Ibero-American News Digest
Quito Radio Hosts LaRouche Spokesmen on Financial Crisis
Sept. 12 (EIRNS)Radio 530 AM of Quito, Ecuador hosted a dialogue between Pedro Paez, head of the Presidential Commission on the Bank of the South in Ecuador, and EIR's Ibero-America editor Dennis Small this morning. The half-hour dialogue was organized by Patricio Pillajo on his show Popular Opinion, where Lyndon and Helga LaRouche have also been interviewed in the past. Paez is an economist who is close to President Rafael Correa, and whose wife is the current Minister of Social Welfare in the Correa government.
Pillajo asked for LaRouche's evaluation of the current mortgage and international financial crisis, and how Ecuador could protect itself under such conditions.
Paez explained that a new financial architecture was required, and that the Bank of the South was part of that effort. He said that much depends on how the U.S. solves its current crisis. In the meantime, we have to organize ourselves, defend our sovereignty, and find ways to not be subject to the whims of the international financial markets and defend our productive activity. Ecuador is particularly vulnerable because of the dollarization that was forced on the country.
Small developed LaRouche's analysis of the global breakdown crisis, and explained that the mortgage blowout in the U.S., like Ibero-America's unpayable debt, are both symptoms of that same crisis. LaRouche's concept for solving them is conceptually the same: create a firewall to protect essential productive functions, and put the illegitimate financial bubble through a process of bankruptcy reorganization. The Bank of the South will only work if it is part of such a global effort.
U.S. Mortgage Lenders Seek Victims in South America
Sept. 10 (EIRNS)With the meltdown of the U.S. mortgage market, some mortgage lenders are desperately looking outside the country for anyone who might borrow from them. An astonished Chilean activist reported to EIR News Service today that she had just received an e-mail from a Florida-based mortgage company announcing, "It's time to get the house of your dreams in the U.S.A.!"
Family First Mortgage Corp., based in Palm Beach, has sent one of its branch managers to Santiago for ten days to promote its "fabulous program for Chileans who want to buy houses in the U.S." "This smells like a scam," the activist said.
And then there's the case of real estate mega-speculator Donald Trump, who just announced that his Developers and Builders Alliance (DBA) is opening offices in Buenos Aires, as the headquarters for a region-wide real estate investment offensive. One of the biggest contributors to the growth of the speculative real estate bubble over recent years, Trump now reportedly feels that Argentina and its neighbors are a more "secure" market than the U.S. "There are a lot of U.S. investors who are looking for a place to put their money, given the U.S. mortgage crisis, and Buenos Aires is an interesting place," DBA president Veronica Mendieta told Argentina's Infobae Profesional.
Will Lula's Deal with Speculators Return to Bite Brazil?
Sept. 11 (EIRNS)During his recent European tour, Brazilian President Lula da Silva was asked during a stop in Helsinki Sept. 10 if Brazil planned to take any new protective measures after the Sept. 7 warning from the Bank for International Settlements meeting that developing-sector nations "are not immune" to the ongoing world financial crisis. In response, the Brazilian President lashed out at the United States, demanding that its government and the central banks of other countries "do something" to resolve "their" financial crisis, which "Brazil did not create and does not suffer. Investment funds "wanted to buy risky debt, imagining they were in a casino." We don't accept that we should be hurt by a game in which we didn't participate "because of bettors that try to make easy money, instead of making money by working," Lula said.
Brazil may not have created the speculative game, but Lula can't say Brazil didn't participate in it. Committed to its deal with Spain's Santander Bank, FleetBoston, and other international interests, the Lula Administration spent its first four years playing by globalization's rules and continuing the destructive "finance first" policies of his predecessors, on the grounds that Brazil needed to attract sufficient speculative foreign capital to avoidhe hopedanother financial collapse. Brazil, in fact, was one of the prime "beneficiaries" of the yen carry trade, since international speculators could make stratospheric interest rates on Brazilian government bonds. Lula's wishful thinking aside, those chickens may come home to roost.
Chile's Private Pension System Was Always Run by Banks
Sept 4. (EIRNS)Former Chilean President Eduardo Frei, who is now the head of the Senate, inserted a dose of reality into the current debate on President Michelle Bachelet's proposed reform of Chile's private pension system, first imposed on the country by the Pinochet dictatorship in 1981.
Intended to be the centerpiece of Bachelet's social policy, the reform calls, among other things, for national and foreign banks to co-participate in the system and control their own private funds, or AFPs, supposedly to enhance competition. This issue has become a point of contentious debate in both houses of Congress, but former President Frei stated on Sept. 3 that this debate is "absurd and ridiculous." Frei pointed out that private banks have always controlled the private system. The Provida AFP "is controlled by a bank. Santander [Bank] controls another one that's about to be sold," Frei said. "Let's not kid ourselves. The banks have controlled the primary AFPs from the start."
However, Frei's critique of the privatized pension system is inadequate. Rather than proposing a fully sovereign national pension system and an end to private banks' stranglehold over workers' retirement funds, he instead proposes to invite the one state-owned bank, BancoEstado, to participate as well, to hopefully offer lower commissions and better terms to workers than the private predators.
López Portillo's Specter Walks in Mexico, Again
Sept. 10 (EIRNS)Twenty-five years after President José López Portillo nationalized Mexico's banking system and took it out of the hands of the speculators, a closed door seminar was held in Mexico City Sept. 7, organized by Amparo Espinoza, the daughter of banker Manuel Espinoza Iglesias, one of the top financial criminals affected by López Portillo's Sept. 1, 1982 nationalization. Also present were several other "ex-bankers," including Agustín Legorreta and Carlos Abedrop, former members of López Portillo's cabinet, and Jos@aae Ramón López Portillo, the President's son and top adviser during his Presidency.
The bankers' argument was that the senior López Portillo had nationalized the banks, imposed exchange controls, and broken with the IMF because he was drunk with power, and wanted to justify himself historically. Never again, the bankers pronounced,, should Mexico fall into such populism. But José Ramón, like his father until his dying day, refused to apologize for his father's defense of Mexico's sovereignty, and defended his father's measures, a number of which he helped draft. He told the media, humorously, on the way in: "I'm the piñata of the party; they're all going to try to club me."
The bankers' faction is nervous because López Portillo's specter is afoot in the country again, and Lyndon LaRouche has had a hand in that. In repeated international broadcasts over the Summer of 2007, LaRouche warned that Mexico will be destroyed as a nation, if its people continue to "spit" on its hero López Portillo. As President of Mexico, López Portillo gave an address in October 1982 at the United Nations, which "should be heard by anyone who is a patriot anywhere within the vicinity of the Western Hemisphere today, as an example of a patriot, whose country had just been destroyed on orders, who stood up like a man as a President, to defend the honor of his country," LaRouche stated in an Aug. 28 webcast. LaRouche's declaration circulated widely among Mexico's top military officers, and at the country's universities.