THIS WEEK YOU NEED TO KNOW
Amidst the Crises: The Time for Reason Has Arrived
Crises are exploding all over the planet, from Argentina to the Middle East, from Japan to Europe and the United States. Just as the strategic situation may appear to be at its most dangerous, with the threat of regional war in the Middle East which could go global, and with the worldwide financial/economic collapse accelerating, and a new outbreak of the "New Violence" in Germany, Lyndon LaRouche said over the past few days: "Rejoice! The time for reason has arrived!"
Why this paradox? Look at things from the vantage point of truth: Reality is hitting hard, and it is getting harder and harder to avoid. The illusions are falling away. That is good news.
Take, for example, the Bush Presidency, which is in total shambles. President Bush has not been in office for 15 months yet, and he is already on the verge of being a lame duck. This President is incapable of handling the mounting crises and the political blackmail being thrown against him by the Sharon/Likudniks in Israel, and the neo-conservatives and lunatic Christian "Evangelicals" in the United States. The President is paralyzed; Sharon knows this, Netanyahu knows this. They have a green light from Washington to do anything murderous that they damned well please. This is pure power politics.
A number of Arab world leaders are coming to Washington and Crawford to meet with Bush, to sound Bush out, and to possibly negotiate with him. While diplomacy demands that these meetings take place, these leaders should understand in advance, that nothing fundamental whatsoever can to come out of these meetings under present circumstances. Saudi Crown Prince Abdullah, was reportedly well aware that nothing concrete could come out of his meetings with Bush and other Administration leaders last week; yet the meeting was important for him, to determine if it were possible to resolve conflicting pictures of the Administration, and in light of crucial decisions which will have to be made by the Arab leadership over the next few weeks. In advance of the meeting, he presented an eight-point plan to the White House which was all but thrown in the trash; not even Secretary of State Powell's staff was provided a copy by the White House.
But it were impossible for the Crown Prince to come out of the meeting with any sense of what the Administration's policy isfor the reason that there is no policy. As we advised our readers last weekthe Bush Administration is behaving like a blind, deaf, and dumb Cyclops. It can't control anything. It has no master plan. It is dangerous, especially if you get underfoot, but it is not running anything. This is a vital point that must be understood, by citizens and world leaders alike: Bush is not sitting atop a vast, well-greased conspiracy to run the world. This is the gang that can't think straight.
Mexico illustates the situation, in two important respects. First, take the recent incident around the UN Conference on Development in Monterrey in March, where President Vicente Fox urged Cuba's Fidel Castro to leave the conference before President Bush arrivedthe primary reason for this pressure, being that Bush did not want to do anything to jeopardize Jeb Bush pulling in the Cuban-American vote in Florida. Nevertheless, both Fox and Bush had denied that any such pressure had been put on Fidel, and they implied that Castro had left the conference as a stunt. However, on April 22, Fidel played a tape of his telephone conversation with Fox, in which Fox told Castro he could attend a luncheon, but must then "go back" to Cuba, or anywhere outside of Mexico, and Fox also urged him not to attack the United States or Bush. Fidel's disclosure left Fox and his Foreign Secretary Jorge Castaneda looking like foolsbut the biggest fool of all was George W. Bush.
Secondly, Mexico provided a sound victory for reason on April 24, when the Mexican Senate decisively voted down the proposals for the deregulation and privatization of electricity promoted by Fox and the Party of National Action (PAN). This came one week after Lyndon LaRouche addressed (via electronic hook-up) an EIR seminar in Mexico City attended by approximately 100 officials from leading Mexican institutions; that event took place in the midst of the tour by LaRouche spokesman Harley Schanger and Nevada State Senator Joe Neal, who played a leading role in reversing energy deregulation in his state. In a meeting in the Chamber of Deputies building, attended by national press and at least ten Congressmen, Schlanger and Neal had presented the collapse of Enron as part of the systematic disintegration of the post-1971 neo-liberal economic model imposed on the U.S.and they emphasized that this collapse is compelling U.S.-based cartels to seek out new sources of loot, such as they hoped to obtain through deregulation and privatization of Mexican energy.
Not only is this a victory for reason, but it as well represents another terrible defeat for Bush, following on top of the fiasco in Venezuela, the mess in Colombiaand of course the absolute collapse of the Bush Administration's Middle East "policy."
Domestic electoral considerations are also a significant factor in the Administration's Middle East bungling. Bush and his advisors may somehow believe, that with his giving a green light to Sharon, that a victory in November for Jeb Bush in Florida can be assured. They may even think they can win a landslide in the Congressional mid-term elections this fall. And, given the horrendous state of the Democratic Party, this is not impossible.
But there are many factors which can, and will, upset their calculationsespecially the onrushing global financial collapse, as we see it playing out right now in Argentina, or Japan, or with the accelerating collapse of the U.S. dollar.
The situation in Argentina is so far out of control that it could be the spark that triggers the collapse of the whole global system. This is especially true, in the context of the advanced stage of crisis in Japan. Argentina has profound implications for Spain, and for the entire European Union (EU). The EU designated Spain as the leading country to run the looting of Ibero-America, so with Spain, particularly BBV Bank and Banco Santander, on the verge of a blowout, all of Euroland is facing a shock.
The only option for Argentina is a Chapter 11-type bankruptcy reorganization. A nation cannot be shut down, as might be done with respect to an insolvent firm. A nation must be kept functioning, with its government intact, and industry and agriculture continuing to operate and produce. The debt is unpayable anyway, so it must be set to one side and sorted out once the economy is back on its feet; the debt cannot be permitted to strangle the real economy. That is the only rational and realistic approach.
Just as the OECD is issuing a report claiming that the United States is leading the global economic recovery, the reality is that the telecom sector in the U.S. is collapsing faster than you can say "John Law." Notable among the past week's developments, was the announcement by AOL/Time-Warner of a $54-billion loss for the first quarter, largely a write-down of the valuation of assets. Also we have AT&T reporting a $12-billion loss of revenue, and almost a $1-billion loss, during the first quarter. JDS Uniphase, one of the large fiber-optic equipment makers, reported a first-quarter loss of $4.3 billion; and Viacom, the media conglomerate that owns CBS and MTV, posted a $1.1-billion net loss for the first quarter. All of this simply reflects the reality of collapse of the "New Economy"as LaRouche has accurately forecast, and others denied, to their own detriment.
At the same time, warnings are again surfacingespecially in Europeabout the U.S. dollar, as capital inflows into the United States, which have financed the enormous U.S. trade deficit, have started to collapse.
Yet another factor which threatens not just the U.S., but the entire global financial system, is the U.S. real estate bubble, pumped up to the limit by the mortgage-backed derivatives, which could explode at any moment. All the phony government statistics and the hype about the "recovery" cannot cover up the fact that the real estate bubble is the primary prop for the U.S. economy at this momentsomething that Fed chairman Alan Greenspan implicitly admitted in his speech to the International Institute of Finance a week ago.
As Lyndon LaRouche has repeatedly emphasized, the decades-long collapse of the real economy of the United States in favor of "free-trade" and "New Economy" shibboleths, has been accompanied by a shift in the mentality of the population into a "consumer society," as opposed to a producer-oriented society, and an increasingly fantasy-ridden outlook, as typified by mass-entertainment, spectator sports, and computer games.
This cultural paradigm-shift erupts at certain moments in a much more violent fashion, as we saw once again with the shooting massacre in an Erfurt, Germany school on April 26. What happened in Erfurt was reminscent of the Columbine high school shootings of 1999after which Lyndon LaRouche and his associates and collaborators launched a high-profile campaign against the "New Violence," focussing particularly on the mentality, and the skills, involved in repeated exposure to Nintendo point-and-shoot video games; also quite relevant in this respect, is the "professional soldier" (mercenary) military model promoted by Samuel Huntington since the 1950s, which has taken over significant quarters of the U.S. militaryi.e., the "body count" mentality.
In respect to the range of crises the world faceseconomic/financial, the genocide in the Middle East, or teen-shooting massacresthe fundamental solution is the same: to dump the fantasy-inducing cultural paradigm shift of the past 35 years, and to return to reason. Fortunately, as reality hits, it may spur that process along, as that state of denial, in which much of the population resides, becomes so much more difficult to maintain.
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