Executive Intelligence Review
Subscribe to EIR

PRESS RELEASE


Schiller Institute Paris International Conference, June 13-14:
Rebuilding the World in the BRICS Era

A Solution for ‘Greek’ and ‘African’ Debt in the Era of the BRICS

PARIS, June 19, 2015 (EIRNS)—The problems of debt and of a productive economy, as opposed to the predatory financial system which has taken control of the trans-Atlantic economy, were at the center of the June 13-14 Schiller Institute conference in Paris. At stake is what type of economy the will world build in the BRICS era, to make it truly human?

Jacques Cheminade, Chairman of Solidarité & Progrès, opened the second day of the conference on the theme of "Public Credit and Debt Cancellation, the Political Challenge for Europe." He gave numerous examples of a world financial system that has gone mad and become criminal: The EU demanding that countries include prostitution and gambling in their GDP; the incestuous relationship between the banks and the GAFA (Google, Apple, Facebook, Amazon); high-frequency trading with no judicial control; shadow banking and "alternative pools"; $800 trillion in derivatives claims.

We have to reestablish a world of real growth, said Cheminade. It is better to jump on the train of the BRICS than to stay behind, or even worse, to actively oppose them as the oligarchs propose. However, the real challenge for Europe is "to add a surplus of power and a larger horizon to the impetus of the BRICS." Cheminade went on to outline Lyndon LaRouche’s measuring rod for a productive economy, which the late Russian scientist Pobisk Kuznetzov once proposed to call the "La." That means understanding that man is not a "geopolitical animal seeking to occupy territories and control resources against other human beings," but a creative being capable of discovering universal principles and transforming society for the better, thorough high technology applications.

Greece: A Silent Putsch Is Underway

In contrast, Greece today presents a case study in oligarchical practices. Stelios Kouloglou, a Member of the European Parliament from the Greek party Syriza, engaged the audience by showing how the Troika (IMF, European Central Bank and European Commission) is using the debt issue to try and overthrow the current Greek government.

The situation is comparable to that of Chile under Salvador Allende, he said. Before Pinochet came in with the tanks, President Nixon told the CIA: "Let the economy scream." And the banks cut off all credit to Chile. Today, the coup against Greece is "not with tanks, but with the banks." As soon as Syriza came to power, explained Stelios Kouloglou, Mario Draghi of the ECB cut, without the slightest justification, the main source of financing of Greek banks, and replaced it with the Emergency Liquidity Assistance (ELA), a facility which must be renewed every week. This, he used "as a sword of Damocles hanging over the head the Greek government."

Mr. Kouloglou used the occasion to address bitter remarks to France: "Abandoned by those forces whose support they were counting on—the French government—Greece cannot solve the major problem of the country: an intolerable debt," which was used essentially to bail out French and German banks in Greece. "The proposal for an international debt conference like that of 1953 which freed Germany from the greater part of debt reparations, opening the road to the economic miracle, has been drowned in a sea of threats and ultimatums," he charged. In that loaded climate, Russia’s positive answer to Greece’s request to participate in the new BRICS bank came as a "sigh of relief and optimism for the Greek public."

Mr. Kouloglou received a standing ovation from the 450 participants. "We will resist," he concluded, underscoring that time is of the essence: "Best wishes for the Greek government are no longer enough. The solidarity it deserves must be expressed by acts. Time is limited."

Africa: The Myth of African Independence

Diogène Senny, Secretary General of the UMOJA Pan-African movement, then showed how the indebtedness of Africa is the result of a "cleverly orchestrated policy of new conquest by neo-colonial forces," and should thus be declared "odious" and "illegitimate," just as the Greek debt should be.

Several phenomena contributed to inflate African foreign debt: 1) private debt in the form of excess euro-dollars reoriented to Africa in the early 1960s, and then of petrodollars after the oil shock of 1973; 2) public "tied debt," i.e., aid tied to signing contracts with the companies of the donor country; 3) multilateral debt given by the IMF and the World Bank. Between 1970 and 1980, Africa’s foreign debt rose to $89 billion. According to UN Commission on Trade and Development (UNCTAD), between 1970 and 2002, Africa received $540 billion in loans, and repaid $550 billion, and yet today, its debt is still of $295 billion. Studies by the Committee for Cancellation of Third World Debt (CADTM) showed that in 2012, Sub-Saharan Africa returned to the world 5% of its GDP (in investment profits and debt service), while development assistance only accounted for 1% of the same GDP.

So, "who is helping whom?" Diogène Senny asked rhetorically. Debt audit and cancellation for which UMOJA is fighting are "not a request for generosity from the creditors, but reparation and an act of justice for peoples betrayed."