|This report appears in the December 26, 2003 issue of Executive Intelligence Review.
CAMPAIGN 2004: WHERE THEY STAND
The Collapse of the World Economic
System, and What To Do About It
The following is the second of a series of documentary comparisons of the views of the 2004 Democratic Presidential contenders. The topics are those raised by Lyndon LaRouche's candidacy since Jan. 1, 2001, and therefore we place him first. The other candidates are listed, by topic, in the order of the number of their itemized campaign contributions. (LaRouche is number two by this count.) Part 1, in EIR of Dec. 12, dealt with the Iraq War and the Cheney neo-conservative coup. Part 3 deals more generally with military policy. Part 4 deals with Attorney General John Ashcroft and the threat of police-state rule. Part 5 deals with how to reverse the breakdown of the United States' economic infrastructure. Part 6 deals with the Middle East Crisis.
The IMF Financial/Economic System
in Breakdown Crisis
Lyndon H. LaRouche, Jr.
On Dec. 12, 2000, at the time of the Electoral College impasse on the selection process for the Presidency, LaRouche held an international webcast in Washington, D.C. to stress the necessity of citizens and government facing the epic nature of the financial and economic breakdown crisis now unfolding. He said:
"The problem is, essentially, that the world is gripped by the worst financial crisis in three centuries.... Let's take one little fact. Presently, according to my best estimate, the current account deficit of the United States is running to about a rate of $600 billion a year. In other words, as an economy, we're operating at a big loss, building up a big debt, with no prospect of ever repaying it. In the meantime we're taking in trillions of dollars each year, or have been until recently, into the United States, to prime the pump on the Wall St. and other markets.
"What happens when the U.S. dollar collapses? And a 40% collapse in the dollar is a possibility, in the marketit's a possibility, a real one. Look at what happened to the NASDAQ. The NASDAQ has gone down about 50% in its index value, in a recent period, and it's going to go down a lot deeper. The Dow is also going to go down, because banks are in trouble. And you've got a prosperous economy, because the market feels good today? Because some jerk from Wall St. told you the market feels good? ... The other problem is, we're in what we call a post-industrial society. The United States went into a post-industrial society, about 1966...."
Since that webcast statement, LaRouche has repeated his warnings, documenting the breakdown crisis, and acting internationally and at home, to mobilize for emergency action.
On Dec. 5, 2003, at a press conference in Paris, he said, "We're in a breakdown of the presently existing international monetary-financial system, especially the system as it was established between 1971 and '72."
The history of LaRouche's current evaluation goes back ten years, to his June 1994 paper (published in EIR, June 24, 1994), "The Coming Disintegration of Financial Markets," stating that the test for policymakers over the coming period was, "that the near-term disintegration of the presently bloating global financial and monetary bubble is unstoppable by any means, alternative to governments acting to place the relevant institutions into bankruptcy reorganization"; namely dealing with worthless debts, stopping speculation, and maintaining essential economic functions.
This 1994 warning of the danger of financial blowout and economic breakdown, was the ninth such forecast of LaRouche's 40-plus years as an economist, beginning with his first forecast in 1956 of the imminence of a major recession, which broke out in February 1957 and continued through 1958; and seven more such accurate forecasts of key economic events, through his 1992 warning of the process of "financial mudslides" taking down key sections of national economies during that decade. LaRouche committed himself to mobilizing forces internationally, as well as in the United States, against the economic disaster.
In December 1995, at a seminar on health care in Rome, sponsored by the Vatican, LaRouche released a now-famous schematic, called the "Typical Collapse Function," or "Triple Curve" (Figure 1) to illustrate the dynamic of the breakdown threat. As events proceeded, without government intervention to stop the collapse process, his forecast was borne out, where even gross statistics (Figure 2), from 1996 to 2002, show that the collapse function is under way.
In February 1997, he spoke at an international conference near Washington, D.C., calling for a worldwide mobilization for a "New Bretton Woods," because the International Monetary Fund (IMF) system was so bankrupt and destructive. Within months, a series of global financial shocks began, first manifest as the mis-named "Asian" crisis, then proceeding in various blowouts to the present day.
On Jan. 3, 2001, LaRouche held an international webcast in Washington, D.C., to brief U.S. citizens and leaders around the world, on the context of the financial and economic collapse, in which elements of the incoming Bush Administration could pose the potential threat of resorting to a dangerous "crisis-management"/emergency rule response to the crisis. LaRouche's views were then included in testimony provided to the U.S. Senate Judiciary Committee, for the record of a hearing, Jan. 16, 2001, on the issue of the nomination of John Ashcroft for Attorney-General:
"[There is an] extraordinary global financial and monetary crisis that will be the first and overriding order of business confronting the incoming Bush Administration, as even President-elect Bush and Vice President-elect Richard Cheney have limitedly acknowledged in public statements. The scope of the onrushing world financial and economic crisis, however, goes far beyond anything that anyone in the incoming Administration now anticipates, and it will require a dramatic reversal of most of the policy axioms that have governed U.S. official policy over the past 35 years, if the United States is to survive in its present, albeit weakened, Constitutional form. Unlike the so-called 'Asia Crisis' of 1997-98, and the so-called 'Russia' and 'Brazil' crises of 1998-99, the epicenter of the current phase of global monetary and physical economic disintegration is the advanced sector, specifically the United States, with our skyrocketing balance of trade deficit, negative household savings, and collapsing real industrial output. Thus, the crisis phase that we have now entered has the most profound implications for the well-being of the American population, and goes to the heart of our domestic tranquility and the common good."
In April 2002, the LaRouche campaign published a 140-page special report, Economics: At the End of a Delusion, with documentation, and LaRouche's extensive review of the crisis.
Dean gives no evaluation of the condition of the U.S. and world economy, except references to an "economic downturn," loss of jobs, the "plight of states," and wrongness of Bush tax cuts in addressing this. Instead, Dean ignores the scope of collapse, stressing a few chosen points (such as "fiscal conservativism," and the interests of the "middle class"), and by presumption, viewing the economy as fundamentally intact. In particular, he likes to praise how economically successful Vermont has been.
From a July 30, 2003 speech, on the Dean website: "I have a well-deserved reputation as a fiscal conservative. Vermont is the only state that does not require a balanced budget, but I balanced the budget every year of my 11 years as Governor. I'm a thrifty person, and I hate waste and inefficiency. So I'm not afraid to say, 'no' to spending plans that don't make sense.
"I cut some taxesboth income taxes and sales taxesbut when we had good fiscal years, I set up a rainy day fund, and put money away against the hard times sure to come. The banks and investment houses liked Vermont's fiscal situation so much that they raised our credit rating and reduced the cost of our borrowing."
Dean was a supporter of the North American Free Trade Agreement when he was Governor, and attended a NAFTA signing ceremony.
On Dec. 10, 2003, Kerry made a reference to "Bretton Woods" in New Hampshire, which by implicationbecause that was the location of the 1944 conference to establish a new monetary system, after the wartime devastationraises the point that we face a crisis of global proportions today. Speaking at Durham, N.H., at the Democratic Party candidates' debate, Kerry said, "This is an extraordinary moment in world history. When you think back to New Hampshire and what happened at Bretton Woods and the capacity to bring people together and change the world, this is a moment to change the world." He added, "This President is making worse the potential of a clash of civilization."
Apart from this instance, Kerry does not address the international breakdown crisis overall. Over 2003, he has singled out Japan and China for "manipulating their currencies." This appears, for example, in his Aug. 28, 2003 "Plan to Fight for America's Economic Future," where he calls for steps so that "other countries, such as China, do not manipulate their currencies to gain unfair trade advantages." He has charged them with undermining U.S. exports. For example, this charge appears in his new proposal, "Plan to Create Manufacturing Jobs," which he unveiled in Salem, N.H., on Oct. 21, 2003. In it he stresses how steps should be taken on international trade, "to assure America has a level playing field."
A search of his website for "monetary system," turns up a single reference, where the candidate has said, "our monetary policy is exhausted."
Moreover, Kerry has implicitly backed the speculative practices and policies contributing to the current crisis, by praising the 1993-2001 years of the Clinton Administration, spanning the info-tech "New Economy" and other bubbles.
At the Oct. 27, 2003 Democratic Party candidates' debate in Detroit, Kerry wrapped himself in the mantle of President Clinton. "If you liked Bill Clinton's economy for eight years, you're going to love John Kerry's for the first four years," he said, citing Clinton's protection of the middle class, how "we grew the economy," and how Clinton was able to cut the deficit in half after four years.
Edwards' website contains no overall characterization of the severity of the international and national economic crisis.
Lieberman has no criticism of the dysfunctional global monetary system. His backers and controllers include prominent members of the circles cashing in on speculation, corporate fraud, and outright black market practices. On Nov. 30, 2003, on Fox News, Lieberman was asked about billionaires George Soros and Warren Buffett "betting against the dollar" to make new fortunes, but Lieberman chose to change the subject and blamed China: "What we really should be worrying about is the way the Chinese and some of the Asian economies" are "artificially" fixing their currencies to the dollar."
Lieberman's consistent statements on the international economy are focussed entirely on how other nations are treating the U.S. unfairly on trade. His campaign website states that there are countries "breaking the ruleslike China, which is keeping its currency artificially low to gain and unfair advantage on world markets, and ripping off American copyrights, patents and products."
Gephardt does not address the international financial crisis, and economic breakdown, except in terms of global impoverishment associated with "unfair trade," and "currency manipulation" on the part of China. He thus expresses the presumption of the continuation of globalized trade, the floating-currency system, and the soundness of the bankrupt International Monetary Fund and associated agencies, by advocating that they should be the means to implement his proposal for an International Minimum Wage (described below).
On currencies, he states that China "is getting a free ride. Under international law, currency manipulation is an actionable offense. Well, it is offense alright. And it is time we took action and held China accountable."
On the global economy, he states in an undated speech on his website: "We have a new global economy and we need new trade policies to meet those new economic challenges.... The trade imbalance is both an American crisis and a global tragedy. Around the world, millions of workers have no choice but to work for meager wages under inhumane conditions. In the race to the bottom, multinational corporations have thrown morality to the winds and sought out those countries where exploitation knows no bounds."
He states, "I believe in free trade. Open markets can create good jobs for our people and others. But I have been to China, India, and Indonesia, places where the most sophisticated, high-tech labor is now done for a few dollars a day. American workers cannot compete with that. And we should not. Without basic standards and rules, it has become simply a race to the bottom."
Gephardt opposed NAFTA, and stresses that "on the issue of NAFTA, I took on my own President, Bill Clinton, a President I supported on almost every other issue." At the Detroit candidates' meeting on Oct. 27, 2003, he repeated this and said that candidates Kerry, Edwards, Dean, and Lieberman now say they would never sign a treaty like NAFTA with China, which doesn't have proper protection for labor and environment. "I was against those treaties when it counted. It's easy to say now that we shouldn't have done that, but when the treaties were in front of the Congress, they voted for them." We've got to stop exploitation of workers around the world, he said. "We need consumers [abroad], not just producers."
But Gephardt is not an opponent of free trade, and was a strong supporter of U.S. membership in the World Trade Organization. The bill in the House that authorized the United States to join the WTO bears his name.
Clark concedes that we are in a severe economic crisiswhich he blames on the Bush Administrationbut he discusses this purely in terms of domestic policy, as a "cyclical" phenomenon. "We're at a crucial turning point in American history," he said at the Detroit candidates' debate on Oct. 27, 2003. "We are in trouble. We're in war abroad, and we have a failing economy at home."
According to his website, Clark says that the Bush Administration's record on job losses is "the worst since the Great Depression." But he does not draw from that the conclusion that we are in a global systemic economic breakdown; nor does he identify the speculative bubble in financial and monetary aggregates. He says that the Bush Administration's economic record"the worst on job creation of any President since Hoover, matched by the largest budget deterioration in historyis a disaster of economic proportions. Economic downturns may be part of the normal business cycle, but the Bush Administration's reckless policies have taken a bad situation and made it far worse." Apart from taking swipes against China's refusal to upvalue its currency, he does not discuss any international aspects of the economic crisis, or cooperation with other nations to solve it.
Kucinich is a consistent opponent of NAFTA and the free-trade ideology that, as he says, is destroying American jobs and the manufacturing sector. Occasionally invoking the precedent of Franklin D. Roosevelt, he calls for infrastructure projects to provide jobs. While devoting most of his attention to domestic economic policy and trade issues, he recognizes that the crisis is of a global nature. He calls for the United States to "fully fund efforts to eradicate world hunger," and says he will push for cancellation of all bilateral debts of countries facing hunger, as well as cancellation of debts to the International Monetary Fund and World Bank.
How To Organize a Recovery
In his April 2002 campaign report, Economics: The End of a Delusion, LaRouche summarizes the nature of the measures to take:
"Today, a general, qualitative breakdown-crisis is already darkening the horizon. To illustrate the nature of that challenge, I list a number of typical actions to be taken to halt the depression and launch a self-sustainable recovery.
"1. We must a.) put the international monetary-financial system into immediate, governments-dictated reorganization; b.) restore a fixed-exchange-rate system; c.) establish exchange, capital, financial controls, trade controls, and fair-trade forms of protectionist measures internally and externally; d.) increase drastically rates of taxation on financial capital gains, and substitute production- and technology-oriented medium- to long-term investment tax credits to entrepreneurs; e.) generate large masses of government-created credit at rates between 1-2% for, chiefly, a combination of entrepreneurial investment production and infrastructure investment; and f.) implement a general bank-reorganization program, which keeps needed banks performing essential functions for the community while under even drastic financial reorganization.
"2. We replace 'free trade' with the promotion of protected hard-commodity international trade, as part of the promotion of a global, long-term economic-recovery effort.
"3. We must introduce the economic equivalent of a high-technology-oriented 'arsenal of democracy' recovery program, both in the domestic economy and in world trade, to provide the qualitative dimension needed to reverse the monstrous loss of technologically progressive, physical-productive capacity and potentiala loss which has accumulated in the world as a whole during the recent thirty years, especially the recent quarter-century.
"We had better take such measures, to stop that process of collapse before it hits with irresistable, crushing force...."
"A New Bretton Woods"
LaRouche's mobilization for emergency measures has in particular, called for a "New Bretton Woods" process of nations making agreements for a new system of mutually beneficial economic and financial arrangements, as they did after World War II, to replace today's defunct International Monetary Fund.
For example, on Dec. 12, 2000, LaRouche spoke about this, and recapitulated his views generally: "The International Monetary Fund is as bankrupt, or perhaps more bankrupt than the Federal Reserve System. But the IMF being bankrupt: who is accountable for its bankruptcy? Well, the nations which created it are responsible for it. The IMF has no authority, except the authority given to it by its member nations, member governments. These governments, led by the United States, I would hope, would reorganize the IMF to put it back in the kinds of policies that worked prior to 1965, and worked very well up till 1958. To restore protectionism. To restore regulation. To restore capital controls, exchange controls, fixed exchange rates, long-term credit at low rates in international trade, 20-25-year agreements on infrastructure development globallythese kinds of policies. And return what is the IMF today, as a taken-over institution by the authority of these governments, to make it an instrument of cooperation, in which we can do for today, what Roosevelt, Franklin Roosevelt, did between 1933 and the time he died in 1945. To make a success of improving the world for its inhabitants in a way which, in net effect, is good. And which stops the slide into Hell, where we're going into now."
Against NAFTA and Free Trade
LaRouche has opposed globalization, "free"unregulatedmarkets, and free-trade swindles of all kinds, including NAFTA, the WTO, and any other form.
In 1991, LaRouche led a mobilization against the enactment of NAFTA, commissioning a mass-circulation paper, "Auschwitz Below the Border," predicting what would be the result.
On Feb. 19, 2002, he released a statement, "On the Democratic PartyA Swift Modest Proposal: Can the Democratic Party Survive?" in which he discussed "free trade" as a cult, like the "New Economy" and others. He said: "In our nation's history to date, every time the U.S.A. has bent to the influence of the fanatics who insist on 'free trade' policies, the economy has undergone ruinous effects. The long, post-1966 decline in our formerly progressing economy, especially since 1977, is a direct result of the folly of returning to the same 'free trade' policies which had often ruined our nation's economy in the past.... 'NAFTA' and 'Globalization,' make absolutely no sense in any sane economic doctrine."
Dean has presented no international perspective except to call for "a more effective trade policy." His website states: "Our efforts will create consumers for our goods and improve our national security because nations with middle classes are generally more stable, more democratic, and less likely to foster terrorism. So the question is not whether one is for or against trade. The question is under what rules should trade be conducted, for whose benefit should the rules be drawn, and how should they be enforced."
For the domestic economy, his starting point is state and local. From his website: "The plight of the state creates a continuing, major drag on the national economy. Economists generally agree that rapid action to relieve the fiscal burdens on the states would be one of the most effective ways to stimulate the economy and create new jobs."
Dean proposes to provide both "immediate help and a long-term commitment to helping the states in two specific areas: education and homeland security." He pledges spending over $5 billion a year more for Homeland Security that the level the Bush Administration is currently authorizing. And he would spend up to 40% more on special education programs, rather that the 17% more pledged by the Bush Administration.
The website gives Dean's summary statement: "My economic policies for America are based on four fundamentals:
- "Repeal the Bush tax cuts, and use those funds to pay for universal health care, homeland security, and investments in job creation that benefit all Americans.
- "Set the nation on the path to a balanced budget, recognizing that we cannot have social or economic justice without a sound fiscal foundation.
- "Create a fairer and simpler system of taxation.
- "Assure that Social Security and Medicare are adequately funded to meet the needs of the next generation of retirees."
Fund to Restore America. For the domestic economy, Dean proposes a $100 billion, two-year program, "designed to add more than one million new jobs to the economy." The fund is to be distributed to states and localities, "to assist communities that have been worst hit by the economic downturn." No Federal projects are included of any scale; instead, the idea is that local decisionseven concerning such projects as railwould put monies to a piecemeal list of programs to "create jobs, rebuild infrastructure." Money is to be used:
- to improve homeland security by hiring and training first responders;
- for public health personnel and security providers for critical installations and ports;
- for purchasing new and improved equipment, for homeland security;
- to build new, or to renovate and repair, failing infrastructure, including: schools, roads, rail, water systems, wastewater treatment systems, electrical systems, and telecommunications systems.
- The fund will place a special emphasis on helping disadvantaged and minority communities, which have been hard hit by the downturn and have recovered the least.
Additional elements of Dean's proposals for the U.S. economy are:
More Capital for Small Businesses. Dean proposes a revamping the Small Business Corporation, by establishing a Small Business Capital Corporation within it, based on the model of Fannie Mae and Freddie Mac, both currently leading props of the U.S. mortgage securities housing bubble.
Targetted Economic Development
Streamline the process for permits and grant-reviews.
National coordination of regional economies. "Governor Dean would improve the system dramatically by reinvigorating the national Economic Council, and creating a White House Office of Economic Growth that would work with governors and mayors to create vital regional growth strategies, and breakthrough bureaucratic logjams to delivers results."
Kerry does not identify what steps should be taken to rectify the international financial and economic crisis, apart from singling out that trade must be fair, and "currency manipulation"on the part of China and Japan in particularmust be stopped. He calls for policing action by the World Trade Organization, in his "Economic Plan to Create Manufacturing Jobs," released Oct. 21, 2003 in Salem, New Hampshire. This plan, and an earlier one, "Plan To Fight for America's Economic Future," are the principal economic policy documents of the Kerry campaign. Both implicitly accept the premises of the current world monetary and trade system, despite the fact that it's disintegrating.
His October statement has an international plank, focussed only on globalized trade, called, "Strong, Enforceable Trade That Works for America." Four points are identified under the heading, "Assure Trading Partners Play by the Rules": 1) Stop countries from manipulating their currencies; 2) enforce and strengthen intellectual property protections, so that U.S. companies can "share their technology without losing control of it"; 3) break down barriers in key export markets. Kerry would use the available tools, including Section 301 of the 1974 Trade Act, WTO remedies, and diplomatic measures to open markets such as Japan and Korea, to U.S. autos, etc.; 4) review existing trade agreements.
Kerry's economic proposals are focussed on the U.S. domestic economy, including:
- Aid States and MunicipalitiesSteps to Jump-Start Job Growth Today. He would repeal Bush's tax cut, and then initiate: a) A State Tax Relief and Education Fund to channel an additional $25 billion a year for two years to stop education cuts, tuition increases, etc., "that are inhibiting our economic growth and causing layoffs." b) "Save jobs by ending the unpatriotic practice of U.S. corporations moving offshore simply to avoid paying their fair share of our nation's tax burden." c) Create new manufacturing jobs, by giving give a corporate tax rate reduction to manufacturers who produce goods in the U.S.A., and other tax credits for creating new jobs. d) Hold "job creation summits" weekly for six months to come up with regional strategies for new jobs.
- Using American Ingenuity To Create a Strong Economic Future, including "control of rising health care costs by helping pay for catastrophic care cases"; connecting all households to the Internet; increased funding for NASA, Department of Energy, and the National Science Foundation; creating new manufacturing jobs by investing in America's energy independence.
- Making College Affordable. Create a new College Opportunity Tax Credit, and pay college tuition outright for students that give two years of Service for College in communities and national service.
- Provide Tax Relief for Middle Class Families and Crack Down on Unfair Relief for Corporate America. He gives a detailed list of proposals, such as opposing the dividend tax cuts for high-bracket individuals. He wants increased funding for the Securities and Exchange Commission for stronger enforcement powers.
- Restore Fiscal Discipline. Proposals include having a "Balanced Budget Summit" to work together; ending Bush's special tax breaks for those making more than $200,000; passing a Constitutional line-item veto "to reduce corporate welfare and excessive spending," and many others.
Kerry's Oct. 21, 2003 "Manufacturing Jobs Plan" gives still more points in the listings along the same lines. It lists four areas: a) tax breaks for corporations to keep operations and jobs at home, not overseas; b) backing for R&D and job training to assist manufacturers and workers, to "stay competitive"; c) enforcing international fair trade laws; d) providing relief for manufacturers that provide quality health care to their workforce. Kerry proposes a "premium rebate pool" that will give employees up to $1,000 to defray health-care costs, and help employers "stay competitive."
Edwards' website emphasizes almost exclusively tax policy, and cracking down on "crony capitalism." In a speech to business students at Georgetown University on June 17, 2003, "On Rewarding Work and Creating Opportunity," he says that "More than anything else, what's holding our economy down is the callous view of a few at the top in Washington and in the corporate world that the values that got us here can now be left behind." Repeating this "values" theme over and over, he says: "America can withstand a plunge in corporate valuations, but we cannot abide a plunge in corporate values. We can overcome the worst job market for people seeking work since the Depression, but not an economic theory that says work doesn't matter."
Except for a brief respite under President Clinton in the 1990s, he says, American politics has been stuck "for most of my adult life" in two competing and unsatisfactory theories: the first, was "the conservative notion that America should ask the least of those with the most." This was disproved in the '80s, but has returned now with Bush. The second theory "was the notion by some in my party that we could spend our way out of every problem. It won't work, yet some in my party want to bring it back."
He vows to end tax breaks for corporations that move their headquarters overseas, or give tax breaks to CEOs while giving no pensions to ordinary workers. He says he will ask Congress to cancel the 2001 and 2003 income, dividend, and estate tax breaks for the wealthiest Americans in the upper two brackets.
The way to make the stock market grow and keep growing, he says, is "to expand the investor class by attracting, reassuring and rewarding millions and millions of small investors, not favoring a handful of the biggest ones.... We've had enough Enrons and WorldComs. It's time to help America prosper the old-fashioned wayby earning it."
Finally, he avows that we must "restore fiscal discipline here in Washington."
Lieberman's proposed international economic measures are 1) tacitly, to keep hands-off the IMF-era speculation, commodity cartels, and other mega-financial and political interests operating in the U.S. and international economies; and 2) to back free trade to the hilt.
His website states: "A Trade Policy That's Free and Fair. Joe Lieberman fights for free and fair trade agreements that help sell more American goods abroad, while protecting our workers and our environment. He has consistently stood behind Bill Clinton's decision to sign NAFTA. U.S. exports to Canada and Mexico grew by more than $112 billion between 1993, when the agreement was enacted, and last year. As President, he will aggressively open new markets while including strong, realistic reasonable labor and environmental standards. And at the same time, he will crack down on trade abuses by challenging countries that break the ruleslike China...."
Domestically, Lieberman has put out a detailed series of proposals, over 2002-03, mostly based on info-tech and the cybersphere.
On Oct. 18, 2002, in a speech at the NASDAQ Market titled "Agenda for Economic Prosperity," Lieberman called for a stimulus package to "bolster consumer confidence and create new jobs, bring shareholders back to the market, and spur innovation and investment by business...." He issued a 31-point program which includes:
- Spur Business Investment and Innovation (speed up broadband access, provide incentives for nanotechnology R&D, enact a short-term investment tax credit for 20% for acquisition of infotech, and other actions).
- Boost Consumer Confidence and Help Working Families, including tax rebates; extending unemployment benefits to maintain purchasing power; restoring the value of the minimum wage; replenishing depleted state Medicaid accounts to counterbalance state cuts.
- Bring Investors Back to the Markets, with measures such as: Enact the Venture Capital Gains and Growth Act, S.1142, to provide a zero capital-gains tax rate for long-term investment in new stock offerings by entrepreneurial firms; enact the Rank and File Stock Option Act to prevent executive abuse of stock options; and take other specified measures to protect employee flexibility in their 401Ks.
- Make Intelligent Government Investments: Enact a New Jobs Tax Credit for companies hiring new workers; a Technology Talent Act for universities; and fully fund the No Child Left Behind program.
His long-term program was first proposed at the Detroit Economics Club, May 20, 2002, and includes:
- Make High-Return Investments (government investments in education and innovation will drive economic growth, give R&D tax credits to tech firms, and reauthorize welfare reform "to place a greater emphasis on moving recipients into work and training."
- Recommit to Free and Fair Trade.
- Limit Spending and Find Savings.
- Restore Fiscal Discipline: Make permanent the most effective parts of the Bush tax cuts, and otherwise "redirect" tax cuts in ways so that, "98 percent of all families would get every dollar included in the tax cut adopted last year , and not a single American would be paying higher taxes. In addition, the government would save approximately $1 trillion over the next 20 years, which could be set aside primarily to pay down the debt, provide pro-growth tax cuts, and make other necessary investments."
Lieberman asserted at the Oct. 27, 2003 Detroit Democratic Party candidates' debate that his middle class-oriented "tax fairness" plan would close loopholes on corporations, and "create 10 million new jobs in the first four years" of a Lieberman Presidency.
Gephardt calls for correction of the trade "imbalance" with China, and for an "International Minimum Wage." "As president, I will press the World Trade Organization to take the landmark step of establishing an international minimum wage, the IMW.... By raising wage standards around the world, we address both the chronic abuse of workers in low-wage countries and the competitive disadvantage faced by American workers.
"The IMW would be different for each country.... Negotiations for the IMW would take place at the World Trade Organization in close consultation with the International Labor Organization.... The necessary infrastructure to support the international minimum wage would come from an integration of the various international financial institutionsthe World Bank, the International Monetary Fund, and other organizations."
Gephardt's campaign website has details on how the IMW is supposed to work.
On the issue of "economic growth," on Gephardt's website, are proposals "to restore America's economy using principles of growth he helped forge in the early 1990s."
Universal health care insurance is his foremost proposal [health-care issues will be discussed in future "Where They Stand" columnsed.]. "Most significantly, he will work to provide the surest stimulus measure we can give our economy: providing guaranteed health care insurance for all Americans. This will give direct financial help to families who pay health care premiums, provide assistance to businesses and state and local governments struggling to pay health care costs for employees, and free up money for better wages and job creation..." He states that, as President, he will focus on this, "After repealing the failed Bush tax cuts..."
In his "record of leadership on economic growth," he cites these "accomplishments:"
- Led Passage of Clinton Economic Plan in 1993, that led to "seven straight years of unprecedented growth and prosperity, and the creation of more than 22 million jobs."
- Empowerment Zones, Earned Income Tax Credit.
- Reducing Deficits.
- Increasing the Minimum Wage. In 1996, Gephardt said he rallied the action needed to raise the hourly minimum from $4.25 to $5.15.
- Fighting for Job Training. "In 1993, Gephardt advanced the School-to-Work Opportunities Act [focussing] on skills-training for those who will not attend college," and other measures.
Clark's "Three-Pronged, $100 Billion Strategy To Create American Jobs" places major emphasis on job creation through Homeland Security measures. He wants to create a Homeland and Economic Security Fund ($40 billion over two years), to "protect our country and provide a jump-start for job creation." This would include investment in training of police, fire fighters, hospital workers, Coast Guard and Customs services, and domestic law enforcement generally. His last point is that there has been "too little focus on, and investment in, projecting America's critical infrastructure." The second "prong" of his plan is to create a State and Local Tax Rebate Fund of $20 billion for year over two years, to create jobs and lessen the need for states and local governments to raise taxes, college tuition rates, and other fees, and/or cut critical expenditures (e.g., health care). Pointing out that "state and local governments are facing their worst fiscal crisis in decades," he calls for $10 billion per year to be spent from his Rebate Fund for education and training; $5 billion per year for Medicaid and other health-care efforts; and $5 billion per year for other pressing needs, such as law enforcement, corrections, or social services. The third "prong" of his plan is "Tax Incentives for Job Creation" ($20 billion over two years). Stating that we are "stuck in a job loss recovery," he wants to create a Job Creation Tax Credit; allow small and medium-sized firms, especially manufacturing firms, to "expense up to $150,000 in investments" over two years; provide tax incentives to keep manufacturing jobs in the U.S.; and "promote growth by promoting tradewhile insisting that all nations play by the rules." This last signifies support for "market-based exchange rates. Wes Clark believes that no major country, such as China, should be allowed to manipulate markets and keep their currency at artificially low levels."
Clark maintains that his job creation plan is "deficit neutral"; it will be paid for "by making changes to the Bush Tax Plan as it benefits families making more than $200,000 a year. He does not say what those changes would be, but says that he will not impose any new tax burdens on families making under $200,000 a year.
Clark's "Saving for America's Future Plan" promises to save $2.35 trillion over ten years for deficit reduction and investment in priorities such as education and health care. This would be done by restoring the principle that "all tax and spending proposals must be paid for without increasing the principle. This principle, called PAYGO in Washington budget rules, was a consensus during periods of deficit from President Clinton to House Speaker Newt Gingrich, but the Bush Administration has entirely ignored it." The plan proposes to streamline government and improve efficiency, including in health care ($225 billion); end "corporate welfare" and close "corporate loopholes" ($300 billion); promote "a more effective and multilateral Iraq policy ($125 billion); recapture revenue from Bush's tax cuts for the wealthiest families ($1.1 trillion). In addition, he sys his plan would save $600 billion in additional debt service, as a result of reducing the deficit more quickly.
His "Economic Vision" statement calls for creating the conditions for long-term prosperity, including by "sustainable energy practices"promoting "alternative energy sources and clean energy technologies," with no mention of nuclear fission or fusion power.
Clark's "Manufacturing Security Plan" wants to create a $10,000 tax credit for each new full-time employee hired in manufacturing or other industries harmed by outsourcing; "stop China's currency manipulation"; make all countries "play by the rules"; require companies to disclose layoffs in America and job increases overseas; stop tax breaks for companies that move overseas for tax reasons; develop "Buy American" guidelines for government procurement; deny government contracts to firms that move headquarters overseas for tax reasons or shift substantial numbers of U.S. jobs overseas; reduce labor costs to manufacturing by making health care more affordable; "explore" ways to relieve companies of pension burdens; implement regulatory reforms that are pro-market and pro-consumer, rather than bailing out corporations.
On Oct. 23, 2003, Kucinich said that as President, "I will make my first act in office the repeal of NAFTA and withdrawal from the WTO. I will replace these corporate trade agreements with fair bilateral trade agreements conditioned on workers' rights, human rights, and environmental protections."
He proposes a 15% cut in the U.S. military budget, as an example to the world, under the rubric of an economic "peace dividend"beating swords into plowshares.
At the Detroit candidates' debate on Oct. 27, 2003, he called for repealing the Bush tax cuts for the people in the top brackets, and putting the money into a fund to provide for universal college education, with free tuition. "My economic strategy would be to fuel growth in the economy by having a full-employment economy, by working to rebuild our cities with a massive new WPA-type program."
On free trade/fair trade and the principle of national sovereignty: His website reports a Dec. 1, 2003 statement upholding steel tariffs. "Clearly the tariffs are needed and are effective. But the President has abandoned the sovereignty required to maintain them. A basic prerequisite for self-governance requires that a nation be free to enact policies that address its needs and provide benefits for its people. But as long as the World Trade Organization determines United States policy, we are not a sovereign nation."
In a Nov. 18, 2003 statement on the Free Trade Area of the Americas (FTAA), Kucinich said it, like NAFTA, "is wrong-headed, and it will be harmful." NAFTA caused a reversal of the U.S. trade balance with Mexico, he pointed out. After NAFTA, U.S. companies "shuttered their manufacturing plants in the U.S. and then relocated to Mexico, where they manufactured for export to the U.S. As a result, many Americans lost their jobs, and many more were threatened with the loss of their jobs unless they agreed to wage and benefit reductions."
After President Bush visited Ohio, Kucinich's home state, on Oct. 30, 2003,Kucinich issued a statement titled "Mr. President, Welcome to Ohio: Where Are the Jobs?" He points out that Ohio has lost 220,700 jobs since Bush took office, including 151,800 from the manufacturing sector. "The President's one-size-fits-all economic solution of tax cuts to the wealthy is a proven failure in Ohio," he states.... The President's economic strategy of 'leave-no-billionaire-behind' tax cuts combined with the sticking the American taxpayers with the over $150 billion price tag for his unjustified war against Iraq will make it impossible for our economy to recover."
Kucinich's ten-point platform also addresses rural communities and family farms. He would "break up agricultural monopolies and restore a strong, independent family farm system with fair prices for farmers and healthy food for consumers," he says.
He calls for "a resurgence of organized labor," and says he will defend the rights of workers to organize and bargain collectively. "Investing $500 billion to rebuild schools, roads, bridges, ports, and sewage, water, and environmental systems will do more to stimulate our economy than tax breaks for the wealthy."
In a Labor Day speech (2003), "Employ the Jobless to Rebuild America's Decaying Infrastructure," he calls for the creation of low-cost Federal financing to administer $50 billion in zero-interest loans every year for ten years. Twenty percent of these funds would be for school construction and repair. State and local governments would continue to issue bonds to finance infrastructure projects, but the Kucinich plan would authorize the Federal government to buy those bonds. The Federal government would hold them in the Federal Bank for Infrastructure Modernization (FBIM), which would administer the loans. The Fed would transfer about $50 billion annually to the FBIM, which would still allow the Fed to operate as it does now to add liquidity to the system. Two million Americans would find jobs through this plan, he says.
Carol Moseley Braun
Moseley Braun's website has nothing on economic policy, except health care.
At the Democratic candidates' debate in Detroit on Oct. 27, 2003, she said: "The first thing we have to do is make certain that the globalization of trade does not create a race to the bottom, that creates the exploitation of workers abroad and the hemorrhaging of jobs here at home. We have an absolute responsibility ... to see to it that our country retains a vital and robust manufacturing base, because manufacturing is central to our ability to create goods for the rest of the world. And in so doing, that's going to require a number of things. We need to take a look at the tax code and the way it works to impair the ability of people to manufacture. But my big issue on manufacturing and what we can do to help is health-care reform. If we can take the burden of health care off of our manufacturers ... that will go a long way to building up our manufacturing base and resolving some of our trade deficit issues."
Sharpton's website has nothing on economic policy. At the Oct. 27, 2003 candidates' debate in Detroit, he said: "I have an infrastructure redevelopment plan, $250 billion over five years, rebuilding bridges, highways, tunnels." He did not say what his plan was.
Regional Recovery Programs
Over the 2001-03 period, LaRouche has travelled to more than ten nations, meeting with policymakers on strategic questions, especially economic recovery programs, and how to understand the leadership crisis in the United States. The centerpiece for his diplomacy is the idea of the "Eurasian Land-Bridge" economic development perspective, in which priority transcontinental high-tech transportation lines are development corridors for vast economic improvements. In 1997, a book-length report commissioned by LaRouche, The Eurasian Land-BridgeLocomotive for Economic Development, was released, and has had vast influence among pro-growth national leaders worldwide.
Among the many regional development programs available on LaRouche's campaign website and in publications, his most recent is for the Americas. Speaking in Coahuila, Mexico in November 2002, he called for taking an approach like FDR, for "Super-TVA" projects on the continent, to provide for the security and benefit of all. In particular at that time, he called for a "Great American Desert" development program, to benefit, through infrastructure-building, the seven U.S. states and six Mexican states spanning the arid region of southwestern North America.
September 2003: "The Sovereign States of the Americas, LaRouche's Program for Continental Development." LaRouche's preface to this 40-page document is titled, "The Monroe Doctrine Today," and gives details of major infrastructure projects needed throughout the hemisphererail, energy, water, health, and so on, in the common interest of all nations.
In October 2002, the LaRouche in 2004 campaign issued a mass-circulation 24-page document, "Emergency Intervention: LaRouche's 'November Program' To Rebuild the Economy," giving parameters and principles for an FDR-type infrastructure restoration program, covering transportation (rail, air and water), water management (supplies and sanitation), energy (generation and distribution), soft infrastructure (medical facilities, public health), education, and other vital sectors. The proposals review such long-standing, unbuilt projects, as the continental-scale North American Water and Power Alliance (NAWAPA), and cover essential new technologies, such as magnetically levitated trains, and the modular high-temperature gas-cooled reactorsthe "Fourth Generation" nuclear power plants.
Among the regional programs the LaRouche campaign has focussed on are:
CaliforniaIn September 2003, the LaRouche in 2004 campaign issued a 24-page economic program, Return to Sanity: Make California a Pilot Project for the Nation!, as part of the LaRouche intervention to defeat the Schwarzenegger/Cheney/Buffett/Shultz attack on California. The LaRouche program presents what actions to take in three phases: 1) short term: cancel the 1996 state energy deregulation law, and repair the damage; 2) longer term: launch the needed power, water, and nuclear projects that have been overdue for decades; 3) phase 3: go nuclear. Launch the 20-30 nuclear power complexes, with the modern "Fourth Generation" high-tech designs. At least 1 million new jobs would be created, and other major economy-advancing effects.
MidwestLaRouche presented key features of a Midwestern economic development program during his mid-November 2003 swing through St. Louis and Detroit.
On Nov. 18, 2003, at a St. Louis town meeting, he said: "Now, this area has recently gone through a little bit of a problem. A lot of the industry has been lost. The merger of McDonnell Douglas with Boeing, and the downsizing of Boeing and other things, have crippled this area's industry, and its potential.
"Now, what would the United States do with St. Louis, under my government? We have a new type of system, for long-range rail or equivalent transport: It's called magnetic levitation. The first operating system is now operating in China, in the Shanghai to Shanghai Airport maglev system. It's now functional. We can develop an improvement on the maglev system, and obviously St. Louis is a place to do that, because of some of the skills and logistical position. And, you would build around such an effort, you would build subsidiaries, which would be based on drawing in talent, which otherwise is going to rot in this area.
"So, now what you do is, you create a fund, a 25- or 50-year plan, which you call the Railway, or Magnetic Levitation, or Transport Reconstruction Fund. Like the Tennessee Valley operation, under Franklin Roosevelt. And, we would take the United States, which has been deprived of efficient mass transit, and we would develop a magnetic levitation system for not only passengers, but for freight....
"So, we're going to do that kind of thing, in my view. This means a long-term investment, of 50 years, essentially, in developing a new mass-transit system for the United States, for freight, and for passengers. And why not start it right here? ...
"Can we do it? Can we get the credit? Why not? The government can guarantee it. We guarantee the credit, on a 25- to 50-year basis: We build the system, the way it was done from experience in the past.
LaRouche is known widely for his long-standing proposal for the Mideast, the "Oasis Plan," proposed in the 1980s as the basis for peace, through mutual-interest economic development programs based on infrastructure improvements for plentiful water (nuclear-powered desalination), energy, and high-tech transportation.
LaRouche has long insisted on, and publicized, the necessity for major infrastructure development for the continent, in the mutual interest of all the nations, to include cross-continental high-tech rail ("from Djibouti-to-Dakar" and north and south), large-scale water projects, such as the Zaire River "Trans-Aqua" Plan, nuclear-powered desalination, and plentiful electricity, through "Fourth Generation" nuclear generation. In the short and medium term, all needed food, medical and public health supplies must be mobilized.
Kerry calls for "job creation summits" to meet weekly for the first six months of his Administration, to create and develop "targetted strategies to create jobs in key regions and key industries." Apart from that, he does not appear to have proposals for any region-based, or infrastructure-based overall economic development programs, either for the U.S. or international economies.
He does identify the "aging electricity grid" in the United States as an infrastructure project to be addressed; and he identifies the program-goal of having 20% of U.S. energy sources to come from "renewable sources" by 2020. He supports "investing in projects like building the Alaska National Pipeline."
The Lieberman consumer, markets-based, and info-tech-based proposals have no special regional nor infrastructure programs except for national broadband access (see below).
Gephardt does not advance regional economic development programsexcept for empowerment zonesnor infrastructure projects. He does focus on farmbelt communities, advocating "bringing the entire farm family back to work on the farm again," and not have off-farm jobs to get health coverage, or to make up for low income.
His website states, "As president, I'll also introduce the most sweeping antitrust initiative our farm communities have ever seen. The centerpiece of that effort will be a ban on packer ownership of livestock.... [I will] instruct the Department of Justice to focus" on that, as much as on high-tech and other high-profile sectors.
None of the other candidates' websites identify any specific regional recovery programsinternational or domesticexcept as previously noted.
LaRouche has backed the development and application of advanced science and technologyfrom nuclear power, to geochemical and biological breakthroughs, as a principle in economics. The conceptual author of what became known as President Ronald Reagan's Strategic Defense Initiative (SDI), he designed that policy to be a science-driver for the economy as a wholeof both the United States and the Soviet Union, which, in his vision of the program, would cooperate for strategic defense, ending the era of Mutual and Assured Destruction (MAD). LaRouche has also developed the idea of the space programincluding the colonization of Marsas such a science-driver. Policies such as these have emerged in his work over decades, as a result of his work as a physical economist, who views human creative discovery as the power underlying economics.
To take one example, on March 10, 2001, he issued a campaign document, "The Science-Driver Principle in Economics: The Gravity of Economic Intentions," saying, "The central feature of any effective long-term economic-recovery program for today, will be the role which a series of 'crash-program' types of science-driver programs, of accelerated scientific discovery and technological change, must contribute, if the world's population is to escape a long-term economic catastrophe already built into the current state, of combined technological underdevelopment and attrition, of the world at large.
Dean's science and sci-tech investment proposals emphasize communications, data storage and retrieval, and computingwithout regard to the collapse of physical infrastructure, the machine tool sector, etc. "Alternative" energy sources are stressed, including ethanol, wind and solar.
The website states: "Over the coming decades, a global communications platform for voice, data and video will emerge that will generate large incremental productivity advances in business while also spawning an incalculable number of new enterprises and lines of business within existing companies. A technology sector that will have great impact on the pace and scale of this change will involve enterprises that are experimenting with and developing optical, molecular and atomic scale platforms that will replace the silicon-based chips and storage devices in use today.
"The Governor is also particularly concerned that broadband is made available to rural America, so that jobs dependent on the rapid transmission of large amounts of data can be created anywhere in the U.S."
Kerry's call for increased funding for science, specifies that he "will strongly support programs targeted at the next generation of innovation, such as nanotechnology and biotechnology research." However, his stress on increasing energy-reliance on "renewable resources" is a turn backwards from advanced technologies, such as nuclear, which he does not specify backing.
There is a "Lieberman Manufacturing Recovery Program" on the campaign website, with components including: 1) NextTecha public/private partnership to further innovation; 2) Nurture Nanotechplans to coordinate Federal backing for innovation; 3) Building 21st Century Infrastructureworking "cooperatively with the private sector by wiring all of America to the high-speed Internet by 2010 and seeding the private sector to replace antiquated energy, transportation, and production systems with new, environmentally-friendly infrastructure"; 4) Accelerate the Deployment of Broadband Internet; 5) Link Economic Security and National Securitybacking a "strong semi-conductor industry"; 6) Give Smaller Manufacturers New Access to Capital; 7) Strengthen Aid to Small Producers.
Lieberman is actively promoting fraudulent science in energy and other areas. On Jan. 8, 2003, Lieberman and Sen. John McCain (R-Ariz.) unveiled "cap and trade" legislation "to curb global warming by establishing a market-based emissions credit trading system" on gasses emitted; on Oct. 30, 2003, Senate debate was held on the global warming sham.
Gephardt points to his record in Congress in support of Federal funding of a list of high-tech items, and pledges that in the future, he would support such measures as "developing a 21st century broadband infrastructure," an E-rate for access to the Internet, as well as to fund high education programs with an emphasis on high-tech.
Gephardt has an energy program based on "renewable" fuels, announced in January 2002, called, "Apollo 21" described as an Apollo Project to achieve energy independence for the U.S. in ten years from that date. Among the ten points are tax credits for advancing bio-mass, wind geo-thermal and other low-density energy sources, fuel-cell R&D, energy-saving mass transit systems, etc.
Nowhere in this energy program, nor in other utilities or in health care, does Gephardt advocate any traditional reregulation. Instead, his energy plan states, "Apollo 21 will outlaw electricity price manipulation and task the FERC with a more aggressive mandate of mounting early investigations of power companies for price gouging."
Reregulation in the Public Interest
LaRouche has consistently called for reregulation of utilities, transportation, health care (under the "Hill-Burton" standard), the financial (especially the speculative markets) and other sectors, and a return to traditional American-System practices, set aside over the past 40 years.
On Jan. 3, 2001, speaking at a webcast event in Washington, D.C.his first event as a pre-candidate for the Democratic Party Presidential nominationLaRouche said of the California and national energy crisis: "Immediately, through the Federal government, create two steps: ... Establish reregulation, emergency reregulation. Do it under Clinton. Don't wait for Bush. Do it Now! ... And then get some money in there.... Get some power generation going in that area. We're going to ensure a safe and adequate supply of energy, to industry and to populations throughout the area."
LaRouche's further interventions on behalf of energy reregulation are summarized in two mass-circulation pamphlets his campaign published September 2003, in the fight to defeat the Schwarzenegger/Cheney/Buffett/Shultz recall attack on California. One was titled, "Who Robbed California? Vote 'No' on the Recall!" and the other was a development program for the state.
In his Feb. 19, 2002 statement, "On the Democratic PartyA Swift Modest Proposal: Can the Democratic Party Survive?" he denounced both "popular" opinion and pandering to popular opinion, over swindles such as deregulation. LaRouche wrote: "Take the case of 'deregulation,' as set wildly into motion under Brzezinski-misguided President Jimmy Carter. That four-year term, with its fanatical emphasis on the combined follies of 'fiscal austerity' and 'deregulation,' did more damage to the U.S. economy, in four years, than has been done under any other post-1945 Presidency, prior to the drive to 'globalization' begun at the beginning of the last decade. The now onrushing chain-reaction collapse of the world's vast financial-derivatives bubble, as merely typified by the Enron case, is merely typical of the vast swindles [which inhere in deregulation]."
Dean remarked to some reporters on his campaign jet en route to Texas on Nov. 17, 2003 that he might want to "reregulate" utilities, big media, and businesses issuing employee stock options, and perhaps telecommunications. But this idea quickly evaporated, and he did not stand by it in subsequent speeches nor on his campaign website. His campaign issued a statement shortly thereafter, on the energy bill before Congress, with no mention of reregulation, but repeating his usual support for "a new energy economy, based on domestic renewable sources and energy efficiency, that will create jobs, protect our environment, and increase our security."
Lieberman is adamant that there be no reregulation of energy, nor any other areas of the economy. His website begins with the feint, "Joe Lieberman supports common sense regulation of industry designed to stop bad behavior and hold bad actors accountable, to prevent harmful consolidation of industry, and promote competition. However, he believes wholesale reregulation of American business will undercut competition, stunt innovation and growth, and kill jobs." The Lieberman website further offers Howard Dean as the proponent of "comprehensive reregulation" of energy, airlines, media, etc., to provide a fake contrast.
Clark defended deregulation, when the issue came up concerning an informal Nov. 17 statement by Howard Dean (see above). Clark said that the Clinton Administration stood for deregulation, and that legacy must be upheld: "You can't win a general election if you abandon the very proven policies that were the cornerstone of our party's success."