THE END OF THE IRAQ WAR'S BEGINNING

The Present Financial Emergency

From Volume 2, Issue Number 18 of Electronic Intelligence Weekly, Published May 5, 2003

LATEST FROM LAROUCHE

THE END OF THE IRAQ WAR'S BEGINNING

by Lyndon H. LaRouche, Jr.

April 23, 2003

The following paper by Lyndon LaRouche was commissioned by the editors of Yarin for their May issue. The paper has been translated into Turkish and published.

Since U.S. President George W. Bush, Jr. uttered his "Axis of Evil" address of January 2002, the honor of the United States has been risked in three Middle East wars: the presently continuing irregular warfare of Israel versus the Palestinians, the unsettled war against Afghanistan, and now a war with no credible exit, over the objections of the UNO, against Iraq. In each, the military forces of the U.S.A., or, its ally Israel, have successfully applied crushing force to a relatively helpless military adversary. Despite the crushing power of the attacking forces in each case, each war now continues, in a new form, without exit, with no workable plan presently in sight from those governments, for getting out of the war-torn situation.

From the beginning of these wars, the community of both serving and retired ground-force generals of the U.S.A. have duly expressed their professionals' understanding of the deadly incompetence of that civilian war-party inside the U.S. government which is led by Vice-President Cheney. But, even now, Cheney's civilian warriors are pushing hysterically for new wars, while announcing their intention to punish France, Germany, Russia, and others, for refusing to support President Bush's virtually unilateral launching of the Iraq war. Had U.S. Vice-President Cheney served in the U.S. Indo-China war, when he might have done so, he might have developed some modicum of insight into the opposition to his policies from among the professional senior ranks of the U.S. military today.

Nonetheless, there is important and rapidly expanding opposition to President Bush's current economic policies within both major U.S. parties. On the list of announced Democratic Presidential candidates for 2004, three of the top four, as ranked by number of campaign contributors, including this writer, plus two former Presidents, Carter and Clinton, are in relevant kinds of growing opposition to one or more leading aspects of the Bush Administration current policies, while the Republican opposition to the President's disastrous tax-cut policies grows in both parties.

This kind of growing opposition to Bush Administration policies from within the U.S., echoes a concern heard from around most of the world. Most of the government circles from around the world with whom I have contact, consider Bush's war policies as a dangerous kind of attempted distraction from the realities of a presently worsening economic collapse of the world's present monetary-financial system. None of these concerned governments have yet adopted workable solutions for the economic crisis; but, they, unlike the Bush Administration, admit that a serious, worsening global economic problem does exist.

So, the issues of war and economy are so intermingled, that no competent assessment can be developed in either area without considering the other. From where I sit, the present situation of Turkey is part of that picture. Warfare on Turkey's Arab and Trans-Caucasus borders threatens to drag all Iraq's neighbors, and more, into a fire-storm of religious and ethnic warfare of the kind which, over 1511-1648, plunged pre-Treaty of Westphalia Europe into what Britain's Hugh Trevor-Roper and other historians once described as a threatened "Little New Dark Age." The situation in Afghanistan is becoming worse again. The Kurdish situation is ominously incalculable, especially with increasing entanglement of Iran's expressed interest in the state of affairs in southern Iraq.

The strategic issue this pattern poses, is: Vice-President Cheney's President Bush has shown how to spread unnecessary wars, but no competent plan for actually getting out of any of them. Under the presently ongoing terminal phase of collapse of the international monetary-financial system, the spread of such war with no safe exits, is presently the greatest of all threats to the security of mankind throughout our planet. It is past time to stop looking at economics from the standpoint of war, and look, instead, at avoiding unnecessary war by formulating strategy from the standpoint of an economic reality for which the Bush Administration has shown no comprehension so far.

For example, if we consider Turkey's present economic difficulties from the standpoint of what my associates and I have named "The Eurasian Landbridge" reform, the present tendencies for new forms of economic growth in Eurasia, represent the context in which a related integration of Turkey's economy into a new, expanded Eurasian-trade orientation by Europe would "spill over" into Turkey along lines already pioneered for Turkey during the period of Germany's post-World War II reconstruction under the original, pre-1971 Bretton Woods system.

The Present Financial Emergency

I present the following simplified explanation of the technical features of the present world economic crisis to point out the importance of taking the kinds of emergency international economic reform I shall describe shortly after that explanation.

My frequently published series of pedagogical "Triple Curve" charts show the origin and character of the global monetary-financial crisis which has been building during the 1966-2002 period to date, especially since the 1971 shift to a "floating exchange-rate" monetary system. As the case for the U.S.A. illustrates the trends, there has been an interrelated expansion of nominal financial assets and monetary emission, while the net physical output of the U.S. economy, per capita, has declined at an accelerating rate.

Recently, beginning 1999, the increased monetary expansion required to prevent a chain-reaction collapse in the U.S. and certain other financial markets has exceeded the nominal value of financial stocks rescued in this way. This recent, 2000-2003 trend defines a limit for the continuation of the world's present U.S. dollar-based monetary-financial system. The date of collapse is not yet known, but the precondition for a terminal collapse now already exists. The point has been reached, that the attempt to delay that collapse, is like fighting forest fires under severe drought conditions while the Summer temperature is soaring: What will happen is already inevitable, but exactly when is not yet certain.

Under those conditions, the greatest part of the world's present debts could never be paid. The attempt to enforce collection of such debts, would, as we have seen in the case of Argentina, destroy civilization in the Americas, Europe generally, and elsewhere. Without simply cancelling most of that debt, especially financial-derivatives debt, real-estate mortgage bubbles, and so forth, civilization would collapse. Therefore, governments must join forces to accomplish two things.

First, the governments must take over most existing central banking systems, putting them into receivership for financial reorganization. These governments must act, at the same time, to reform the existing world monetary-financial system, to the effect of creating a fixed exchange-rate, philosophically protectionist form of monetary-financial system, one copying many of the features of the 1944-1958 IMF.

Second, through that reform, large-scale, long-term, low-interest-rate financing of long-term infrastructure projects of between 25 and 50 years financial maturities must be launched, especially for large-scale development of coordinated development of such elements of transcontinental and lesser projects of development of coordinated basic economic and related projects of basic economic infrastructure as mass transport, power generation and distribution, water-resources development and distribution, urban development, and health care and research and education institutions. The infrastructure programs should be used as stimulants for both employment and for investments in technologically progressive forms of private entrepreneurships in production and distribution of goods and services.

In Eurasia, the focus of such development is the improved development of central and north Asia's potential resources and the coordination of Europe's role in the increase of the productive powers of labor in East, South-East, and South Asia.

The development of Turkey in such a context of Eurasian development, should be obvious, including the role of Turkey's labor-force, and also Turkey's integral role in reforestation of relevant areas of Anatolia and the water-management and power programs of the Middle East. These, and related potentials overlap the fact, that, on the one side, Turkey's integration into the European continent's economic-development potential is essential for Turkey's economic future, as the wiser heads in the United Kingdom wish to avoid those forms of attachment to current U.S. Bush Administration adventures which would tend to spoil the U.K.'s opportunities for participation in economic development programs of the Eurasia continent.

In the end, if the U.S. government comes back to its senses, the U.S.A. will adopt a policy of conciliation and cooperation with continental Europe. Given the economic disaster of the foolishly stubborn President's failed economic policies, the fact that I am fourth, or perhaps third in rank of number of contributors to my 2004 Presidential-nomination campaign, shows a degree of support for my candidacy which suggests a good future for renewed closer cooperation between the U.S.A. and Europe. That would be good news for Turkey's, and the Middle East's future.

All rights reserved © 2002 EIRNS