See Danger of Financial Crash–Mobilize for LaRouche’s Four Economic Laws
- ‘If I Had COVID-19, I’d Want To Be Treated in China,’ States WHO Official
- WHO Reports More New COVID-19 Cases Outside China Than Inside, But ‘Fight Can Be Won’
- Lavrov Encouraged by Prospects for Putin’s Effort To Convene UNSC Permanent Five Summit
- Mini-Mike Concedes, “Me, Buy the Presidency? I Already Bought Congress’
- Spanish Farmers Continue Protests, Possible Gains Won
- FAO Appeals for More Funds To Fight Locusts, as Pledges Are Nowhere Near Sufficient
- Iraqi Shi’ite Leader Seeks National Unity for U.S. Troop Pullout
- Malaysia’s Dr. Mahathir, in Master Stroke, Ends British Effort To Impose Anwar Ibrahim
- China Transportation Ministry Announces Launch of New Projects
Feb. 26 (EIRNS)—If an epidemic spread of the COVID-19 virus occurs in enough countries to make it a pandemic, it may become a trans-Atlantic financial and banking crash in the process. Warnings of a “Lehman Brothers moment” are being sounded in Europe, whose major nations’ physical economies were already deeply depressed, and whose markets in China for automotive and engineering products, etc. have drastically contracted for this quarter at least. The six-month-long fall of U.S. Treasury interest rates has suddenly turned into a dramatic dive to the lowest levels in history, whacking U.S. banks’ profits and now threatening to whack their $200 trillion in interest-rate swap derivatives. This week’s hefty plunge in the stock markets is being led by the stocks of banks and their derivatives partners, insurance companies.
The economic activity of the United States and major European economies—and to an increasing degree, that of China—is based overwhelmingly on spending for consumption; their financial systems in the floating-exchange-rate era are based on financializing and securitizing consumption, while globalizing and cheapening production. It is consumption which has taken the longest-lasting blow in China’s outstanding public health battle to save human life. And this will happen in other countries which may experience large-scale epidemics. These would be the makings of a financial blowout—whether or not we are at the “Lehman Brothers moment” this week or next.
Net income or profit of U.S.-based banks was already 11% down in the fourth quarter, compared to the same quarter of 2018, according to the FDIC’s quarterly bank profile released Feb. 24. This was because interest rates swooned in that quarter from the time the Federal Reserve started pumping out daily tens of billions in “repo” liquidity (mainly to non-banks) on Sept. 17, and resumed quantitative easing on Oct. 4. Banks cannot make money lending under those conditions. The global corporate bond bubble reached a record $13.8 trillion at the end of 2019, inflating by $2.1 trillion or 16% just in that year. One-quarter of these are junk bonds; another half of them are rated BBB, one step above junk. A new OECD report says, “today’s stock of outstanding corporate bonds has lower overall rating quality than in any previous cycle.” That was before the loss of markets began with the virus spread in China.
Now there is one choice of action available in the face of these threats: Mobilize for the fast implementation of Lyndon LaRouche’s “Four New Laws To Save the Nation.” These actions in turn can mobilize high-productivity production and demand within the nation—including agricultural production—as China is now restoring its industrial production with large amounts of directed bank credit.
Most immediate of those actions laid out by LaRouche for a crisis: Restore Glass-Steagall bank separation to prevent a City of London- and Wall Street-centered crash from devastating the real economy; and create and direct national banking credit into expanded high-technology production and infrastructure-building, with the use of frontier technologies and scientific research. Public health and hospital facilities preparation to save lives from an epidemic, is only one of the jobs in front of us—the necessity is to lift up production and productivity with new, high-technology capital goods, above all in infrastructure.
These are actions LaRouche spelled out and called for over decades, with every serious epidemic threat to human life in any continent or country, and as defense against each of the many financial crashes of the floating-exchange-rate speculative casino. They must be taken now; an immediate summit of heads of state and government of the United States, Russia, China, India and perhaps other nations is needed to coordinate taking them.
SCIENCE AND INFRASTRUCTURE
Feb. 26 (EIRNS)—Dr. Bruce Aylward, WHO epidemiologist who just returned from leading a WHO team to China, praised China’s approach, during his press conference in Geneva yesterday. “If I had the COVID-19 virus, I’d want to be treated in China,” Dr. Aylward said. He highlighted that China’s pragmatic approach is “technology-powered and science-driven. They are using big data, artificial intelligence (AI) in places.” China’s approach is a differentiated one, he said, tailoring their response to the severity of outbreak, numbers and location, relying on a variety of capabilities, including technological ones which allow for remote evaluation, medical consultation, prescription refills, and much more. You can’t place the whole country on lockdown—as was done in Wuhan—he said, thus the differentiated approach.
“It’s never easy to get the kind of passion, commitment, interest and individual sense of duty that help stop the virus. Every person you talked to [in China] has a sense that they’re mobilized like in a war against the virus, and they are organized.”
His conclusion? “The world is—it’s simply not ready…. This is a rapidly escalating epidemic in different places that we’ve got to tackle superfast to prevent a pandemic. That may be difficult in countries that don’t have the same disease surveillance setup as China.”
Aylward emphasized that the techniques used by China can be emulated elsewhere. They are “old-fashioned public-health tools, but applied with a rigor and innovation of approach on a scale we’ve never seen in history. In 30 years of doing this business, I’ve not seen this before.” Being successful requires “a real shift in mindset.” You can’t find every single case, but “you want to find enough to break the big chains of transmission, slow this thing down and get a grip on it. The technique might sound draconian, but it is how a lot of public health work is done.”
Feb. 26 (EIRNS)—In a press conference in Geneva this morning, World Health Organization Director General, Dr. Tedros Adhanom Ghebreyesus, reported that for the first time, the number of new COVID-19 cases outside of China yesterday exceeded those inside the country. As WHO epidemiologist Dr. Brian Aylward found during his recent trip to China, the virus has “plateaued,” and containment measures have been largely successful. Outside of China, there are now a total of 2,918 cases across 37 countries, including 43 deaths as of this morning.
Inside China, the Washington Post reported, a demographic study by Chinese scientists shows very strong age-dependency. A study of the mortality rate of 45,000 people infected through Feb. 11 showed that the highest mortality rate occurred among those over age 80; as ages declined, so did the mortality rate.
Dr. Tedros cautioned, however, that this is no time for complacency; continued vigilance is necessary. Emphasizing that the key message should be that containment is possible, he pointed out that many countries have succeeded in doing that. And, he added, the best way to protect countries that are vulnerable is by “doing our utmost to contain epidemics in countries with the capacity to do it.” He also underscored that there’s no reason to push for a pandemic declaration “without a careful and clear-minded analysis of the facts.”
Using the word pandemic carelessly, he said, “may also signal that we can no longer contain the virus, which is not true. We are in a fight that can be won if we do the right things…. I am not downplaying the seriousness of the situation, or the potential for this to become a pandemic …[but] the primary objective of all countries with cases must be to contain the virus.”
A number of “worrisome” situations exist, he said, such as in Italy (total cases 322) Iran (total cases 95), South Korea (total cases 1,261) and parts of Europe. A joint delegation of the WHO and the European Center for Disease Prevention arrived in Rome yesterday to review public health measures put in place and offer technical support. Cases in some Arab nations—Bahrain, Iraq, Oman and Kuwait—have been linked to Iran, which has reported 95 cases and 15 deaths. A WHO delegation will travel to Tehran this weekend to provide support.
In Europe, France, Spain, Croatia, Austria, Switzerland have all reported new cases as of this morning. The first COVID-19 case in Latin America has appeared in Sao Paulo, Brazil; authorities are tracking 20 suspected cases in that country.
THE NEW GLOBAL ECONOMIC ORDER
Feb. 26 (EIRNS)—Commenting on Russian President Vladimir Putin’s Jan. 23 proposal for a summit of the five permanent UN Security Council member states—the UN founding nations Russia, France, China, the U.S. and the U.K.—Russian Foreign Minister Sergey Lavrov told the Conference on Disarmament in Geneva that prospects were promising. “As you know, Russian President Vladimir Putin has invited his colleagues to hold a summit of five permanent members. This summit would definitely become a starting point for making landmark decisions in the interests of the entire world community. The reaction to this proposal is promising, we will be working on fulfilling it,” Lavrov said.
“At this landmark moment, they should demonstrate special responsibility for ensuring international peace and security,” he declared. Lavrov said the UN founding fathers had sought “this kind of multilateral cooperation in ironing out global issues.”
This last comment is confirmed by Franklin D. Roosevelt’s son, Elliot, in his book, As He Saw It, in which he reports on the February 1945 Yalta Conference, the last conference of the “Big Three,” with FDR, Stalin and Churchill. It was devoted mostly to the establishment of the United Nations, and was considered the first of many such conferences that would continue into the postwar period. After Roosevelt’s death in April 1945, and Harry Truman’s ascendency as President under Churchill’s thumb, Truman refused to hold a summit with Stalin after Allies Potsdam summit, which refusal became a major factor to the emergence of the Cold War.
Now, 75 years later, Mike Pompeo’s State Department continues to refuse visas to Russian diplomats to attend United Nations sessions in New York, a violation of the letter and spirit of the United Nations founding agreements.
Commenting on the violation, Russia’s Deputy Permanent Representative to the UN Gennady Kuzmin told a session of the UN Committee on Relations with the Host Country on Feb. 25: “The crisis of non-issuing visas to representatives of member countries is only growing. The U.S. does not issue visas to Russian delegates who are supposed to work at the Russian mission. Visas of diplomats who already work at the mission are not being extended. Russian citizens who were chosen to work at the UN Secretariat do not get visas. This policy also affects other countries as well.”
Since the start of the 74th session of the UN General Assembly, more than 20 Russian delegates have not been issued U.S. visas, reports TASS.
U.S. POLITICAL AND ECONOMIC
Feb. 26 (EIRNS)—At last night’s debate of Democratic candidates in South Carolina, Sir Mike Bloomberg effectively admitted he bought the Democratic House majority in the 2018 midterm elections.
He just managed to catch himself as he was about to use the word “bought,” referring to candidates he had in fact bought. As quoted by the New York Post, Bloomberg boasted “All of the new Democrats that came in put Nancy Pelosi in charge, and gave the Congress the ability to control this President. I boug… I got them.” Pretty clear.
COLLAPSING WESTERN FINANCIAL SYSTEM
Feb. 26 (EIRNS)—Farmers of Spain went into their fourth consecutive week of protest actions on Feb. 24. Thousands of them took to the streets in Murcia, Tarragona, Guadalajara, and Merida. In the region of Murcia alone, which is a leading producer of fruits and vegetables, 7,000 farmers took part with about 400 tractors, with their regional association chairman Miguel Padilla speaking of farmers’ “cry of despair” over the widening gap between their expenses and incomes. Farmers consider themselves victims of the globalized food markets, which flood fruits and vegetables into Europe at low prices which local farmers, and especially those from Spain, cannot compete with: Spain has been the leading producer of fruits and vegetables for all of Europe.
In the city of Tortosa (Tarragona region) and in Molina de Aragon (Guadalajara region), farmers deployed about 200 tractors in each region in protest rallies, with temporary road blockades in the Guadalajara event. Protests are not generally supported by the official farm association, but, as in the Extremadura region, for instance, organized by independent groups like Aseprex, La Union and Agrocoltores del Jerte. Protesting farmers are particularly upset at the fact that numerous meetings with political leaders have so far not yielded a single euro of financial support from the national and regional governments. Protests may therefore continue beyond mid-March.
That is how matters stood—until the government, under Prime Minister Pedro Sánchez of the Socialist Party of Spain (PSOE), approved a series of measures to ensure increased prices, allowing farmers to avoid selling their produce at a loss, and for better working conditions for protesting farmers, Emma Pinedo of Reuters reported today.
Under the proposed law, sales contracts would be indexed to production costs, ensuring that farmers do not have to sell at a loss, Agriculture Minister Luis Planas announced after the weekly cabinet meeting; the new measures aim to give farmers and ranchers more power in negotiations with supermarkets and distributors. The bill would allow retailers to sell below the production cost only if the expiration of a perishable product were close, but prohibits retailers from passing the loss on to the farmer.
“The government believes it is possible that prices don’t rise [for the consumer] and at the same time the farmers get a fairer price for their products,” Planas said.
Feb. 26 (EIRNS)—On Jan. 20, the UN Food and Agriculture Organization appealed for $76 million to deal with the locust crisis. It has since had to raise that figure to $138 million, but as of Feb. 25, reported Stephane Dujarric, $33 million has been pledged.
A joint statement yesterday by Qu Dongyu, Director-General of the Food and Agriculture Organization (FAO); Mark Lowcock, UN Emergency Relief Coordinator; and David Beasley, Executive Director of the World Food Program, described the scourge in East Africa as “a graphic and shocking reminder of this region’s vulnerability. This is a scourge of biblical proportions. Yet as ancient as this scourge is, its scale today is unprecedented in modern times….
“Since FAO launched its first appeal to help what was then three affected countries, the locust swarms have moved rapidly across vast distances and the full extent of their massive scale has become clear. Since our last op-ed pleading for action on Feb. 12, swarms have been sighted in Djibouti, Eritrea, South Sudan, Uganda and Tanzania. Each day, more countries are affected. Last week, a swarm crossed into one of Africa’s most food-insecure and fragile countries, South Sudan. Just this week, it was confirmed that one swarm reached the eastern boundaries of the Democratic Republic of the Congo—a country that has not seen a locust incursion since 1944.”
The FAO has told EIR that in three of the worst-affected countries, Kenya, Ethiopia and Somalia, it estimates that at least 100,000 hectares in each country need to be sprayed with insecticide. As of this writing, only about 50,000 hectares out of a total 300,000 have been sprayed.
The Feb. 24 FAO’s Desert Locust update reports immature swarms in Kuwait, Bahrain, Qatar and the southwest coast of Iran.
The release concludes, “It is time for the international community to act more decisively. The math is clear, as is our moral obligation. Pay a little now, or pay a lot more later.”
STRATEGIC WAR DANGER
Feb. 26 (EIRNS)—Moqtada al Sadr, the Shi’ite leader who controls the largest political bloc in the Iraqi parliament, appears to be fighting to overcome the sectarian divides in Iraq with a call for unity, particularly with respect to the U.S. troop presence in the country. During an interview with the al-Sharqiya TV channel, al Sadr basically argued that Sunnis, Kurds and Shi’ites are all Iraqis first, and should conduct themselves as such. For example, al Sadr called on Masoud Barzani, president of the Kurdistan Region of Iraq and the head of the Kurdish Democratic Party (KDP), not to be so sympathetic towards the presence of U.S. troops in Iraq. “[My message] to brother Masoud is for him not to be sympathetic to the Americans. We benefit him more than them. The [U.S.] occupation has to leave no matter what. Enough with tampering with our potential, division among us,” al Sadr said.
The Iraqi Kurdish news service Rudaw reports that al Sadr has insisted on the departure of the approximately 5,200 U.S. troops currently based in Iraq, arguing that U.S. presence is destructive to national security and is causing the country to play host to international battles. However, calls for the expulsion of U.S. troops from Iraq have largely been opposed by Kurdish and Sunni politicians. “The people all are ready [for ISIS]. The entirety of the blood of Sadrists, including mine, is ready to be spilled for Iraq’s salvation from Daesh,” al Sadr said, referring to ISIS’ Arabic name.
Al Sadr also said that there shouldn’t be regional militias in Iraq. “Iraqi Army and Police are guards of the (Kurdish) Region,” he said. “A Shi’ite protects the Region and a Kurd protects the south. This is how a state should be—not a Kurd protecting Kurds, a Shi’ite protecting Shi’ites and a Sunni protecting Sunnis. This is not a state.” The Kurdish pesh merga, al Sadr said, is one of the militias that should be disbanded.
Al Sadr also urged for the Kurdish and Sunni political factions to stop blocking the formation of the new cabinet by Prime Minister-designate Mohammed Allawi.
Feb. 26 (EIRNS)—The wily and wise Dr. Mahathir Mohammad has again dealt a blow to the hopes of the British and their American assets to get their boy, Anwar Ibrahim, into power in Malaysia—a potential disaster not only for Malaysia, but for the world. On Feb. 24, Mahathir resigned as Prime Minister and as head of his party, Bersatu, which was in a coalition with Anwar’s People’s Justice Party, which coalition won the election in 2018. The coalition’s deal was that Mahathir would serve as Prime Minister for a few years to stabilize the country after the massive corruption of the former Prime Minister Najib Razak became an international scandal, with cases against Razak in Malaysia, the United States, and several other countries over a multibillion-dollar scam. Mahathir would then cede power to Anwar to finish the term.
But Anwar is still the snake he always has been, and Mahathir clearly only worked with his old rival in order to get rid of the corrupt Najib. At 94, many thought Mahathir might live up to the deal, given to his age—but that belief is now shown to have been an underestimation of his courage and dedication.
Anwar, recall, was Mahathir’s deputy in 1998 when the so-called “Asian financial crisis” hit, and Mahathir stood up to the IMF (with full public support, gratefully received, from Lyndon LaRouche and EIR), imposing currency controls and exposing George Soros and the IMF for their responsibility in the destruction of several Asian currencies through imperialist speculative powers. Anwar chose to oppose Mahathir, openly working with the IMF and the likes of Soros, Al Gore, Paul Wolfowitz and other miscreants of the Anglo-American financial cabal—all documented by EIR research which circulated widely in Malaysia and around the world. Mahathir dumped Anwar, who soon went to prison for sodomy, until Mahathir returned to power in 2018 in the deal with Anwar’s party, and pardoned him.
Now, the old conflict is out in the open again. Eleven of Anwar’s party officials resigned (thought to have switched their support to Mahathir); this together with Mahathir’s group, means Anwar does not have a majority to keep the current government in power under his own rule. It is not clear that Mahathir does either—the King, Sultan Abdullah Ri’ayatuddin, is meeting with all the MPs (rather than party leaders) to see if there is a majority for either to form a government, or if new elections must be held. He appointed Mahathir as acting Prime Minister until that is decided.
Most interesting is what Mahathir wants to do: Form a government of national unity without party affiliations. At a press conference Feb. 25, he said: “Politics and political parties must be set aside for now. If permitted, I will try to have an administration that doesn’t lean towards any party. Only national interests will be prioritized.” Lyndon LaRouche will be smiling.
Feb. 26 (EIRNS)—In a sign of economic activity coming back online in China, the Ministry of Transportation announced resumption of work on a number of projects that are in line with China’s development strategy.
Nearly 39% of the country’s railway projects that were under construction previously have restarted, as have 37.2% of the highway and waterway projects as well as 25.9% of the civil aviation facilities. Fan Jianyu, the deputy director of the ministry’s planning department, said that it would also fast-track a number of new construction projects. China plans to spend at least 2.7 trillion yuan ($385 billion) on transportation infrastructure projects in 2020, including 800 billion on railways, 1.8 trillion on roads and waterways and 90 billion yuan on civil aviation.
Fan also said that 115 prefecture-level cities and 158 county-level cities had resumed transportation services by Monday, Feb. 24. Currently, 505 cities, or more than 70% of all cities, have restored public transportation.
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