Ibero-American News Digest
Economic Hit Men Threaten Destabilization of Ecuador
May 31 (EIRNS)Foreign financial and banking oligarchs have unleashed the current "corruption" scandal targetting Ecuador's Finance Minister Ricardo Patiño, aimed at destabilizing the government of President Rafael Correa, if not at assassinating the President himself. On May 21, while Patiño was in Asunción, Paraguay, meeting with regional finance ministers to discuss the new Bank of the South, the Teleamazonas-TV network transmitted part of a video, purporting to show him engaging in insider trading and "market manipulation" schemes with foreign creditors, allegedly to make a financial killing for the government just days before a scheduled February payment of $135 million on its Global 2030 bonds.
On cue, London's Financial Times reported May 25 that Ecuador "could be hit with legal action" by the U.S. Securities and Exchange Commission (SEC) and foreign bondholders, as Patiño had violated "the Securities Act," which "could be the basis for enforcement action." The London Economist, as well as mouthpieces for Wall Street's interests, jumped in to predict that bondholders might try to seize Ecuador's assets, while opposition legislators announced May 31 that they were beginning impeachment proceedings against Patiño.
On May 27, in the province of Los Rios, Correa reported that he had received repeated death threats, and that there are people who want to "take a shot" at him. Earlier, he had warned of a conspiracy against his government, echoing charges made May 25 to the Gamavision news agency, by former President Abdala Bucarám, of a coup plot against him. And, Correa added, "new attacks will come."
These threats follow the same modus operandi that author John Perkins exposed in his 2005 bestseller, Confessions of an Economic Hit Man. There, he documented the dirty tricksincluding assassinationthat foreign banking and intelligence networks used against any developing-sector government or President who defied them. Perkins, who was in Ecuador on May 22 to ask Ecuadoreans to forgive him for his role in destabilizing their government in the 1980s, charged that the "accidental" death of President Jaime Roldós in 1981, was in fact his "payoff" for having attempted to restrict the looting rights of foreign oil companies and allied financial interests.
These financial predators and their local toadies today are enraged that Correa and Patiño are not only challenging their right to continue riding roughshod over Ecuador's economy, but are also collaborating with other South American leaders, such as Argentina's Néstor Kirchner, to challenge the very premises of the International Monetary Fund's bankrupt system. When Patiño emerged from the Asunción meeting, he told reporters that agreements made there represented "a fundamental historical framework for the creation of a new international financial system. The Bank of the South is the inflection point in the international financial system."
Correa and Patiño point out that the real issue at hand is Ecuador's economic sovereignty and the welfare of its people, which come before any payment of the foreign debt. Correa warned on May 26, "We are in a revolution, and war is war, after all." Patiño, who for many years worked with the Jubilee 2000 Commission set up by the late Pope John Paul II to investigate the malicious role of the foreign debt in poor countries, showed the infamous video-tape in its entirety on May 24. He explained that he had secretly taped it with Correa's permission because, "it was my obligation ... to use the circumstances of my public office to thoroughly investigate how these perverse mechanisms of indebtedness operate." It was clear that the creditors were making an "indecent proposal," intended to hurt the country, and they had to be exposed, Patiño said.
Colombia Needs Protective Tariffs To Control Hot Money
May 29 (EIRNS)Drug-linked speculative capital is pouring into Colombia at an accelerating rate: US$ 5.5 billion since Jan. 1, 2007, as compared to $360 million in the same period last year, according to the Central Bank on May 22. Hot money has driven up the value of the Colombian peso vis-à-vis the dollar by 5% in the last three weeks, 14% this year, and 21% over the last 12 months, damaging Colombia's already-precarious productive sector, and feeding the crisis in governability that is developing over revelations of drug mob penetration of all branches of the government.
The official exchange rate is about 1,900 pesos to the dollar; in the drug-infested Magdalena Medio region, dollars are so plentiful they can be bought for 1,000 pesos.
On May 23, the government announced the imposition of minimal controls on short-term capital, requiring "investors" bringing money into the country to deposit 40% of the total at the Central Bank for six months, at no interest, or to pay a fine of 9.4% of the total. President Alvaro Uribe told a meeting of the construction industry the day before the measures were announced, that such short-term capital used to be called "hot money, but today, very sophistically, it is called portfolio capital."
What the President did not say, is that the single greatest source of hot money flooding the country is the drug trade, against which the limited monetary measures just imposed, while not harmful, will do nothing. In fact, the peso revaluation has accelerated since the government's action, just as it did after the Central Bank imposed similar measures on offshore loans and deposits repatriated by local companies on May 6.
Lyndon LaRouche pointed out May 29 that what Colombia needs, for starters, is protective tariffs, to defend its trade and economy. Protective tariffs provide the framework under which monetary policies, including full exchange and capital controls, can work, he specified.
Mexican Workers: Overturn Social Security Privatization
May 30 (EIRNS)Mexican President Felipe Calderón is finding that while it may be easy to pass financial reforms to loot the Mexican people, he may not have the political power to implement them. Protests are building around the country demanding that the privatization of the social security system for public sector workers of the ISSSTE (Social Security and Services Institute for State Employees), rammed through Congress on March 31, be rescinded. The protest has the potential to catalyze broader ferment against the Calderón regime itself, whose election was never accepted as legitimate by half the country.
One of the leaders of the drive to reverse the privatization is Agustín Rodríguez, secretary general of the Trade Union of the National Autonomous University of Mexico (STUNAM) and co-chair of the National Workers Union (UNT) labor federation. During the mobilization, he will hold an internationally broadcast dialogue June 14, with the leading anti-globalization strategist of the United States, Democratic Party leader Lyndon LaRouche, and Chilean labor leaders, on "Globalization Equals Fascism."
Rodríguez announced on May 29 that the UNT and one of Mexico's teachers' federations, the National Teachers Coordinator (CNTE), have reached an agreement to coordinate actions to reverse the law, using everything from street protests and national strikes, to contesting the law in the courts. Already, hundreds of thousands of lawsuits seeking injunctions against the law have reportedly been filed, while CNTE activists have set up an encampment in front of ISSSTE headquarters, from which they are deploying daily protests. Plans for a national strike are under discussion.
Feeling the heat, President Calderón personally began campaigning in defense of the rotten law on May 29, complaining that the reform is "misunderstood," and without it, the country would have gone bankrupt.
Argentine LYM Brings FDR Legacy to Economics Seminar
May 29 (LPAC)The LaRouche Youth Movement (LYM) took the opportunity of the First International Economics Seminar, sponsored by the Economics Department at the National University of Buenos Aires (UBA), to organize at the campus.
The opening session of the event included the 2006 Nobel Prize winner in Economics Edmund Phelps, who, apparently displeased with President Néstor Kirchner's anti-IMF economic policies, told the government it should act to improve its "image" with foreign financial markets.
LYM leader Betiana González approached Finance Minister Felisa Micelli, who attended, but did not speak, and handed her some literature, including Lyndon LaRouche's statement of support for the Bank of the South, the LYM Internet publication Prometeo (Prometheus), and EIR. Miceli responded warmly, "good, thanks very much." When González remarked that "a new economic order must be created, Minister," Miceli firmly stated, "Well, that's your mission: to work, fight, organize!" González concluded the exchange with, "It has to be with Franklin Roosevelt's legacy!"