Larouche Online Almanac

Published: Tuesday, June 3, 2003

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Volume 2, Issue Number 22
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Need to Know This Week

LaRouche: Is Dollar Policy 'Stupidity,' or Trigger for 'Economic 9/11'?

In light of clear indications that the policies adopted by the Bush Administration to deal with the dollar collapse are only making things far worse, Lyndon H. LaRouche, Jr., candidate for the Democratic Party Presidential nomination, has raised the question: "Is this being done out of stupidity, or is it willful?"


Take, for example, the new Administration tax-cut plan, which was signed into law this past week, at the same time that the post-April 15 tax-revenue picture shows that U.S. government revenues from corporate and personal taxes are sharply down for the third year in a row (first seven months of FY2003). The U.S. Federal debt ceiling was lifted by nearly $1 trillion last week, to stand at $7.4 trillions. As for the falling dollar, Treasury Secretary John Snow said, "it's easier to export," when you have a weak dollar.

That this is worse than stupidity, is the judgment of some observers. For example, the May 23 London Financial Times headlined its editorial, "Tax Lunacy—The U.S. Administration Throws Prudence Out the Window." They wrote, "On the management of fiscal policy, the lunatics are in charge of the asylum." Why do they act this way? The Financial Times concludes, that to those "more extreme Republicans," a "fiscal crisis offers the tantalizing prospect of forcing" cuts in social spending "through the back door."
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LaRouche Spokeswoman Sets Date for First Candidate Debate
On May 28, Debra Hanania Freeman, the national spokeswoman for Lyndon LaRouche's campaign for the 2004 Democratic Presidential nomination, announced that a date had been set for what she called "the first real, substantive discussion of the Democratic Presidential campaign."

LaRouche to Mississipi Democrats:
I Am Committed — To 'Our Sovereignty, Our General Welfare, and — The Security and Welfare of Our Posterity'

Prague Weekly Nase Pravda Interviews LaRouche
The following interview with Lyndon LaRouche about his campaign for the U.S. Presidency, and his policies, appeared during the week of May 23 in the weekly newspaper Nase Pravda, published in Prague, Czech Republic.
Economic reports

U.S. Economic News

World Economic News

World and Nation-state

United States

Ibero-America

Europe

Russia and Eurasia

Middle-East

Asia

Africa


this week in history

June 2-June 8, 1933

As the end of the emergency Congressional session, later to be known as the "Hundred Days," approached, President Franklin Delano Roosevelt was engaged in a virtual frenzy of activity, geared toward trying to put credit policy and economic policy on track for a sustained recovery. The Constitutional principle which the President was trying to ram through was clear: The general welfare of the U.S. population had to take priority in guiding the actions of the Federal government.

On June 5, the President took one of his most controversial actions in this direction, by signing the Gold Standard Act. This bill completed the process of freeing the U.S. government from an arbitrary, deflationary gold standard, by abrogating the "gold clause" in public and private contracts, and making legal tender acceptable in settlement of such contracts.

The significance of the series of actions which FDR had taken, which we will review in a minute, was succinctly summarized by author Arthur M. Schlesinger, Jr., in his The Coming of the New Deal. Schlesinger wrote this about the shift away from the gold standard:

"It meant that American monetary policy was no longer to be the quasi-automatic function of an international gold standard; that it was to become instead the instrument of conscious national purpose."

To put it in the language of today's analysis by Lyndon LaRouche: What Roosevelt did was to assert the sovereign right of the nation to control its own credit, rather than permit the "international marketplace" to determine what credit would be available. And he did it because the general welfare of the population depended upon it.

Gold Standard vs. Gold Reserve

Before we get further into our story, it's important to distinguish between two ways of looking at the gold standard: The "British" gold standard, whereby every piece of currency is convertible, vs. the gold-reserve standard, which permits gold to be used as a standard for international valuation, but at a ratio to the currency emitted. In the first, gold basically limits the credit which can be issued, and keeps control in the hands of those with "hard" currency. In the second, gold works as a stabilizer for settling accounts, but the fundamental reality of the fact that it is production, not precious metal, which comprises wealth, is made clear.

What FDR did with his moves on gold, which were followed up in international conferences, up to the New Bretton Woods Conference itself, was to move the U.S. from the gold standard—which had been imposed with Specie Resumption back in the 1870s, as a reaction against U.S. sovereign control of currency through the greenbacks—to the gold-reserve standard.

Defense of the Nation

President Roosevelt took his first measures on gold in the days and months immediately following his March 4, 1933 Inauguration. On March 5, he suspended all transactions in gold, and gave authority over any such matters to the Secretary of the Treasury. On April 5, he went further, issuing an executive order against hoarding of gold.
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In Depth Coverage From Executive Intelligence Review
Links to articles from Executive Intelligence Review*.
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Feature:

HISTORIC BANGALORE CONFERENCE:
For a Just New World Economic Order!
by Mary Burdman
The international conference on the 'World Situation After the Iraq War,' cosponsored by Chandrajit Yadav, chairman of the Centre for Social Justice of India, and Helga Zepp-LaRouche, chairwoman of the international Schiller Institute, was held in Bangalore, India, on May 26-27. This was the first international conference on these strategic issues to be held in Asia.

A Precis:
The Peaceful Concept of Technology Transfer
by Lyndon H. LaRouche, Jr.
In the aftermath of the recent, U.S.A. war against Iraq, the world has two broadly defined choices for the present course of history: Either there will be an inevitably disastrous continuation of the policies leading to the recent U.S. break from the proceedings of the UNO Security Council; or, the more hopeful prospect, the prospect of measures adopted to reverse the presently accelerating economic collapse...

'We Must Revive the Concert of a Just, New World Economic Order—Now!'
Here is Lyndon LaRouche's keynote, as delivered, to the conference on 'The World Situation After the Iraq War,' in Bangalore on May 26, organized by the Centre for Social Justice and the Schiller Institute.

Economics:

U.S. Fiscal 2003 Deficit Could Top $500 Billion
by Richard Freeman
During the third week of May, the U.S. Treasury Department, in its parsed, dry language, dropped a bombshell: It reported that through the end of the first seven months of Fiscal Year 2003 (i.e., October 2002-April 2003), the Federal government registered an official budget deficit of $201.61 billion. Further, the Treasury projected that, were trends to continue, the U.S. government would run an official budget deficit of an unprecedented $304.16 billion for the full Fiscal Year 2003.

New NIM Report:
U.S. Infectious Disease Death Rate Is Rising
by Marcia Merry Baker
Even gross statistics now show that over the last 20 years in the United States, a near century-long trend of a declining death rate from infectious disease has reversed, and is now on the rise. This is the case, without including the HIV/AIDS disease, which was first identified at the outset of this period.

El Salvador Port Opens Up Regional Prospects
by Christine Bierre
Through an interview with Roberto Turcios, member of the National Development Commission of El Salvador and Regional Coordinator for the Eastern Zone of the country, a new prospect for regional economic integration in Central America emerges.

Business Briefs

International:

Will Bush Force Sharon 'Unilateral Surrender' on Road Map?
by Jeffrey Steinberg
May 29 (EIRNS)—On May 23, Israeli Prime Minister Ariel Sharon "formally" accepted the Road Map put forth by the Quartet, setting out a path for the creation of a Palestinian state over the next three years. (The Quartet consists of the U.S., the European Union, Russia, and UN Secretary General Kofi Annan.)

U.S. Targeting of Iran Fuels Iraq Resistance
by Muriel Mirak-Weissbach
No sooner has the smoke cleared in Iraq, than the chickenhawks have raised their strident voices in Washington, calling for regime change in Iran.

Report From Germany: Leaders Needed To End the Depression
by Rainer Appel
The Chancellor prevails over critics, but that does not halt the wide, called on the trade unions to economy's continuing decline.

A Look Behind the Al-Qaeda Terror Wave
by Dean Andromidas

In the space of two weeks, suicide bombers struck in Tel Aviv, Chechnya, Saudi Arabia, and Morocco—all attributed to Osama bin Laden's al-Qaeda organization. In a May 23 editorial, EIR cautioned those who would attribute these attacks to the 'sociological phenomenon' of terror by enraged Islamic militants. EIR asked the questions: Who benefits? And who runs al-Qaeda?

Elites Rebel Against U.S. Utopian 'Poison'
by Mark Burdman

The Hitlerian-fascist character of the Dick Cheney/Donald Rumsfeld-centered mob now running Washington policy, has engendered an unprecedented crisis within two of the leading oligarchical policy institutions of the trans-Atlantic and trans-Pacific elites, the Trilateral Commission and the Bilderberg Group.

Middle East Road Map: Will Bush Become Sharon's Lackey?
by Dean Andromidas
When Israeli Prime Minister Ariel Sharon approved the road map for a Middle East peace, he attached 14 'reservations.' After the reservations were made public, senior Israeli commentator Akiva Eldar warned in the daily Ha'aretz on May 27 that if they were accepted, they would turn the road map 'from a diplomatic initiative into an Israeli diktat of a Palestinian surrender agreement.'

International Intelligence

National:

Neo-Conservative Cabal Under Mounting Attack
by Jeffrey Steinberg
The 'regime change' in Washington, demanded by Lyndon LaRouche in the immediate aftermath of the Iraq war, moved considerably forward in the final days of May, with Secretary of Defense Donald Rumsfeld and the 'chicken-hawk' cabal inside his office coming under mounting attack—from the Establishment media, from the Congress, and from within traditionalist military and intelligence circles.

Intelligence Distortions Under Investigation
by Edward Spannaus
The manner in which intelligence concerning Iraq was distorted for political purposes, in the period leading up to the invasion of Iraq, has set off alarms among many current and former intelligence officers. There are two relevant areas of concern...

CFR Report on China Counters Neo-Con Aims
by William Jones
The release on May 22 by the New York Council on Foreign Relations of a report on 'China's Military Power,' was a shot across the bow of those neo-conservative warriors who aim at provoking a conflict with China over Taiwan.

Cheney Hires China-Hawk Author Aaron Friedberg
by Roch Steinbach and Mike Billington
Princeton University Professor of Foreign Policy, Aaron L. Friedberg, was recently appointed to the position of Deputy National Security Advisor to Vice President Dick Cheney, for a one-year period. EIR has learned that this appointment results from the concern among the neo-conservatives in the Bush Administration that, since 9/11, Asia policy has slipped out of their control...

Arab Knesset Member Appeals to Americans
by William Jones

While Israeli Prime Minister Ariel Sharon—ostensibly as a result of a terrorist bombing in Jerusalem—postponed his visit to Washington on May 20, where he was to meet with President Bush to discuss the 'Road Map' to Middle East peace, Azmi Bishara, an Arab member of the Israeli Knesset did come to Washington, with a message to Americans desirous of ending the bloodshed of the Israeli occupation of the Palestinian territories.

Congressional Closeup
by Carl Osgood

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Coverup Exposed!

The Israeli Attack On the USS Liberty

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