Is America still the land of "liberty and justice for all"? Or, are we heading into a totalitarian police state, like Nazi Germany or Soviet Russia? Read this book, and learn the truth about what happened to justice in the United States.

U.S.A. vs. Lyndon LaRouche, et al.

GET A . ." bragged the railroading the frameup and of presidential Lyndon LaRouche.

Judge Albert V. Bryan was the judge who finally accomplished what a federal government "Get LaRouche" Strike Force had been attempting to do since 1983. That task force swung into motion using the resources of the FBI, . CIA, IRS, and private agencies, at the instigation of Henry Kissinger, who bragged in the summer of 1984 that "we'll take care of LaRouche after the elections." The first federal case against LaRouche and his associates, held in Boston before Federal Judge Robert Keeton, backfired on the government. A mistrial was declared, and the jury said they would have acquitted everyone on all charges. But in Alexandria federal court, the "rocket docket" did the job. Judge Bryan hand-picked the jury in less than two hours, excluded all evidence of government harassment, and rushed the defense so rapidly that convictions were brought in on all counts in less than two months from the indictment. LaRouche was sent to jail for 15 years, on January 27, 1989,'a political prisoner. The conviction and impris­ onment have provoked protests of outrage from around the world. In this book, you'll see why.

664 pages, illustrated with index: $10 suggested contribution Order from: Human Rights Fund, P.O. Box 535, Leesburg, VA 22075 Bulk rates available on request. Founder and Contributing Editor: Lyndon H. LaRouche. Jr. Editor: Nora Hamerman Managing Editors: John Sigerson. Susan Welsh From the Editor Assistant Managing Editor: Ronald Kokinda Editorial Board: Warren Hamerman. Melvin Klenetsky. Antony Papert. Gerald Rose. Allen Salisbury. Edward Spannaus. Nancy Spannaus. Webster Tarpley. William Wertz. Carol White. Christopher White Millions of U. S. television watchers who saw his half-hour broad­ Science and Technology: Carol White casts during the 1984 and 1988 presidential campaigns know, that Special Services: Richard Freeman Book Editor: Katherine Notley Lyndon LaRouche has never told anyone to "read my lips." Instead, Advertising Director: Marsha Freeman he has been out front with the bad news about the downward spiral Circulation Manager: Cynthia Parsons of the U. S. and world economy, and equally clear, direct, and com­ INTELLIGENCE DIRECTORS: Agriculture: Marcia Merry prehensive about the causes of the problem and the nature of the Asia: Linda de Hoyos solution-which he described a year ago as making a "bootlegger's Counterintelligence: Jeffrey Steinberg. Paul Goldstein tum" in the policies that have dominated the U.S. government for Economics: Christopher White the past two decades and more. European Economics: William Engdahl. Laurent Murawiec With his June 26 announcement, George Bush did not take a lhero-America: Robyn Quijano. Dennis Small "bootlegger's tum"; he just backed down on his solemn campaign Medicine: John Grauerholz. M.D. Middle East and Africa: Thierry Lalevee promise in 1988, much reiterated since then, that-there would be "no Soviet Union and Eastern Europe: new taxes." Not that George wants to raise taxes-but he has run Rachel Douglas. Konstantin George Special Projects: Mark Burdman right into the consequences of the fatal weakness LaRouche pointed United States: Kathleen Klenetsky out at the outset of 1989 when he said: "The Bush presidency enters INTERNATIONAL BUREAUS: office with the qualifications of men and women who tend to excel Bangkok: Pakdee Tanapura. Sophie Tanapura Bonn: George Gregory. Rainer Apel at making money, without knowing how to earn it. As typified by Copenhagen: Poul Rasmussen James Baker III, the more they themselves know about money, the Houston: Harley Schlanger Lima: Sara Maduefio less they know about economics." Mexico City: Hugo Lopez Ochoa. Josefina Our Feature gathers the crucial Menendez evidence about LaRouche's re­ Milan: Marco Fanini cord on the economy, versus the dismal failures of those who op­ Susan Maitra New Delhi: posed him and put Paris: Christine Bierre him in prison to silence that voice of reason. We Rio de Janeiro: Silvia Palacios have extended this issue to 80 pages in order to bring the entire Rome: Stefania Sacchi Stockholm: Michael Ericson package to you in one week; we expect this magazine to become a Washington. D.C.: William Jones standard reference work for any public official or aspirant to office Wiesbaden: G6ran Haglund who really wants to respond to the needs of the voting public.

EIRIExecutive Intelligence Review (ISSN 0273�314) is A second major theme is tracking the advance of the neo-pagan published weekly (50 issues) except for the second week of July. the last week of August. and last week of cult movement led by Britain's Prince Philip and Robert "Body December bv EIR News Service Inc .• P.O. Box 17390. Count" McNamara, and which goes under such various guises as Washington: DC 20041-0390( 202) 457-8840 European Headquarters: Executive Intelligence Review "environmentalism," "ecology," and now "animal rights" (see espe­ Nachrichtenagentur GmbH. Postfach 2308. Dotzheimerstrasse 166. 0-6200 Wiesbaden. Federal cially pages 6 and 60-62). Our investigators will soon be bringing to Republic of Germany Tel: (06121) 8840. Executive Directors: Anno Hellenbroich. EIR readers the accumulating evidence that the Soviet leadership is Michael Liebig In Denmark: EIR. Rosenvaengets Aile 20. 2100 knee-deep in the conspiracy of Duke of Edinburgh's crowd to destroy Copenhagen OE. Tel. (01) 42-15-00 the Judeo-Christian faiths. In Mexico: EIR, Francisco Ofaz Covarrubias 54 A-3 Colonia San Rafael. Mexico OF. Tel: 705-\295. The new section on the Statistical Survey o/the Physical Econo­ Japan subscriptionsales: O.T.O. Research Corporation. Takeuchi Bldg .. 1-34-12 Takatanobaba, Shinjuku-Ku, my, inaugurated last week, will resume in our next issue, dated July Tokyo 160. Tel: (03) 208-7821. 20, after our usual Independence Day summer break. Copyright © 1990 EIR News Service. All rights reserved. Reproduction in whole or in pan without permission strictly prohibited. Second-class postage paid at Washington D.C .. and at an additional mailing offices. 3 months-$125. 6 months-$225. I year-$396. Single issue-$IO Postmaster: Send all address changes to EIR, P.O. Box 17390, Washington, D.C. 2004\-0390. •

TIill Contents

Interviews Departments Economics

24 Hugh Ellsaesser 19 Report from Bonn 4 What ought to be on the A leading atmospheric scientist, Inside the "productive triangle." Houston agenda formerly of the Lawrence The Group of Seven is having its Livermore National Laboratory, 63 Vatican annual economic summit, and exposes the potential cost, in Europe's task: to keep the peace. President Bush is bringing with him countless lives, of the ban on the disastrous doctrines of free CFC's. 64 Dateline Mexico enterprise and radical What does Negroponte do? environmentalism. Meanwhile, 29 Robert Alexander Rome burns. A consultant on radiation protection 65 Panama Report and health effects dispels some of U.S. seeks to outlaw security 6 McNamara on crusade for the sacred myths of the anti-nuclear forces. genocide in Africa movement. 75 Kissinger Watch 7 Asian AIDS epidemic to 51 Mateo Mychajlo Havryliv Dr. K, Bilderbergers push George's rival Africa A leader of the outlawed Ukrainian tax hike. Uniate (Catholic) Church, in Rome 8 East Germans form for a meeting with the Pope, says Editorial association for independent that Gorbachov's glasnost has 80 Mideast war alert. allowed them to celebrate mass agriculture without fear of arrest, but little more than that. 10 Currency Rates Science & Technology 63 Father Giovanni Cavalcoli 11 Bush's free trade pact A Dominican priest and expert on 24 Debunking media myths means genocide European affairs, looking ahead to about the ozone layer No one will gain if all lbero­ the 1991 special Synod, calls for a Part II of Dr. Hugh W. Ellsaesser's America is turned into one huge revival of classical culture. demonstration that from every runaway sweatshop. competent scientific standpoint, the thesis that chlorofluorocarbons are 12 Brazil's President opts for destroying the ozone layer in the chaos Earth's atmosphere is pure bunk. 13 Europe's nuclear fuel Nuclear radiation: facts 29 cycle: a bottleneck to versus scare stories economic growth The scaremongers about the dangers of radiation from nuclear plants are simply playing on 15 The gutting of America: people's ignorance of the physical investment in electricity nature of radiation. generation dries up

20 Agriculture A farm bill to wipe out agriculture.

21 Energy Insider The Bush offshore drilling ban .

22 Business Briefs •

Volume 17 Number 28, July 6, 1990

International National

48 Five non-Russian republics 68 Outrage grows as voters declare their sovereignty read George Bush's lips While the Western media tried to The White House miscalculated keep the spotlight on Gorbachov, that public reactions would blow the real news was elsewhere in the over in 24 hours after the President Soviet Union, where a new form of broke his campaign promise of no Russian imperial system is shaping new taxes. There's no disagreement up. at the top of our one-party system­ Columbus. Ohio. 1985: A major thrift institution. Home State Savings. is shut down. Since then. 791 but at the bottom, anger is building U.S. banks have either failed or been merged out of 50 A look at Russia's new up. existence. parties 70 Murder, suicide, 32 Who is reponsible for 51 What lies ahead for the starvation, death: U.S. America's banking crisis? Ukrainian Church? Supreme Court protects There is no way a bunch of crooks them all could have caused the collapse of 52 Peru's Shining Path: near 791 U.S. banks since 1985. It the end? 72 Mandela raises hopes, happened because of deliberate funds in New York decisions made by both Democratic 54 Canada is dissolved; is the and Republican governments over U.S. next? 73 Strike force demands that more than a decade. And every step LaRouche not leave jail of the way. EIR and its founder alive Lyndon LaRouche were issuing 55 IMF tells Argentina's warnings that the result would be armed forces to disappear the crisis we have today . EIR's 74 Americans reject Bush Economics Staff reviews the record 56 Khmer Rouge on the defense plan of who was right. and who was march in Cambodia wrong. 76 Congressional Closeup 58 Sri Lankan civil war adds to instability of South Asia 78 National News

60 Prince Philip apes Adolf Hitler's creed

61 Animal rights: the new Nazism

66 International Intelligence • �TIillEconomics

What ought to be on the Houston agenda,

by Chris White

On July 7, the heads of state and government of the Group for a multibillion-dollar package to aid the Soviet Union of Seven top industrial nations meet in Houston, Texas, to­ and Africa, and Japan's Ministry of International Trade and gether with their finance ministers and central bank chiefs. Industry has drafteda series of economic proposals for East­ For George Bush, a preview of what will be on the table ern Europe , though Prime Minil'ter Toshiki Kaifu has made for the meeting suggests, perhaps, a healthy portion of the it clear that Japan will not join the proposed Soviet package. broccoli the President says he finds inedible. For the world Great Britain and Canada are expected to support the United at large , it is certain that the one agenda item which ought to States in refusing to put any money into a package to support be discussed will not be. the Soviet Union. What ought this agenda item to be? If the world were ruled by reason, it ought to be obvious. The bankruptcy of 'Free enterprise' insanity the dollar empire would be the top priority, in the context of That listing of Eastern European and African countries discussing how to organize a real economic recovery for the presumably covers most of what Bush had in mind when he collapsing economies of the Anglo-Saxon world, the disin­ spoke of "economic support for various countries." What , tegrating economies of the Soviet Union and China, and for then, is the significance of the U.S. insistence that the Uru­ the billions who live in the southern hemisphere , who face a guay Round of trade negotiations-the General Agreement future which at this point offers only hunger and famine, on Tariffs and Trade (GATT)-and "progress on the environ­ plague and war. The agenda ought to feature a program for ment" be included? using reunified Germany as the motor for the rapid industrial The answer is twofold, reflecting both the tactical com­ and technological development of Europe, centered in the mitments of the moment, and the underlying policy which triangle that links Paris, Berlin, and Vienna-as Lyndon has governedthe U.S. approach to these gatherings since the LaRouche has proposed . The benefits of such a "productive mega-summit process began in the middle of the 1970s. triangle" would spin offto other regions of the world. In the Uruguay round of trade talks, the United States, Instead of this, the agenda the United States puts forward , through such representatives as Secretary of Agriculture before the summit begins, includes these three points: "At Clayton Yeutter, has insisted that a time frame be adopted the Houston summit we will press for progress in the Uruguay by participants for the elimination of agricultural subsidies. Round of trade negotiations, discuss economic support for This is the work of the free enterprise wrecking crew, various countries, and review progress on the environment." demanding that governmentswhich support food production, This was announced by President Bush at a press conference by guaranteeing some form of income for farmers, cease in Washington, D.C. on June 30. to do so. It is a policy aimed at especially the European West Germany's Chancellor Helmut Kohl and France's Community's Common Agricultural Policy, at Japan, and at President Fran'.;ois Mitterrand will put on the table a proposal Third World nations that attempt to protect their ability to

4 Economics EIR July 6, 1990 produce food. It is a commitment to concentrate food control which was threatened by the demand for a just new world in the hands of corporations like Cargill, Archer Daniels economic order. Midland, and Continental Grain, while ensuring that the ma­ jority of the world's popUlation does not have enough to eat. Writing offthe Third World The heading "progress on the environment" conceals a This is the nightmare which continues in the name of the similar intent. Using such pseudo-scientific hoaxes as "the trade and environment agenda for Houston. The Twentieth ozone hole" and "global warming," the Bush administration Century Fund and the New York Council on Foreign Rela­ is demanding the elimination of the industrial and technologi­ tions, two of the outfits which came up with policies for cal capabilities on which human survival depends. A case in Henry Kissinger and the Carter administration in the 1970s, point is the call for a ban on chlorofluorocarbons (CFCs), on have just published reports which make this clear. Called the grounds that they are destroying the ozone layer-an 'The free trade debate," and "Governmentsand corporations allegation that is without scientificfo undation. in a shrinking world," the reports, authored respectively by Gary Hufbauerof Georgetown University and Sylvia Ostry, Kissingerian consensus politics formerly chief economist of the Organization of Economic The Bush administration's Houston agenda represents a Cooperation and Development (OECD), recommend that the continuing commitment to policies which underlay the orga­ Third World nations be eliminated entirely from international nization of these annual summits from their beginning. That discussions on trade. The rationale offeredis that many issues doesn't mean a unifiedcommit ment among all participants­ now central to trade negotiations are peculiar to advanced far from it. It does mean, since such activities are organized nations-for example, regulation of industry, commercial on the basis of what American and British liberals call "the and securities law, and anti-trust law. They claim that GATT, consensus," that the underlying commitment to the evil intent with almost 100 members, is too unwieldy a forum for such gets carried along with everything else, in the name of "con­ discussions, and advocate its replacement by the 27-nation sensus," "coordination" and so forth. OECD, made up of the industrial nations of North America, The Group of Seven summits began during the Ford ad­ Europe, and Japan. In the OECD, Third World nations will ministration, under the prompting of then-Secretary of State have no direct input or voice. and National Security Adviser Henry Kissinger. The chaos The point isn't whether GATT should be defended or which had followed President Nixon's decision to take the not. As an institution, it is a horror show. But, behind the dollar off the gold standard in 1971, and the oil shock of U.S. emphasis on trade is coming to the surface a proposal 1973-74, were the spurs. The intent, on the side of Kissinger to keep the developing sector out of internationaldiscu ssions and his backers, was to organize a unified front among the altogether. major industrial powers against developing sector demands, This was a featured element during discussions held June voiced by such leaders as India's Indira Gandhi, Pakistan's 21-24 at Ditchley Park in England, the same Ditchley Park Zulfikar Ali Bhutto, Mexico's Luis Echeverria, and Pope that once gave its name to the Ditchley Group of banks, Paul VI for a new just world economic order. The demand which formed the core of the international creditors' cartel. then was for a world conference, between the countries of The consensus at the Ditchley Park conference was that the North and South, to create such a new order. Third World would be "the object rather than the subject of Against that demand, the Group of Seven affirmed, from post-cold-war history, the problem rather than the solution," the Guadeloupe and Rambouillet summits of 1974 and 1975, according to Edward Mortimer, the feature correspondent for the primacy of the so-called international institutions-the the London Financial Times, who attended the conference. It International Monetary Fund, the World Bank, and the was organized on the theme "Elements of change in interna­ GAIT-and did so by insisting that murderous IMF austerity tional relations: a foreign policy agenda for the 1990s." Mor­ conditionalities be enforced. Conditionalities policies, so­ timer reported that the consensus was that the "new world". called, were designed to enforce the commitment that unless now emerging would be a "trilateral or tri-polar" world, developing sector nations devoted all economic and financial based on North America, Europe, and Japan, although, said means to service of debt, they would not get new financing. participants, "we would have to camouflage trilateralism in The intended effect was to destroy developing sector access wider global institutions." to advanced sector technology and capital goods needed for In a sane world, these annual summits would never have development. The result, also intended by Kissinger and gotten started in the firstpla ce. But they did; and they have company, who insist that the world is overpopulated, was to brought the world to the point where elements of the Anglo­ plunge the developing sector, led by Africa, into a new Dark American Establishment feel free enough to put forward in a Age of genocide, while pushing especially the United States public forum proposals designed to eliminate the developing and other English-speaking countries into an economic de­ sector from the international institutions. There is only one pression worse than that of the 1930s. All in the name of reason to do that, and it isn't anything that anyone with a protecting the political power of the financial stitutionsin human conscience would want to be associated with.

EIR July 6, 1990 Economics 5 Episcopalian church that sponsors pagan cults. A McNamara admirer who attended the Nigeria meeting complained that "AIDS has all the effect of a mosquito bite, McNamara on crusade in relation to the magnitude of the problem" of population growth. "Even if you add AIDS and regional and tribal wars for genocide in Mrica together, the death rates can ,only be counted in hundreds, while the birth rate is in thousands," he said. "It's not like the old days, when disease did a good job. In former times, by Mark Burdman with sickness, rampant infant mortality, and an average life of 29 years, things were different, but now health has im­ Britain's Prince Philip, president of the World Wide Fund proved, the average age oflifeis 60 years, and the continent's for Nature, has been leading an international drive to ensure population is exploding." the reduction ofthe human population, particularly in Africa, He mooted that a "benevolent neo-colonialism" might be in order to make more room for the "wild creatures." One needed to reduce population effectively. Meanwhile, there of his associates in this endeavor is former u.s. Defense would be no perspective of economic growth or large-scale Secretary and World Bank president Robert Strange McNa­ infrastructure projects for Africa, since the continent is mara, who is promising to carry out population reduction in "fighting for survival only, ahd to avoid total marginaliza­ Africa with the same "efficiency" with which he implement­ tion." He said that Africa was being crushed by its debt ed the notorious Vietnam "body count" strategy. burden, and that there were no perspective of that improving McNamara was the keynote speaker at a conference on in the foreseeable future . "Population Problems in Africa," which took place in Nigeria during the week of June 18, under the patronage of former The AIDS apocalypse Nigerian leader General Obesanjo and individuals associated This view is a lie, even in its own terms of reference. with the malthusian Inter-Action Council, headed by former Even the reports made during the Sixth International AIDS West German Chancellor Helmut Schmidt. The message that Conference in San Francisco by the World Health Organiza­ emerged from that event, is that the combination of AIDS tion, a body which has specialized in covering up the extent and other diseases, regional and tribal wars, famines, and of AIDS in Africa, indicate 'that AIDS is decimating the other disasters that have hit Africa in recent years, has not continent's population. been effective enough in stopping the "population explosion" A WHO report presented at the San Francisco conference in Africa. Therefore , new approaches must be found, cen­ stated that for Africa, "the potential demographic impact of tered on some form of "recolonization" of Africa. [AIDS] outbreaks is striking ...when up to 20% of young adults are infected, as is the situation in many cities in Central 'More efficient' than Prince Philip and East Africa. . . . In these cities, current HIV infection A source who attended the conference said McNamara levels could cause a tripling ofthe total adult mortality rate "has launched an amazing crusade to limit population, in and a 50% increase in the child mortality rate during the Africa." This source added, "McNamara is at least as worried 1 990s. " as is Prince Philip, but he is much more efficient in doing According to the WHO, some 2 million women in sub­ something about it. He's writing articles, he's traveling ev­ Saharan Africa were believed to be infected with the HIV erywhere , he's exceedingly active." virus; one out of every 50 adult men and women in this area McNamara is taking the inside role in a crude "inside­ is estimated to be carrying it; and the incidence of the disease outside" strategy targeting Pope John Paul II, whom Prince is increasing. In Abidjan, the capital of Ivory Coast, AIDS Philip recently urged to drop his opposition to malthusian­ is the single biggest killer of adults, accounting for 41 % of ism. Noting that McNamara had been the first person, in all male, and 31% of female deaths. In parts of Zaire, tests 1968, to set up a population program at an American universi­ of blood donations were indicating that one in five may be ty (Notre Dame), the source commented: "McNamara is a infected. Catholic himself, so this took courage ....Even if he's a A representative from one African country reported that Catholic, his views are totally different than the Pope Wojty­ the total health budget per capita for his country was $7 a la. McNamara simply ignores the Pope." year. Eunice Kierenie, from Kenya, chairman of the WHO's One should not make overmuch of McNamara's Catholi­ regional nursing and midwifery task force, told the confer­ cism. In the past years , he has participated in the events of a ence: "In some parts of Africa, surviving family members gnostic-pagan outfit called the Temple of Understanding, are already overwhelmed by children whose parents have which is an adjunct of the London-Geneva-New York-based died of AIDS. For those of U$ living in areas where health Lucis (originally Lucifer) Trust. The temple is run out of hygiene, basic facilities, and ithe tools for communicating New York's Cathedral of St. John the Divine, a nominally ideas are less established, the impact of AIDS is awesome."

6 Economics EIR July 6, 1990 and we do not have the whole situation in hand." If the Chinese authorities admit to over 100 cases of AIDS, the situation is very grave, the China editor of Hong Kong's largest newspaper, the South China Moming Post, told EIR. He said that the figures the officials give must be AsianAIDS epidemic taken as only 10% of the real number, so that it is very possible that there could be 1,000 dooths from AIDS in the to rivalAfrica soon near term. The world must take the situation very seriously, he warned, because AIDS will spread very rapidly in China. Yunnan, the southern province of China that borders on by Mary M. Burdman Burma, is the focus of the problem. Yunnan, part of the "Golden Triangle, " has long been the center of drug produc­ The AIDS epidemic now threatens the two most populous tion and trafficking in China. Last year police arrested 2,000 nations on Earth: China and India. Thailand is also facing an drug addicts in the provincial capital cityof Kunming alone, AIDS crisis. The disease is spreading most quickly in the and the 146 cases of AIDS infection were found concentrated immediate wake of ever-greater drug consumption in these in Ruili county on the border. At lea'st 69 people were sen­ countries, as huge opium crops year after year make the tenced to death for drug trafficking in Yunnan last year. heroin so cheap that even impoverished Chinese and Indians The province is now putting all diagnosed AIDS virus can afford to inject the dope. carriers under local quarantine, and is attempting a three­ In Asia, as in Africa, or in America's city slums, AIDS is year plan to contain the disease. Carriers must register so striking heterosexuals. There is pathetically little information their movements can be traced; and AIDS-testing operations available about the situation, because little testing has been are being expanded. But poverty has reduced treatment to done, but already rates of HIV infection among prostitutes in the pathetic: Traditional herbal medicines are now being test­ Bombay, India and in Thailand's second-largest city, Chiang ed for a possible cure. Mai, is over 40%. Among the poorest of Chiang Mai's prosti­ tutes' 72.2% were HIV-infected as of a fu ll year ago. 'Rock Hudsons' in India Southern China and India are among the most densely The deadly drugs-AIDS complex is now spilling over populated areas in the world. These are huge tropical areas. into bordering regions in India. In the eastern Indian state of While the possibility of AIDS transmission by insects has Manipur, close to the Burmese border and an influx pointfor been hysterically denied by the AIDS research mafia, inde­ Burmese-Chinese heroin, the first HlV-positive patient was pendent researcher Dr. Mark Whiteside has presented com­ recorded in January.In the last six months, more than 220 pelling evidence that that is just what happened in the tropical people have tested positive. Out of this grouping, 214 are southern United States. intravenous drug users and six donated blood. There are an estimated 15-20,000 drug addicts in Manipur. AIDS hitting China In the cities, the problem is worse. In Bombay, 40% of Even the Chinese Communist government, which for the 100,000 prostitutes are infected with AIDS, estimates years has churned out propaganda claiming it had eliminated Dr. Geeta Bhave, the head of the Indian government's only drugs and prostitution, suddenly has had to admit the oppo­ AIDS surveil lance center. Dr. Bhave told the British daily site. Up until this year, the government had insisted that there Guardian that the government had budgeted almost no mon­ was no AIDS problem in China except among those few ey to deal with the crisis, and she attempts to treat infected who associated with "foreigners." But on Feb. 7, the official prostitutes - all of whom go on taking customers, some up Xinhua news service reported that by the end of 1989, one to 20 a day - with homeopathic medicine, which is all she hundred ninety four people infected with the AIDS virus had can afford. The government maintains that there are only been found on the Chinese mainland - and only three of them 2,167 cases of HIV infection among the 461,118 people were not Chinese. AIDS had spread to 10 provinces and tested in the screening program begun in 1986, but this is autonomous regions, the report said, and local governments a gross underestimate, Dr. Bhave and others state. Many had been have been told to carry out - at their own expense - desperately poor "professional" blood donors who are HI V­ a ban on prostitution, drug trafficking, and drug addiction. positive continue to sell their blood, by going to towns where This fivefold rise in reported cases came only from testing they have not been screened. "high-risk" groups. But it is not only the poor in India who are infected. Dr. The same day, China's state radio quoted senior Health Bhave reported that her program also gets blood samples Ministry official Dai Zhicheng that AIDS in China "is no from the "five-star" hospitals patronized by India's upper longer a myth. The spread of this disease is in fact very classes, and many are HIV-positiv¢. It is only a matter of serious .... Our abilities to control this disease are limited time before India has its own "Rock Hudson" AIDS death.

EIR July 6, 1990 Economics 7 East Germans form association for independent agriculture

Rosa Tennenbaum

Have you read that there is no interest in East Germany in Germany, there were already ofganizations in every state, as private agriculture? Well, that is clearly the hope of many well as district and local associations. politicians, including some in the West. But, in fact, the Winzer discussed the most recent history of the G .D.R. exact opposite is true: All those who have remained in agri­ He described how forced collectivization led to many trage­ culture in East Germany after 40 years of terror are now dies. Thousands of farmers were forced offthe land to avoid considering how to make themselves independent. They are ending up in the prisons of the communists. Agriculture was attempting to find out what conditions, such as taxes and the thus robbed of its most capable individuals. Farmers were cost of production, exist in the Federal Republic of Germany , forced into the LPGs, where they had to work like hired and are calculating whether they will have the basis for exis­ hands under the leadership of political cadre who often knew tence, given the land they have. How great the interest in nothing about agriculture. East German agriculture, which free agriculture actually is, was demonstrated impressively before the war was among the. most productive in Europe, at the founding conference of the Association of German was devastated and is today the picture of misery. Farmers (VDL), which took place on June 16 in East Berlin. Farmers not only had to bring their land, their cattle, and Since only a small space was available, the association had all their buildings and machinery into the LPG; they even to strictly limit the number of participants to 300. Nonethe­ had to pay for their forced entry. In total, the capital (called less, 600 came, and, under normal circumstances, there the investment contribution) that farmers had to bring into would have been easily double that number. the LPG was 5,000-7,000 mafks per hectare. Farmers re­ In February, the board ofthe State Collective Farm (LPG) ceived no interest on this capital, received no rent on their changed the name of the "Union of Mutual Farm Assistance" land, and the buildings that the LPG used were not main­ (VdgB), the farm association that was founded by the ruling tained. Barnswere used until the roofs fell in on the cattle and Socialist Unity Party (SED) in the 1950s as the instrument were then abandoned. Today, farmers are literally standing in of collectivization, to the Farmers Association of the German the ruins: Their fieldsare in bad condition, access roads have Democratic Republic. They have been attempting to build been destroyed, and so forth . themselves up as the only representation for agriculture­ Winzer urgently warned in his speech against hanging on with the same old program. They intend that the LPG will to present structures. Cartelization and concentration are the survive, that large-scale agriculture will remain the dominant greatest danger since the LPGs offer a profitable object for form in East Germany. Nothing is to change in the German Western corporations. "Here, in one fell swoop, they could Democratic Republic (G.D.R.), only the word "private" was gain control of 6,000 or more hectares. If a Westerncorpora­ to be inscribed on everything. tion can't do that, it will take them years and they will spend Gerd Winzer, who was elected in the afternoon as presi­ millions on trials." The second possibility is that the LPGs dent of the VDL, expressed in his speech the disappointment "will tum themselves into corporations and then take action of farmers in the following words: "It must not be, I thought against their own members like ;wolves in sheep's clothing." at that time, that the quiet revolution should pass over agricul­ Additionally, the LPGs are not competitive: "An LPG with ture without leaving a trace. I began to look around for people 6,000 hectares must pay at least 1.2-1.5 million deutsche­ who thought the same as I, and found some here and there. marks (DM) in rent. Over the 30 years that they used the land Our conviction was, we have to take matters into our hands, without compensation, that comes to DM45 million. With waiting would ruin everything." Thus, at the beginning of that, things can be managed, and yet the LPG couldn't do the year, they began, moving slowly, to call the association it," he said, referring to the miserable agricultural condition into existence. At the founding conference for all of East that two-thirds of the LPGs are in.

8 Economics EIR July 6, 1990 Property must be restored dation for the restoration to owners of their rights. There was The most urgent demand ofthe association is the immedi­ agreement that land and buildings must be given back. The ate and total restitution of property. In so doing, the many goal of the governments is "a multiply structured agriculture debts that burden the LPGs must not be portioned out among based on agrarian freedom." the farmers. "We entered without debts, and we want out The governments intend "to comprehensively support without debts," Winzer said, to the applause of his listeners. single-farmer farms." The cooperatives would be required to Members who wish to leave on July 1 must be able to take return property and to support members in the construction this year's harvest with them since they also entered with the of independent existences, he assured them. On questions of harvest. The LPG law must be immediately canceled, the European Community (EC) market structures, the private national cooperatives broken up and dissolved. "We want a farms are to be "placed on a fully, equal basis" with the renaissance of free agricultural structures," he said. cooperatives. The association will be a "welcome partner" The young president (Winzer is 35 years old) attacked in the reform of agriculture. Understandably, there was a the numerous attempts by LPG officers to save their "stolen great sense of relief among the audience after this speech property and their power." A favorite method now is to tum since, hitherto, the attitude of the government on this ques­ the LPGs into corporations. Agricultural workers (members tion has been extremely equivocal. who brought in no land) have to pay DM3,500 and farmers The vice chairman of the association, Ulrich Orling, was have to bring in seven hectares of land. A bank, however, one of those who had to pay a high price for forced collectiv­ would loan DM I68,OOOon the seven hectares. "Landowners ization. Since his farm was over 100 hectares, he was at­ are thus to bring in 96 times what those who bring in no land tacked as a "large farmer," and thrown into prison by the have to pay. That is simply fraud." communists. Orling recalled that the association very quickly Returnof the land and the buildings is the foundation of formed in the states, and was already the target of attacks free farms. The LPGs have to refund the investment contribu­ from opponents. He himself learned that painfully. The tions and additionally pay a lump sum amount per hectare Farmers Union (DdgB) slandered him with absurd accusa­ and per year as rent. These amounts will come to hundreds tions. Orling was forced to answer with a lawsuit, and decid- of thousands of marks even for small farms, and will be a welcome assistance in starting up for private farms. "If these demands are met, then all the LPGs are bankrupt," Winzer said at the meeting. Further, he demanded from the govern­ ment a reconstruction program for farms, a credit program, assistance with the development of machines and advisory Overpopulation Isn't groups, educational programs, and so forth. "The future of Germany can only be with free farmers having a maximum of Killing the World's Forests- 200-300 hectares of land. That is also an eminently important political question since, as FreiheITvom Stein earlier stated, the Malthusians Are whoever has land, ultimately has power." Winzer's speech was unexpectedly interrupted by a visit from Prime Minister Lothar de Maiziere. In a brief greeting, he thanked the farmers for participating in the revolution, and because they had made sure "that during the revolution bread did not become scarce." With their votes in the elec­ tions they had, additionally, made clear that they wanted German unity . He encouraged the farmers "to join together their usually somewhat quiet voices" and to make their justi­ fieddemands with pride.

Germanys back single-farmer farms The East German Agricultural Minister, Dr. Peter Pollak , said that his participation in the founding conference was not an exercise of duty: "I quite positively welcome the founding Order from: Ben Franklin Booksellers, Inc. ofthis association." The shared statement of the two German 27 S. King St. Leesburg, Va. 22075 (703) 777-3661 governmentson property "had essentially facilitated my pres­ $4.95 plus $1.50 shipping ($.50 lot each additional book) ence here." Three days before, Bonn and East Berlin had MC. Visa. Diners. Carte Blanche. and American Express accepted. agreed, after lengthy negotiations, that the post- 1950 expro­ Bulk rates available priation would be countermanded. This will create the foun-

EIR July 6, 1990 Economics 9 ed, because of this controversy, to withdraw his application for the presidency. Currency Rates He put forward, as one of the most important tasks of the association, "to clarify the value of land to individuals." The dollar in deutschemarks Orling calculated the debts of the LPGs as on the average New York late aRernoonfixing DM2,500 per hectare. The widespread tactic of the LPGs, to pay out the investment contributions in the weeks before 2.00 the currency union (higher amounts are converted at only a 1:2 ratio) "are for us only a payment on account since free 1.90 availability determines property, and that only begins on July 2." The surplus of workers in agriculture should be deployed 1.80 in a focused way for improvement of infrastructure, the Han­ 1.70 over-Berlin railroad should be built more quickly and im­ - -- proved, and more roads are urgently needed, Orling said. 1.60 -- 5/9 5/16 5/23 5/30 6/6 6/13 6/20 6/27 Schiller Institute made this possible The Schiller Institute, a policy think-tank founded in The dollar in yen 1984 by Helga Zepp-LaRouche, has vigorously supported New York late aRernoonfixing the development of the association from the beginning. How 160 important this support was and is, was made clear in many speeches. The vice chairman of the Thuringian state associa­ 150 '- tion, Heinrich Beier, interrupted his speech to say, "I would like to use this opportunity to sincerely thank the Schiller 140 Institute for what you have done for us. The association could not exist without that and your publications." Peter Orling 130 also expressed his thanks in similar words. Rosa Tennenbaum of the Schiller Institute appealed in 120 her speech to the association not to simply submit to EC 5/9 5/16 5/23 5/30 6/6 6/13 6/20 6/27 guidelines, but also to defend the interests of the members in The British pound in dollars this matter. There is every reason to think that the G .D.R. New York late aRernoonfixing will take extensive acreage out of cultivation and slaughter up to a million cattle while the supply situation grows worse 1.80 on the borders of the G.D.R. The agricultural policy of the EC should be changed, and this association could do much 1.70 - on this, since it is "not corrupted," she said. 1.60 The mood of the participants was militant. In the discus­ sion, the demand was made that the goal of the association 1.50 must be to eliminate the V dgB . One member related how his 44-hectare farm had been completely ruined by the LPG. The 1.40 LPG law created a foolish license for the cooperatives, but 5/9 5/16 5/23 5/30 6/6 6/13 6[20 6/27 on July I "when the law is abolished we can finally put a The dollar in Swiss francs check on them." Some months ago, he filed a suit against New York late aRernoon fixing the SED party and the government with the superior public prosecutor of the G .D.R. "because of coercion and extortion 1.70 according to Paragraph 129 and Paragraph 127 of the penal code" committed against him during the forced collectiviza­ 1.60 tion of 1960. He still has not received an answer. Despite opposition and all the intimidation, there is a 1.50 broad movement for private agriculture in the G.D.R. Forty -- - - "'" years of suppression and terror have only made the wish for 1.40 ,... � independent activity in free and personal responsibility more urgent. "We want to be what we always were," Heinrich 1.30 6/13 Beier summarized the desire of those present: "We want to 5/9 5/16 5/23 5/30 6/6 6/20 6/27 be free farmers. "

10 Economics EIR July 6, 1990 would ask for another $100 million each from Europe and Japan. The elimination of trade barriers between such disparate Bush's free trade economies as that ofthe United States and its southern neigh­ bors not only makes Ibero-America's cheap labor pool a pact means genocide target for colonial-style exploitation by runaway U.S. shops, but will also be used to smash U. S. wage levels by blackmail­ ing workers with the ever-present threatof moving industry by Valerie Rush south of the border. Further, with the establishment across Ibero-America of In a major foreign policy address June 27, President Bush sweatshop assembly plants on the Mexican maquiladora proposed a hemispheric "free trade zone," modeled on the model, the U.S. economy will find itself buried under a free trade pact the U.S. and Mexico will begin negotiating floodof cheap imports from the Trilateral Commission's new in December, whose purpose will be to loot the entire Ibero­ "Hong Kongs" south of the Rio Grande. It is doubtful that American continent. Bush's initiative, which he dubbed an the already-depressed U. S. industrial sector, now saddled "Enterprise for the Americas," is premised on recommenda­ with the restraints of the Clean Air Bill and other innovations tions made last March by the Trilateral Commission, the of the "read my lips" Bush administration, would survive supranational coordinating body for the Anglo-American such an inundation. elite which pulls the strings of the Bush administration. Investment in such light industry, labor-intensive assem­ Paving the way for the Bush initiative has been a months­ bly plants is the core of Bush's actual policy. The idea is to long propaganda barrage by U. S. government and related create, as Vice President Dan Quayle recently put it, thinktanks and their Ibero-American co-thinkers, threatening "America 1992" to counter the creation of "Europe 1992." the governments of the continent that if they don't open The use of low-wage Ibero-American labor will permit U.S. their economies to this "free-trade" scheme, they will be multinational companies to export,

EIR July 6, 1990 Economics II ruling in favor of large wage increases. Several courts have already granted wage increases of 166% to some workers. Earlier in June, the Collor administration lost a crucial deci­ sion in the Supreme Court, which ruled that the government could not legally reintroduce a decree that had just been voted Brazil's President down by Congress. The deCree in question was an order prohibiting the labor courts from granting large wage in­ opts for chaos creases. In response to the rebuff, Finance Minister Zelia Cardoso announced that Collor was prepared to bring on a sharp recession, if that was the only way to stop inflation. by Peter Rush No strategy for development Brazilian President Fernando Collor de Mello has been in Colior lacks any vision for the development of the coun­ office for 100 days, yet he cannot get his program through try. He has neither said nor done anything about restarting Congress and the courts, and his policies are increasingly long-overdue investment in Brazil's electricity, transporta­ unpopular with a growing number of citizens, including those tion, and mining industries, which are the keys to long-term representing the nationalist current in Brazilian political life. growth. Even prior to his election, Collor received a copy of The first 100 days have disappointed those who were uncom­ the document issued by the Superior War College (ESG), fortable with many of the liberal monetarist features of Col­ which outlines a plan for transforming Brazil into an industri­ lor's program, but who also saw aspects of his initial set of al giant over the next decade, and defending it from the measures that might have contributed to growth. Instead, Washington-London-Moscow axis which has designs on its those initiatives have gone nowhere, while Collor's commit­ sovereignty (see EIR , June 15, 1990, "Sovereignty is non­ ment to monetarist policies, combined with numerous con­ negotiable, Brazilian Army tells superpowers"). cessions to Brazil's enemies, are producing economic chaos Collor apparently didn't take the ESG document, entitled and worker unrest. 1990-2000: The Vital Decade. to heart. The June 23 issue of So far, more than 100,000 industrial workers have lost the Rio de Janeiro paper Tribuna da Imprensa made this their jobs in the state of Sao Paulo alone, according to a June point when it attacked the government's economists for only 14 announcement by the Industrial Federation of the State of being concernedwith the "financial economy," and identified Sao Paulo-more than 60 ,000 from March 15-ApriI 30, and the root cause of Brazil's economic difficulty as "the insuffi­ another 47,447 in May alone. This drop is 5.2% of the total ciency of physical production," and the monetarist fixation work force in the state, and more than 10% of the industrial on shrinking consumption to fit the inadequate production. work force. Federation President Carlos Eduardo Uchoa Fa­ gundes told the press that he was "shocked" at the figures, Nationalist opposition speaks out and said, "This is a critical moment. We have reached a point Certain sectors of the country's elites who oppose the of rupture." government's policies, have indicated they are prepared to On top of that, the Coilor administration has promised to act. Former Government Minister Aureliano Chaves, who lay off 90,000 civil service workers immediately, and anoth­ maintains close ties to a faction of the Army, has begun a er 270,000 as soon as possible. Industrial production is now lecture tour across the country, criticizing Coli or for trying projected to fall by 10% this year, and there areno alternative to return to laissez-faire, by indiscriminately selling off the jobs for these firedworkers . Even inflation, which was 9. 1 % state sector of the economy and overthrowing the nation's in May-down from 80% the month before Collor came institutions. Chaves is closely identified with the building up to power-is moving up again, and the main anti-inflation of Brazil's state sector companies. Columnist Carlos Chagas, measure taken in his first week in office, the freezing of reporting on Chaves's upcoming tour, said that the govern­ $120 billion in private checking and savings accounts, is ment's course is "destined to tum Brazil not into the great now "leaking" worse than a sieve and cannot be relied on to power which all hope for, but into a second class colony." suppress further price increases. Collor's response to the ESG document has been to give In any case, the prime factor in holding down inflation in free re in to his environment minister, Jose Lutzemberger, March, April, and May was the fact that workers had not who is backed by the international pagan environmentalist gotten their customary inflation-indexed cost-of-living ad­ movement. On June 6, Lutzemberger issued a IO-point justment since February, so, by some calculations, the buy­ broadside calling on the government to replace "the conceit ing power ofthe salaried segment of the population had fallen of development" with "a strategy of eco-development," to by more than 50%, naturally depressing sales and prices. make concern for the environment the national priority, and Now, the labor movement has embarked on a strike wave to place severe limits on industry and agriculture on this in opposition to the layoffs , while the labor courts have begun account.

12 Economics EIR July 6, 1990 Europe's nuclear fuel cycle: a bottleneckto economic growth by William Engdahl

On June 5, Japan's Ministry oflnternationalTrade and Indus­ from the highs of $36-40 per pound for yellowcake in the try (MIT!) announced its plans to construct an additional mid- 1970s, down to about $10 per lb. today. The effect of 40 nuclear power reactors in Japan, doubling the present this price collapse has been to drive numerous U . S. and other capacity of electric generation from nuclear sources. The uranium mines out of business, leaving the rest cartelized in rapidly growing Asian economies of South Korea, Taiwan, the hands of a tiny number of global giants, such as London's and, most recently, Indonesia, have all moved to institute Rio Tinto Zinc. significant new nuclear programs in recent months. Yet the nuclear requirements of the emerging economies of Eastern Uranium ore processing Europe-presently choking in inefficient and filthy lignite The emerging economies of Eastern Europe desperately coal power plants-are just beginning to be assessed as a need a significant increase of electric generating capacity vital component of strong, rapid industrial modernization. and-for real environmental considerations as well as eco­ The requirements of new nuclear plant capacities world­ nomic ones-must turn to clean, slife, and efficient nuclear wide, and immediately in the western part of Europe, will generation. They will need to purchase much of this from very soon become a critical bottleneck to future industrial Western Europe, and the constraints of the present uranium growth (see EIR , April 27 , 1990, "Nuclear energy base cru­ ore-processing capacity in the West are significant in this cial to European industrial reconstruction"). We review here respect. Europe's critical nuclear fuel cycle capacities, the elements Western Europe today has the following capacities for in the process without which not a single watt of nuclear processing uranium ore (measured in tons of uranium ox­ electricity would exist. This review leaves aside the question ide-U,Os-per year): of more advanced technologies that are also required, such as the fast breeder reactor and fusion power. Belgium: 50 According to data from the Nuclear Energy Agency ofthe France: 5,410 Organization for Economic Cooperation and Development West Germany: 125 (OECD), in 1990 the world will produce only slightly more Greece: 150 uranium than nuclear reactors will consume. Fifteen years Spain: 830 ago the United States was the world's largest uranium mining Total European Community: 6,565 producer and the world's largest commercial reprocessor. Today, the United States is the world's largest consumer of In 1988, total non-communist , world uranium ore-pro­ uranium fuel, with 107 gigawatts-electric (GWe) of opera­ cessing requirements were almost exactly equal to capacity, ting reactors. But owing to federal governmentenvironmen­ a dangerous state, to say the least. This demand totaled tal policy and refusal to regard uranium mining as a vital 46,000 tons of U30S per year. This capacity tightness had strategic interest, the country has little control of its own been only somewhat improved by 1990, with new capacity uranium supply and processing. being added, but in the context of large, new nuclear plant In terms of supplies of "yellowcake" (a mixture contain­ orders in Europe of 75-250 GWe over the next decade and a ing 75% uranium), the U.S. firmEnergy Resources Interna­ half, we simply do not have at present sufficient uranium tional estimates that for the next 5-10 years, the 1980s trend ore-processing capacity in the world. With construction lead of "excess uranium supply" will continue, with the biggest times of an estimated seven years to build new ore-processing demand question being the rate of expansion of nuclear ca­ plants, it is urgent to begin this now. The European nuclear pacities in Western Europe. Because ofthe numerous nuclear industry today has made clear that it must have government plant cancellations in recent years, OECD countries have assurances that it will not be bankrupted by Green sabotage been leftwi th a backlog of uranium stock equal to some four or legal wrangles, if it is to make such a new and costly years' consumption, which has resulted in a price collapse commitment, as with all aspects Of the nuclear fuel cycle,

EIR July 6, 1990 Economics 13 • including revival of a broad-based European fast breeder and This represents 31% of total world enrichment capacity a high temperature gas-cooled reactor (HTGR) development of 43,705,000 SWU per year. If we exclude the special case program as the next generation. of the 10,000 SWU per year of Soviet capacity, the EC share of enrichment capacity is fully 40% of the Western world's Uranium refining and enrichment capacity. The U.S. capacity at. present is 19,1 30,000 SWU Out of total world uranium-refiningcapa city, France and per year. If that is closed in any significant way for budget the United Kingdom held 41 % (as of July 1989). This breaks reasons, we have a world enrichment capacity crisis at hand. down as follows (measured in tons of U30S refinedper year Current U.S. nuclear industry requirements alone are for 10 into uranium hexafluoride-U6F): million SWU per year. With only their current plants under construction, in several years France and Japan will each France: require some 6 million SWU by the mid- to late- 1990s. Given Pierrelatte (NatU): 14,000 the growing geopolitical uncertainties, the Japanese govern­ Pierrelatte (RepU): 350 ment recently stepped up plans for its own domestic enrich­ Malvesi: 14,000 ment capacity, but this will at best give only 1.5 million United Kingdom: SWU by end of this decade. Springfields: 11,200 World enrichment demand versus capacity today is in Total European Community: 39,550 slight surplus, but only slight. As of OECD data from July 1989, capacity was expected to exceed demand annually in Uranium for use in light water reactors must have concen­ 1990 by 14 million SWU per year. tration of fissionable U-235 to a level of 3.5-5%, depending The death knell last year for the Wackersdorf nuclear on the design of the reactor. Enrichment is measured in Sepa­ reprocessing facility in West Germany eliminated with it the rative Work Units (SWUs). Worldwide present enrichment prospects of reprocessing spent fuel rods to meet this de­ capacity for civilian fuel is 35 million SWUs per year. Of mand. Current expansion of capacity is, however, planned this, 19 million, or about half, is in the United States, in a by France's Eurodif and the U.K.-Dutch-German Urenco program run by the Department of Energy-an incredibly consortium, which has enrichment facilities in operation at bungled operation which is losing its world monopoly by Capenhurst in the U.K. and Almelo in the Netherlands. overcharging and mismanagement. Given the recent U.K. government decisions regarding As of Jan. I, 1989, when the new U.S.-Canada Free nuclear industry and electricity privatization, British partici­ Trade Agreement went into effect, Canadian uranium be­ pation in such future plans are somewhat doubtful. British came exempt from U. S. Atomic Energy Act restrictions that Nuclear Fuels (BNFL) is a member of the Urenco con­ block import of enriched uranium for U.S. reactors. This sortium. means a major boost to Canadian and British enrichment One very promising area being pursued in France and, at markets and a probable further closing of U.S. capacity. least until recently, in Germany, has been laser enrichment We mention this, because it bears on the issue of demand techniques to replace aging gas diffusion capacities. Under for European enrichment capacities. The United States has the A VLIS method-which was originally developed in the recently shut down 29% of its enrichment capacity-9 mil­ United States, at Lawrence Livermore National Laborato­ lion SWU worth-further driving U.S. electric utilities onto ry-U-235 atoms can be selectively "excited" by existing the European market for long-term contract supplies. The high-power copper vapor lasers i and then electromagnetical­ U.S. Department of Energy has, as a result, lost a major ly extracted. There remain techn.cal materials handling prob­ share of its previous contracts to enrich uranium for Western lems with this promising new enrichment method, including European nuclear reactors, placing further demand pressures use of materials which resist corrosion with uranium at on existing European Community (EC) enrichment capacit­ 2,500° Kelvin. ies. Given the U.S. budget uncertainties in the coming sever­ There is also another avenue for future enrichment using al years, it would be a prudent assumption that U.S. enrich­ laser-catalyzed chemical reactions, known as CRISLA. De­ ment capacities will not be a very reliable source for needed veloped by the firm Isotope Technologies in California, enrichment, in face of an expanding European demand. CRISLA may become economical in low-level enrichment Here is what presently exists in EC uranium enrichment of uranium for power plants using an infrared carbon dioxide capacity (measured in SWU per year): laser. The energy requirements to drive this type of separa­ tion process in laboratory results are some 300 times less France: 10,800,000 than the conventional energy-intensive diffusion techniques. West Germany: 450,000 Ifdif fusion consumes 2,500 kilowatt hours (kWh) per SWU, Netherlands: 1,200,000 CRISLA consumes 10 kWh per SWU and AVLIS some 40 United Kingdom: 950,000 kWh per SWU. Ultracentrifuge consumes some 50 kWh per Total European Community: 13,400,000 SWU.

14 Economics EIR July 6, 1990 The gutting of America: Investment in electricitygeneration dries up by Anthony K. Wikrent

Beginning in 1988, areas in the United States began to experi­ the minimally acceptable level of 17%. The council noted enced occasional reductions in electricity, and even some that the Eastern Seaboard of the U.S. had fallen below that complete interruptions-not because of an extraordinary ac­ margin in 1988, leading to 37 occasions when available re­ cident, but because the United States no longer has sufficient serves fell below the 6-7% of the capacity safety level man­ electrical generating capacity to meet peak demands. Spoke­ dated by the New England Power Pool. smen for the electric utility industry and other experts are By December 1989, the New York-New England area warning that this situation will worsen, unless the United had suffered II brownouts. The G�ater Boston Chamber of States begins to add new capacity for generating and distrib­ Commerce estimated that these electricity service disruptions uting electricity. But the U.S. electrical equipment industry caused the loss of $86.8 million in economicre venues in the has been so decimated by a decade of declining orders, that state of Massachusetts alone. The U.S. credit-rating agency, it no longer even has the physical capacity to rebuild its Standard and Poors, Inc. issued an analysis that the declining electricity generating and distribution capacity. reliability of electricity service in the region threatens the The first area to feel this latest effectof the collapse of the creditworthiness of the entire area. physical economy was the Northeast, which in the summer of Actually, even a 17% capacity margin is not adequate, 1988 experienced a number of temporary voltage reductions since about 30% of peak demand is determined by the weath­ (brownouts), and even a few complete interruptions of ser­ er. A 20% capacity margin has historically been considered vice (blackouts). In February 1989, severe cold weather and the minimally safe margin for eleotricity generation in the snow storms in the Pacific Northwest drove electricity de­ United States. But by 1988, out ofthe nine regional electrici­ mand so high, that the Bonneville Power Administration was ty reliability systems, only two were at or above that margin. forced to cut back power to the large aluminum production plants of Intalco near Ferndale, Washington, and of Kaiser Depression mentality rules planning Aluminum's plants at Mead, near Spokane and Tacoma, These crippling shortagesof electricity are occurringbe­ Washington. cause the shift by the U.S. to a post-industrial economy, Another severe cold wave in December 1989, which increasingly enforced by environmentalist fanatics, has cur­ dropped two inches of snow on the northernFlorida Panhan­ tailed the addition of new electricity capacity (see Figure 1). dle, caused a statewide demand of 33,883 megawatts Not only have U.S. electric utilities ceased beginning new (MW)-a peak demand that was not expected to be seen projects, but many projects already begun were terminated until 1995. In a desperate attempt to provide minimal service before completion. without endangering the electric system's equipment, Flori­ Faced with a Luddite assault on nuclear power by the da electric utility companies instituted "rolling blackouts"­ environmentalists on the one hand, and on the other by U.S. cutting off all electricity to one locale for a period of time, financial markets hostile to investments in basic economic then restoring service, while cutting offa different area-on infrastructure with the attendant low rate of return, U.S. Dec. 24 and 25. electric utilities committed themselves to plans for increasing In June 1989, the U.S. Council for Energy Awareness, capacity by only about 72,180 MW between 1988-98 (plus the trade association for the U.S. nuclear power industry, about 30,000 MW being added by independent power pro­ issued an analysis which warned that during 1990-9 1, the ducers). Their plan was based on the asssumption that de­ U . S. electricity capacity margin-electricity generating and mand for electricity would grow only 2% annually-less distribution capacity that is maintained as an operating mar­ than even the 2.8% growth in the immediate aftermath of the gin for unusual peaks in demand, or extraordinary reductions 1973 oil crisis (see Figure 2). in capacity because of accidents or repairs-would fall below Sales of electricity in the United States grew 4.5% in

EIR July 6, 1990 Economics IS FIGURE 1 FIGURE 2 Orders and installations of turbines for electric Projected additions to electric generating utilities are grinding to a halt capacity indicate vicious economic cycle (thousand megawatt capacity, in continguous United States) . (thousand megawatts) 1 00 12 90 11 80

70 1 0

60 9 50 8 40 7 30

20 6

10 5 0 4--r-.� 4 -r---r--�---'--�r---r---�--�--�--� 1974 1976 1978 1980 1982 1984 1986 1988 1989 1991 1993 1995 1997

- Ordered _ Installed IIII Nuclear installed

Source: Edison Electric Institute. Source: NorthAmer ican Electric Reliability Council.

1987 and 5.1% in 1988. Industry analysts predict that such Unlike the transport of other commodities, where an in­ growth rates will continue, meaning that in fact, 250,000 terruption in one spot can be quickly isolated (water mains new megawatts of capacity is needed. It is also highly unlike­ turned off, forexa mple), a disturbance occurring at any one ly that even the planned addition of 72,000 MW will actually point in an electricity distribution system will be felt at all be built, since only 44% of that is currently under construc­ other points in the grid, and cannot be easily isolated. There tion. And a major unknown is what will happen to the 107 is no way to separate the electricity flowingthrough the power coal-burning power plants, mostly located in the Midwest, lines that is replacing power in an emergency, from power which will be unable to comply with the new Clean Air Act being wheeled between utilities to save money. amendments. Similarly, according to the North American Electric Re­ liability Council, "Electricity transfer from one portion of Spreading the poverty an interconnected area will, to some extent, flow over all Rather than adding new electricity generation capacity , transmission lines, not only those in the direct path of the utilities began to "wheel" power among them: If one region transfer." If there is a problem, voltage collapse and instabili­ had a surplus of power, it delivered it to a region that was ties can occur in fractions of a second, and may destroy a short. Though this capability is critical in an emergency, critical piece of equipment somewhere else in the distribution when equipment is down, it has now been done on a continu­ system. ous basis for nearly two years, as a way of allowing utilities If there were to be an economic'upsurge in manufacturing to avoid building new plants. industries, and a return to the 6,8% per year growth of elec­ Wheeling has also been extensively used for short-term tricity demand of the 1960s, the United States would face an cost-cutting by replacing electricity generated with higher­ immediate crisis, not just because the new capacity being priced fuels, such as oil, with power that is cheaper, such as built is wholly inadequate to meet even present, truncated hydroelectric. This has been done on an hour-to-hour basis. demand. More importantly, because the United States has Wheeling of power has placed enormous stress on the trans­ lost the ability to manufacture critical equipment for the elec­ mission system, and has left many power lines operating at trical industry , such as interrupters and high-voltage circuit above 90% of capacity for significant periods of time. This breakers, and is rapidly losing the capability to produce other decreases the ability of the utilities to respond to genuine equipment, such as transformers, large steam turbines, and emergencies, and threatens the reliability of the entire system. control panels.

16 Economics EIR July 6, 1990 Case study: the transformer industry possible to build up inventories. Rather, manufacturers must A clear example of how the United States has destroyed retain the sophisticated engineering and scientific personnel itself economically is provided by a study of the transformer needed to design them, supervise their production and instal­ industry. The steep decline in construction of new electricity lation, and test them, along with thelhighly skilled work force capacity has caused the electrical industrial equipment and needed to fabricate and install thctm according to design. electrical generation equipment industries to dramatically Moreover, the immense size and weight of power transform­ "downsize" over the past decade. The downsizing of trans­ ers requires very large manufacturing facilities and equip­ former production is a catastrophe because of the nature of ment, including overhead cranes able to lift up to 500 tons, the product, and because transformers are key components and testing equipment able to simulate the most adverse op­ in the electricity distribution system. erating conditions, such as lightning strikes. Massive vacu­ Large power transformers, of 10,000 kilovolt amperes um and pressure chambers are needed to remove all moisture (kV A) and above, are used to step up the voltage of electricity from the completed unit, and to force the impregnation of generated by a power plant, usually between 2.4 and 30 dielectric (non-conducting) oil in the internal windings. kilovolts (kV) to the higher voltage (sometimes as high as These considerations dictate a much larger burden of 765 kV) required to move the current efficiently through fixed costs for transformer manufa(!turers than is normal for hundreds of miles of transmission lines. These power trans­ other manufacturers in other industries. A steady volume formers are known as generator transformers. Along the of orders is required to keep unit costs price competitive. transmission lines are other power transformers, known as Underutilization of manufacturing capacity drives up unit shunt reactors, which operate to keep the voltage up to the costs disastrously, making the manufacturer increasingly un­ required level over long distances. Where two different trans­ competitive, and increasingly unable to support the research mission systems interconnect, autotransformers adjust the and development expenditures required to sustain a techno­ voltage level of one system to the other. logical position. The demand for power transformers is thus Once the current reaches the location where it must be very inelastic, being almost entirely derived from the addi­ divided into different distribution systems for delivery to end tion of new electric power generation and distribution ca­ users, "substation" or "step-down" transformers are used to pacity. step down the voltage of electricity from the high-power It was exactly this process, where declining orders forced transmission lines to the lower voltage required for local declines in production capacity, that has engulfed the U. S. power line distribution, usually 345 kVA, but ranging from power transformer industry and has shrunk it to less than half one to several hundred kV A. its size since the 1970s. No better example can be found of All these different types oftransformers are known gener­ how the physical economy is destroyed if it is subordinated ically as power transformers. Each is custom-designed and to financial and monetary considerations-such as a blind tailor-made to meet its specific application, as well as other ideological belief in "free" markets, or "free" trade. After specifications of the utility purchasing the power transform­ the market for power transformers peaked in 1974 at 293,012 er. Such factors as the length and particular features of the megavolt-amperes, it collapsed to 66,004 m V A by 1984, as transmission line, and the characteristics of the load being utility companies ceased adding new generating or transmis­ served, can vary significantly between applications. The typ­ sion capacity. New orders for power transformers in 1988 ical price of a power transformer runs well over $1 million. were only 83,872 mVA (see Figure 3). Other transformers will further step down the voltage The collapse of the market forced down capacity utiliza­ to 230 k V A or 115 k V A for final delivery to distribution tion rates to under 50% by 1986.1 According to a special transformers , which reduce the voltage to 110 volts to serve survey done by the National Electrical Manufacturers Asso­ two to fivere sidential homes. The most common distribution ciation at that time, transformer manufacturers had not shown transformer used in the United States is rated at 25 kVA, but a profiton their operations since 1980. A wave of business may range as low as 4 kVA and as high as 138 kVA. Industri­ failures and major restructurings by remaining companies al plants are served with 440 volts, and may be served by in the industry caused U.S. production capability to shrink distribution transformers of up to 500 mVA, but 5 mVA is rapidly. In 1986, there were 244 companies with 293 manu­ most common. The market for distribution transformers is facturing facilities engaged in producing all types of trans­ primarily determined by new residential construction. formers , distribution as well as power. Four companies that Generally, the higher the voltage in the line, the less the dominated the industry, accountinglfor aproximately 55% of loss of current. However, the equipment needed to handle industry shipments, as measured by dollar value. By 1985, the higher voltage can cost considerably more than that need­ shipments of transformers, at 46,933 mVA, were less than ed for lower voltages. one-fourth of the 186,709 mVA shipped in 1975, and the The unique design of power transformers imposes ex­ industry was operating at less than 50% capacity. traordinary burdens on manufacturers . Because there is no In the 1960s and early 1970s, the transformer industry set standard design, they cannot be mass produced, nor is it operated at close to 90% capacity. In 1988, orders of 83,872

ElK July 6, 1990 Economics 17 duce power transformers. In June 1988, Cooper also bought FIGURE 3 RTE Corp. , which manufactures liquid-immersed power and New orders plunge for power transformers of distribution transformers. 501 kilovolt-amperes and larger In February 1989, the National Electrical Manufacturers (gigavolt-amperes of capacity) Association testified before the Senate Government Affairs 300 Committee that nearly 40% of U.S. transformer production capacity had been shut down in the previous 30 months. 275 250 No incentive for new technology A major technological advance in the transformer indus­ 225 try has been the development of "amorphous rhetals." By 200 rapidly cooling a molten compound of iron, silicon, and 175 boron, a metallic material is produced with a random atomic structure similar to glass, which can be cast as thin as I mil, 150 as compared to II or 12 mils for the silicon steel used up to 125 now, while achieving considerable reductions in current loss 100 in transformer cores. According to Edward van Damm of the Electric Power 75 Research Institute (EPRI), it is not economical for U.S. utilit­ 50 ies to replace existing transformers with new ones construct­ 25 �-r-.-.-.��-.-'-'-''-.-r-'-�T-� ed out of amorphous metals. New transformers will be in­ 1972 1976 1980 1984 1988 stalled only as new capacity is built, and only if the utility has higher cost types of power. A utility with large amounts Note: Figure for 1 989 is estimated. basedon doubling figure for first half of year. of cheap hydropower capacity will not find it economical to Source: Edison Electric Institute. purchase and install the new, more expensive transformers. But technological levels between the major international manufacturers of transformers are at best a minimal consider­ mVA were booked, and the order backlog at the end of the ation for buyers. Far more important are the terms of financ­ year was 67,511 mVA. In 1974, orders of 293,012 mVA ing. Here, U.S. companies operate at a severe disadvantage were booked, and the backlog stood at 186,709 mVA. Total compared to their foreign competitors, because the U.S. Ex­ employment in the transformer industry dropped 32.3% from port-Import Bank amply reflects the usury that dominates 50,700 in 1973, to 34,300 in 1990. Imports as a percentage the U.S. economy, and is also more often used to enforce of apparent supply more than tripled in the same period, from adaptation to "appropriate technologies," such as windmills, 3.3% to 1 1.5%. The latter figure is misleading to the degree rather than the most modem industrial equipment available. that it does not reflect the loss of domestic ownership in the In the early I 980s, interest rates on loans offered by the industry. Exim Bank were approximately 190 basis points higher than In 1987, Westinghouse became the nation's predominant comparable institutions. transformer manufacturer when General Electric adandoned Besides power transformers , the United States has almost the industry and sold its transformer manufacturing facilities completely lost the ability to produce other equipment, such to Westinghouse. This was ironic, because Westinghouse as high-voltage circuit breakers. Like power transformers, had already begun "downsizing" its transformer manufactur­ these devices are large and complex, with detailed specifica­ ing capacity in 1984, when it closed facilities in Greenville tions and requiring elaborate testing. However, their design and Sharon, Pennsylvania. The Westinghouse facility in is far more standardized than the design of power transform­ Muncie, Indiana was reduced from 1,600 workers to only ers. McGraw Edison is the only U.S. company left able 460. to produce high-voltage circuit breakers, and its production In 1987, the firm ASEA A.B. of Sweden merged with capacity is almost negligible when compared to annual de­ Brown Boveri of Switzerland to become one of the world's mand, even at the depressed levels of today. largest manufacturers of heavy electrical equipm ent. In A joint venture between Hitachi and General Electric also 1989, Westinghouse, which had previously established a assembles high-voltage circuit breakers in the United States, joint venture with ASEA Brown Boveri Ltd. to produce and using sulfur hexafluoride produced in Japan. Sulfur hexaflu­ market power transformers in the United States, sold its 55% oride is a gas that quickly extinguishes the arc in a circuit interest in this venture to ASEA Brown Boveri, leaving Mc­ breaker, and offers a major reduction in size of equipment. Graw Edison, bought by Cooper Industries in 1985, as the This is a particularly strong advantage in Europe, with its last U. S.-owned company with significant capacity to pro- shorter distances.

18 Economics EIR July 6, 1990 Report from Bonn by Rainer Apel

Inside the 'productive triangle' and Hamburg are being intensified in Infrastructure projects between Germany and Czechoslovakia order to promote the idea of joint Elbe will yield more rapid economic results. development. On April 19, the magis­ trates of both cities signed a sister-city partnership with the perspective of closer cultural and political relations, T he emergency DM5 billion credit em Europe, from Hamburg on the and of economic cooperation on a granted by West German banks to the mouth of the river, to Prague, which higher level. Soviet Foreign Trade Bank is the big­ is linked to the upper parts of the Elbe One short -tdrm priority project be­ gest single German credit to a foreign via the Moldau River. ing discussed could increase commer­ client to date. While one-third of it In early April, the Hamburg port cial activities at the 71-year-old Czech will be spent to cover overdue Soviet authority and 80 industrial and trade enclave in the port of Hamburg, as the payments to West German firms, companies presented a paper entitled Czechs plan to increase trade overseas there are strong expectations that the "The Economy of Hamburg in a Uni­ during the 19906. The Elbe waterway rest of the sum may be used for new fiedGerma ny. " The authors endorsed has become more important over the joint projects. the following priority projects, urging past few years for the Czechs, who The next encounter between their authorization at the highest polit­ handled more than 50% of their for­ Chancellor Helmut Kohl and Presi­ ica
level this summer or soon there­ eign trade in 1989 through Hamburg. dent Mikhail Gorbachov in Moscow after: It is a good sign that the new Czech at the end of July, may announce some • Rebuilding the Elbe River into minister of economics, Vladimir big joint projects to initiate what has the main central waterway for the Dlouhy, is favorable toward rapid been called the "beginning of a new transport of goods between Prague, German reunification, which he sees chapter in German-Soviet relations." Hamburg (becoming the central and as a chance to cut loose from 45 years The chapter will undoubtedly be­ southeast European "gate to the offorced dependency on the U . S.S. R. gin with the flowof more billion-deut­ world"), Dresden, and Magdeburg. At a meeting of Comecon economic schemark credits eastward, but it will, This involves several waterway engi­ ministers in Prague on April 24 , Dlou­ due to protracted systemic sabotage neering efforts--deepening the river, hy, then Czech Vice Premier, said that and inefficiency in the Soviet econo­ fortifying the river banks, and install­ he sees a unified Germany as its num­ my, produce very few positive results ing modem signal and communica­ ber-one future trade partner, "a much in the short term. tions equipment-all along the wa­ bigger partner than, the U.S.S.R. is for Compared to the scope of industry terway; us today." projects in East Germany and the East • Modem computer-controlled Reunified Germany will, for ex­ European countries, Western invest­ container transport by ship is to be or­ ample, become the primary trade part­ ments in the Soviet economy will ganized from three coordination cen­ ner for the Czech machine-building shortly become a side-aspect. ters-likely Hamburg and Prague, sector that has been highly dependent Far more important is the question and a third to be built "in the southern on barterdeal s with the Soviet Union of how much economic development G.D.R."; over the past 45 years. Soviet orders can be achieved within the next few • Restoration, modernization, are declining because of the increasing years in the heavily industrialized re­ and extension of traditional rail routes incapacity of the Soviets to deliver the gions of Central and Central Eastern from Hamburg to Berlin and the other raw materials n¢eded by the Czechs. Europe, inside the "productive trian­ important centers of industrial pro­ The reorientation of the Czech in­ gle." A centerpiece of the triangle will duction ofthe G.D.R. and Czechoslo­ dustry towards ,the West is a conse­ be the cooperation between reunified vakia, such as Magdeburg, Dessau, quence of development of the Elbe Germany and Czechoslovakia-both Leipzig, Dresden, and Prague. This waterway and the surrounding infra­ traditional centers of industrial and involves the modernization of port structure. A government-backedGer­ machine-tool production in Europe. facilities along the entire route and man credit of several billion deutsche­ Of specific interest, is the revival construction of central storage and re­ marks to Czechoslovakia would yield of the Elbe River waterway, connect­ distribution centers to link up the results that couldn't be reached with ing numerous urban industrial centers countryside to the waterway. the U.S . S . R. over a comparab I y short between northwestern and southeast- Political relations between Prague period of time.

EIR July 6, 1990 Economics 19 Agriculture by Marcia Meny

A farm bill to wipe out agriculture that will cover the farmers' production The new five-year U.S.farm bill should really be called the and capitali�ation costs and a fair re­ turn. It was parity prices decreed by "Food ScarcityAc t of 1990. " Washington, D.C. during World War II, that allowed the vast expansion of food for the war effort. On June 14, at 2:05 in the morning, susceptible to such diseases. For exa�ple, the parity price to a voice vote of the House Agriculture The new farm bill does nothing to the farmer for milk should be over $24 Committee of the U. S. Congress ap­ improve this situation. There are no for 100 pounds. The new bill freezes proved a proposed farm bill package emergency measures to produce more the minimum support price at $10. 10 for the next fiveyears . To replace the food. The bill reauthorizes food stam­ per hundredweight, through fiscal expiring 1985 "Food Security Act," ps and other food assistance pro­ 1995. the new bill, H.R. 3950, is called the grams, and orders that federal spend­ Farmers get only 50% of parity "Food and Agricultural Resources Act ing should gradually increase in these price for almost every commodity. of 1990." However, it should, more areas. However, even the spending re­ Therefore, they are going under, or accurately, be titled the "Food Scarci­ quested is below the current rate of staying in operation by working off­ ty Act of 1990." inflation in food prices-well over farm jobs, or selling out, and becom­ The new package continues some 10% and rising. ing serfs for absentee landowners. of the disastrous policies from the last This means, for example, that Hastening this process, the USDA bill, and adds even worse innovations. food stamps and the vouchers of the loan agency, the Farmers Home Ad­ This is a result of the deliberate policy WIC program (Women, Infants, and ministration (FmHA), has recently of the food cartel corporations to shut Children) will not cover nutrition stepped up its foreclosure actions down family farming and feudalize needs. This year alone, up to 280,000 against fanner borrowers. what remains of American agri­ mothers and infants are being kicked The beneficiaries of these insane culture. off desperately needed food supple­ farm programs arethe big name food Look at the farm legislation in ments, because food prices rose high­ cartel companies: Archer Daniels terms of the three major elements of er than WIC allotments. Midland (ADM), Cargill, ConAgra, food and farm policy: food supply, The only food program expanded Continental, Bunge, Louis Dreyfus, condition of farmers, and state of the in the new farm bill is the provision to and others, ,which continue to under­ resource base: "combat fraud and misuse" offood aid pay farmers for their output, and thus • Depleted fo od stocks. Com programs. reap the benefit of the paltry outlays stocks are at their lowest level in 10 • Crisis condition of fa rms. By the government makes to keep farm­ years. Wheat stocks are at the early- 1995, the United States could lose ers in business, as de facto peons to 1970s levels. Dairy supplies are be­ 500,000 farms-the core of the fami­ the giant companies. low the level which would be utilized ly farm system in the nation-accord­ • Disintegration of agriculture if households had the income to pur­ ing to a recent report released by the infrastructure. The U.S. grid of basic chase the quality diet they want. The Congressional Budget Office. This is inputs for modem agriculture-water U.S. Department of Agriculture has the projected result of the continued supplies, electricity, transportation, had to stop supplying the National fall in income from farming due to land improvements, and so forth-is School Lunch Program (set up after prices paid to the farmer being lower deteriorating rapidly because of lack World War II to prevent malnutrition) than farm costs, and to the ineffective­ of repair and expansion. The new with nonfat milk powder and cheese. ness of minimal federal programs to farm bill ,proposes unprecedented The USDA has stopped or curtailed keep farmers in operation. measures to have farmers "adjust" to supplying these items to the supple­ This report caused a sensation, this, in the name of "sustainable agri­ mental food programs for nursing and House members voted to retain culture practice." This is the fancy mothers, infants (set up in 1974 to various loan and price support mea­ word for low-technology, primitive curb infant mortality), and the elderly. sures for cotton, rice, wheat, com and farming. The bill authorizes $40 mil­ Epidemics of measles, tuberculosis, other feed grains, oilseeds, and dairy lion annuall� for research and $40 mil­ and other once-controlled illnesses are farming. But in no case does the legis­ lion for extension training on how to rising as the population becomes more lation call for parity prices-prices become a low-tech greenie.

20 Economics EIR July 6, 1990 EnergyInsider by Rogelio A. Maduro

The Bush offshore drilling ban provide safe and dependable energy It will jeopardize energy supplies and national security. The supplies for the ,American people." industryfina lly takes off the gloves. The petroleum industry has decid­ ed to take the gloves off before it is too late. Speaking at a meeting of the South/West Energy Council the day before the President's announcement, API's Charles . DiBona blasted the President Bush announced, on June Bush may have underestimated Clean Air Act and urged the federal 27, a to-year ban on oil and gas explo­ the reaction from the oil industry. The governmentto develop an energy pol­ ration along much of the California, leaders of all the major petroleum re­ icy focused on �'real-world energy is­ Florida, North Atlantic, and Pacific lated groups have denounced the deci­ sues" rather tOan relying solely on Northwest coasts. In the name of sion in the starkest terms. Paul Hilli­ "haphazard by-products of environ­ "protecting the environment," the ard, Chairman of the Independent mental policy." green President has essentially banned Petroleum Association of America DiBona insisted that the V.S. exploration and extraction of oil in the (IPAA), the leading organization rep­ needs to devel()p its domestic petro­ most promising areas. Charles Di­ resenting independent operators and leum resources or energy problems Bona, president of the American Pe­ producers, called the ban on offshore will become more difficult. He stated, troleum Institute, says this will cost drilling in key coastal areas of the "Energy issues· simply don't get the the V. S. over 2 million barrels of oil V.S. "highly disappointing; a mis­ hearing they should. In fact," he said, per day by the year 2000. V.S. oil take, and a sad day for the American "in two decades of work on energy production stands at less than 6.8 mil­ consumer. It means a surrender of issues in Wasqington, I have never lion bpd, and is going lower because V.S. control of its own energy future seen a more difflcult--oftenhosti le­ of other environmental regulations, to foreign suppliers, a certain formula political climate than we have today yet in May the country imported 52% for disaster, potentially grave conse­ on Capitol Hill." As a result, environ­ of its oil. quences for V.S. economic and na­ mental legislation is being passed that Bush's decision to please the envi­ tional security interests." is "more the res!Jlt of emotion and po­ ronmentalists flouts thescientific evi­ Hilliard warns, "The President's litical pressure lhan of merit or scien­ dence. A 1985 study by the National decision guarantees that the V. S. will tificjudgment .'� Academy of Sciences concluded that continue on its reckless course of in­ Blasting the process by which the less than 1.5% of oil pollution comes creasing dependency on insecure Clean Air bill was drafted, DiBona from offshore oil drilling. Bush is us­ sources of oil. . . . He has decided that warned that"proposed ethanol formu­ ing the hysteria created by the Exxon the V . S. will have more tankers bring­ las could increase the cost of produc­ Valdez and other recent oil tanker ac­ ing foreign oil ashore, more environ­ ing gasoline by ;1 0- 15¢ a gallon. They cidents to shove through his meaSure, mental risks, a greater drain on our would require extremely costly while in fact, offshore oil drilling is economy, a larger trade deficit, and changes in refineries, and they would the solution to tanker oil spills. The fewer domestic jobs for explorers, probably put some refiners out of bus i­ net result will be an increased likeli­ drillers , fabricators, suppliers, geolo­ ness. They coulddo all that with little hood of spills, as more foreign tankers gists and service companies. In addi­ or no benefit to air quality. In fact, arrive in V.S. ports. tion, the V . S. taxpayer will see the loss they could actually make some air According to Carl Schmid, leas­ of additional federal revenues from quality problems worse because of the ing advocate for the National Ocean OCS leasing and production." Hilliard high emissions 1of some ozone-form­ Industries Association, offshore oil concludes: "We can now add V. S. off­ ing compounds. Still, these ethanol exploration involves thousands of shore drillers to the administration's fuels were extolled as an environmen­ small companies. He notes that the latest 'endangered species' list." tal panacea. In �his instance, the illu­ President's action will have the most A National Ocean Industries As­ sory benefits of new environmental severe impact on such family-owned sociation press release states, "By de­ regulation dov�tailed with the eco­ companies, which will go out of busi­ laying leasing and drilling for such an nomic self-inttlrest of a small, but ness while the giant oil corporations extended period of time, the President powerful interest group--the ethanol simply go abroad and import the oil. has abdicated his responsibilities to producers. "

EIR July 6, 1990 Economics 21 Business Briefs

Manufacturing zil's former finance minister Mailson da oped by Gerard A. Mourou of the University Nobrega shocked London bankers in May, of Michigan at Ann Arbor. The CPA technique Legal costs a major boasting that he had secretly bought back $3 involves stretching out a pulse of I picosecond billion worth of debt titles from various bank­ (I trillionth of a second) by a factor ranging drag on U.S. economy ers and speculators during the first quarter of from 100to a few thousand, amplifying it, and the year. Brazil appears to have canceled $6 then recompressing it to its original duration. The costs of legal defense have become a ma­ billion in nominal debt at a cost of 28¢ to the If the pulse were not stretched out during am­ jor drag on U.S. economic competitiveness, dollar. using dollars most bankers think should plification, its power density would shatter the attomey Hal O. Carroll wrote in aJune 25 Wall have gone to paying interest to them. amplifier, a, glass matrix impregnated with Street Journal column. There are 30 times as neodymium ,ions. many lawsuits per capita in the U.S. as in Ja­ "With power densities at this level," pan, for example, he pointed out. Exorbitant Mourou said, "we may soon be able to create jury awards in tort cases have caused liability Agriculture an intense X-ray laser-like beam capable of insurance costs to skyrocket, when insurance producing three-dimensional 'snapshots' of is available at all. Income drops with microscopic structures within living cells that A recent survey by the Conference Board have never been seen before ." found that 47% ofthe firmscontacted reported 'sustainable' farming having discontinued at least one product line because ofconcerns about liability litigation. A study sponsored by the U.S. Department of Agriculture and the National Academy of Sci­ German Unity ences comparing a conventional farm to one using 'sustainable' agriculture in South Dako­ Monetary union treaty Debt ta, shows a dramatic income drop on the sus­ tainable farm . takes effect July 1 Ibero-America: Cut The study, entitled "On-Farm Research Comparing Conventional and Low-Input/Sus­ On June 21, the two German parliaments debt service by 75 % tainable Agricultural Systems in the Northern passed the treaty on the German economic­ Great Plains," was released in April. The re­ monetary union by a vast majority, in parallel lbero-America should pay $10 billion annual sults of the five-yearstudy comparing two com sessions in East Berlin and Bonn. In the East, interest on its foreign debt, instead of the $40 and soybean farms, show that gross income 306 out of 400voted in favor of the treaty; the billion it is now paying, 26 governments de­ from the conventional farm was 25% higher communist FDS and the left-greenie Alliance clared June 22 in a policy adopted at the bi­ and net income was 18%-20% higher. Labor­ 90, against. linthe West, the treaty was adopted annual meeting of the Latin American Eco­ hours peracre were almost twice as high on the with 438 out of 505 votes, the Greens and 25 nomic System (SELA) held in Caracas, Vene­ low-input farm . Social Democrats voting against. In Bonn, it zuela. was the first time the deputies from West Berlin SELA permanent secretary Carlos Perez were allowed to vote on legislation-thanks to del Castillo pointed out June 15 that despite the three Westernal lies' long overdue decision the region paying $250 billion in debt service Technology to lift the voting ban on the Bundestag mem­ during the 1982-89 period, its debt increased bersfrom Berlin. by $100billi on to over $430 billion. Powerful laser leads The treaty, to take effect July I, will be A year ago, SELA proposed cutting the followed by a second treaty soon that is to de­ debt's principal in half, but that was rejected to usable X-ray device fine the timing and details of the formal reuni­ by the creditors. Now, it calls for the principal ficationproc ess. to be reduced by an average of 75%, to the Scientists at the University of Michigan and rates prevailing on the secondary market. The the French Atomic Energy Commission re­ reduced debt would be reissued as 30-40 year ported the creation of the world's most power­ bonds at fixed interest rates to be guaranteed ful laser in a simultaneous announcement June Infr astru�ture by a fund to which each debtor would annually 7. The beam of the P- 102 laserdelivers 20tera­ pay I % of its debt, and by the International watts (20 trillion watts) within a diameter of 9 Six-nation initiative Monetary Fund. centimeters (more than 300 billion watts per Brazilian debt negotiator Jorge Dauster square centimeter). The previous limit was 15 for Baltic economic zone declared June 18. "This is not a debtors' club terawatts with a beam diameter 50 times but a search for political endorsement for a pro­ greater. Six nations are involved in an initiative for an gram to reduce the foreign debt." Such reduc­ The P- I 02 relies upon a technique called economic cooperationzone along the eastern tions have been going on surreptitiously. Bra- "chirped pulse amplification" (CPA) devel- Baltic, EJR has learned. A non-public meeting

22 Economics EIR July 6, 1990 • CANCER is not linked to elec­ tromagnetic radiation generated by electricity, a study by the Environ­ mental Protection Agency has found, of experts mapping out areas offuture coopera­ goray pushed it through anyway. The June 27 the June 23 Washington Post report­ tion took place in late April in Brest, involving London Financial Times reported that the most ed. Desperately needed new electric delegates from Poland, Belorussia, Ukraine, important aspect ofthe deal is the debt for equi­ transmission lines have been halted and the three Baltic republics. At the center ty swap, which was based on 13% of the face across the 0.s. over alleged health of projects discussed, is a plan for industrial value of Argentina's debt, and was pushed effects. development of the central ports on the Bal­ through with "little of the expected political tic-Gdansk, Klaipeda, Pillau, Parnu, Riga, furor and trade union opposition." • JAPAN gave $8.96 billion to de­ Reval , and Narva. "There's nowhere to get money. They veloping cduntries in foreign aid, The ports in the three Baltic republics, can't finance themselves from foreign credi­ more than tne $7.66 billion given by ' largely or partly used by the Soviet Navy, are tors, there's nothing much left to confiscate the U.S ., in 1989, according to a re­ to be demilitarized and turned into zones of domestically, and they can't finance them­ port by the Development Assistance Western investments in the civilian industry selves with inflation, becausethat would lead Committee of the OECD. Japan sector. All of the mentioned ports possess straight to hyperinflation," one banker gloated plans to provide $3 1 billion in assis­ berthing capacities for deep-sea vessels and a to the Wall Street Journal. tance over the next three years. functioning, though outdated, railway infra­ structure connecting the ports with interior in­ • C.L. S1ALS, governor of the dustrial regions. Reserve Bank of South Africa, told a A modernized rail link from Poland into Financial Times conference that the Belorussia and the Baltic states and into the Environmentalism bank is buying gold to prevent U.S. Kiev industrial district of Ukraine, is being manipulations from collapsing gold discussed in this context. The six nations in­ Cost of U.S. regulations below $340 per ounce. Market tend to form a bloc of economic independence could top trillion sources say the intervention has led and political autonomy from Moscow, and $10 to a rising ptice in June to $353. may include the district of Leningrad in their cooperation, depending on how much auton­ Existing and soon to be enacted environmental • BRITISH industrial orders are at omy Leningrad is able to negotiate with regulations will cost the U.S. economy over an eight-year low, reports the Con­ Moscow. $ IOtrillion by the year 2000,according to sev­ federation of British Industry. CBI eral recent government and private studies. reports that if the Thatcher govern­ And $10 trillion may be a conservativefigure ment's 15% base interest rate policy given that it does not take into accountthe shut­ is continued much longer, it risks Debt fo r Equity downs of the productive U.S. economy and "making British industry into an in­ dislocation of its workforce. sular enclave." Argentina's Entel for Major items include: $2.6 trillion to clean up asbestos; $2.2 trillion to comply with Clean • ROTHSCHILD'S branch in the debt swap approved Air and Clean Water laws; $1.28 trillion to re­ U.S. is inVOlved in one-third of all duce radon levels in households; $200billi on major U.S. bankruptcies, the June 25 The largest debt-equity swap in Ibero-America for chlorofluorocarbons (CFC) replacements London Financial Times revealed. was approved when the consortium bid of for refrigeration air conditioning equipment; "Very few of the big Wall Street firms Telef6nica of Spain and Citicorp for Entel and $150 billion or more to clean up Superfund spotted the bankruptcy opportunity south in Argentina, and Bell Atlantic's bid for Hazardous Waste sites. Private sources esti­ early. One that did was Rothschild," Entel north, over $5 billion in debt-swap of­ mate Superfundmay cost as much as $1 trillion the Times wrote. fe rs, was accepted by the governmentof Pres i­ by year 2000, most of it being legal fees. The dent Carlos Menem. ban on logging and use of pesticides, insecti­ • JAPANESE investment in mod­ The first entailed payment of$1 14 million cides, and fungicides, will add several trillion ernizing indllstry is twice that of the in cash, and the second a mere $100milli on. dollars to costs. U.S., a rep�rt from the Council on The rest of the purchase was for $2.7 billion in The two top radon experts in the U.S., Competitiveness shows. In 1989, Ja­ debt-swap in the south Entel bid, and approxi­ William Nazaroffand Anthony Nero of Law­ pan spent $549 billion to modernize mately $2 .2 billion for the northernEnte! . This rence Berkeley Laboratory in California, au­ and expand its industries, compared would give them 60% control of Ente!. The thored a study published in the JuneJournalof to $5 13 billion spent by the U.S. rest would go to the public through stock offer­ Environmental Science and Technology at­ Since Japan's population and econo­ ings (25%), to Entel employees (10%), and tacking the Environmental Protection Agency my is half the size of the U.S., the 5% to local telephone cooperatives. for forcing people to spend "on the order of Council notes that "In effect, Japan Former public works minister Rodolfo $1 trillion" to reduce radon to imperceptible is putting twice the tools in the hands Terragno criticized the deal for accepting too levels, when a small percentage drop in ciga­ of the Japanese worker." little cash, but Entel manager MarfaJuliaAlso- rette smoking would have more effect.

EIR July 6, 1990 Economics 23 �TIillScience & Technology

Debunkingmedia myth s about theozone layer

Dr. Hugh W. Ellsaesserweighs the possible ben�ts ojin creased ultraviolet radiation against the claims that the 'ozone hole' spellsthe doom ojman. PartII ojan interview.

Dr. Ellsaesser retired from the U.S. Air Force Air Weather covered that there was a hole in the ozone layer in Antarctica, Service after 21 years as a weather offi cer and fr om the supposedly caused by CFCs. No matter that scientist Gordon Lawrence Livermore National Laboratory after 24 years in Dobsonfirstnoticed the hole in 1956 and deemed it a natural, climate research. He is continuing his studies at Lawrence seasonal phenomenon. Livermore as a Participating Guest Scientist. Rogelio Madu­ In this week's concluding installment, Ellsaesser goes ro interviewed Ellsaesser fo r 21st Century Science & Tech­ fu rther, to assert that ifthe benefitsof CFCs are eliminated­ nology on March 1. notably their use in refrigeration-millions could die as a In Part I, published last week in EIR, Dr. Ellsaesser direct result. But the government and the media are not looked systematically at the available scientificevidence con­ interested in this; neither are they interested in examining cerning the "ozone hole" -a phenomenon which has become the related issue of the benefits of ultraviolent radiation. an environmentalist cause celebre. In 1987, ministers of over While the ozone layer blocks harnifu l ultraviolet rays, which a dozen nations drafted a global ozone treaty in Montreal, can cause skin cancer, those same rays provide the human calling fo r a 50% cut in production of chlorofluorocarbons body with vitamin D, without which we cannot absorb calci­ (CFCs) by 1998. Offi cials of more than 70 nations are cur­ um, which is necessary to maintain bone strength, and espe­ rently meeting in London to draft a treatymandating a com­ cially urgent in children and the elderly. plete ban on CFCs by the year 2000, on the grounds that these allegedly are causing a hole in the ozone layer. The Q: Now back to the question of the high-level ozone, the "Chicken Littles" of the environmentalist lobby claim that a ozone layer, which the environmentalists claim is essential barrage of ultraviolet rays, unblocked by a degraded ozone to the existence of life on Earth. Most of the news media say layer, will start epidemics of skin cancer. Ellsaesser showed that the ozone layer is less than half an inch thick, and in all that the evidence fo r all of this is quite inconclusive. the diagrams that I have seen in Time and Newsweek, they The theory that CFCs deplete the ozone layer was pro­ regularly show a very thin layer pf ozone over the Earth. posed by F. Sherwood Rowland in 1973 and was discounted Ellsaesser: If you reduce it down to standard atmospheric by the scientificcom munity. During the early 198005, horror conditions-that is, the temperature and pressure we have stories of "nuclear winter" abounded, which held that a here at the surface-you have about 300milli-a tmospheric­ nuclear war would cloud the atmosphere and cool the Earth centimeters. That means 0.3 centimeters of ozone (about such that the plant life to support any surviving humans one-eighth of an inch) when the layer is compressed to stan­ would not be able to continue. Then, as the "nuclear winter" dard temperature and pressure and you have nothing but theoryproved fa lse, in 1985 , the environmentalist lobby dis- ozone in the layer.

24 Science & Technology EIR July 6, 1990 Q: Does this layer really exists in that way? face is about eight times larger at ,the equator than in New Ellsaesser: As a layer, yes-but not thin-it extends over York City. tens of kilometers in concentrations of parts per million of Ellsaesser: On an annual average, yes. the ambient air. But it's very important. It screens out the very energetic part of the ultraviolet light. . . . Q: And people at the equator have managed to survive! Ellsaesser: Yes. But you'll notice that people who devel­ Q: What I am asking is this: When people see the diagrams, oped in those climates, had dark skins. And in Scandinavia, they think of the ozone layer as something very fragile, and on the other hand, where there is very little ultraviolet for this frightens them. vitamin D production, they had very light skins. In other Ellsaesser: It is being presented as if it were compressed to words, we humans adapted to our ultraviolet environment standard atmosphere conditions, but it is actually mixed into by changing the pigment in our skill. People in low latitudes the atmosphere over a great depth. It extends from the tropo­ who absorbed too much ultraviol� and damaged their skin pause up to something like 70 km. It's very rugged. It has and those in high latitudes who didn't absorb enough to devel­ been there ever since the atmosphere developed with oxygen op good skeletons basically didn't survive to reproduce. If in it. However, before we had an oxygen atmosphere, it they moved slowly from one latitude to another, the advan­ probably was not there. In other words, until we had devel­ tages and disadvantages would have been more gradual , but oped an atmosphere containing oxygen-and part of that the people with the proper amount of skin pigment would still oxygen was converted to ozone by ultraviolet light from the have had a survival advantage and gradually have become the Sun-the radiative environment on land was such that no predominant survivors. animal or plant could have survived. But now people are beginning to move quite rapidly all So we had to have the oxygen atmosphere, which then over the globe. So we have dark-skinned people in high lati­ developed the ozone atmosphere, before life could move out tudes who are developing rickets because they don't get of the water onto land. The estimates of the amount of ozone enough ultraviolet to develop the vitamin D they need. And required for that evolutionary step to occur-estimates that we are getting light-skinned people, like those who went to were made before the SST or any other ozone arguments Australia, who are getting more ultraviolet than theirinherited came along-is roughly one-tenth of the present level of skin pigment is adapted to, and they are showing the highest ozone. In other words, we could reduce our ozone screen skin cancer incidence in the world. presumably tenfold without having too great an effect on our Thinning the ozone layer will help the dark-skinned peo­ ability to live here. ple who migrated to higher latitudes, but it will make the skin cancer problem worse for those like the Australians. We have Q: So you mean that a very significant reduction of the ozone to keep track of where we are and whether we need to do more layer would still permit people to live here. than rely on our inherited skin pigment to take care of us. Ellsaesser: Yes. They would undoubtedly have to take pro­ tective measures in some areas. In Indonesia now, when Q: Does this mean that what the environmentalists are most Dutch people go there and live at higher elevations where afraid of is that we'll all become dark-skinned people if the it's cool, they have to be very careful to protect themselves ozone layer is depleted? from ultraviolet. They get severe sunburn and skin damage; Ellsaesser: Well, I think they are being racist because only they just can't tolerate it. It would be like going up on top of white-skinned people suffer parti¢ularly from excess ultra­ a mountain here and staying out in the Sun. violet.

Q: What is the amount of ozone-the thickness of the ozone Q: I think the other fundamental point is, obviously, as long layer-and the amount of ultraviolet that reaches the people as there is ultraviolet light, sunlight, and there is oxygen, at the equator, as opposed to people in New York City, for there will be an ozone layer .... Now, would it not be example? dangerous if there were no mechanisms to deplete ozone, Ellsaesser: On an annual mean basis, from the pole to the and it just kept on being created from oxygen by the ultravio­ equator ultraviolet increases roughly 50-fold. The doubling let light? Don't there have to be some natural mechanisms? distance is roughly 1 ,000 miles. So it's roughly four to eight Ellsaesser: But there are. It's already self-limiting. It's a times more at the equator than what we get. That does not very reactive chemical. take account of the fact that there are other things in the atmosphere that help screen out ultraviolet. For example, in Q: Self-limiting-you cannot produce any more ozone? the tropics you have lots of moisture particles-more than Ellsaesser: Not unless you changethe ultraviolet fluxof the you have here-which also help screen out ultraviolet. Sun, or something else like that.

Q: But the amount of ultraviolet that is received at the sur- Q: Why is that?

EIR July 6, 1990 Science & Technology 25 "We put out money to investigatethe detrimentalconsequences of man's actions. Butfo r somereas on, everybody thinks itwould be immoral and Wegalto sp end any taxpayermoney to docum.en.tpossible the befudicial fdfe ctsof our actions. So we arebiasing our decisions."

Ellsaesser: Once you have an oxygen atmosphere and a the Earth, where it is destroyed. certain ultraviolet fluxfrom the Sun, the ozone layer is estab­ There is another process, the so-called smog photochem­ lished. There is a certain rate at which ozone is produced and istry , which goes on in the boundary layer at the surface. a certain rate at which it is destroyed , and the ozone increases There the impinging ultraviolet that gets through the strato­ until the destruction rate matches the generation rate . The sphere goes on to cause a reaction and generates ozone in the point at which equilibrium occurs is sensitive to such things boundary layer. But this ozone in the boundary layer is also as temperature and the distribution of solar energy by wave­ usually destroyed in the boundary layer. It's a diurnal pro­ length . cess; it increases during the daytime and is destroyed at But the biggest factor in the total depth of the ozone layer night. is transport-air motion . There is much more ozone near 60° latitude than over the equator-and in winter than in Q: Does this mean that, nightly, the amount of ozone at the summer-that is, just the opposite to what you would expect lower levels will go down? from the amount of ultraviolet. Most of the stratospheric Ellsaesser: It typically goes to zero every night at the Earth's ozone is essentially in storage-chemically inactive-in the surface over land. Over the oceans it may actually be coming lower polar stratosphere . out of the ocean. Such things as oxides of nitrogen, of hydrogen, of chlo­ rine and of bromine, by setting up catalytic destruction cy­ Q: And how about in the stratosphere? cles, may shift the chemical equilibrium point at different Ellsaesser: No. There is a relatively small diurnal variation altitudes where ozone is chemically active . But the effects in the stratosphere . Of course there are seasonal variations, are substantially less than originally thought, simply because but the seasonal variations in the stratosphere are primarily all of these catalytic ozone destroyers also interfere with each due to the movement of the air containing different amounts other. This may well be why observational confirmation of of ozone, rather than to photochemistry. In winter, tropical catalytic destruction of ozone cannot yet be claimed. air containing high mixing ratios of ozone drifts polarward and downward , building thicker layers of air with a high Q: How is ozone destroyed naturally? content of ozone-so the total amount of ozone in the column Ellsaesser: The primary way in which it is destroyed in the becomes much larger than in the tropics where the ozone is stratosphere is by ultraviolet light. The primary way in which actually generated. it is destroyed in the troposphere is by interaction with parti­ cles-that is, solid objects-at the surface of the Earth . Q: One thing that I find very curious-and I haven't noticed anybody making a major point of this-is that the time that Q: How high up in the stratosphere do you findozone from the ozone hole occurs in Antarctica is right about the end of

the surface of the Earth? the six-month polar night , during which there is no ultraviolet Ellsaesser: Oh, you find it all the way up to something like radiation coming in. Would youl not expect the ozone level 80 or 90 km. There is some above that, but it has only to go down because you don't have ultraviolet light? been measured up to about 70 km that I know of. But the Ellsaesser: If there were particles or something there that interesting thing about this is that from the surface of the could destroy the ozone, you would anticipate that. But the Earth, the ozone increases steadily up to the tropopause, that ozone molecules have to make contact with some kind of is, the lower boundary of the stratosphere . You may find a solid to be destroyed, as they do at the Earth's surface. some oscillations, or blips, in it where there are layers that Normally, ozone is not destroyed significantly by anything don't mix too well, but there is an increase with altitude. So we find in the stratosphere in the absence of sunlight. As I the major process that is going on is that ozone is being mentioned earlier, in higher latitudes ozone is essentially in formed in the stratosphere; it is descending through the polar storage . Remember that in the stratosphere, ozone is present tropopauses in the springtime when you have the breakup of in parts per million-almost everything else that might attack the polar vortex, and then is diffusing down to the surface of it is in parts per billion or less. �

26 Science & Technology EIR July 6, 1990 Layers of the atmosphere and penetration of sunlight km altitude Thisfigure shows the different layers of the atmosphere and the penetration of different wavelengths of sunlight through them . The � (]) ozone layer, where ozone molecules, 03' .s:::. c. are created andfound. extends fr om the oo 0 surfa ce of the Earth to approximately 80 E km altitude. While the highest 100 CD .s:::. I- concentration ofozone molecules are fo und at the bottom of the stratosphere. around 30 km altitude. most popular press � have incorrectly drawn an imaginary thin (]) .s:::. line at 30 km altitude. as ifthat were the c. oo layer's location. 0 layer oo (]) How much and what wavelengths of Stratopause :::i: electromagnetic radiation penetrate the atmosphere is dRterminedby atmospheric � (]) .s:::. absorption within the spectral region in c. oo question: Some ,infrared and all visible � light reaches the Earth ' s surface; ultravio­ Tropopause U5 let and and extreme ultraviolet are entirely absorbed in the upper atmosphere. Longer wavelengths in the ultraviolet range. called UV-B, reach the Earth 's surface. Earth's surface

Source: NASA

Q: So six months would not be enough for it to driftdown going to be a substantial reduction in the use of it. That is to the surface of the Earth and be destroyed? going to have a health effect. I don't know anyone who has Ellsaesser: No. If there is a destruction process, it would looked at that particular health effectand tried to balance it have to be something like this: Particles of ice crystal clouds against the one they are worried about. take up (sublime) the nitric acid vapor-which is what oxides of nitrogen become in the wintertime when there is no sun­ Q: Some individuals have denounced the ban on CFCs be­ light-and grow enough to precipitate. When the Sun comes cause it will mean that miIIions of people in the Third World up the following spring, the nitric acid cannot be converted will die as a result of food poisoning because of the lack of back to oxides of nitrogen so they could chemically tie up food refrigeration. the chlorine. This leaves the chlorine free to attack the ozone, Ellsaesser: I think that is probably true, because at the time and it may be what's going on in the ozone hole region that we introduced refrigeration in this country, there was a over Antarctica. But, at the present time, I think it is still very rapid drop in the mortality rate from such things as somewhat questionable that that is an important part of the stomach cancer. However, the big problem with food-be­ process. However, it can't be ruled out either. cause it tends to be produced sporadically-is keeping it edible until the next hunt or harvest. Q: Is it therefore warranted to impose such an onerous tax on CFCs or to ban them, based on this? Q: Therefore, ostensibly to save a few lives that might be Ellsaesser: If they ban freon, we've got a lot of automobiles lost from increased ultraviolet radiation, perhaps miIIions with air-conditioning equipment that will not be replaceable. wiII die?

I don't think many are going to go to the expense that it will Ellsaesser: Yes . That has already happened with DDT. They take to put in the new type of equipment that will have to be just haven't looked at all of the ramificationsof this and, as I used for the new types of chemicals they are coming up said, I think that the slight destruction of ozone that might be with. The same type of problem will occur with all of our occurring from freon chlorine, could verywell be a net benefit refrigerators and air-conditioning equipment in homes and to humans and to other vertebrates here on Earth. offices. Unless we are all more affluent, fewer of us wiII be able to afford air conditioning and refrigeration. There is Q: That benefit still has to be documented, correct?

EIR July 6, 1990 Sc+ience & Technology 27 Ellsaesser: Yes. No one is paying for that research to be situation, and the government h�s got itself into the act where done. That's the crime of the present U.S. government regu­ it is biasing the decisions by looking only at the detrimental lations. We put out money to investigate the detrimental effects. It's not spending any money for research on the other consequences of man's actions. But for some reason, every­ effects-the other side, such as the Idso material that I men­ body involved thinks it would be immoral and illegal to spend tioned on heart attacks. There is also Dr. Don Luckey, who any taxpayer money to document the possible beneficial ef­ used to be at the University of Missouri, who has collected fects of our actions. So we are biasing the decisions, because some 300 studies that show that there is a beneficial effect of we don't have the other side of the question looked at and radioactivity for levels up to about 10 times what we consider evaluated, and the data developed that we need to make a to be background. According to his data, we would all be sound decision. better off-healthier-if we were exposed to 10 times more Sherwood Idso claims that there are already benefitsfor radioactivity than we are getting at the present time. the biosphere from the increased carbon dioxide content of For years, Luckey kept trying to get the government or the atmosphere. He lists about half a dozen of them. One someone to fund a research study in which he would take mice of them shocked even me . He claimed that the decrease underground in a mine to protect them from cosmic rays. He worldwide in coronary mortality over the last two decades would shield them with lead to protect them from the uranium may very well be due to the rise in carbon dioxide content of and radium in the Earth . He would replace the potassium-40 the atmosphere. I don't know of any way to rule that out, in their bodies to protect them from self-radiation from that, because it is more consistent with the observation data avail­ and thus raise them in a very low-radiation environment. He able than is greenhouse warming itself. had hoped to prove by this process that the slope of the health The only way to find it out is to have people look into it, effects curve for radioactivity is negative at the background and that means somebody has to pay their salaries. If the level. In other words, he predicted that these mice would be government is not willing to fund research into this type of less healthy than those exposed to normal radioactivity . No question, it is going to continue to bias the conclusions and one wants to touch that! take us off into the very expensive type of mistake we are He hasn't been able to get anybody to pay for a study. now headed for. He's done a little bit on his own, on microbes and bacteria, which tends to support it, but it's not the type of thing that most people would accept. He wants to run a fu ll-scale exper­ Q: Has anyone calculated how many millions of people will iment with enough mice or animals to make it hard to discount die as a result of a ban on CFCs? his results, and that takes money. Ellsaesser: Not that I am aware of, but I think, if you used Something else. I don't think you have ever heard of the the types of approach that the environmentalists have, you so-called mega-fish experiment. People always talk about could easily come up with a very big number. It's just like mega-mouse experiments, because it takes millions of cases taking smog out of Los Angeles. Nobody is complaining to detect these very small effectsthey are looking for at levels about the fact it's going to increase ultraviolet and skin cancer of radiation near background. Well, here on the West Coast down in Los Angeles. The problem is that all of our commu­ at the salmon fisheries, they have exposed 600,000 salmon nications, including the scientific ones, have put in a one­ fry to 25 rems of radioactivity before they were released, and way filter, because the government has become the main released another 600,000 without any such exposure . They source of research funds. They are biasing the decisions by tagged them all, and kept track of them as they came back. looking only at one side, the detrimental side. They found that 20% more of the irradiated ones than of the un irradiated ones made it back. This suggests that the Q: But how could the environmentalists get so much govern­ radioactivity gave them some sort of a living advantage out ment funding when other scientists cannot? there in the ocean where they all lived. Ellsaesser: Well, it developed historically. Ever since Ra­ I have never found anybody who has heard of this experi­ chel Carson's book Silent Spring appeared in 1962, the atti­ ment except my original source, Don Luckey .... tude has been that the only thing that is important is looking at the detrimental effects-the possibility of beneficial ef­ Q: What would you suggest be doneto have rigorous scien­ fects was not admitted. That is, man can do no right. tific evidence? Of course, that's the thing the news media love to publish, Ellsaesser: They should acknowledge this bias and either the thing you can use to scare money out of Congress to get fund the other side of the equation or stop fu nding the investi­ research funds. So the system developed in that way, not gation of the detrimental effects that people keep proposing. necessarily because of the environmentalists, but just be­ One of the two. In other words, don't bias the results. If you cause that's the way humans are . We play the rules and not are going to fund one, fund the other. If you are not going to the game. fund the other, then stop funding the one. It is the bias that's But now the environmentalists are trying to exploit the leading to problems ....

28 Science & Technology EIR July 6, 1990 Interview: Robert Alexander

Nuclear radiation: facts versus scare stories

Robert Alexander, a Virginia-based consultant in radiation nal organs. protection and health effects, is the immediate past president Particulate radiation also includes neutrons. Neutrons are of the Health Physics Societyand served on the science panel somewhat smaller than alpha particles, but they don't come of the White House Offi ce of Science and Technology Policy's from radioactive materials. The neutron results from other Committee on Interagency Radiation Research Policy Coor­ nuclear phenomena, such as the operation of a nuclear reactor dination fr om 1982 to 1988. For 16 years he directed the or a particle accelerator. radiation protection research and regulations development program fo r the Nuclear Regulatory Commission and its Q: How do these forms of radiation interact with the human predecessor. body? In this interview, he debunks some of the scare stories of Alexander: In terms of penetrability into the body, gamma the anti-nuclear lobby and the media, and he updates the and X radiation are very efficient;beta radiation is normally figures that appeared in EIR's June 8 issue, in the box "Mea­ stopped by the skin, but ne"utron radiation can penetrate to suring radiation" on page 24 . The interviewer is Marjorie the internal organs. The alpha radiation is completely stopped Mazel Hecht, managing editor of 21st Century Science & by the dead layers of skin, so that it is only a hazard when Technology magazine. radioactive materials that emit alpha particles are taken into the body by inhalation or ingestion. Q: People don't know very much about radiation, and this It is important to distinguish between radioactive material allows the anti-nuclear forces to scare people with all kinds and radiation itself. Radioactive material is just regular of lies and misstatements about what radiation is. Can you chemicals that all of the Earth is composed of, except that give a brief description of what radiation is and how it is some of the atoms are unstable-that is, radioactive. They measured? give off radiation as they decay to a stable state. Radioactive Alexander: Man and all life forms on Earth have evolved material can give off gamma rays and even X-rays, and it in a radiation environment. This radiation comes from two can give off beta and alpha particles. When certain radioac­ natural sources. One of these is solar radiation and radiation tive atoms fission-the atoms split in two-they give off from space called cosmic radiation, which gives a radiation neutrons. dose to every life form . Then there are naturally occurring radioactive materials on Earth , which give all life forms an Q: How do you measure how much radiation is reaching the additional dose. So radiation is the most natural thing in the body? world. Alexander: We measure radiation with an assortment of There are two basic forms of the type of radiation we are devices that can detect the various interactions that radiations discussing. One is what the physicists call electromagnetic have with matter. As the radiation goes through matter of radiation, which is very much like light, except that it has any kind, it interacts with the electrons that are part of the more energy and can penetrate much farther. This kind of atoms composing that matter. Those disturbances can be radiation is called gamma rays or X-rays. measured. Any other kind of radiation is particulate, composed of Some of our instruments give us readings while we are atomic particles that have weight and that travel at very high looking at the instrument. We also have passive measuring speeds. There are beta particles-really just electrons, the devices, through which we can look at the cumulative effect same as those that come through electric wires. There are of the radiation later and see what dose was delivered. In the also alpha particles that come from atomic nuclei and are old days, we used filmvery similar to photographic film,and much, much larger than electrons. Because they are large, the radiation affected the film in much the same way that alpha particles are not very penetrating. If the radioactive light does. These days we use thermoluminescent dosime­ material that emits alpha particles is located inside the body, ters , which can be processed after they have been exposed to however, then the alpha radiation can do damage to the inter- radiation to tell what the dose was.

EIR July 6, 1990 Science & Technology 29 The average anllual radiation dose for those who live near a U. S. lI uclear power plant is about 7 microrems per year. A persoll who lived in Wa shington, D. c., and sp ent a year in Denver would probably receive an extra 100, 000 l71icrore111s. Shown here: the Connecticut Ya nkee nuclear power plant.

Q: What kind of units do you use to measure the radiation Q: The anti-nuclear propagandists talk about the radiation dose? you get from living next to a nuclear power plant. But if you Alexander: In radiation the principal quantity we use is live in Denver, you get far more radiation-naturally. called the dose equivalent. and it is measured in units called Alexander: Oh, yes . Let me give you some numbers . The rems. A rem tells you how much radiation energy was ab­ average annual radiation dose to people who live in the vicini­ sorbed by the tissue that it passed through , as well as the ty of aU. S. nuclear power plant is about 7 microrems per effectiveness of that radiation in producing a particular bio­ year-seven-millionths of a rem-a lifetime dose of about logical response. The response that we worry the most about one-half of a rem. A person who lived in Washington, D.C., is cancer. So the rem is just a unit of radiation-effectiveness and spent a year in Denver would receive probably an extra on the tissue that absorbs it in terms of producing cancer in 100 millirems, which would be 100,000 microrems. Com­ that tissue. The rem was established as the unit for physicists pare the extra dose from living one year in Denver of 100,000 to use in controlling radiation risk, so that we can tell whether microrems with the 7 microrems from living next to a nuclear people are being exposed in a safe, controlled manner. The power plant, and you can see that the concern about environ­ radiation standards are given in rem units: The millirem is mental radiation from nuclear power plants is not well found­ one-thousandth of a rem and the microrem is one-millionth ed . The concern is just an emotional reaction, through misin­ of a rem. formation that has been distributed.

Q: What are some examples of background radiation? Q: What about riding in an airplane or watching color tele­ Alexander: In the United States, natural radiation causes an vision? average of about 300 millirems per year. So if a person lives Alexander: Unless you are seated very close to a color tele­ for 70 years, that would be about 21 rems during his or her vision set, you don 't receive an appreciable amount of radia­ lifetime. tion . A child sitting within two or three feet of some color TV sets could receive a few millirems per year. It's low, on Q: And if one lives at a higher altitude, as in Denver, the order of what one would receive from a diagnostic chest wouldn't the dose be greater, because of the cosmic radi­ X-ray , that is, about 20 millirems. ation? If you fly from coast to coast, the radiation dose you are Alexander: Yes, 300 millirems is the national average; this going to receive would be on the order of 5 millirems. A is higher than what people who live in coastal areas receive, person would probably not hesitate to make a round trip from and it is lower than what people who live in mountainous Washington to San Francisco and back and receive maybe areas receive. This is primarily because the atmosphere 10 extra millirems from cosmic radiation-that's 10,000 serves as a shield against the radiation from outer space. The microrems. But the same person living in the vicinity of a more air you have above you , the less cosmic radiation you nuclear power plant receiving 7 microrems might worry get; the higher the altitude, the less air and the more cosmic about that .... radiation you get. The variations are not small. Variations from one locale Q: We are often told that more is known about radiation to another may be as much as 100 millirems per year. This than any other agent that causes cancer. Is this true? is an important fact to consider when establishing regulatory Alexander: No. To make the statement true we cannot say limits on radiation dose. "radiation"; we have to say "radiation delivered at high doses

30 Science & Technology EIR July 6, 1990 and dose rates." This distinction is important. We have a were no natural radiation. convincing data base for large, instantaneous doses---on the Alexander: To say that there is no safe level of radiation, order of 10 rems or more-and that is all. For small, instanta­ depends on one's definition of the word "safe." That idea neous doses and for large doses delivered over an extended springs from a supposition thatjust one interaction with radi­ period of time, cancer induction has not been observed. We ation in the nucleus of a cell could cause that cell, when it can only guess. Is there no effect? Is cancer caused? Is cancer divides, to start dividing out of control, causing cancer. No prevented? No one knows. We only know that if cancer one has ever been able to prove that that can happen, or that is caused, it cannot be detected using our most sensitive it cannot happen. That's something that no one knows. It epistemological techniques, and that the probabilities must isn't very likely that we will ever know the answer. But, as be very small indeed. I am going to explain, it is really not important. For example, if I live here in a nice quiet neighborhood, Q: What about higher levels of radiation-the lethal doses, and if I go outside and back my car out of the driveway and for example, from the Chernobyl accident. What happens park it in front of the house, there is a finite probability that then? I will be killed in the process. There are many ways that Alexander: There you shiftyour focus from cancer, which could happen. For example, a big truck might come along is a biological response that occurs years afterexpos ure, to and hit me. An airplane might crash into me. A tree could more immediate biological responses, where the tissues are fall and crush me. So, I could say that there is no safe way damaged so severely by the radiation that you get a very rapid to drive your car out of your own driveway and park it in response. In extremely high doses, radiation kills so many front of your house. cells that the organs can no longer function properly and the You have the same thing with this question of the interac­ person dies. tion of radiation with the cell nucleus. The point is really not whether it can happen, but what are the chances that it can Q: What would be the threshold dose? happen. Should I refrain from parking my car in front of my Alexander: I don't think anyone has ever died from a dose house because the probability is not zero? The answer is, of of less than about 400 rems. Below 400 rems, the chance of course not. At the other extreme, if I want to drive my car recovery is good. When you get somewhat above 400, the 120 miles an hour on one of the interstate highways, then the chance of recovery is not so good, and by the time you get risk of death becomes real. to about 800 rems, it is becoming hopeless. If it is penetrating With radiation, at some point there are enough interac­ radiation to the whole body, just about all of the organs are tions in the nucleus of the cells that the cancer probability going to be affected, and there is little chance of surviving. becomes high enough to start considering it, and making Of course, there are two things about these doses that decisions about what you are and are not going to do. That's everyone needs to remember: one is that they are very large, what is important, that we understand the probabilities, and close to a billion millirems; two is that the doses are instanta­ make our decisions in a reasonable way for ourselves and for neous. If these amounts of radiation are distributed over a those for whom we are responsible. period of time so that the body has an opportunity to recover, The existence of a risk is not nearly as important as the then they are not so dangerous. probability that the event will oCC\;lr. In the case of low-level radiation we have no evidence that.it is harmful---only suppo­ Q: You mean if you accumulate a large total dose over a sition. In addition to that, we worry about such low doses that, period of a year in small increments, your chances of survival even if they can produce cancer, the probability is too low for would be better? reasonable people to take them into consideration. Alexander: That's right. The International Commission on Radiological Protection (ICRP) believes that if we limit the Q: I think you said the key word there-"reasonable." It radiation dose in any one year to any organ to 50 rems or seems to me that a lot of the claims being made are totally less-that is, 50,000 millirems or 50 million microrems­ unreasonable, and if applied to the rest of what people do in none of the biological effects other than cancer would ever society, people would not be doing very much at all, includ­ occur. In other words, 50 rems per year is considered to be ing the people writing these scare stories. a threshold for the type of effect we have talked about as Alexander: That's true. From the scientificinformation that causing cellular damage that prevents an organ from working we have, there are no data indicating that low-level radiation properly. causes cancer. In fact, there is quite a lot of information from studies of people who receive extra-high background Q: The press is full of stories where the anti-nuclear people radiation showing that low-level radiation may be beneficial. proclaim that "there is no safe level of radiation." From what So if an extraterrestrial being were to come here and look at you have said, this statement is absurd, since we get so much our regulations and at the actual data, and remain unaffected radiation naturally. In fact, we would not be here if there by our emotions, he would think we are crazy.

EIR July 6, 1990 Science & Technology 31 ITillFeature

Whois responsible for America's banking crisis?

by EIR's Economics Staff

Since the end of 1985, seven hundred and ninety-one U.S. banks have either failed or gone out of existence through mergers with larger institutions. As of the end of 1989, according to the Federal Deposit Insurance Corp. (FDIC), another 540 banks, in 33 states, had bad assets in excess of their paid-in capital plus loan loss reserves. They are bankrupt. About 1,500 of the nation's approximately 14,000 banks are classified as problems. Banks in all states lost money last year. Overall, the officiallyclassifie d bad assets of the banking system as a whole come to 30% of the paid-in capital and loan loss reserves of the system. What was once the thrift system is bankrupt. The bill for its reorganization, over 30 years, with interest charges added in, is going; to come to at least $500 billion, and could still double in size before the end is reached. Federal prosecutors in the November-December 1988 frameup trial of Lyndon LaRouche and his associates in Alexandria, Virginia attempted to ridicule the defense: "Didn't they tell you that your money would be safer with them than in the banks?" they asked their witnesses. Rochelle Ascher was given the same treatment during her trial in 1989 for alleged violations of Virginia's securities laws. How ridiculous, the prosecutors implied, to say the banks aren 't safe. Every­ one knows the banks are safe, don't they? Well, are they, or are they not? Between 1934, when the FDIC was created, and 1974, the largest volume of deposits affected by banking failures was registered in 1939 when the federal government had to back up $160.2 million. In 1974, there were only four bank failures, but those four banks had combined deposits of $1.575 billion. In 1982, forty-two banks failed, and those 42 banks had combined deposits of $9.908 billion. The year 1982 ushered in a new era of bank failures. The 1 ,038 commercial banks which have failed since 1982 account for 74.5%of all bank failures since the beginning offederal deposit insurance in 1934. The $1 11.09 1 billion in depos­ its held by those 1,038 banks account for 94.5% of the deposits of all banks that

32 Feature EIR July 6, 1990 EXECUTIVE CE f INTELLIGEN REVIEW

Who was right. EIR and itsfounding editor. Lyndon LaRouche. or the "wizards" of thefillancial Establishment who said they had no use/or him and his American System economic policies �

have failed since 1934 (Table 1). is only a problem of corrupt bankers , they say . Bush and Prosecutors ofLaRouche and his associates in Alexandria company want to throw them all in jail. argued that such assertions by the defendants, and therefore On June 22, President Bush unleashed a posse of federal also the necessary remedies they proposed, were part of the prosecutors, to be organized into "rapid response" task forc­ defendants' conspiracy to defraud contributors. So, do we es, "teams of razor-sharp prosecutors and auditors" to speed have a banking crisis, or not? Are your deposits safe, or not? up investigation and prosecution of fraud in the savings and loans. 'These cheats have cost us billions and they will pay Who was right? us back with their dollars and they will pay us back with On May 6, 1990, fifteen months after LaRouche was years of their lives," is what he told his audience in the Great sentenced to 15 years in prison as a result of the Alexandria Hall of the Justice Department. frame up , administration and congressional leaders met to Gephardt's friends among the congressional Democrats discuss the federal government's budget crisis. The subject, want more, faster. "Too little, too late ," said Rep. Charles according to Budget Director Richard Darrnan May 14, was Shumer from Brooklyn, New York, and Sen. Timothy Wirth the government's "contingent liabilities." These are implicit from Colorado declared, "The President had a photo opportu­ obligations, assumed to be backed with the "full faith and nity today ." credit of the U.S. government." Some $5 .6 trillion of such So who was right, and who was wrong, on the question obligations are outstanding. Approximately half of the total of the banking system? If LaRouche was right, then what is made up of deposit insurance; another portion is made up conclusion ought to be drawn about the patrons of the prose­ of government-underwritten mortgage obligations; another cutors who attempted to ridicule his forecasts of banking is government-secured pension obligations. They were the collapse? What conclusion ought to be drawn about a Presi­ subject of the "budget summit" discussion, because none are dent and administration who still insist, "There is no banking safe, and because, with present policies, the government has crisis, only a problem of corrupt and swindling bankers"? no way to back them up. This was the meeting at which, Who was it who warned on May 26, 1987, five months according to the New York Times of May 7, the President before the Oct. 19 "Black Monday" 500-point crash of the refused a request from Rep. Richard Gephardt (D-Mo.) that New York stock market: "Whether the great financial crash he take to the national TV networks to tell the country how of 1987 erupts by October or later, will depend upon what bad the crisis is, for fear of triggering financial panic. leading governments do at the international monetary 'sum­ What Bush wants to do is something very different. He mit' held in Venice on June 12. Those bankers who are and his friends still insist there isn't a banking crisis. There expecting a crash by October, make that forecast on the basis

EIR July 6, 1990 Feature 33 TA BLE 1 FIGURE 1 Banking failures since the 'recovery' SEPT. '80 FORECASTS FOR 1981 AND 1982 INDUSTRIAL PRODUCTION INDEX Commercial banks Savings and loans EVANS Year Number* Deposits Number Deposits 17nf----�-----4+_�� (a) Closures since 1982, with volume of deposits affected (deposits in million $) DATA RESOURCES f----+----+----+------:;j 1982 42 9,908 NA NA WHARTON 1983 48 5,441 52 18,600 CHASE 1984 79 2,883 27 6,000 1985 120 8,059 34 12,100 15m----, 1986 138 6,471 49 13,000 1987 184 6,282 48 10,700 1988 221 37,215 232 100,700 1989 206 31,005 318** 107,000** (b) Total bank and thrift failures, 1934-89 (deposits in million $) 1934-89 1,393 117,500 NA N.A. EIR was righ t and the competition was wrong: a graphic used 1982-89 1,038 111,091 760 268,100 on one of LaRouche 's 1984 TVbroadcasts. 1982-89 as a % of 1934-89 74.5% 94.5%

'Insured commercial banks. was continuing under his administration'? It was George "In 1989, ten S&Ls, with deposits of $667 million, failed outright. The other 308 Bush, who is now letting it be known that he won't tell people failing S&Ls, with deposits of over $1 06 billion, were placed in conservatorship, ad ministered by the Resolution Trust Corp., which was created in August 1989. the truth, because it might caus� a financial panic. Sources: FDIC. FSLlC, Officeof ThriftSuper vision, Resolution Trust Corp. Who said, on Oct. 22, 1987, "This is purely a stock market thing, and there are no indications of a recession or hard times at all"? And, on Oct. 20, 1987, 'The economic of assuming that the U.S. government's role at Venice will fundamentals in this country remain sound, and our citizens be a continuation of the foolish internationalmonetary policy should not panic. And I have great confidencein the future." which the Reagan administration has followed over the past That was Ronald Reagan, then President. five years ....Th is would turn the Venice 'summit' into a Who said, on Oct. 20, 1987, "Depositors should not be disaster, destroying the last bit of confidence in the U.S. concerned about their deposits in the banks"'? That was Rob­ dollar in international financial markets. Under those condi­ ert L. Clarke, Comptroller of the Currency, responsible for tions, an October crash would be very probable"? regulating a portion of the nation's banking system. Who was it who wrote on July 4, 1989, three months On those two occasions, LaRouche was right on the before the stock market tumbled 190 points on Oct. 13, the mark. It wasn't the first time. second worst one-day fall in its history: "In this situation, we must expect it nearly, if not absolutely, certain that the July The Volcker depression 14th Group of Seven meeting will be the watershed for an Between October 1979 and 1983, LaRouche had spon­ ensuing slide into new financial collapse. Unless some very sored the publication, in EIR , ofthe results of an econometric radical change in policy occurs by approximately July 14th , model, the LaRouche-Riemann model. Between October a coming crash should be visibly in progress during August, 1979 and the end of 1982, the LaRouche-Riemann model and will erupt, most probably, during September or Oc­ forecasts were consistently the only accurate forecasts by any tober"'? agency (Figure 1). EIR published its first an'alysis of then The author of those lines wasn't anybody attending Federal Reserve chairman Paul VoIcker's high interest poli­ Bush's "summit" meeting on the budget, that's for sure. cies, in its issue dated Oct. 23-29, 1979 under the headline, Lyndon LaRouche warned of the prospects for the Black "VoIcker's depression ." Between October 1979 and the mid­ Monday blowout as a candidate for the 1988 Democratic dle of 1981, VoIcker jacked up U . S. interest rates to a high presidential nomination. He predicted the Sept. 15, 1989 of 22%. The result was to reduce the economy and banking deflationary turn on the markets in the preface to his congres­ system to a shambles (Figures 2-3). sional campaign platform , "The Great Crisis of 1989- 1992." On Oct. 16, 1979, from the New Hampshire headquarters And who said on Nov. 7, 1989, nearly a month afterthe of his presidential campaign, LaRouche had issued a call for Oct. 13 stock market slide, and nearly two months after the Congress to impeach the Federal Reserve chief. LaRouche Sept. 15 default of junk financier Robert Campeau, that the accused VoIcker of either lying to Congress, or being incom­ longest period of economic growth in the nation's history petent for the job, when he had told Maryland Sen. Paul

34 Feature EIR July 6, 1990 FIGURE 2 FIGURE3 The effects of Volcker's credit policy What actually happened industrial production index TRANSPORTATION TRANSPORTATION u.s. Surplus Free.energy index 54971 .518 DJFMAMJJASONDJ FMAMJJ '78 '79 '78 '79

154 ______

152r--�--l'_�:....--�...."fC-��:::::::II",c.--..:l- ...... Dec. 79_ =152.1

150 ______+

148 ______36818. .328 1973 1977 1981 1973 1977 1981 Time (years) Time (years) 146 ______

AGRICULTURE AGRICULTURE Surplus Free-energy ind•• 37258. 685 144 ______�______

142 -2.4% Source: Federal Reserve Board

cker will cause a 15% recession in theU.S. economy, proba­ bly putting the United States into a recession twice as severe as that of 1974 ... .

1973 1977 1981 1973 1977 1981 "The argument that Volcker's 'fiscal austerity' will hin­ Time (years) Time (years) der inflation is a hoax. Although there might be some tempo­

TOTAL ECONOMY TOTAL ECONOMY rary levelling off of inflation-rates during the weeks just Net inve.lible surplus Free-energy index 179309. 188 ahead, by about January 1980, Volcker's measure would begin to send inflation-rates spiraling upward again .. .. "There are two immediate measures which would amelio­ rate the present crisis. First, the U.S. gold reserves must be valued at an adjusted current world market value, a value to be negotiated with both the European Monetary System member-nations and the OPEC 'petrodollar' holders. This would stabilize the value of the dollar and take the worst

-20982.+--L---'-----'-----'-'--�--'---'- pressures off dollar liquidity. Second, the Federal Reserve 1973 1977 198\ 1973 1977 1981 Time (years) Time (years) must immediately implement the kind of selective credit­ flow controls which Senator Sarbanes proposed. This would These graphs are printoutsfrom the computerized LaRouche­ not solve our nation's problems, but would give us breathing­ Riemann econometric model, published in EIR's issue of Nov. 6- room for developing a comprehensive, long-term set of mon­ 12, 1979. While most economists were hailing the credit­ tightening measures of Federal Reserve chairman Paul Volcker, etary and investment-incentive measures." the LaRouche-Riemann model projected a devastating impact: an On Nov. 5, 1979 in a speech bHore the National Econo­ aggregate 15% loss in real output over an eight-quarter mists' Club in Washington, D.C., LaRouche elaborated on continuous downturn through the end of 1981 . the theme. The speech was reported in EIR's issue of Nov. 13-19, 1979: Sarbanes on Oct. 15 that the Federal Reserve had no means ''I'm opposed to Volcker's measures, not only because to channel credit to ensure that businesses stayed open. they're going to cause these awful things to happen to the LaRouche's statement read in part: economy, but because such measure are totally unnecessary . "As one of the world's leading economists, I have caused It represents an act of suicide, an economic suicide taken my staff to conduct a computer-based analysis of the near­ purely for ideological reasons, the ideological reasons being term consequences of Volcker's measures. Those results, the refusal to accept the kind of alternatives I propose, that coinciding with the estimates of other analysts reporting inde­ the government of France proposes, that the leading forces pendently, indicate that the measures already enacted by Vol- of the European Monetary System :have proposed.

EIR July 6, 1990 Feature 35 "Two things are central. The ideologues in VoIcker's measures, which pushed economic activity below the break­ group refuse to accept the return to a gold-based monetary even point. system, that is, the remonetization of gold. This would not If you wreck the economy, and tum down po licies, such occur on the old Versailles-Bretton Woods basis, but would as those designed by LaRouche for recovery, what happens? ' be a monetization of gold on the basis of its competitive Since financial obligations and debt service are ultimately market value as a monetary commodity, about $375 an supported by physical production of new wealth, in the form ounce, which is a fair market value for monetary gold right of production, capital improvements, and technological in­ now-not to the credit of Adam Smith, but it just happens to novation, a bankrupt economy, left unreversed, leads to a work out that way. bankrupt financial system. And out of a bankrupt financial "The second measure that has to be taken is what is called system, comes financial panic and collapse. the 'dirigist' approach nowadays, of what some of the British Was LaRouche right in October and November 1979, or call a 'neo-mercantilist' approach to organizing the world not? Did VoIcker's high interest rate policy lead into an market and to shaping policies within nations." economic depression which bottomed out in 1982, or not? Where did the others line up on the VoIcker measures? Was there ever any recovery from that economic depression, Here's a selection of quotations from those who were then, or not? like LaRouche, presidential candidates: The forecasts issued from the fall of 1979 projected a Jimmy Carter: "The number one threat to our national slide into depression bottoming out in 1982. By the summer economy is inflation. Whatever it takes to control inflation, of 1982, VoIcker's policies had indeed wrecked the econo­ that's what I will do" (to the New York Times, Oct. 10, 1979). mies of U . S. trading partners, reduced the U. S. economy to Ronald Reagan refused comment until his candidacy bankruptcy, and created the basis for financial catastrophe. was announced. On July 20, 1982, EIR published an article by LaRouche, George Bush: "The action by Federal Reserve Chairman "U .S. not responsible for Eurodollars," in which he wrote: VoIcker is a necessary stop to curb the staggering growth in "I hold an alternative out to these would-be , lecherous the rate of inflation." looters of the people of the United States. It is time to scrap And from among the economists: the Rambouillet and subsequent foolish agreements, and to Alan Greenspan, an adviser to Presidents Ford and Nix­ institute quickly those measures of sweeping monetary re­ on, and now VoIcker's successor as chairman of the Federal form I have been consistently proposing since the spring of Reserve Board: "The Fed has no alternative." 1975 ....The point of monetary collapse has been reached at which the bankruptcy of the Third World debtors has be­ How things went wrong come the bankruptcy of the Third World's creditors .... The point is this: Who has any right to talk about jailing The time has come to shut down the International Monetary corrupt bankers now, if they aren't willing to go back and Fund and to end the grip of the Bank for International Settle­ say that everything that has been done since VoIcker imple­ ments. Only a new, gold-reserve-based New World Econom­ mented his interest rate policy has been a national disaster? ic Order can salvage a trillion dollars or so of presently unpay­ Was there an enduring significance to the VoIcker policy? able debt. You gentlemen are behaving like pick-pockets The answer is, yes, of course. If interest rates are increased plying their profession among the passengers and staterooms to levels approximately double the average rate of profit of of the sinking ocean liner Titanic, who seem to prefer lying industrial corporations, farms, small businesses, public utili­ rich at the bottom of the Atlantic to surviving the catastrophe ties, then, within not too longa time frame, those businesses you have brought largely upon yourselves." are forced out of business. That is what the VoIcker policy, and the policy of those who agreed to support VoIcker, ac­ The debt bomb: bankers vs. LaRouche complished. LaRouche's alternativewas a plan for the reorganization VoIcker forced the United States into economic bankrupt­ of Ibero-America's debt, published in the United States in cy. That doesn't mean the problem started with VoIcker. For August 1982 as Operation Juarez. Circulated to the govern­ that, go back to the "Great Society" program, adopted after ments of Ibero-America and the United States during July the assassination of President John F. Kennedy, when the and August of that year, the plan proposed a way to reorga­ destruction of U. S. economic power began in the name of nize debt to permit a hemisphericeconomic recovery which the "consumerism." Then, the taking down of the NASA would have transformed the world. Operation Juarez was space program in the period following the monetary shocks the alternative to banking collapse and the imposition of of 1967. That was the beginning of the so-called "post-indus­ genocidal looting on debtor nations. Then, as later, trial society." And the decision to take the dollar offthe gold LaRouche was told by bankers and others, that technically, standard on Aug. 15, 1971, which ended currency stability, his plan would work; but politically, it was not acceptable. wrecked world trade, and destroyed U.S. export markets. Beginning July 9 of that year, following the July 5 bank­ Add the oil shocks of 1973 and 1978, and then the VoIcker ruptcy of the Oklahoma oil patch bank, Penn Square, the

36 Feature EIR July 6, 1990 January 10, 1983

EIR was right about the Ibero-American "debt bomb, " months befo re the liberal Establishment's media caught up with what was really going on.

Federal Reserve had begun pumping in reserves to prevent wrote . "It is the ideological commitment to what is called the bankruptcy of the U.S. banking system. This was report­ 'free market economics' which has caused the present de­ ed in EIR's Aug. 3, 1982 issue. By the end of the month pression and imminent financial crash." of August, Mexico had taken the first steps to implement On Oct. 19, 1982, EIR published Citibank's reply. Senior LaRouche's Operation Juarez proposal , when President Jose Vice-President Robert Rice said, "We don't need LaRouche, Lopez Portillo telephoned the Presidents of Argentina and we can solve the debt problem ourselves." Brazil to ask their support in declaring debt moratoria. The We shall return to how Citibank proposed to do that. A financial system was on the edge. week earlier, on Oct. II, 1982, David Rockefeller, then On Aug. 24, 1982, EIR published a LaRouche-drafted chairman of Chase Manhattan Bank and head of the North script, an outline of how Ronald Reagan could have ad­ American section of the Trilateral Commission, had told dressed the nation that night: "At the close of Sabbath , just U.S. News and World Report: after midnight tonight, I shall have used my Executive pow­ "The U. S. banking system is very sound. Obviously, in ers to put into immediate effect a number of emergency mea­ times of recessions there are more business failures, and sures which are the firststep in stopping this depression." By business failures have their impact on the banking system. the first week in September, EIR was reporting that large There have been a few failures, but my own view is that the U.S. banks-Chase Manhattan, Citibank, Bank of system itself is well managed and strong, and that regulatory America-were unable to market their certificates of deposit. authorities are working wisely and cooperatively with the There' were no buyers for U.S. bank paper. banking system to deal with these problems." During this same period, Henry Kissinger, then a mem­ It was not until Jan. 10, 1983, when Time magazine ran ber of the President's Foreign Intelligence Advisory Board a cover story titled 'The debt bomb," by Rimmer de Vries (PFIAB), initiated the correspondence with then-FBI Direc­ of Morgan Guaranty, that the media caught up with what had tor William Webster which led to the July 2, 1987 Boston really been going on behind the scenes six months earlier, indictment of LaRouche, and the December 1988 Alexandria during the summer and fall of 1982. railroad trial during which the prosecution team attempted to ridicule LaRouche's banking crisis forecasts. Repeal Gramm-Rudman! On Oct. 5, 1982, LaRouche wrote, in an "Open Letter to On Jan. 29, 1986, LaRouche delivered his State of the Walter Wriston," then chairman of Citicorp: "I appeal to you Union Address, in Arlington , Virginia. The speech was re­ and others of the banking community to come to your senses printed in the weekly newspaper New Solidarity in two parts, before irreparable damage occurs." on Feb. 7 and Feb. 14. In it, he demonstrated the idiocy of the "The crucial problem is political, not economic," he Gramm-Rudman budget-cutting amendment and President

EIR July 6, 1990 Feature 37 Reagan's tax refonn , showing how these would adversely Banking and credit systems could be reorganized, reas­ affect the banking system: serting the Constitution's provisions on creation of money, "Unless we repeal the Gramm-Rudman legislation, un­ through a new issue of gold-backed Treasury notes, and end­ less we repeal this horrible tax refonn , which is as destructive ing the Federal Reserve's usuwation of the power of credit as Gramm-Rudman, it will shut the economy down! Real issuance, through the so-calle� Keynesian multiplier. Such estate will be shut down; municipal utilities will be shut gold-backed new credit would �e issued through the banking down; state and local spending for capital expenditures will system, at administrative 1-2%iinterest charge only, to priori­ be shut down-and so forth-unless that tax refonn is re­ tized borrowers in industry, (arming, and in provision of pealed. basic infrastructure. Such cre�its would be intended to shift "Our banking system is collapsing ....At present, the employment back toward pro�ction, and to pennit the pro­ current liabilities of U.S. commercial banks are about two duction of useful wealth, throlilgh high-technology, energy­ and one-half times the size of these banks' current assets. In and capital-intensive job-creat�on programs. Productive em­ other words, the entire U.S. private banking system as a ployment would be doubled in a five-year period, thereby whole, is presently bankrupt. also-providing transportation, energy, and water manage­ "What's going to be hit? Federal revenue sharing? ... ment bottlenecks were address�d-doubling output. That means, not only programs of the type for which federal What's the objective? Firs�, to end the economic depres­ revenue sharing was originally created, at least in words. sion by organizing a real reco�ery in employment, and pro­ . . . What that means is shutting down sections of state and duction of useful goods and sttvices, such as education and local government. The areas most hard hit, will be the older, health. That way, the financialh stem can be rebuilt, deposits major cities ofthe United States, the ones with the big pockets don't have to be wiped out, persions can be protected, gov­ of poverty . ernment revenues expanded. Anything else won't work. And "Another area that's going to be very hard hit is the state it hasn't. : of Texas and the adjoining states of Oklahoma, Louisiana, and so forth, and southern California.... Mortgages will Deregulation made the crisis worse collapse. Entire banking systems will collapse. Fanny Mae What did those who opposedLaRouche in 1979, in 1982, will collapse. Ginny Mae will collapse." in 1986 do instead? They insisted that the crisis could be And that isjust what the combination ofGramm -Rudman solved by deregulating the financial system, deregulating the and tax refonn did during the course of 1986. During the first economy, and, as the crisis has deepened since 1979, they quarter of 1986, the net worth ofthe S&Ls became negative. have insisted that more deregulation was what was required. Output of critical physical goods fell by around 15% in the They took a banking system which was bankrupt by first and second quarters of the year. The oil price collapsed, 1978, bankrupted the whole economy by 1981-82, and built dooming the real estate and banking sectors of the Southwest­ up the biggest bubble of usury and speculation that has ever ern states. In that same State of the Union address, LaRouche been seen in human history. called for the imposition of an emergency trigger tariff on oil That's right. It started under Carter. It continued under imports, to protect the industry and the banking system. Reagan. Reagan, the President of the "magic of the market­ They didn't want to hear. In an April 2 press conference, place" and "free enterprise," the opponent of big govern­ Vice President Bush said: "When it gets to damage your ment, had exactly the same policy as Jimmy Carter on these national security interest or gets to throw a number of finan­ questions. It has continued down to the present day. cial institutions into tunnoil, that cuts the other way .. ..So Benchmarks include the April 1, 1980 passage into law I think the only answer is market, but also the stability of the of the Reuss-Proxmire Omnibl.\sBa nking Act. Among other marketplace." As if it already hadn't happened. features, the bill empowered Volcker's Federal Reserve to LaRouche insisted, in 1979, in the cited proposals of change bank reserve requirements as it saw fit,waived state 1982, in his 1985 published Program/or America-his cam­ anti-usury laws, repealed Regulation Q, which protected the paign platfonn for the 1988 presidential elections-in pro­ borrowing and lending of S&Ls, and preempted state usury posals circulated before and after the Oct. 19, 1987 market laws as they applied to mortga$e finance. crash, such as "Keep the local banks functioning" of March Who supported this? Here's what David Rockefeller had 18, 1987, and "Summary offederal loan measures to stabilize to say in a speech to the June 1980 conference of the New state and local tax revenues" of Dec. 16, 1987, that what was York State Bankers' Association: firstrequired was the recognition and admission that a crisis "In recent months, I have detected a new, more construc­ does indeed exist. tive attitude among a number of government officials. On the Such a recognition would take the fonn of either a presi­ one hand, I see a new awakening to the value of letting the dential declaration of financial andeconomic emergency, or marketplace dictate the servic(!s we offer and the prices we emergency action by Congress, to mobilize support for what charge. On the other hand, I :see a new realization of the would have to be done. pitfalls of applying excessive controls and artificial ceilings

38 Feature EIR July 6, 1990 on banking markets ....I would like to point to several Depository Institutions Deregulation Committee, phased out encouraging signs. One was the decision of the Congress two anti-usury regulations, permitted commercial banks to oper­ months ago to phase out Regulation Q over a six-year period. ate reserve-free International Banking Facilities, and began In 1933, Regulation Q ceilings were imposed on bankers to to phase out restrictions on interstate bank lending. Never ensure the safety and soundness of the financial system dur­ mind the damage that had been done, and was yet to be done ing the difficultdays ofthe Depression. Today, these ceilings by Congress. This was Volcker's Fed by fiat. have outlived their usefulness and only serve to deprive con­ sumers of what they could and should rightfully earn on thrift Policies wiped out the S&Ls and savings deposits. Another positive sign, part of the same Under the freeenterpri se President, the Garn-St Germain 1980 legislation, was the federal preemption of state usury bank bills were rammed through the House and Senate in ceilings on residential mortgage loans." September 1982, becoming law on Oct. 12. They permitted And what happened? Within a year the chairman of the any institution to buy any failing institution, and permitted Federal Home Loan Bank Board, one of the agencies which S&Ls to undertake money-market operations. They were regulated S&Ls, was before the House Banking Committee, supported by Treasury Secretary Donald Regan, one-time reporting that 80% of the 4,700 S&Ls were operating at a chairman of Merrill Lynch, in pretty much the same terms loss, and that one-third were bankrupt. EIR reported in its that Carter administration officialshad employed during the issue of July 28, 1981 that the FHLBB chairman had told years before. He told Congress on April 28, 1981: Congress, in order to avoid the costs of a bailout, "Wipe out "The administration and Congress share the responsibili­ unnecessary bank regulation." He was testifying on behalf ty to resist the parochial interests of some institutions of the ThriftInst itution Restructuring Act of 1981 . A spokes­ [S&Ls-ed.]. We must place greater reliance on market forc­ man for the Treasury Department told EIR , "The whole pur­ es to determine the character and structure of our financial pose of this act is to allow the S&Ls to get out ofthe unprofit­ system. It is a desirable objective to all institutions on an able business of home lending." equal competitive basis. At some �int all institutions must On Sept. 5, 1980, Comptroller of the Currency John have the same powers to performthe same typesof business. " Heiman testifiedbefore the House Banking Committee's sub­ Walter Wriston was quite frank about why he found these committee on financial institutions. He called for an end objectives "desirable." He told the September 1982 issue to interstate banking regulation, and "relief from the legal of Fortune magazine, "Willie Sutton said he robbed banks constraints that artificially confine the expansion of U. S. because that was where the money was. I see that $1.2 trillion institutions' fu ll service banking operations to a single state. out there, and I don't see any number that looks like that . . . Congress should begin lifting the barriers to interstate anywhere else." expansion of domestic institutions." The $1.2 trillion was the deposit base of the S&Ls. De­ The same month, the Carter administration leaked a pre­ regulation was designed precisely so that Walter Wriston and view of a report on the nation's banks prepared by Domestic company could stave off the bankruptcy of the commercial Policy Adviser Stu Eizenstadt. It called for the modification banks that they had wrecked by employing the methods of of the standing Douglas Amendment to the McFadden Act Willie Sutton. to permit interstate banking. Carter's Treasury Department On July 19, 1983, Donald Regan told the New York representatives spoke candidly about how this would be Times, "I think a lot of these worries are overblown that the achieved: "We'll chip away at it. Little by little it will become crash of 1929 could come back. 'We have to go on with irrelevant, and one day someone will say, 'Hey, by the way, deregulation." Without further deregulation by Congress, we still have McFadden here,' and we'll take the corpse and he said, "banks will go to the states" to establish non-bank sweep it under the rug. The way McFadden and Douglas are subsidiaries "that allow the most advantages to them." written, there are too many ways to get round them. They There were two institutional arrangements, apartfrom the are all loopholes and no cheese." treasury secretary, within the Reagan administration, which That day came on June 27, 1983, when Walter Wriston, maintained continuity with the der. egulation policy estab- chairman of Citicorp, testifed before the Senate Banking lished under Carter. Committee. There is "a certain irony," he said, "with respect The first of these was the Presidential Task Force on to a moratorium on so-called non-banks acquiring or becom­ Regulation of Financial Services, ,established in December ing banks. That horse is long since out of the barn. . . . The 1982 under the chairmanship of then Vice President George combination of interstate banks and S&Ls offers a crystal Bush. This committee produced a1report, published July 2, clear picture of the effectiveness of our present ban on inter­ 1984, entitled "Blueprint for Reform." The group was recon­ state banking ....The dam has already broken and it is too stituted in Reagan's second administration on Dec. 15, 1986. late to hold back the waters." Among the recommendations of the first taskforce were ones October and November of 1980, just before and after the returningnow in the "throw them aU in jail" campaign: "The presidential election, the Federal Reserve, acting through its FDIC would also have new authority to take enforcement

EIR July 6, 1990 Feature 39 FIGURE 4 u.s. merchandise exports, imports, and trade balance, 1955-1989 (billions $) $500

400 Exports

300 _ Imports Merchandise trade balance 200

100

-100

-200�-r-r�-.-'-.r-r-r-�.-'-.--r-r�-.-'-.r-r-r-��'-.-�-r�-.-'�'-.-'-' 1955 1960 1965 1970 1975 1980 1985

Source: International Monetary Fund action against violations of federal law concerning unsafe Because his incarceration reflects the rejection of, among bank practices in any bank examined by it where the primary other things, the policies for which he stands, and has stood regulator failed to take such action upon prior request of the for. The Bush administration, nearly all the Establishment in FDIC." Paul Volcker served on this commission, along with Washington, is obsessed with the delusion that the Bush other officialsfrom the so-called regulatory agencies. combination will continue to function: "Oh, we're going to The second arrangement for implementing deregulation control this terrible financial crisis, LaRouche is wrong, we was the Administrative Conference of the United States. This can ignore him." The whole American population is going obscure body, brought into existence in 1964, oversees pro­ to hell because of the Bush administration's attitude toward cedural matters arising from the activities of Executive LaRouche and his proposals. Branch agencies. It is the bureaucratic overseer ofthe bureau­ cracy, and is staffed mainly by lawyers from the private The ideological problem sector as well as the government, who decide how regulatory LaRouche said in November 1979 that Volcker' s stagger­ procedures should be interpreted. In 1986, this body estab­ ing interest rates were implemented for ideological reasons. lished a Special Committee on Financial Services Regula­ In his October 1982 letter to Citibank's Walter Wriston, tion. The chairman of the committee was Kenneth Bialkin he repeated the same, insisting that the problems were not of the Anti-Defamation League of B'nai B'rith; among its economic, but political, ideological. members was C. Boyden Gray, then counsel to the vice What is the issue here? The slogan form of it is the old president and formerly of the law firm Wilmer, Cutler, and saw "free market," "magic of the marketplace." The elabo­ Pickering, whose partner Lloyd Cutler was Jimmy Carter's rated form of the matter was; presented in a set of studies White. House counsel. James C. Miller Ill, director of the prepared by the New York Council on Foreign Relations Officeof Management of the Budget under Carter, involved (CFR) during 1975-76. The studies, the result of 10 working in an earlier phase of deregulation planning, joined the com­ groups, involving 300 people, were published in an initial mission in 1981, as part of its Committee on Regulation. 30 volumes. Work was directedby the Committee of Studies The deregulators started with a bankrupt U.S. banking of the Board of Directors of the:Council on Foreign Relations, system, and by 1989 had bankrupted the country perhaps working through a 1980s Project Coordinating Group. three more times (Figures 4-7). EIR presented a summary of the project in its issue of LaRouche was right, and was framed up andjailed. Many May 15-21, 1979 under the title "A conspiracy of morons: Americans will suffer as a result of his incarceration. Why? the CFR's Project 1980s."

40 Feature EIR July 6, 1990 FIGURE 5 u.s. debt and speculative investments bubble, 1972-89 (trillions of dollars) $22.218 In 1972 , the total of all 1 ) Bank Off-Balance Sheet liabilities debt and speculative 20 2) Stock Market & Mutual funds investments stood at 3) Community Option & Other Markets $3 .810 trillion; by 1982 , 4) American Bank Portion of Eurodollar & this was inflated to Other Markets $9.825 trillion, and then 5) Total Debt to $22 .218 trillion by the 15 third quarter (�lI989. $9.825 This growth (�l the 1) $1 .093 2) $1 .798 bubble by $12.393 3) $0.300 trillion in the last seven 10 $3.81 0 4) $0.514 years has been 5) $6.119 misnamed the Reagan­ Bush "recovery." 5) $13.501

Source: Federal Reserve Board Flow of Funds Ac­ count; New York Stock Ex­ change Fact Books; Chicago Board of Trade published re­ ports; Salomon Brothers, The Status of Global Risk-Based Bank Capital Adequacy, June 1988 report and up­ dated reports; Morgan Guar­ anty Trust, World Financial Markets newsletter

Leading individuals associated with the project left the level, developing nations hope to $ubstitute politicization for CFR in 1977 to become the Carter administration. Among what they see as tacit acceptance of the status quo as it these: Carter's Secretary of State Cyrus Vance, National Se­ manifests itself through the operation of market forces and curity Adviser Zbigniew Brzezinski, Treasury Secretary W. technical management. Michael Blumenthal, and a host of junior officalslik e Leslie "The developing world, as challenger of today's balance Gelb, Richard N. Cooper, and Joseph S. Nye. There was a and structure of political and ecortomicpower , sees increas­ significant overlap with the membership of David Rockefel­ ingly the explicit politicization ofithe international economy ler's Trilateral Commission. Rockefeller is among the fund­ as an opportunity to forge a new international economic order ers of the CFR. more favorable to its interests. By contrast, in the view that The project became the adopted policy of the Carter ad­ dominates both governmental attitudes and the main thrust ministration; it continued to be, through the two Reagan of analytical discussion in the developed world, the focus is administrations, down to the present day. on the dangers of increased political friction and economic disruption that would result from the substitution of political The CFR's 'magic of the marketplace' decisions for market or technical influences, Westerngovern­ The late Fred Hirsch, formerly editor of the London ments see politicization as a threat"to both economic prosperi­ Economist, authored one of the project's benchmark contri­ ty and political hannony. In their opinion, the containment butions, "Alternatives to monetary disorder." Hirsch identi­ and reversal of the trend toward increasing politicization are fied what he called "the most urgent problem of the next among the most urgent international problems of the next decade" this way: decade." "An almost continuous series of conferences has brought The backdrop to Hirsch's invective was the global pro­ together representatives of the developed countries, the less­ cess that had been unleashed by the issuance in 1967 of Pope developed countries, the oil-exporting countries to discuss Paul VI's encyclical Popu[orum Progressio. The Pope had the problems of energy supply, raw materials, economic de­ sparked a movement among developing nations for a just, velopment, and international finance. These matters hitherto new world economic order, freed of the looting arrangements have been dealt with independently and in low key. It is now of the old colonialism and imperialism. In Pope Paul's view, the overt aim of the developing world to link these issues. "The new name for peace is development." Leading expo­ Beyond this, by elevating decisions to the highest political nents of the movement included Mexico's Luis Echeverria,

EIR July 6, 1990 Feature 41 FIGURE 6 FIGURE ? U.S. steel production capacity U.S. oil refining capacity

number of refineries barrels per calendar day 340 20,000 160

320 19,000 150

300 18,000 140 280 17,000

130 260 1 6,000

120 240 15,000

110 220 14,000

13,000 100 1972 1977 1982 1987 1975 1980 1985 1990' _ Total operable refineries - Total crude distillation capacity

'preliminary Source: American iron and Steel Institute Source: Energy Information Administration

India's Indira Gandhi, Algeria's Houari Boumedienne, Paki­ cally, another volume of the series posited Mao Zedong's stan's Zulfikar Ali Bhutto, among others. China, barely then emerging out of the genocide of the Cul­ In an April 1975 press conference in Bonn, West Germa­ tural Revolution, as the model for what the Third World ny, following a visit to Iraq , LaRouche had put forward a should aspire to--Mao's China, and what was euphemisti­ proposal to form an International Development Bank, to be cally called "a country in Southeast Asia." This was Cambo­ formed by treaty arrangement among agreeing states, to orga­ dia, where, while the study was being drafted, Pol Pot mur­ nize monetary reform to the end of fostering three-way trade dered approximately one-quarter of the population. among the nations of the OECD, Comecon, and developing The "nationalist concerns" of the developing sector, sector, securing the advance of the first two through the Hirsch wrote, "are far from new. They were eloquently ad­ economic uplifting of the latter. LaRouche's proposal was dressed by Hamilton in his Report on Manufactures of 1790, voted up in 1978 at the Colombo, Sri Lanka conference of in which he expressed the oppositionof American nationalists the Non-Aligned Movement--oneof the principal targets of to their country's assuming the role of a raw materials exporter Hirsch's invectives against "politicization." to Britain. Nationalists feared andopposed two aspects of this role: the tying ofAmerican economic development to the Brit­ CFR rejects Hamilton and List ish economy and the growing d�ndence on Britain for goods Hirsch identified two conflicting traditions in economic vital to national defense. Friedrich List, inspired by Hamil­ theory. One he called "mainstream liberal thought"-the free ton's observations of American trade policy, outlined in market theory of Adam Smith, David Ricardo, John Stuart American Political-Economy what he saw as the proper object Mill, et al .-the other "the neo-mercantilist." The neo-mer­ for a developing country's commercial policy: cantilists were typified by Alexander Hamilton, George " 'This object is not to gain matter, in exchanging matter Washington's secretary of the Treasury, and by the German­ for matter, as it is in individual and liberal economy, and American economist Friedrich List. Slyly, he lumped the particularly in the trade of the merchant. But it is to gain Marxists in with what he called the neo-mercantilists, the productive and political power by means of exchange with better to lie in his scholastic language, that the movement other nations; or to prevent the depression of productive and launched by the Pope was a pro-communist movement. Ironi- political power, by restricting that exchange.' "

42 Feature EIR July 6, 1990 A program of 'controlled disintegration' few living economists who represent the economic policy on The way Hirsch proposed to deal with what he called "the which our republic and its past economic successes were most urgent international problems of the next decade" was based: the policy which U.S. Treasury Secretary Alexander thus: Hamilton was first to name 'The American System of Politi­ "A degree of controlled disintegration in the world econo­ cal Economy.' Second, the economic forecasts which my my is a legitimate objective for the 1980s and may be the most associates and I have produced, are the only accurate fore­ realistic one for a moderate international economic order. A casts published by either governmental or private agencies central normative problem for the international economic during the past seven years. Third, !my recommended policies order in the years ahead is how to ensure that the disintegra­ are policies of the type which have been proven, repeatedly, tion indeed occurs in a controlled way and does not rather in past experience, as the only effective way to organize a spiral into damaging restrictionism. The problem therefore is general economic recovery from a depression." not to minimize politicization in the process sense of political Add up the tally. LaRouche says he is an advocate ofthe intervention in market outcomes; it is rather to create a frame­ methods of Alexander Hamilton. Hirsch, and the crowd who work capable of containing the increased level of such politi­ became the Carter administration, say that Hamilton, List, cization that emerges naturally from the changed balance and the "American System" tradition are the enemy, "the of forces in both domestic economies and the international most urgent problem of the decade." They insist on the system. The fu nction of the loosened international economic counterposed tradition of liberalism, associated with Smith order would be to provide such a framework by setting and Ricardo and company, against which the American Rev­ bounds to arbitrary national action and thereby containing the olution was fought. LaRouche and associates produced a tendencies toward piecemeal unilateral action and bilateral record of forecasts over the I I-year period since 1979 which bargaining that may ultimately be detrimental to the interests is unparalleled in its accuracy, and against which every other of all parties concerned." agency, governmental or not, is reduced to absurdity. And Less than one year before he became chairman of the LaRouche's proposed solutions would work, whereas those Federal Reserve Board, on Nov. 9, 1978, Paul Volckerdeliv­ of his opponents have led to disaster. ered the Fred Hirsch Memorial Lecture at Warwick Universi­ What can be concluded from this? Ask yourself another ty in England. Volcker's speech was excerpted in EIR Oct. question. Whom did you vote for in the presidential elections 16-22, 1979. It had originally been published in the London of 1980? Whom did you vote for in 1984? Whom did you monthly The Banker in January 1979: vote for in 1988? Chances are you didn't vote for LaRouche "I was tempted to take as my text today one of Fred in any of those elections. Chances are you did what most of Hirsch's last dicta: 'A controlled disintegration in the world the electorate does, and didn't vote at all, or you did what economy is a legitimate object for the 1980s. . . .' Theph �ase most voters do, and voted for what seemed to be the least captures what seems to me the prevailing attitudes and prac­ offensive choice of those put before you. So you, like your tices of most governments in this decade, as they struggle neighbors and friends, share some of the responsibility, both with two central issues that bedevil so much of our negotia­ for what has happened, and for what is yet to occur, don't tions and our actions, not just with respect to money, but you? over the fu ll range of international economics .. .. You did have a choice. Like millions of other Americans, "Let us be aware of the difficulty of controlling disinte­ you probably saw one or more of LaRouche's 21 half-hour gration, once fairly started .. .. televised addresses to the nation, broadcast during the 1984 "I do not suggest that we stand on a knife's edge forced and 1988 election campaigns (see;box) . Each of those broad­ to choose between integration and autarky. But I would much casts was devoted to a single theme, treating each issue in rather take as my rallying cry, as a focus for necessary negoti­ greater depth than any other candidate did. If printed policy ations, as an ideal from which to measure progress, the chal­ studies and books are added, LaRouche probably supplied lenge of 'managing integration' rather than disintegration." more than half of the political input of both election cam­ paigns. LaRouche and the 'American System' Hirsch, writing for the Council on Foreign Relations be­ What was the ideological issue then, and now, between fore he died, objected to what he called "the politicization" LaRouche and the sponsors of the careers of such as Hirsch of matters which he preferred be handled in a "low-key" way, and Volcker? by "market forces" and "technical management," otherwise On Nov. 6, 1987, LaRouche issued a presidential cam­ known as "bureaucratic methods." LaRouche's final cam­ paign statement, "The world economic depression in prog­ paign broadcasts of 1984 were disrupted, when the FBI ille­ ress: why it happened and how recovery must be organized." gally seized bank accounts hel

EIR July 6, 1990 Feature 43 LaRouche's TVbroadcasts

During his presidential campaigns of 1984 and 1988, LaRouche addressed the nation through numerous half­ hour TVbroadcast s, on issues rangingfr om the banking col/apse to the transfo rmations ongoing in the Soviet empire.

Jan. 21, 1984, "LaRouche Calls for National Defense Emergency Mobilization" Feb. 4, 1984, "Stopping the Worldwide Economic Col­ lapse" March 17, 1984, "Re-open America's Steel Plants Now!"

March 26, 1984, " Henry A. Kissinger: Soviet Agent of Influence" April 27, 1984, "While Washington 's Politicians Are LaRouche on the campaign trail in Rochester, New Sleeping " Hampshire, JUlie 1987. May 10, 1984, "The U.S. Under President Reagan's 'Her­ bert Hoover' Recovery" Nov. 5, 1984, "Why the Soviet Government Supports

May 31, 1984, "The Ominous Crisis in U.S. Defense Walter Mondale and Fears LaRouche" Policy" Nov. S, 1984, "Operation Juarez"

June 1, 1984, "Stopping the Present Spiral of Worldwide Feb. 4, 1988, " Who Is Lyndon LaRouche?"

Financial Collapse" March 3, 1988, "The Woman on Mars"

June 2, 1984, " Ending the Catastrophe in U.S. Foreign April 12, 1988, "The Test of Fire"

Policy" June 4, 1988, " Nothing Short of Victory: War Agai nst

Sept . 3, 1984, "Food Shock in 1984" AIDS"

Sept. 30, 1984, " What Is the Soviet U nion? " Oct. 1, 1988, "The Great Food Crisis of 1989-90" Oct. 23, 1984, "Walter Mondale and the Neo-Nazi Green Oct. 31, 1988, "The Winter of Our Discontent" Party" Nov. 4, 1988, "The Trial of Socrates"

against LaRouche proceeded even during the final weeks of spark of creative reason." Creative reason is the universal the 1988 election campaign. power of the individual human being to develop and impart Is there a relation between opposition to "politicization" conceptions which are efficient in respect to the species' in favor of "market forces" and "technical management" and ability to transform the universe. Lower species can't. the defense of the liberal tradition against Alexander Hamil­ LaRouche proves the efficacy of creative reason from ton and Friedrich List? The answer is emphatically yes, and human history, from mankind:s progress from the mode of it has everything to do with the most profound differences existence called by anthropologists "hunting and gathering," between LaRouche and his opponents. It has to do with the to the present day. Hunting and gathering society could only matter of what is a human being, and with the purpose of support maximally under 10 million persons, given the land human existence. area required to support each hunter and gatherer. Modem society supports, more or less well, 5 billion people, with Economics, and a conception of man the potential, if currently available technologies were univer­ In LaRouche's view, and this emphatically was also the sally applied, to support 50 billion. Mankind has created a view of the drafters of the U.S. Constitution, Alexander three-order-of-magnitude increase in the Earth's population Hamilton among them, there is an absolute distinction be­ potential in the course of its historical existence. No other tween mankind and the lower beasts. Mankind is distinguish­ species has done so. ed by what WesternChristian tradition refers to as "the divine The increase is the work of creative reason. Scientific

44 Feature EIR July 6, 1990 discovery, improving man's mastery of the lawfulness of should be given to disclosure-or incentive-based modes of universal creation, through technological development, regulation before turningto the classical command and con­ proves that man is indeed in the image of the living God, and trol modes." not one among a delicatessen of forms of wildlife randomly This is the same approach that Hirsch recommended. The deposited on the face of the Earth. This conception is the ABA's commission was funded by the Ford Foundation, core of what has permitted WesternChristian civilization to ARCO Foundation, Exxon, Gulf, Mobil, and other oil com­ develop the way it has. panies. Commission members induded Lloyd Cutler, Law­ Alexander Hamilton's "American System of Political­ rence Walsh, Charles Kirbo, DaIiiei Yankelovich, Sol Li­ Economy" is an outgrowth of that tradition, as is emphasized nowitz, and Stanley Morris. Lloyd Cutler, from the law firm by the idea, developed in his Report on Manufactures. of Wilmer, Cutler, and Pickering went on to become White "artificial labor"-technology replacing human labor to House counsel for President Jimmy Carter; his partner, C. cheapen and improve production methods. The same concep­ Boyden Gray, to become counsel to the Business Round­ tion is reflected in the Constitution's Preamble, "for our­ table, and then to Vice President George Bush. Charles Kirbo selves and our posterity." There is a higher purpose to the was from the Atlanta law firm which produced Carter's Attor­ brief life of the individual, assured only of the certainty that ney General, Griffin Bell. Sol Lioowitzof Xerox Corp. be­ he or she wiII leave this world with no more than he or she came the negotiator of the Panama Canal treaties. Lawrence brought into it. To discover, and improve, those knowable Walsh is the Iran-Contra special pk-osecutor. Stanley Morris principles of natural law , which wiII leave the world a better was regulatory affairs head at the Office of Management of place for those who come afterus, and thereby also confirm the Budget under Carter, before becomingan aide to Edward the contributions of all those previous generations who came Schmultz, a top official in the 'first Reagan Justice De­ before. partment. Physical economy, the transmission belt by means of The commission's mandate was what was known in the which developed ideas are transmitted to the future, is, for Carter days as "deregulation" and in the Reagan days as "the LaRouche, the means by which the adequacy of man's efforts magic of the market place." The names and labels changed; to improve his mastery of natural law is vindicated. the policies remained the same. The policies spawned were Oppose that, and what is left?If man is no different than implemented by regulatory fiat, or fa it accompli. without the lower beasts, what value does human life have? If it reference to existing law-constitutional or otherwise. has no value, of what value are laws to safeguard human existence? What is more important than power and the main­ A test case: the HongShang takeover tenance of the power to dispose of human affairs in mockery The banking system was the model for transformation of of the Creator's laws? "Low-key" market forces and techni­ America as a whole. The first test case was the Hongkong and cal management, not politicization. Genocide and destruc­ Shanghai Banking Corp. 's application to take over Marine tion, not fostering of mankind's uniqueness in the image of Midland in New York State. The application was registered the living God. with the authorities on Sept. 1, 1978. By 1978, the U.S. banking system was bankrupt, after Fascism, American-style the combined effects of the collapse of the Bretton Woods Hirsch's opposition to "politicization" thus reflects the system between 1967 and 1971, Nixon's Aug. 15, 1971 same underlying outlook as his collaborator in the 1980s decision to remove the dollar from the gold standard, and the Project, Samuel P. Huntington, the author of the Trilateral adoption of the insanity of floating exchange rates. Nixon's Commission's report "The end to democracy." In modem Phase I, II, and III austerity packages, modeled after those political terms, the outlook reflected in the Council on For­ of British Labour Party Prime Minister Harold Wilson in the eign Relations program for the 1980s, is called fascism. 1960s, and the oil shock of 1973-74 had done the rest. U.S. The CFR's outline was translated into U.S. policy in the exports collapsed, and internaldebt began to pyramid. following way. While the CFR task forces were meeting, the Outside the Unitd States, a pOol of about half a triIIion American Bar Association (ABA) organized a Commission dollars had accumulated in what were then known as the on Law and the Economy. This was founded in 1975, and Eurodollar markets. The proposal was adopted inside the issued its report at the end of 1979. The commission was United States to solve the U.S. liquidity crisis by bringing chaired by John J. McCloy, then one of the leaders of the offshore hot dollars, including drug trade dollars, back on­ Council on Foreign Relations, and a leading member of the shore. Back then, U.S. banks were forced to maintain re­ liberal Establishment. The commission's report recom­ serves of up to 15% of their liabilities. There were no reserve mended, "In lieu of governmental intervention in the econo­ requirements for banking activity in the offshore markets, my, reliance should be placed when feasible upon the com­ however. To pull the funds into the United States, banking petitive market as regulator supported by anti-trust laws. had to be deregulated. The HongShang takeover of Marine Where governmental intervention is required, consideration Midland was the firstmajor test ofthe commitment.

EIR July 6, 1990 Feature 45 Architects of the banking collapse

The ruinous policies of "colltrolled disintegration " George Bush: He wants Paul Voleker: It was his David Rockefeller: and banking deregulation, begun by the Trilateral to arrest the S&L "allti-infla tion " Under the slogan of "the Commission 's Presidellt Jimmy Carter, were managersfor pro!vam that shut down magic of the continued under Ronald "Free Market" Reagan . implemellting the Americall industry and marketplace," he policies that he and his drove capital into wild promoted banking Establishment. /i·iends speculation. deregulation , wrecking demanded. the S&Ls.

During 1978, HongShang banker Y.K. Pao was brought hearings before the Federal Reserve Board , and committees onto the international advisory board of David Rockefeller's of the New York State legislature , that HongShang did not Chase Manhattan Bank. Chase and Citicorp shifted their in­ meet the accounting standards demanded of U.S. banks, and ternational investment pattern , with Chase deploying one­ did not do so because it was disguising its dependence on third of its international fu nds out of Hong Kong, and Citi­ funds derived from the financing of the opium trade . The corp moving onto the island, to become by 1981 the fourth Labor Party case against HongShang bank was the basis for largest banking network there . Chase and First Chicago were the later publication of Dope, Inc. appointed agents for the Bank of China in the United States. The case against the takeover was irrefutable under stand­ The First Chicago liaison official, Barry Sullivan, was de­ ing U.S. federal law, and under the state law of New York . ployed there from Chase, where he wrote Chase's proposal Further, on Aug. 29, 1978, before the filing of the takeover to transform U.S. banks, freed of re serve requirements, into request, HongShang's accountants had refused to certify the what were called International Banking Facilities. Volcker, bank's position , because of undisclosed secret internal re­ then at Chase, became the Fed chairman who implemented serves. Income accruing from the sale of fixed assets, foreign those changes. exchange activities, and investments was added to or deduct­ The HongShang takeover, as was documented in the ed from the internal reserves of the bank. The internal re­ 1979 bestseller Dope, Inc., was the centerpiece, because serves themselves were kept secret. The bank, therefore , was HongShang was the central bank for the international drug maintaining two sets of books on its financial condition­ trade , whose proceeds were then estimated at $100-200 bil­ one for the public, and one for itself. The accounting firms lion per year. The drug fu nds were the core of the offshore of Peat Marwick, Mitchell and Price Waterhouse noted that monies known as Eurodollars . the Hong Kong government had intervened to ensure that the LaRouche, and the U.S. Labor Party with which he was information not be re leased . then associated, opposed the takeover. It was argued, in This disqualified the takeover under New York law, and

46 Feature EIR July 6, 1990 was the basis for opposition from New York Banking Super­ destroyed the country . intendent Muriel Siebert. Opposition to the HongShang take­ over led by March I, 1979 to a demand from Siebert that Could it happen here? It did! Congress open an investigation into all foreign bank take­ Who should go to jail? S&L execs, sleazy or not, who overs . did what the regulators demanded they do, after the elimina­ On March 16, 1979, chairman of the Federal Reserve tion of Regulation Q, and the ending of usury laws? Political G. W. Miller ordered all investigations into the takeover proponents of the U.S. Constitution. closed, and by fiat declared the acquisition accomplished. A policy structure was put in place in the mid- I970s, What had happened? EIR reported in its issue of May 22- with the task of eliminating the vestiges of what it called 28, 1979, that the Bank of England had threatened to cut off "neo-mercantilism," in favor of bureaucratic rule by an elite U.S. banks' clearing rights in the City of London, if the based on the power of international finance. takeover did not go through . The takeover, rammed through That policy structure identified its enemy as the political in violation of all law , by regulatory means, was the begin­ system of representative government based on providing for ning of the deregulation of the U.S. banking system, and the future in fulfillment of the wo�k of those who had gone thus the beginning of everything that has fo llowed from that before . It was predisposed to rip up the Constitution, and it deregulation. has . The means adopted included bureaucratic fa its accom­ The policy which Hirsch had sketched out for the CFR, plis and political orchestration of crises. and which the McCloy ABA commission had recommended, It has jailed its number-one enemy, Lyndon LaRouche, was elaborated by the Financial Times of London on May 8, the most competent spokesman for the outlook and policies 1979. Compare what the Financial Times recommended with that the financial power structure opposes. what later occurred: And now the world stands on the edge of the catastrophic Banks' fears "are that the mountain of debt which has crises that the policies adopted were designed to bring about. been piled up could be transformed by a serious recession Where does that leave you and yours? Are you going to into a landslide of defaults ....The issue has potentially continue to sit this one out, as many sat them out in 1984 and far-reaching implications. Some banks want to see reserves 1988? Because if you are , you can kiss goodbye everything virtually eliminated, a move which could have implications you hold dear. for the Eurodollar markets ....It is into this exciting envi­ ronment that foreign banks which are expanding into the U.S. are venturing . They can be assured of an exciting jour­ ney ....On the banking side , it seems clear that the main causes of distortion are an excess of regulation of the wrong kind. The Federal Reserve is not allowed to pay interest on reserves .. ..Ba nks are not allowed to pay interest on current accounts ....Consumer credit is largely exempt from the Fed's own interest rate policies under state laws limiting interest charges. Congress could cure most of these worrying ills, but is unlikely to move." The same deregulation perspective was organized for in­ side the United States. On May 14, 1979, A.W. Clausen, then chairman of the Bank of America, spoke to the Financial Analysts' Federation in San Francisco: "Why does this country differentiate so minutely among the powers of commercial banks, mutual savings banks, sav­ ings and loan firms, finance companies, industrial banks, and to what end? ...Why should not each be able to take in all types of deposits and make all types of loans through offices anywhere in the nation?" By the end of 1979, it was estimated that 20% of all new e Power of bank lending in the U.S. originated from foreign banks . In Reas New York, the figure was as high as 45%, and in Los Angeles on: 1988 35%. By 1981, more than 20% of the equity of all U.S. An Autobiography by Lyndon H. LaRouche, Jr. : corporations, after Volcker's interest rate war, was in foreign Published by Executive Intelligence Review Order from Ben Franklin Booksellers. 27 SO\lth King St., Leesburg, VA hands. And the takeover wave did not start until 1984. To 22075 $10 plus shipping ($1.50 for first copy. 50 for each additional). Bulk rates available keep their banks afloat, they let in the drug money, and

EIR July 6, 1990 Feature 47 Five non-Russianrepu blics declare theirso vereignty

by Konstantin George

History was made in the Soviet Union June 19-24, not by of Sovereign States" containing federated, confederated, and the highly publicized June 19-23 Russian Communist Party more independent components. conference, but by the sovereignty declarations by the Com­ munist Party leaderships, organizations, and parliaments of Ukraine forced the turn five non-Russian republics including the three biggest: The tum in policy by Gorbachov does not reflectbenevo­ Ukraine, Belorussia, and Uzbekistan. These moves by the lence or generosity towards the non-Russian Captive Na­ same party leaderships which had furiously resisted any tions. Pro-independence developments in the largest non­ moves toward sovereignty, were the result of a policy shift Russian republic, Ukraine, witJil 51 million persons, forced by Gorbachov and the Presidential Council leadership forced the Moscow shift. The outlook of Ukrainians falls into on the Kremlin by the growing popular demands for indepen­ roughly three categories: those who demand immediate inde­ dence or autonomy from Moscow Center. pendence, who are supported by the overwhelming majority The sovereignty declarations mean that the Soviet Union in the western Ukraine, and are now beginning to gather will soon no longer exist in its present fo rm . What will support in central and eastern Ukraine; those who demand emerge will be a mix of "sovereign" federated republics, the gradual, evolutionary achievement of independence­ confederated republics, and independent republics, with at the population of central and eastern Ukraine being roughly least one common denominator: The end of Communist Party evenly divided; and those willing to remain affiliated to rule through the institution of the Communist Party. Moscow, albeit only in a loose, confederated form. In the The dissolution of the empire along nationalist lines has autumn of 1989, the majority of Ukrainians were in favor produced a debate within the Soviet leadership, analogous to of settling for autonomy. Today, the majority favor true that produced by the revolutions in Eastern Europe: Crack independence. down!with military force against populations who have "lost This change in popular mood is not confinedto whispered their fear" of the Kremlin and risk armed popular insurrec­ discussions in dark places. The new Ukrainian Parliament, tions in several republics-in effect, many "domestic Af­ elected in March with one-third of its deputies from the Na­ ghanistans"; or, sacrificethe ancien regime form of empire tional Movement, Rukh, resounds with calls for Ukraine's for another form of empire . Moscow has chosen the latter independence which are printed in the Ukrainian media. A course. dramatic call was issued on May 31 by Rukh deputy Pavlych­ The June developments which forced this decision to­ ko, who began by describing bolshevism as "neo-colonialism ward a new form of empire included the election of Boris built on Czarist foundations of dictatorship, which has trans­ Y eltsin, the outspoken champion of Russian sovereignty and formed the pre-revolutionary prison of nations into a post­ a new, post-Bolshevik empire , to the presidency of the Rus­ revolutionary concentration camp of nations." Pavlychko sian Federation; the June 12 declaration of sovereignty by the called on his fellow Ukrainians to exercise "the will of history Russian Parliament; and the speech delivered to the U . S.S. R. itself, to bring down the last empire on Earth." He rejected Supreme Soviet on the same day by Gorbachov announcing as a "cover" and "masquerade" the Kremlin's policy for the the coming replacement of the U.S.S.R. with a new "Union "renewal of the federation," and demanded the "gradual,

48 International EIR July 6, 1990 evolutionary, peaceful, but continuous drive towards a real victory by parties demanding immediate independence. independence of the country. " Once that occurs, the greatest pro-independence surge yet will be unleashed. Moscow's 'Damascus Road' With developments moving so quickly, Moscow had to Polozkov backs Gorbachov ensure that concessions to Ukrainian national sentiments In contrast, the Russian party conference, though it were made by the Ukrainian Party Congress which opened grabbed the headlines was, relatively speaking, a sideshow. on June 20. The alarm from Moscow Center was sounded on Ironically, a confirmation of this assessment was provided by June 18 in a statement issued by Grigori Revenko, the token Pravda June 25, two days after the party conference ended, Ukrainian on the Gorbachov U.S.S.R. Presidential Council, through published results of a poll taken by the Central Com­ who declared that "pro-independence impatience is growing mittee's Social Research Institute. The poll showed that only enormously, especially in westernUkraine ." 18% of Soviet citizens still view the Communist Party as the On June 20, while the Western media were focused on "leading force in society. " the Russian party conference in Moscow, the Ukrainian The Western media made much of the in-fighting that Communist Party congress opened. It was the first Ukrainian occurred at the Russian party conference, focusing on the party congress in history where every speaker, including heavy criticisms of Gorbachov by Politburo member Yegor Ukrainian party head Vladimir Ivashko, spoke in Ukrainian. Ligachov and others. The man electedto head the new Rus­ The party congress was a spectacle of overnightconvers ions sian Communist Party, Ivan Polozkov, was depicted as "anti­ by the party leadership, from Ivashko on down, to the cause Gorbachov." The coverage ignored the predicament of the of Ukraine's sovereignty. The Wendehals (wryneck) phe­ Communist Party. The party has been dumped from power nomenon, so familiar to East Germans, Czechoslovaks, Hun­ at the top, where the Politburo and Central Committee have garians, and Poles, had come to Ukraine. been kicked aside for the Presidential Council and the Federa­ Ivashko personally presented the declaration of sover­ tion Council, and has lost all support, including that bornby eignty resolution, which passed with near unanimity. It was fear, from the population. not an independence declaration, but it asserted for Ukraine After the Russian party conference ended and Polozkov something approximating full domestic autonomy. It granted gave his firstpre ss conference, it became clear that the con­ Ukraine "all rights and powers . . . except those which ference had been a non-event. The "anti-Gorbachov" Poloz­ Ukraine voluntarily concedes to the Center." It echoed the kov became a critical supporter of Oorbachov: "He [Gorba­ June 12 Russian sovereignty declaration, stating that the laws chov] doesn't take revenge because of criticism. Naturally, of Ukraine have precedence over those of Moscow within the I'm for Gorbachov remaining President and chairman or gen­ republic. The speed of the political transformation can be seen eral secretary of the party. The presidial regime [the rule of in this declaration. A month ago, such a vote by a Ukrainian the country by the Presidential Council] has not yet unfolded party congress could only have been forced at gunpoint. its entire potential, and the power of the party cannot yet be The personnel changes made at the Ukrainian party con­ written off." gress also show the coming end of the present form of the The only criticism Polozkov had of Gorbachov made Communist Party. Ivashko quit as party leader, turning it Gorbachov look "too benevolent": "He is too tolerant, thinks over to his deputy, Stanislav Gurenko. Patterning himself things over too much, and is too cautious." Regarding Yelt­ after Yeltsin, Ivashko got himself elected Ukrainian Presi­ sin, who had beaten Polozkov in the Russian Parliament vote dent, thus gaining the second most important seat afterY elt­ for the Russian presidency, Polozkov declared his readiness sin on the U.S.S.R. Federation Council, which consists of to cooperate with Yeltsin and with the Democratic Platform Gorbachov and the presidents of the republics. The U. S.S. R. reform group in the Russian party, who form the core of Federation Council will spend this summer drafting the "new Yeltsin's support: "I have no personal problems with him. Union Treaty" for the new form of empire that will replace ...I am prepared, in light of the inner-party opposition, to the Soviet Union. No time will be wasted, Ivashko stressed take the Democratic Platform into cDnsideration." Polozkov during the party congress: "There will be no delay in working declared his support for the "transition to a regulated market out the new Union Treaty." economy," and for treaty-based trade between sovereign re­ Within days of the Ukrainian party congress resolution, publics, thus echoing Y eltsin' s position on these questions. similar resolutions were adopted by the parliament of Uzbe­ So much for Polozkov, Yeltsin, and, Gorbachov. The kistan, the largest of the U.S.S.R. 's Muslim republics, the majority of Russians couldn't care less about the Russian parliament of Kirghizia, the Belorussian party congress, and or the Soviet Communist Party, The Russian majority only the parliament of Moldavia. knows what it doesn't want. It has not made up its mind as The next change in the non-Russian republics will occur to exactly whom, or what, it does want. When it begins to, at the latest in October when the Transcaucasian republic of events sweeping across Russia will intersect the upheaval in Georgia holds elections which will produce an overwhelming the other republics. Turbulent times are at hand.

EIR July 6, 1990 International 49 could hold our founding congness; the KGB and the Central Committee of the Communist Party put pressure on the direc­ tor of the Krasnaya Presnya Cultural Center where it was to take place. They told him not to let us in. The authorities only make concession when they are forced to do so."

A look at Russia's The Russian Democratic Party The Russian Democratic Party was founded in Moscow new parties on May 27. It grew out of the Russian Democratic Bloc, which was largely under the influence of Andrei Sakharov. Leading members of the new party include the world chess by Our Wiesbaden Bureau champion Gary Kasparov and the People's Deputy Mikhail Tolstoy. The party's founding principles consist of a declara­ Just as in many of the Soviet Union's non-Russian republics, tion of universal human rights, Andrei Sakharov's draft con­ in Russia itself many new organizations, parties, and move­ stitution, and the program of tbe Democratic Bloc. Accord­ ments are springing up, all independent of the Communist ing to the party's declaration, "The RDP, acting as a mass Party. The Soviet newspaper Moscow News, in its July 1990 democratic party, will contribute to the establishment of actu­ German-language issue, introduces some of these new parti­ al popular power in the republic. It will work toward cleaning es. Of particular interest are the Democratic Party and the out the remnants of totalitarian�sm, in order that it might give Russian Christian-Democratic Movement (RHDD). Moscow a new impulse to constructing a sovereign, democratic, and News asked one of the executive committee members of the economically viable Russian Federation. The RDP considers RHDD, People's Deputy Viktor Aksyushchiz, who quit the it basic to its outlook, that the primacy of ideology over Communist Party II years ago, about the aims of his economy be rejected, and that i� be reoriented toward the real movement. needs of human beings." Regarding his organization's principles, Aksyushchiz Along with the Christian D�mocrats, the RDP rejects the said: "Briefly, these are three: responsible anti-communism, idea of a Russia on the chauvinist model, as is espoused by Christian spirituality, and enlightened patriotism. A few Pamyat. words on what we understand under anti-communism: For us, every human being is the model and image of God such Elena Bonner's experience in the United States that even our opponents view us as brothers lost in The existence of this kernelof democratic parties in Rus­ Christ .... sia is largely due to the untiring efforts of the late Andrei 'The current situation in the Soviet Union is a catastro­ Sakharov and his wife Elena Bonner. Bonner recently trav­ phe, both materially and spiritually. We are convinced that eled to the United States, and did not mince words when she in order to climb out of this chasm, the people must grow warnedAmericans against being naive about Gorbachov. greater than themselves. History shows that a people only She told Moscow News that the trip had made her very manages this when it strives for supremely high values, the uneasy. "First, Lithuania. I was asked again and again: highest ideals. In our view, Christian spirituality is the only 'What's more important: the right of a people to self-determi­ thing which can save Russia. For us believers, spiritual val­ nation, or the inviolability of borders?' It's like a powder keg ues form the basis for all other processes, including the eco­ which can explode at any time .. ..The Lithuanians will not nomic transformation of the country." let themselves be provoked. Then comes the blockade-a For the RHDD, "enlightened patriotism" means love of blatant inconsistency. Recently the Supreme Soviet of the one's own people without national pride, extremism, or U.S.S.R. condemned Azerbaijan's blockade of Armenia. chauvinist aggression. Therefore, he said, his organization Even though the decision was put into effect 'step by step,' is completely opposed to the extremist Pamyat. as they put it nowadays, it's clear that the supreme power The RHDD currently has 15,000 members and its own considers blockades to be illeglll. But if that's the case, why group within the Russian parliament. Its membership is most­ is it legal to do it against Lithuania? Where is the 'new ly concentrated in Moscow and Leningrad, where the move­ political thinking' with its priority on universal human val­ ment is represented on the city and precinct soviets (coun­ ues? Are the Lithuanian children sitting in their unheated cils). The RHDD grew out of many illegal discussion circles, kindergarten room perhaps not worth something more human Christian clubs, and groups operating under charitable cov­ from the standpoint of those who have proclaimed the new ers. But even today, the Soviet regime is still attempting thinking? to use its remaining apparatus to make life difficult for the "Many Americans did not agree with me. In discussions Christian Democrats. "Everything that we have, is the result they repeated one and the same argument: 'You can't obstruct of a tough fight. It was only with the greatest difficulty that we Gorbachov.' "

50 International EIR July 6, 1990 Havryliv: The only improvement since Gorbachov's visit Interview: Mateo Mychajlo Havryliv was the suspension of religious persecution; everything else has yet to change. Gorbachov promised that the new law on freedom for believers would be enacted; he made big promises, but so far the mountain has given birth to a mouse. Whatlies ahead for EIR: What is the attitude of the Russian Orthodox Church toward the Ukrainian Catholic Church? Havryliv: The hierarchy is very hostile, but the believers Ukrainian Church? have ecumenical feelings toward the Catholic Church. They take part in our masses and pray in our churches. In many On June 25 -26,for the first timethe Ukrainian Uniate (Cath­ villages Catholics and Orthodox share the same church and olics of Easternrite) bishops, who were all consecrated clan­ alternatetheir religious functions with different rites. destinely, and oppressed by one of the harshest religious persecutions of any East European nation, met with Pope EIR: Last March the negotiations carried on by two delega­ John Paul II in the Vatican. Also present were the Ukrainian tions, one Orthodox, the other from the Vatican, in Leopolis, bishops of the diaspora. On the eve of the meeting, EIR's to discuss questions regarding the Greco-Catholic Ukrainian Maria Cristina Fiocchi met Father Mateo Mychajlo Havry­ Church, were broken off by Ukrainian Bishop Sterniuk. liv, Superior of the Hoshiv Monastery in Eastern Ukraine, Why? at the Monastery of the Basilian Fathers on the Aventine in Havryliv: Because the Russian Orthodox Church spokes­ Rome, and spoke with him about this historic occasion: men wanted to be the boss and impose their viewpoint by authority, and unhappily, the Holy See's delegates, Monsi­ EIR: One of the main topics of the meeting will be the gnor Mursyn and Monsignor Sulik, were not adequately pre­ legal recognition of the Catholic Church of Byzantine rite in pared. The two Catholic archbishops should have met the Ukraine and the recovery of its property . What are the obsta­ Ukrainian bishops as soon as they raached the Soviet Union cles to be overcome? to go deeply into the problems to be dealt with, but they did Havryliv: The Soviet government and the Russian Ortho­ not .... dox Church have recognized up to now the Catholic Ukraini­ an Church only in the form of groups of believers, but they EIR: In the West there is more and more talk about the refuse to recognize it as a legitimate institution. After years danger of a civil war breaking out in the U.S.S.R., which in clandestinity, today we are allowed to celebrate mass, would follow the failure of Gorbachov's perestroika. What administer communion, and pray together. But all our is your opinion? Church's property, confiscated by the state in 1946 on Sta­ Havryliv: I will probably surprise your readers, but even lin's orders and turned over to the Orthodox, is still denied here , one has to know certain things. Perestroika is essential­ to us. We are restructuring the churches, but we are denied ly an economic reorganization to permit the restructuring of their possession. Our religious orders live in monasteries the military apparatus. The Kremlin leaders are concentrating which they cannot own. It is not possible to open seminaries all their resources to catch up with, and eventually surpass, to train new priests. Cardinal Myroslav Lubachivsky, the the Americans in the conquest of space; I refer to the strategic archbishop of L vov and head of the Ukrainian Church, is not defense system. The true strength of the Soviet Union is the allowed to visit his flock nor to take his place in Ukraine. Russian Army. Gorbachov is a puppet used by the army, and Our bishops don't have the means to administer their dioces­ when he becomes useless, they will!dump him. By that I do es-no telephones, no Catholic publications. not mean that he does not show a certain political ability, doubtless greater than his predecessors had. EIR: Is the Catholic press banned? Havryliv: Legally no, but in fact no religious community EIR: How is the popUlation experiancing this reality which has the right to own a press and print papers, not to mention is so unstable and full of uncertainty? an eventual television or radio spot. We cannot even have a Havryliv: Very intensely, and also quite nervously. The bank account. In short, we exist, but it's as if we weren't people understand that Gorbachov's biggest problem is the there. nationalist problem, and history teaches that every Muscovite regime, from the czarist to the communist, has always re­ EIR: During his viSit to the Vatican, Gorbachov promised solved the nationalist problem militarily. President Bush and the Pope a rapid enactment of the new law on freedom of Mrs. Margaret Thatcher ought to reflecton this reality. We conscience and religious association in the U.S.S.R. How must hope and pray to God. In such'an uncertain period, we has the situation changed since their meeting? should pray more.

EIR July 6, 1990 International 51 Peru's Shining Path: near �e end? i Luis Vasquez Medina explains why their Maoistori gins-though denied by U.S. 'experts'-may be precisely the reason their time is running out.

When the Peruvian police raided a luxurious mansion on the and current development are tightly linked to the internation­ outskirts of Lima before dawn June I, culminating a lengthy al communist movement. intelligence operation, they were greatly surprised to findthe "general archives" and "Museum of Military Campaigns" of In the Shining Path of Bukharin the Shining Path terrorists. The residence, in one of Lima's Shining Path is the belated product of the "Bukharinite" most exclusive neighborhoods, had been the site of the latest line expounded in the famous " Congress of the Oriental Peo­ national congress of Shining Path's Communist Party of Peru ples" convoked by the Communist International (Comintern) at the end of 1989. in the the Soviet city Baku in July, 1920. That heterodox During the ensuing days, another four houses, all in position argued that world revolution would necessarily ad­ wealthy parts of the city, fell into police hands. According vance by means of revolutions in the backward colonial and to the police, more than 100 people were arrested, including neo-colonial countries. To accomplish this, the Bukharinites no less than three members of the terrorists' central commit­ contend, Marxists should take into account millennarian au­ tee and practically the whole logistics, finances, and docu­ tochthonous ideologies, which in syncretism with Marxism mentation staffof Ibero-America's bloodiest narco-commu­ could forge an alliance between the immense peasant masses nist organization. of those countries and their incipient worker vanguards. The most significant find were the filesshowing the real For many Marxists, the ChineseRevolution of 1949 con­ identities of the band's top and middle-level commanders firmed this hypothesis. And, in fact, the leadership of the and listings of legal fronts providing backup to the terrorists first socialist revolution in a backward country was trained and of people cadre should tum to in event of emergencies. in the Bukharin line by Borodin. According to the Lima press, the names and addresses The founder of the Peruvian Communist Party, Jose Car­ of prominent Peruvian political leaders appear on the los Mariategui, argued the same thesis in the 1928 Com intern list. at which the South American branch of Comintern was formed. The core strategy Mariategui propounded in his writ­ Demonic destruction ings was that the path to socinlist revolution in Peru would Ten years ago, dogs were found hung from Lima tele­ not begin with the small and incipient working class, but phone poles with signs reading "Deng Xiaoping, traitor to from messianic rebellions of the backward Indian majority Mao." It was the announcement of the beginning of Shining seeking to reestablish the Incan society which existed before Path's armed struggle, which has since then caused the coun­ the Spanish Conquest. try 18,000 deaths and $15 billion in material losses. The He founded the Peruvian Communist Party on that idea. terrorists fire-bombedfactor ies, dynamited hundreds of elec­ When the split between China and the Soviet Union took trical transmission towers, and bombed research centers. place in 1964 , the Maoists toolea larger ratio of the Peruvian They raged particularly against agricultural experimentation Communist Party than in any other country outside of China. stations in the backward highlands region. Their systematic Marilitegui's Seven Essays on the Peruvian Reality was the liquidation of these centers and murders of hundreds of exten­ bestseller at the colleges. A i faction calling itself "In the sion agents and teachers have thrown Peru back at least a Shining Path of Jose Carlos Mariategui" was born inside the decade in agricultural development, something really de­ Maoist Red Fatherland party. In 1970, it split out under the monic in a country in which the majority suffers from malnu­ name "Communist Party of Peru: In the Shining Path of Jose trition. Carlos Mariategui," presenting itself as the most radical and Shining Path insists that it is a strictly Peruvian move­ authentic followers of the Chinese Cultural Revolution. ment, without international connections and support struc­ There is more than enough evidence to affirmthat Shining tures. U.S. government "Shining Path experts" such as D. Path was, from its inception, a deployment of the most recal­ Scott Palmer and Cynthia McClintock have long vouched for citrant faction of the Chinese Communist Party, of the still its "autochthonous" nature. In fact, Shining Path's origins intact "Gang of Four," who protected Shining Path founder

52 International EIR July 6, 1990 Abimael Guzman during his long visit to China in the mid- The myth through which Shining Path manipulates the 1960s. Indian popUlation is the "Inkari" myth, according to which Between 1966 and 1970, there took place in Peru what a the Spanish, in order to consolidate d1eirconquest afterkill­ Rand Corp. sociologist called "the biggest peasant revolts of ing the Inca (in 1533) dismembered. the Inca's cadaver and the century aside from the Chinese Revolution." More than buried the pieces in the far comers bf Peru. The myth says 3 million Indian peasants mobilized for invasions of large that from the moment in which Mother Earth (Pachamama) landed estates. Abimael Guzman's group, which was in­ embraced the remains of her son, the Inca, the pieces of the volved in the ferment, grew stronger during this period. Intel­ cadaver began to move under the earth with the intention of ligence reports from the period speak of the presence of reuniting. Once the corpse of the Inca is complete, the body Chinese advisers in the Peruvian countryside. This peasant will resurrectitself and the redemption of the Indian race will wave was only brought under control by Gen. Juan Velasco be a reality. Shining Path tells the Indians that that moment Alvarado's 1969 agrarian reform. is about to come and to accelerate : it, "the earth must be The links between Abimael Guzman, or "President Gon­ bathed with blood." zalo," as he prefers to be called, with the Beijing cliques were confirmed by the many gifts from China exhibited in Shining Path is finished the Shining Path museum which police discovered on raiding Abimael Guzman, according t@ the best intelligence their Lima headquarters June 1. sources, is about to die. It is known tbat he has suffered from a rare form of leukemia of the red blood cells for more than 15 years, which should now be in its final stages, if it has not finished offthe criminal. His wife, Alejandra La Torre, who There is more than enoughevidence lives in exile in Sweden, surreptitiO\!lsly entered Peru a few months ago with the intent to bid him adieu. It is believed to affi rm that Shining Path was,fro m that her entry was detected and was one of the tracks which its inception, a deployment qfthe led police to the safehouse and the capture of the Shining most recalcitrantfa ction qfthe Path files. Neither the death of its founder, nor a successful but Chinese Communist Party, qfthe still isolated police action, could assure Shining Path's destruc­ intact "GangqfF our," who protected tion. Hopes for a prompt victory here in Peru are encouraged itsJounder Abimael Guzman during by other more profound aspects on the international plane. The Tiananmen Square student rebellion and the unmasking hislo ng visitto China in the mid- of the oppression of the Chinese people, has had enormous 1960s. effects on the minds of young Peruvian students. All the propaganda of a bucolic Communist China in which every­ one was well-fed and happy was nullified, the moment televi­ sion transmitted the images of Chinese tanks rolling over There does exist an ultra-radical communist internation­ students who demanded liberty and ptogress for their people. al , whose roots are in the Beijing soil which has protected Although Shining Path has mobilirzedthousands of miser­ Shining Path from its inception. This Maoist international, able and backward peasants as cannon fodder, hundreds of its which orchestrates the Shining Path support campaign in leaders were recruited in the country's universities, including Europe and in the United States, has held two international the most prestigious private colleges. Today, according to congresses in London, with the participation of Shining Path , military intelligence reports, Shining Path's recruitment in the Sikh terrorists from India, the Cambodian Khmer Rouge, Lima universities is practically nil. the Revolutionary Communist Party of the United States, Massive desertions of the gang'srcadre have taken place among others. during the past few weeks. In Ayacucho, dozens of their Abimael Guzman began as a former professor specializ­ military cadre turnedthemselves in to the Peruvian army. On ing in the philosophy of Immanuel Kant. From the time he May 17, Shining Path's tenth anniversary, a leafletappeared came to the University of Huamanga in the backward Andean in Ayacucho announcing that a faction was laying down arms city of Ayacucho in the 196Os, he delved into Indian messian­ and quitting the battle. Two of the top Shining Path leaders ism. That is the "blood and soil" ideology which supports a operating out of Europe, the anthropologist Julio Casanova revanchist utopia of the Indian race for the resurrection of and Luis Kawuata, also announced their separation from the Incan Empire. The role of the University of Huamanga Shining Path in late May. They claimed that other leaders and the stream of U.S. and French anthropologists who were using the movement's funds, ga(hered from its coopera­ worked there was vital for the design of Shining Path as an tion with cocaine trafficking, for their personal benefit, put­ ethnic separatist movement. ting them in bank accounts outside Peru.

EIR July 6, 1990 International 53 Congress, Ff A has been directly responsible for the loss of \05 ,000 Canadian jobs. Statistics released in early June re­ Canada is dissolved; port that 165,000 manufacturing jobs have disappeared in one year. But rather than placing the blame where it lies-in is the U. S. next? London, New York, and Washington-insincere Canadian voices are trying to blame Mexico instead. According to Peter C. Newman, writing in MacLean's magazine on June by EIR's Canada Staff 25, the immediate fear is that "what's leftof Canada's indus­ trial base could disappear in the face of Mexican wage rate, The June 23 provisional dissolution of Canada, through the which averages $.60 per hour. [There is the threat of] Mexi­ failure of the provinces of Manitoba and Newfoundland to co's maquiladora zone ...the deregulated area of northern ratify the Meech Lake Accords, advances a program of un­ Mexico where workers tum out every imaginable product controlled disintegration of nation-states throughout the for duty-free import into the United States, under minimum Western Hemisphere. It was clearly not the Indians of Mani­ income conditions, with virtually no health, safety, or envi­ toba Province, nor First Minister Clyde Wells of Newfound­ ornmental standards." land, who up-ended the Meech Lake agreement-a deal The big question is, will most Canadians swallow such whereby French-speaking Quebec would ratify the constitu­ misleading finger-pointing. Some 57% of Canadians in a tion only on the condition that it would be granted special recent poll said that the Ff A has harmed their nation. Polls status as a "distinct society." In fact, there had been agree­ asking the question: "Should the United States and Canada ment from Wells that he would submit the accord to a vote become one country," find 81 % of Canadians opposed to it. of the legislature (which he did not do) on June 9, and Manito­ Even in this traditionally placid population, the potential for ba's First Minister Gary Filmon, had assured Prime Minister something quite different than what the "common marke­ Brian Mulroney that his Province would ratify on time. teers" plan, might well be unleashed, once Canadians find Political economist Lyndon LaRouche, commenting on that in their newly found regional independence, they have the failure of Meech Lake, warned against treating it as an only traded their British colonial status for a far worse form "outburst of sincerity." On the contrary, he said, "this is an of economic slavery. outburst of manipulation." The question is, who benefits from the present constitutional mess? Many observers noted that neither the stock market, nor the bond markets experi­ EIR AUDIO gives you an hour cassette each enced any significant shock at Meech Lake's demise, despite REPORT week of the news, analysis, the fact that the Canadian media were filled with glowing interviews, and commentary that predictions of the Accord's passage. Establi$hment media don't want The only real beneficiaries of the political breakup of you to hear. Canada is the Anglo-American financial Establishment and its condominium arrangement with the Russian empire . Mul­ EIR AUDIO comes to you from the staff of roney's view is indicative. In an interview, he said that "We REPORT Executive Intelligence Review, have a stand-alone relationship with the United States, which the magazine founded by Lyndon is probably unique in the world-which is not unhelpful, by LaRouche, with bureaus around the way, in getting things done. We are developing a good the world. stand-alone relationship with the Soviet Union." With you get in an hour what "AII­ Free trade, the route to poverty EIR AUDIO News Radio" won't give you in a But that relationship will hardly be "stand-alone," since REPORT, lifetime. the Establishment's plan is to form a North American Com­ mon Market, while imposing a Schachtian monetary and First with the War on Drugs. banking dictatorship on Canada, Mexico, and the United First with the Foodfor Peace. States. Articles in the London Economist and columns by < First to drive a stake in the heartof Satanism. American yahoos such as Pat Buchanan now loudly proclaim Listen to EIR AUDIO REPORT each week. that the U.S.-Canada Free Trade Agreement (FfA)conclud­ ed last year ought to be extended to Mexico, and that the $500 per annual subscription. appropriate redrawing of the continental political map, in­ Make check or money order payable to: E I R News Service,P.O. cluding annexation of provinces (and perhaps, even seces­ Box 17390, Washington, D.C. 20041-0390. MasterCard and sion of states), should result. Visa accepted. Or call to place your order, (703) 777-9451. According to the 2.2 million-member Canadian Labor

54 International EIR July 6, 1990 city of Rosario, Menem told the military command that "the Argentina armed forces are not a trade union . . . they have to carry out specific functions and not demand ll¢tter wages. We're not going to risk the country's economic stability granting funds we don't have." Political analysts in Buenos Aires estimate that Menem's IMF tells armed willingness to implement the IMF's austerity dictates, even if it means dismantling national institutions such as the armed forces to disappear forces, has lost him the support of the Army high command which previously backed him. Finance Minister Erman Gon­ zalez has infuriated the high command by indicating he wants by Cynthia R. Rush to use the proceeds from the sales of state-runmil itary compa­ nies to pay offthe foreign debt, rather than to allocate those New military unrest has emerged in Argentina over the dra­ funds to the defense budget. Recently, Menem publicly in­ matic economic crisis faced by the armed forces. Funds are sulted Army chief of staff, Gen. Martin Bonnet, afterthe often not allocated for basic military operations and base latter requested that the President move up his timetable for maintenance, and officers and soldiers are forced to work pardoning members of the 1976-83 military junta who have second jobs to make ends meet. Recent wage increases have been jailed on various charges. Bonnet was prepared to hand not alleviated the crisis over funding or wages. Yet, in early in his resignation, but eventually backed down from publicly June, when an official of the International Monetary Fund confronting the President. · met with Economics Vice Minister Carlos Carballo, he com­ The President's popularity isn't doing too well in other plained that the nation's defense budget was too large, and spheres, either. His ratings are plunging in opinion polls, and demanded that it be cut. he has become the butt of jokes in much of the national media The Bush administration, and institutions such as the and television, which poke fun at his marital problems and Trilateral Commission, are demanding that Ibero-America's his reputation as someone to be avoided because he brings armed forces be dismantled, reduced Panama-style, to a do­ bad luck. But it is Menem's embrace of neoliberalism and mestic constabulary which can "fightdru gs." This plan does harsh fiscal austerity that is the real source of people's anger. not sit well with Argentina's top military brass, but it has been Inflation is starting to shoot up again, and there are reports endorsed by President Carlos Menem and Finance Minister that new austerity measures will shortly be announced. Antonio Erman Gonzalez. June's inflation rate is expected to be in the range of 15%. Reflecting tension over the economic and wage crisis, The popular support accorded Menem's estranged wife, in mid-June Major Jose Antonioni of the Eighth Mountain Zulema Yoma de Menem, is something of a barometer of Infantry Brigade unit based in Mendoza accused his superior, national sentiment. The First Lady has been highly critical Gen. Jorge Apa of the IV Army Corps, of having withheld of her husband's IMF austerity policies and their effect on funds which were supposed to go to the Mendoza unit, and the poorest sectors of the population. Last month she warned called for the general to be investigated by a Tribunal of that the country "is going to the devil" as a result of these Honor. The Mendoza unit had not received any monetary policies, and predicted they would fail by August. The First allocations for 45 days. General Apa's decision to relieve Lady is known to maintain friendsmps with Peronist labor Antonioni of his command and impose 15 days arrest for leader Saul Ubaldini, and nationalist army leader Col. Mo­ insubordination, was rejected by the entire Mendoza unit. hamed Ali Seineldfn, both opponedts of the government's When Apa ordered other mountain units to repress the rebels, economic policies. they refused to obey his orders. Other units based in the In statements published in Noticias magazine in May, provinces of Cordoba and Santa Fe , indicated they would Mrs. Menem charged that her husbll.nd has, in effect, been back Major Antonioni "with action" if necessary. kidnaped, and is surrounded by greedy individuals who only The incident was finally resolved through the intervention seek to use him. Shortly after that, Menem signed a decree of two top generals, and their agreement to investigate Gener­ ordering his wife to be removed from the officialpr esidential al Apa, who subsequently resigned as commander of the IV residence in Olivos, forcing her to ftake up residence in a Corps. But the economic crisis facing the armed forces is so downtown Buenos Aires apartment. After Mrs. Menem dire, that further uprisings are expected in coming weeks. moved into her apartment, slogans defending her began to appear on the walls near her apartment building. Zulema 'Don't ask for more' Yoma has indicated thatshe is prepared to expose high-level Menem stated in early June that he would accept no pres­ corruption among the President's cl�sest advisers, and that sures regarding military wages, and that whoever disagrees she will not leave without a fight. "II assure you," she told "can get out." On June 18, speaking on a radio station in the the June 3 Noticias, "if he wants war, he'll get war."

EIR July 6, 1990 International 55 Khmer Rouge on the march in Cambodia by Linda de Hoyos and Uwe Parpart

The Beijing-backed Khmer Rouge, whose leaders carried out (and toothless) protests from Washington, the Beijing gov­ the auto-genocide of Cambodia during their short tenure in ernment has recently sent shipments of supplies and arma­ power 1975-79, is on its way to re-establishing its power in ments to the Khmer Rouge, whose troops have been long Phnom Penh. Responsibility for such a victory must be laid prepared and built up by Communist China for the day of at the doors of Moscow, Washington, and Beijing, which Vietnam's troop withdrawal from Cambodia last September. have used the Cambodian people as nothing but cannon fod­ Money is reportedly no object for the Khmer Rouge lead­ der since the mUlti-power agreement to dispose of Cam bod i­ ership, which has also begun sending its children to European an head of state Prince Sihanouk in 1970. universities. Ieng Sary, number six in the Khmer Rouge In the last two months, the Khmer Rouge has managed hierarchy, has millions of doll�s at his disposal, according to duck negotiations for a ceasefire, initiated by Japan and to sources quoted by the Washington Times. The money Thailand, while steadily making headway on the battlefield. reportedly comes from Beijing or from the sale of gem mining According to the London Financial Times, the Khmer Rouge rights in Pailin, the key town in westernCambodia seized by has made the most significant gains its II years of fighting the the Khmer Rouge last winter. The Khmer Rouge has enough Hanoi-backed Phnom Penh government. The Khmer Rouge, money to buy rice from the peasants at inflated prices, paying along with the U.S.-backed KPNLF and Sihanouk's ANS, in U.S. dollars or gold. Cambodian sources also told this have reversed the defense of the key provincial city of Bat­ news service that in the eastern battlefields, the Khmer Rouge tambang put up by the Phnom Penh government earlier in simply carries money in from its western bases, buying weap­ the spring, with the reported aid of Vietnamese troops. In ons and materiel on the spot frC,}m either corrupted Vietnam­ mid-June, the Khmer Rouge bombarded Battambang with ese or Cambodian outpost commanders. heavy artillery , used by the Pol Potists for the first time. The Adding to the Khmer Rouge's material clout, the U.S. capture of Battambang, the Khmer Rouge believes, will clear House of Representatives voted June 28 to continue aid to the way for its troops to proceed down Route 5 to Phnom the "non-communist" resistancefor ces. This aid, as reported Penh. by Peter Jennings's ABC television documentary in May, The Khmer Rouge has also opened up another front, finds its way into the hands of the Khmer Rouge. Second, as acting to cut Route 6, which straddles Tonie Sap on the other Assistant Secretary of State Richard Solomon let slip during side. On June 6, the Khmer Rouge captured two district an interview on the Jennings show, such aid includes arma­ towns in Kompong Thorn province, Stuong and Sandan. ments, despite Congress's "non-lethal" provision. The The Khmer Rouge also claims to have seized 70 villages in House bill was promoted by Rep. Stephen Solarz (D-Mass.), northwestern Siem Reap province and has opened a battle­ chairman of the House Subcommittee on Far Eastern Affairs field around Kompong Thorn, in the vicinity of which they and an apologist for Beijing. It and was heavily lobbied for claim to have taken control of 35 villages. Between Kom­ by the Bush administration. pong Thornand Siem Reap cities, Route 6 is coming increas­ In sum, the Khmer Rouge and its assisting KPNLF and ingly under Khmer Rouge control. Five bridges have been ANS are poised to bring their military operations to success­ destroyed. The Khmer Rouge has also succeeded in cutting ful completion. Route 10 to the west. Simultaneously, according to Bangkok sources, the Khmer Rouge has issued directives to its guerril­ Troubles in Phnom Penh las to increase political propaganda (accompanying terror of On the other side, Phnom �nh has few resources to meet peasants), harping on the themes of Phnom Penh corruption this challenge. According to the Hong Kong press, a prior and nationalist fervor against the Vietnamese. decrease in Soviet aid had already produced a condition in which the Phnom Penh army lacked spare parts for its heavy Advantage to the Khmer Rouge equipment. The Soviet Union and Eastern European coun­ From all appearances, the Khmer Rouge is better tries are planning to cut off most of their economic aid to equipped than its Phnom Penh opponents. Despite public Cambodia, according to a confidential report of relief agen-

56 International EIR July 6, 1990 cies obtained by the Washington Post. That aid provides the Phnom Penh government with 80% of its revenue; 40% of Khmer Rouge forces cut Route 6 the budget goes to defense. Economic relations with the U.S.S.R. will be strictly commercial, meaning that Cambo­ dia must now pay on delivery for its oil and petroleum sup­ THAILAND plies, without the normal three-year postponement. Eastern European advisers have been recalled home. The government has been forced to lay off 56,000 civil servants and to sell government gold reserves to meet civil and military requirements. The author of the report states: i "When adding up all the factors, one must seriously question { whether the country can survive longer than six or 18 i months." .\..1 .' There are also signs of extreme tensions in the Phnom ./ Penh regime. At the end of May, the government of Prime Minister Hun Sen reported an attempted coup, announcing VIETNAM the arrest of key personnel , including Ung Phan , Minister of Transport , Communication, and Posts; Kan Man, the deputy director of the European and American bureau of the foreign ministry; and Col. On Sum of the Defense Ministry's re­ search department. There may also be questions as the military's re liability . Bangkok };ost According to columnist Jacques Beckaert, the The Khmer'Rouge are now simultaneously bombarding police are playing an increasingly important role in national Battambang with artilleryfire and pressing on Kompong Thom . defense and "their special A3 units are considered better with the aim of cleaning the path down Routes 5 and 6 to Phnom trained and disciplined than regular army forces." Penh.

Washington blows up ceasefire ment that might block the Khmer Rouge's return to fu ll power The opportunity for Khmer Rouge military break­ or remove the Khmer Rouge as a Beijing power card in the throughs was handed to the Pol Potists by the United States' region. Washington's interest in bolstering Beijing's region­ sabotage of negotiations among all four Cambodian factions al concerns in this case was further compounded by the Bush in early June in Tokyo. The talks had been painstakingly administration's reluctance to see any settlement evolve un­ prepared, primarily by Thailand in conjunction with Japan . der the coordination of Japan. Japan's Minister of State for Thai Defense Minister Chavalit Yongchaiyuth, in coordina­ the Defense Agency had met in Bangkok with Prime Minister tion with Japan , had prepared a draftceasefir e agreement and Chatichai .to affirm Japan's support for Chavalit's mediation successfully prevailed upon all four Cambodian factions to efforts. signal their concurrence by initialing the document in ad­ In its drive for a settlement in Cambodia, to which Japan vance. has pledged development funds once the war is ended , Tokyo Enter Assistant Secretary of State Solomon. After years was also mediating between Vietnam and the P.R.C. The of no objections from the State Department to the United Thai-Japanese effort, which saw major meetings in Bangkok Nations' seating of the Khmer Rouge as the officialCambo di­ between Thai leaders and leaders of all Cambodian factions an representative, Solomon, along with Pansak Vinyaratn , and Vietnam, additionally had the backing of Indonesia, Ma­ adviser to Thai Prime Minister Chatichai Choonhavan, insist­ laysia, and the Philippines. The entire effort had shoved to ed on changes in various clauses of the Chavalit draft, to the the sidelines the 1989 intervention of the Australians, which, effect of "reducing the Khmer Rouge role." Presented with backed by the United States, was also aimed at establishing the changed document in Tokyo, the Khmer Rouge's Khieu a British Commonwealth franchise over Indochina. Samphan claimed he had no mandate to sign it. The talks There may be a domestic motivation for Washington's essentially collapsed. Further confirming the deliberate U.S. blow-up of the Tokyo talks. U.S. embassy sources in Bang­ role in sabotaging the talks, on June 8, the military wing of kok indicate that since early settlement of the Cambodia issue the KPLNF announced that it did not fe el bound by the Hun would put normalization of U.S .!Vietnamese re lations on the Sen/Sihanouk Tokyo "self-restraint" agreement. agenda before the 1992 elections, and since a majority of One immediate reason for Washington's detonation of the 2.7 million Vietnam veterans would not look kindly on the talks is the Bush administration's consistent policy of normalization, George Bush is in no hurry to draw the war kowtowing to Beijing, which is not interested in any settle- in Cambodia to a close.

EIR July 6, 1990 International 57 Sri Lankan civilwar adds to instabilityof SouthAsi a by Ramtanu Maitra and Susan Maitra

The uneasy truce between the Liberation Tigers of Tamil not allow its territory to be used by "foreign terrorist groups" Eelam (LTTE) and the Sri Lankan government has broken as a base of operation. down over a trivial incident, and an all-out bloody war is The foreign terrorists referred to by the Indian prime now in progress in Sri Lanka. The 40-year-old ethnic crisis minister are none other than the LTTE militants, who, ac­ between the Tamils and Sinhalese, which has taken a toll of cording to media reports, are operating from the southern thousands of lives, is now fast approaching a state of civil Indian state of Tamil Nadu, 21 miles from Sri Lanka across war. The past history of Indian involvement with the Sri the Palk Straits. The Tigers are reportedly off-loading arms Lankan Tamils, coupled with a near-war situation prevailing purchased from Singapore and elsewhere along the Thanja­ in the subcontinent over Kashmir and Punjab, has made vur coast in Tamil Nadu, and transshipping them to the north­ South Asia currently one of the most volatile spots in the ern Jaffna Peninsula of Sri Lanka using fast fiberglass motor ' world. boats. Such information has been widely circulated in India, Reports about the present state of affairs in Sri Lanka but surprisingly, no action has been taken so far. indicate that the LTTE 'Tigers" and the Sri Lankan military are determined to annihilate one other. At this writing, the Tigers run amok in Tamil Nadu Tigers, who had grown decidedly cocky after "defeating" the The LTTE presence in Tamil Nadu is hardly news. Only Indian Peace Keeping Forces during the latter's two-year recently, a posse of LTTE assassins broke into an apartment stay in the island-state, have been inflicted with heavy casual­ house there and gunned down 1:4 members of the rival Tamil ties and are now on the retreat from urban areas in eastern militant group, the EPRLF, including its general secretary. districts. The Tigers are , however, holding their own in the In Sri Lanka, EPRLF was voted to power in the Tamil­ rural areas of the eastern provinces, ambushing Sri Lankan dominated northern and eastern provinces, in an election soldiers mostly through mines and booby traps, and consolid­ organized under the terms of the India-Sri Lanka Accord and ating their hold in the northern districts where the Tamils boycotted by the L TIE. The aPRLF government collapsed have a decided edge over the Sinhalese. with the withdrawal of the Indian Peace Keeping Force in The Sri Lankan Army, on the other hand, after initial early 1990, and the group officially sought refuge in India. successes in the urban aras , is now bogged down in the rural Their presence in Tamil Nadu iwas supposed to be a secret, areas of the eastern districts. With the help of the Air Force , but evidently security was breached. the Army is trying to break the Tigers' stranglehold in the The expose of the L TIE massacre in Tamil Nadu, northern districts. At this point, the pressure is on the LTTE . splashed across national dailes, was grave enough for New The vicious mood of either side is reflected in the no­ Delhi to summon Tamil Nadu

58 International EIR July 6, 1990 were supplied with "replacement" weapons on demand. the Tigers, "Eel am" has become a mere ruse, a pretext for Following the stationing of the Indian Peace Keeping indulging in violence. Forces on the island in 1987, India came to clash with the It is becoming increasingly evident that the LTTE is a Tamil Tigers when they reneged on the agreement to lay fascist organization which promotes ,a mystical racial notion down arms under the terms of the India-Sri Lanka Accord . of the destiny of the Tamil people. Anything that stands in The umbilical cord between RAW and the Tigers was cut, its way has to be attacked and destroyed: first, the Sri Lankan but not before the RAW-trained Tigers, using mines and soldiers; then, the other Tamil militant groups; next, the booby traps, had killed as many as 1,200 Indian soldiers. In Indian soldiers; and then, back to square one: Annihilate the addition to the RAW connection, the Tigers had powerful Sri Lankan Army. According to on-the-scene reports from friends in Tamil Nadu. The late chief minister, M.G. Rama­ one Indian news weekly, Tamils in J�ffna who have come to chandran , who was posthumously adorned with India's high­ accept the killings as "j ustifiable homicide" today see "noth­ est national award by then-Prime Minister Rajiv Gandhi, was ing ahead." It is difficultto comprehend how the Tamil Nadu a personal friend of Pirbhakaran and had helped the Tigers chief minister could support such a movement. operate from safehouses in Tamil Nadu until the day he died. The process has already created a security crisis in the There are many other covert sympathizers of the Tigers in region. In 1983, President Junius Jayewardene of Sri Lanka, Tamil Nadu who tenderly address them as "the boys." unable to cope with the Tamil militancy, sought help from British mercenaries and the Israeli Mossad to train the Sri Many dangers Lankan Army in counterinsurgency. India justifiably op­ Such sentimentality is hardly appropriate. As Prime Min­ posed this move, citing a breach of the security situation ister V.P. Singh has pointed out, Indian support to foreign within a stone's throw of its borders. A similar situation is terrorists is fraught with many dangers . On the surface the again developing today . Sri Lanka buys arms from China, Tamil Tigers demand an independent Tamil state (Eelam) the United States, Pakistan, and others . It will be a danger within Sri Lanka, advocating the "two-nation theory"-one to the region if China or some such hostile nation is allowed country , two nations-earlier pushed successfully by Mo­ to dig its roots in Sri Lanka because of the threat posed by hammad Ali Jinnah before Pakistan was created. But, for the Tamil Tigers.

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EIR July 6, 1990 International 59 After this colorful beginning, Casey, in the early seg­ ments of the article, called into question an historical-philo­ sophical trend in English thinking which openly prefers ani­ mals to human beings, especially when those human beings are non-whites. He noted that the English have traditionally been guilty of what he calls the "heresy" of "animal worship." H� warned that "conservationists and animal rightists" are Prince Philip apes proposing to re place the Judeo-Christian tradition with "a mixture of sentimentality and species fascism." Adolf Hitler's creed The Cambridge professor pointed to Prince Philip, inter­ national president of the World Wide Fund for Nature (for­ merly World Wildlife Fund), as representative of this kind by Mark Burdman of thinking: "The husband of the Supreme Governor of the Church of England [Queen Elizabeth II] recently tried to In a commentary appearing in the Sunday Telegraph of Lon­ persuade the Pope to abandon Judeo-Christian teaching, in don June 17, Prof. John Casey ofCaius College, Cambridge which man has dominion over: all the beasts of the field, in University launched a sharp attack on the fascist "animal favor of the conservationist view that human beings are now rights" movement. Casey identifiedAdolf Hitler as the most simply a teeming proletariat, who are making the world un­ famous animal rights advocate of this century. Also, Casey safe for gorillas , elephants, and badgers. This must have singled out for attack an individual whose endorsement of been the most improbable attempt at conversion since St. paganism is familiar to readers of this publication: Prince Francis of Assisi preached Christian pacifism to a startled Philip, Duke of Edinburgh, prince consort of Queen Eliza­ Sultan of Egypt in 1219." beth II. Further on, he honed in on the philosophy of the animal Casey is a professor of philosophy and expert on ques­ rights movement: "Until very recently, all philosophers and tions of morality and ethics. He has just written a book enti­ theologians taught that only persons can have rights. Indeed, tled Pagan Virtues, which defends Christianity against its the idea of a person is the idea of a being with rights .. ..The pagan critics. Earlier this year, Casey wrote an opinion col­ idea of the rights of animals is made up of several elements: a umn for the Sunday Telegraph, in which he warned that revulsion at inflicting pain upon them; a delight in them; and Britain would irreversibly be crossing the boundary from a denial of their otherness and strangeness. To claim that Christianity into paganism if its leading influentials contin­ animals have rights is to reduce the very notion of rights to ued to call into question the principle of the sacredness of mere sentimentality, a matter: of taste. To grant rights to human life. gorillas and the higher mammals, but to deny them to spar­ His attack on the "animal rights" movement followed by rows and ants, is to make rights arbitrary, and to remove all days, an offensive launched by the left-Fabian Guardian force from the idea. And to ex-tend rights to all living crea­ newspaper in support of the "animal rights" philosophy. tures would be to make the notion of a right unintelligible. Guardian feature articles of June 11 and June 14 asserted "If that is all we mean by 'rights' then we are in grave that there was no moral or philosophical basis to distinguish danger," he went on. "For it encourages us to think that human beings from the animal species, and singled out the having rights is not an essential, inalienable part of being most precious notions of the Judeo-Christian tradition, such rational. Human beings have rights, not because they are as natural law and the primacy of human creative reason, as clever, or rare, or nice-but because they are human beings." impediments to the realization of "animal rights." In the days leading up to the Guardian offensive, Prince Philip had 'His name was Adolf Hitler' openly lent his support to the pagan animal rights movement. In the last two paragraphs, Casey went in for the kill. Also, Britain and other countries have been hit by an increas­ "The idea that human bein&s are to be valued, not essen­ ing wave of "animal liberation front" terroristactio ns, target­ tially, but only if they are members of higher, rarer groups, ing scientificresearchers in particular. is not unknown in the modern times. And a love of animals need not lead to a reverence for human beings. Do ants have rights, too? "The most famous animal lover of the 20th century hap­ Casey's June 17 piece is entitled, "How animals make an pened also to be a fervent vegetarian. It is said that his dog ass of man." He began the article with a quatrain: was the only being which inspired human affection in him. "He prayeth best who loveth best If he saw anyone eating meat-soup, he berated them for All things both great and small; consuming what he called 'corpse tea.' He thought that the The streptococcus is the test; world would be a better place with a smaller human popula­ I love him best of all." tion of the finest stock. His name was Adolf Hitler."

60 International EIR July 6, 1990 Animalrights : the new Nazism The 'animal liberationists' are so crazy they might sound like harmless kooks-but look again. They 're deadly serious.By Kathleen Klenetsky.

On June 10, a 13-month-old baby was nearly killed in Bristol, in human lives is incalculable," says one scientist. England, when a car bomb intended for a scientist exploded In other areas, animal activists have promoted legislation next to the infant's carriage. Just days earlier, British re­ aimed at shutting down all meat production, by imposing searcher Margaret Baskerville, a veterinarian at the Chemical regulations on livestock farmers so stringent that they would Defence Establishment at Porton Down, barely escaped either drive them out of business or drivemeat prices into the death when an explosive planted beneath her car detonated. stratosphere. Authorities believed that both acts of terrorism were the The animal rightists are quite open about their goals: work of so-called animal liberationists. In the Baskerville They want to end the use of animals by man, period, and case, a man who identifiedhimself as a representative of an they are explicit about why this should be done. To view animal rights group called BBC TV to claim credit for the animals as having been created for man's use is gross "specie­ attack, saying it was "unfortunate" that Baskerville had sur­ ism"-according to Peter Singer, the movement's leading vived, and warning that "anyone who works at Porton Down philosopher and author of its bible, Animal Liberation. first is now a target." published in 1975. The fact that human beings are endowed These incidents are only the latest in a long string of acts uniquely with creative reason does not give them any greater of violence and intimidation carried out in recent years by importance, or greater rights, than animals, he says. the proponents of "animal liberation" or "animal rights." "I don't believe human beings have the 'right to life,' " Their targets include scientists, researchers, farmers, pet asserted Ingrid Newkirk of People for the Ethical Treatment owners, furriers, and fur-wearers-anyone, in fact, who uses of Animals (PETA) in a 1986 interview. "That's a suprema­ animals in any way. Since 1981, ninety-one incidents in the cist perversion. A rat is a pig is a dog is a boy." Newkirk also United States alone, including bomb threats, break-ins, and believes that ending animal experimentation is as urgent as arson, were linked to animal rights groups, according to the the obligation to crush the Nazi oppression of the Jews. And office of Rep. Charles Stenholm (D-Tex.). Scotland Yard PETA founder Alex Pacheco predic�s, "The time will come has put the Animal Liberation Front (ALF) on its list of when we will look upon the murder of animals as we now terrorist organizations. look on the murder of men." These depraved views are gaining currency among larger 'A rat is a pig, is a boy, is a dog' and larger numbers of people. Six. years ago, PETA, the The animal rights movement, which has been growing best-known U.S.-based animal liberation outfit, had 8,000 by leaps and bounds over the past several years and has members, an annual budget of $242,000, and a staffof eight. received the de facto imprimatur of such oligarchs as Brit­ Now it has more than 300,000 members, a $7 million per ain's pro-pagan Prince Philip, represents a potent danger to year budget, and it employs nearly 100 people. According humanity. Behind all the rhetoric about protecting animals to the American Medical Association, the U.S. is currently against cruel treatment, the animal liberationists' real agenda home to over 400 animal-protection societies, which spend is to destroy the physical and philosophical bases for the $200 million each year. survival of mankind. With lethal intent, the movement has made biomedical Against the sanctity of human life research one of its priority targets. Through tactics ranging The utter contempt for human life expressed by Newkirk from actual and threatened violence through letter-writing and and Singer is far more dangerous than any specificact com­ propaganda campaigns, it has succeeded in spreading fear and mitted by the animal rightists, and places the movement on demoralization through the scientificcommunity . Animal lib­ the cutting edge of the campaign to wipe out Judeo-Christian erationists have wrought tremendous physical damage on labs civilization, and bring back paganism. and research centers, forced experiments vital to medical By insisting that a man is no better than an animal, and progress to be delayed or terminated, and frightened current that no animal should be "sacrificed"to human use (in scien­ and prospective scientists into other fields. 'The potential toll tificresear ch, or as food or clothing),. the animal liberationists

EIR July 6, 1990 International 61 are consciously attempting to destroy the fundmental premise to kill a healthy chimpanzee. To say otherwise, he charges, of Christianity, that God made man-and man alone of all is an example of "specieism." . Creation-in His image. In 1985, in reaction to the U.S. "Baby Doe" decision, he That campaign can be traced directly to the highest reach­ wrote a book called Should the Baby Live? The Problem of es of the international oligarchy, which is committed to recre­ Handicapped Infants. in which he insisted that the "doctrine ating a global empire modeled on that of pagan imperial of the sanctity of life, as understood in the Western tradition Rome. Prince Philip gave voice to this intention, when he since Christianity prevailed, is not in any sense a fundamental gave a ringing endorsement of paganism, telling the National tenet of a civilized society." Singer cited examples of other Press Club in Washington that pagan religions had been more "civilized" societies, such as ancient Greece, which practiced effective than the "revealed religions" in cultivating a proper infanticide, and says that Western society's ''unusual'' rejec­ respect for Mother Nature. tion of infanticide reflects "some seventeen centuries of Philip was in Washington for the North American Con­ Christian domination of Westem thought and cannot rational­ ference on Religion and Ecology May 16-19, which featured ly be defended." among its speakers leading animal-rights activist Michael In an article published in 1983 in Pediatrics. Singer Fox, of the Humane Society of the United States (see EIR . wrote: "Once the mumbo-jumbo surrounding the term 'hu­ June 8, 1990, "Prince Philip and the EPA revive paganism man' has been stripped away, we may continue to see normal as 'ecology' "). In his presentation, Fox charged that man's members of our species as po$sessing greater capacities of "doministic" attitude toward the animal kingdom had result­ rationality, self-consciousness, communication and so-on, ed in a "holocaust." To establish the right relationship with than members of any other spe¢ies; but we will not regard as nature, said Fox , humanity must abandon the "male, mono­ sacrosanct the life of each and every member of our species, theistic religion of reason" and return to the "religious tradi­ no matter how limited its capacity for intelligent or even tions of earlier times, which linked humanity to the animal conscious life may be. If we compare a severely defective kingdom through the Earth Mother, the matrix-creatrix ... human infant with a nonhumah animal, a dog or a pig, for Gaia, Pan, Diana." example, we will often find the nonhuman to have superior Three weeks afterthe NACRE conference, Prince Philip capacities, both actual and potential, for rationality, self­ told the London Observer that, in a recent meeting with consciousness, communication, and anything else that can Pope John Paul II, he had argued in favor of curbing human plausibly be considered morally significant." population growth, on the grounds that it was "reducing the In a 1979 offering, PractU;al Ethics. Singer wrote that space available" for wild animals. The prince also excoriated Bentham "was right to describe infanticide as 'of a nature the Bible for allegedly promoting cruelty to animals. With not to give the slightest inquietude to the most timid exquisite timing, the prince's statements came just days be­ imagination.' " From there, he proceeded to argue for legis­ fore 24,000 animal-rights activists demonstrated in Washing­ lation that would "deny a full legal right to life to babies" for ton in favor of the pagan belief that man is on a par with the at least a month after birth . "Killing a defective infant is not rest of nature. morally equivalent to killing a' person. Very often it is not wrong at all. " Kill people, not animals In the same volume, he marshaled a host of arguments in The animal liberation movement's determination to oblit­ favor of euthanasia-including "nonvoluntary euthanasia" erate the concept of the sanctity of human life is perfectly and active euthanaisa-against the elderly, the handicapped, explicit. Peter Singer, a philosopher at Australia's Monash and the terminally ill. University whose 1975 Animal Liberation is credited with initiating the animal rights movement, places himself in the Hitler loved animals, too tradition of British utilitarian Jeremy Bentham, who took As Singer's pronouncements demonstrate, the animal love of animals to truly bizarre depths. Invoking Bentham's rights mentality bears a frightening resemblance to the Nazis. ludicrous thesis that the most important characteristic of a Hitler, whose euthanasia program against "defective" Ger­ being is its capacity to feel pleasure and pain, Singer argued man citizens led inexorably to the Holocaust, loved animals, that animals, because they have this capacity, should be treat­ and was a fanatical vegetarian; as were several members of ed essentially as humans-and vice versa. his inner circle. This leads straight down the path to the wholesale de­ The similarity is not lost 00 the animal rights theorists. struction of human rights, including the fundamental right, Singer wrote that, while the Nazis "committed horrendous the right to life. Singer has also written extensively on the crimes," this "does not mean that everything the Nazis did need for instituting infanticide and euthanasia-against hu­ was horrendous. We cannot condemn euthanasia just because mans, not animals. the Nazis did it." The Oxford-educated Singer has stated publicly that it is Next: How the animal rights movement is sabotaging more moral to kill a "defective" human newborn, than it is medical progress and agricultural production.

62 International EIR July 6, 1990 Vatican by Maria Cristina Fiocchi

Europe's task to keep the peace there were nationalist-type exaggera­ Giovanni Cavalcoli, a Dominicanfather active in the Roman tions. But after the Council, a kind Curia, says we must revive classical cultural values. of self-wounding process took place. Now we must recover the most au­ thentic humanistic values of the Gre­ co-Roman tradition, so that the peo­ ples outside Europe may also be Forty cardinals, bishops, and repre­ the existence of spiritual ferment all inspired by these universal values sentatives of religious orders from over Europe. I think it will be a matter without fearing extraneous superim­ East and West were invited by the of getting European Christianity's positions. " Pope to a meeting to prepare the spe­ 'two lungs' to breathe together, as the Father Cava1coli observed that cial assembly of bishops to be held in Holy Father likes to put it." He warned common origins in the Enlighten­ 1991. The meeting at the Vatican that "we must be quick to supply aid," ment, shared by Soviet Marxism and from June 5-7 touched upon, accord­ to Eastern Europe, "including eco­ American liberaljsm, are shaping the ing to an official Vatican press re­ nomic aid, because we stand before "new cultural climate which is becom­ lease, "vitally timely topics, such as a grand spiritual rebirth, recognized ing hegemonic ala world level" in the the description ofthe situation and ex­ even by the Communists," but great "U.S.-U.S.S.R. dialogue." Taking pectations, the theme and the date of poverty of means. an "historicist" view of everything, the future special Synod, its prepara­ Father CavaIcoli contrasted the this "new Iiberill-socialist Russian tion, the criteria for election of the "strong spirituality" in the East, "test­ American ideology" makes the error Synodal Fathers, and the presence of ed by countless sufferings," to the of "relativizing truths and religious observers from other Christian spread in the West of "a certain secu­ and moral values," he warned. churches. " larism . . . a certain sympathy for We asked him what he thought of This occurred, the press release Marxism which has something para­ the persistent talk of a New Yalta-a went on, "in a spirit of deep commu­ doxical in it." Western Christianity new dividing up �f the world between nion and unity with the churches shows signs of becoming "decadent, the two great powers. which have come out of long decades enfeebled, slack, a bit skeptical," he "The basis upon which it rests is of oppression, whose representatives noted, with the faith "considered as very fragile," he replied. "I don't have offered impressive witness of one opinion among others. think it is capable of guaranteeing a personal sufferings and those of the "Now, too, there is the risk, which truly serene future on the international community for the Gospel. " the Pope exposed, that the entry of level. This is also the Holy Father's We asked Father Giovanni Caval­ freedom to the East may open the viewpoint, whicb I fully share, and I coli, a Dominican priest, to comment doors to the infiltration of negative refer to the Pope's calling upon the for our readers on this extraordinary and decadent elements from the responsibilities of Europe, a Europe event. He is active at the Roman Curia West." Already, he said, "all kinds which can rediscover its own Christi­ and has already published numerous of cults, above all from the U.S., are an roots. This r�covery of Christian writings on the role of Europe. coming in, and they are loaded with roots, in the Pope's intentions, is not Father CavaIcoli said, "We have money. The Syn9d convoked by the a kind of historical-narcissistic revisi­ before us a great historical prospect Holy Father is for us believers a sign tation, but an awareness of Europe's from various standpoints: the con­ of great hope for such dangers to be role in a task of �great responsibility: struction of a united Europe and the allayed." maintaining and assuring peace in the edification of a European Church CavaIcoli believes that "no conti­ world. The Pope;considers Europe as which will be able to recover with nent has as much potential as Europe the determining factor. Today peace greater strength and sharpness . . . the to offer a Christian-inspired culture to cannot be guaranteed by these East­ Christian values, the values of faith the world. There is the need, in my West treaties, although they have their which are at the origin of Europe." view, for a recuvery of the Greco-Ro­ value, so much as by a more active, He pointed out, "The times are man culture which has been somewhat decisive presence of Europe. May the quite favorable, both because of the downgraded in these last post-Council voice of Europe also be heard by the crisis of communism and because of decades. Of course, before Vatican II great powers!"

EIR July 6, 1990 International 63 Dateline Mexico by Carlos Cota Meza

What does Negroponte do? riots were headed by Buddhist monks; The reign of U. S. ''proconsul'' John Negroponte in Mexicohas Buddhism is a religion in which Ne­ coincided with a series of strange developments. groponte has special ized. Negroponte's mission in Mexico is to prevent, at all cost, the advance of the nationalist opposition movement around Cuauhtemoc Cardenas and Less than one year in his post, U.S. end of the visit, Negroponte told re­ other sectors both within and outside Ambassador to Mexico John Dimitri porters that the two governments the government who want to set an Negroponte is already a central figure "have agreed not to publish the de­ independent course in Mexican for­ in Mexican politics . And while his in­ tails" of their arrangement governing eign and ea:onomic policy. To that ef­ fluence grows weightier by the day, DEA agents in Mexico, but that it was fect, Negr

64 International EIR July 6, 1990 PanamaReport by Carlos We sley

u.s. seeks to outlaw security forces bat, according to sources in Panama, Media attacks on the narco-government have only one purpose: will soon be appointed the first civil­ elimination of any inde endent militaryfo rce. ian chief of the new constabulary. He p said the use of the PDF "is only a tran­ sitory stage." But Eisenmann and his allies are demanding that Panama abolish out­ right any security forces. This is not a Syndicated columnist Jack Ander­ pleased with Eisenmann's criticism of new position for these agents of Proj­ son denounced the U. S-installed gov­ those troops," Anderson reports, and ect Democracy, the U . S. not -so-secret ernment of Panama in an article on at one point "tried to gain control of parallel government. Eisenmann, a June 25. "Since Panama was 'liber­ the 700 La Prensa shareholders and contributor to the magazine put out by ated' by the United States from the have Eisenmann fired." He didn't suc­ Project Democracy's public arm, the clutches of Manuel Antonio Noriega, ceed, but his critics insist that Arias is National Endowment for Democracy Panamanians are findingout that free­ covering up for "corrupt members of (NED), had La Prensa proclaim back dom isn't what it was cracked up to the Panamanian police." in July 19, 1987: "Panama does not be," wrote Anderson. "The new ad­ Neither Anderson's column nor an need an army." La Prensa also called ministration of Guillermo Endara has almost identical attack appearing the for dismantling the Civil Police, the show little patience for its critics in same day in the Los Angeles Times Coast Guard, and the Border Police in the press or inside the government." made any reference to the most seri­ order to "have democracy." Ruben After such an introduction, the ous case of corruption of all: that of Caries, Panama's Comptroller Gener­ reader perhaps expected Anderson to Col. Eduardo Herrera. Appointed at al and an ally of Vice President Ford, chastise Endara for trampling on the the insistence of the U. S. to head the told the Times, "Now is the time to rights of, say, publisher Escohistico Public Force, the constabulary that re­ build a completely new Public Force, Calvo, who has been jailed on placed Panama's Defense Forces while the Americans are still here." trumped-up charges since the U.S. in­ (PDF), Herrera is at the center of the As we noted in EIR on June 15, vasion. Instead, Anderson took up the scandal involving the transfer of "It is not a case ofbea ting swords into cudgels for La Prensa's Roberto weapons obtained by Israeli reserve plowshares. While Panama will be de­ Eisenmann, who "has been at the Col. Yair Klein to Medellin cartel nied its own army, there will be armed forefront of a crusade" to purge Pana­ kingpin Gonzalo Rodriguez Gacha. forces in Panama-U.S. forces." ma's new constabulary of "corrupt According to the Times, Arias Those troops will enforce the new im­ former members of Noriega's Panama Calderon, who is also the interior and perial agreement& between the U. S. Defense Forces." justice minister, "is moving to impose and the U.S.S.R. Eisenmann is facing opposition his policies in areas under the jurisdic­ U.S. Secretary of State James from AttorneyGeneral Rogelio Cruz, tion of President Guillermo Endara, Baker told a meeting of Central Amer­ whose own ft!sume-says Ander­ and the second vice president, Guil­ ican Presidents in Guatemala on June son-"includes a stint as director of lermo (Billy) Ford." Ford, a former 18, that they should "take the historic Panama's now defunct First Inter­ co-owner of Eisenmann's Dadeland opportunity" to cut their militaries. Americas Bank, which was controlled Bank of Miami, is, to quote the Times, According to the June 25 issue of by the Cali drug cartel of Colombia. " "an advocate of strict free-market pol­ Newsweek magazine, "Panama is the But Anderson fails to mention that icies, an approach scornedby" Arias's test case" for a "new era in U.S.-Latin Eisenmann is tied to the rival Medellin Christian Democrats. American relations." U.S. Ambassa­ cartel, through his co-ownership of They also differ in their approach dor Dean Hinton, "America's closest Dadeland National Bank of Florida, to Public Force. Arias favored using approximation to the Roman Empire's a key financial institution for one of former members of the PDF as the troubleshooting proconsuls," is over­ Medellin's money launderers. core of the new constabulary. "We seeing the demilitarization of Pana­ Vice President Ricardo Arias Cal­ wanted them to know that there is a ma. "The heart of the program is the deron, whose family links are also place for them," Arias's aide Roberto conversion of the Panama Defense with the Cali cartel, is Eisenmann's Azbat told the Times. "We didn't want Forces into a police force armed only main oponent. Arias is "none too to see them become guerrillas." Az- with pistols and shotguns."

EIR July 6, 1990 International 65 International Intelligence

to train some of the new riot-control units, Po lice shakeup in I1iescu said, because they had the most Panamanians demonstrate Colombia 's Cdrug capital' experience in crowd control! The new against U. S. occupation force will be set up because, "for the police and the Army, psychologically Colombian National Police authorities an­ Giving the lie to the claims of the Bush ad­ speaking it is now difficult to confront the nounced on June 20 that major internal ministration that Panamanians "welcomed" populace when they are on the streets," changes were under way in the city of Med­ the U.S. invasion of their country last Dec. Iliescu said. "This has created a state of ellin, dubbed the country's "drug capital" 20, some 25 ,000 Panamanians, many stress and a certain inferiority complex on because the cocaine-trafficking Medellin dressed in mourning, demonstrated on June behalf of some military units - even when Cartel is headquartered there . The 96-man 22 against the continuing presence of U.S. they have to confront obviously rebellious command hierarchy of the Medellin metro­ troops and the puppet government installed elements. ... Even though we had a politan police is slated for replacement by by Wa shington. legally elected government and state insti­ officers from Colombia's outlying provinc­ This i$ the largest opposition demonstra­ tutions were being attacked, the police did es, and the top commanders of Medel l fn 's tion since-the invasion, and more than dou­ not dare to shoot to scare them even in F-2, the pol ice intelligence unit, are expect­ ble the size of a previous demonstration, in self-defense. This is an indication of the ed to be transferred elsewhere imminently. May. The!major sponsoring groups were the acuteness of this psychological state." Replacement of the entire police force is Relatives ;af the Fallen of December 20, the I1iescu said he would have to recruit also under consideration. National Committee of Unemployed, the "young and determined l ads." The shakeup reportedly has as much War Refu�ees of Chorillo, plus many trade to do with purging contaminated elements unions, student groups, and groups of rela­ as it does with giving much-needed relief tives of political prisoners . to the city's law enforcement agents. Med­ Speakers at the rally denounced the ellin Cartel chieftain Pablo Escobar has Ch ina to strengthen crimes committed during the invasion and offered a bounty of $4,000 for every militia to keep �order' demanded justice and a government that was policeman assassinated in that violence­ independ�nt of the United States. The orga­ torn c 141 n izers vowed to hold monthly demonstra­ ity. So far this year, officersha ve The Army of the People's Republic of China been slain, and 40 more have resigned in tions on tfue20th of each month. is calling for strengthening the m i l i tary ca­ fe for their ar lives. pability of the country's militia to deal with "We are seriously considering changing what it termed "the urgency of the situa­ all of the 160 officials and 4,187 agents we tion." The Liberation AmlY Daily of June 19 have in that city; that is, bringing personnel Fa ng �izhifreed: did not specifythe source of the urgency, but from different parts of the country. It is a it said the militia was supposed to "maintain Will Bush restore ties ? measure intended to prevent infiltration by social order." Medellin Cartel people," said one police In an earlier article, the same paper not­ The announcement on June 25 that Chinese source. ed, "The possibility exists of local wars and dissident Fang Lizhi and his wife have been military conflicts in the border areas of our allowed to leave Beijing, is seen by i nte l li­ country," and that much of the weaponry in gence analysts as giving the go-ahead for the People's Liberation Army, while well the Bush administration to fully restore rela­ Romanian government suited to normal conditions, "cannot meet tions with the Chinese Communist govern­ the needs of fightingin cold, hot, or jungle ment. Astrophysicist Fang and his wife had consolidates fa scist rule areas ....When they reach 4,000 meters, been given asylum in the U.S. embassy in then the weak points emerge." Beijing during the June 4 massacre last year. Romanian President Ion Iliescu is setting The sections of the Chinese frontier that The Bush administration hailed the re­ up a new riot-control force, he told the are so high are mainly in Tibet - which bor­ lease ofthe couple as a "far-sighted, sig­ Times of London of June 25 . The move ders on India, Nepal, and Bhutan - and Xin­ nificant step," which will allow improve­ follows a bloody crackdown against anti­ jiang, which abuts the Soviet republics of ment of Sino-U. S. relations . government demonstrators earlier in the Ta dzhikistan, Kirghizia, and Kazakhstan. Fang, who is now in Britain, will likely month, in which storm troopers recruited To deal with "local war," the Liberation teach at Cambridge University. Xinhua, the by Iliescu's government beat and jailed Army Daily said the PLA needed equipment official Chinese news agency, said that he peaceful protesters. "mobile on land as well as transportable by and his wife have "repented" and promised The Romanian government is consider­ air," and which could be used in tropical not to take part in any anti-Beijing activities ing asking British or American institutions areas as well as .high al titudes . abroad.

66 International EIR July 6, 1990 Br�ejly

• THE WEST GERMAN Parlia­ ment on June 21 formally denounced the violence P€lrpetrated by Roma­ nia's Presidcne Ion Iliescu against demonstrators. The new Romanian Gerald Seagal, a China expert with Brit­ going on inside NATO , as "the nature of the dictator was ac�used of inciting vio­ ain's Royal Institute of International Affa irs potential enemy changes. " lence aga inst tht opposition, to crush (Chatham House), said that the release of Many British military people believe peaceful protes� rallies in Bucharest. Fang gives the Bush administration the that the kind of equipment and manpower The resolution was handed over to "symbol" it has been seeking from China Britain now has stationed in Germany is "no the Romanian ambassador to Bonn. , since last year to prove that China is a "nor­ bloody good, if something is brewing south mal country" that you can do business with. of the Mediterranean or in the Middle East." • THE BRAtILIAN Green Party, Bush has been looking for the opportunity According to this source, there is much dis­ which had failed to meet the relative­ to make a deal with the P. R.C. since he sent cussion in Britain about the growing "supra­ ly simple requirements for registra­ National Security Adviser Brent Scowcroft national threat of fundamentalist Islam." tion as a na tional party, and which and Deputy Secretary of State Lawrence Ea­ had therefore b�en ruled ineligible to gleburger there last year, Seagal said. The run for office, :was resuscitated by British government must also have played a Shamir hails end of vote of a majority in the Congress key role in Fang's release, he said. on June 23, whp voted to waive the The Chinese government m ust be happy u. s. dialogue with PLO normal regulations and permit the to let Fang go now, Segal said, because he party to be regi*ered anyway. , was causi ng problems in relations with the Israeli Prime Minister Yitzhak Shamir on United States. Beij ing is convinced that the June 20 praised the Bush administration for • ARGENTINA'S nationalist mil­ opposition movement will never amount to breaking off its 18-month-old dialogue with itary leader Col. Mohamed Alf the Palestine Liberation Organization. He Seineldfn is the target of attack in the anything, Seagal said, because it is too frag­ ! mented. Beijing's view is that sending a dis­ said he hoped Washington would never June 1990 issue of the Anti-Defama­ sident leader with a "strong ego" abroad will speak to the group again. tion League's Lptin America Report. just help splinter the opposition. Bush announced that he was suspending Author Martin !Edwin Andersen, a deal ings with the PLO because it had not fri end of forme� Argentine President denounced a May 30 attempt to raid Israel Raul Alfons!n, �ccused Seineldfn of New role seen fo r NATO by sea. being the primab' threat to democra­ "Today, after the United States has cy in Argentina; in �unboat diplomacy ' reached its conclusions, we cannot but wel­ ! come it," Shami r told Israel Radio . • FRANCIS iMAUDE, Britain's NATO must remain a viable alliance, to deal Regarding Bush's comments that he Minister of S tat� for Hong Kong will with threats from the South, including North would promptly reopen talks once the PLO visit Beijing in �uly, the first British Africa and the Middle East, stated Britain's condemned the assault, Shamir said: "It minister to visit there since the mas­ permanent representative to NATO, Sir Mi­ raises doubts that perhaps the United States sacre last June. The visit will discuss chael Alexander, in a speech to the Royal has not reached a clear conclusion that what arrangements f4>r the shift of Hong United Services Institute in London on June we are indeed talking about is a terrorist Kong rule froll1 Britain to China in 20. Because such threats exist, he stated, organization that never stopped terrorism 1997. The For�ign Office expects a the NATO alliance is "still very much in for a moment. I hope this suspension will del uge of dom4stic criticism of the business," despite what he described as di­ not be temporary but will determine a new viSit, but a spokesman said: "We just min ishing East-West tensions. Chapter in the U.S. attitude towards the have to brave it 10Ul. It is simply nec­ Alexander said that NATO could be Middle East." essary to get on with our di alogue . faced in the coming years with "precise" Intelligence sources report that there is over Hong Kong . " threats from the south, including a possible more to the Israeli policy than meets the attack from a specificco untry. Under such eye, however. During the last week in June, • YAEL DAiAN, the daughter of conditions, NATO would be able to "retali­ Shamir sent letters to Bush, Gorbachov, and the famous Isn�li Gen. Moshe Da­ ate" against that country. He didn't mention Egyptian President Hosni Mubarak, on the yan, is touring t�e United States with any specificcou ntry he might have had i n issue of Soviet Jewish settlements on the Faisal Hussein i� whose fa ther is an mi nd . occupied territories . The Israelis have asked Arab mil itary c

EIR July 6, 1990 International 67 �TIillNational

Outrage grows as voters read George Bush's lips

by William Jones

A burst of voter outrage has greeted what was hoped to be a Joe Isuzu, the smiling prevaricator of TV commercials fame. low-key announcement by President Bush on June 26 that in Senior congressional leaders endorsed the President's spite of his repeated pledges of "Read my lips-no new statement, but Republican legislators, many of whom have taxes" during the 1988 election campaign, he was now pre­ to face the voters again this year, were troubled by the Presi­ pared to raise taxes as part of a budget-gouging program dent's about-face. Ninety GOP conservatives signed a letter which was being worked out by White House and congres­ to Bush telling him that any tax increase was "unacceptable," sional negotiators. and Rep. Robert Walker (R-Pa.) calling Bush's announce­ The move has made it official that when it comes to ment a "dumb trial balloon." economic policy, there is only one political party in the Unit­ When it was obvious that the outcry would not die down ed States: the party of the U.S.'s international creditors and within the projected 24 hours, White House spokesmen be­ their spokesmen in the Anglo-American liberal establish­ gan to put their own "spin" on the President's statement. ment, which has been squeezing Bush to raise taxes since Marlin Fitzwater said that the announcement did not repre­ before he took office in January 1989. As EIR has warned sent any reversal of the President's position, since he had for over a year, tax hikes and other draconian measures, in a already said, at the beginning of the "budget summit" with worsening economic picture, will increase pressure for the leaders of Congress, that everything was on the table. Final­ outbreak of the kind of mass resistance in the United States ly, on June 29, President Bush himself held a press con­ that has been seen overthe last year in China, Eastern Europe, ference. and most recently in Britain. Bush tried to drape himself in the mantle of Abraham Lincoln, who also had to reverse his position when faced Miscalculation with new circumstances, he said. He also attempted to use In a short statement issued to the press on June 26, Presi­ the pretext of the "confidentialityduring the budget summit" dent Bush said that he had met with congressional budget to avoid commenting on precisely what he meant by "tax negotiators in the morning and that it was clear to him that revenue increases." the following measures would be required: "entitlement and mandatory program reform, tax revenue increases, growth Under fire from all sides incentives, discretionary spending reductions, orderly reduc­ Bush shot himself in the footafter the Democrats refused tions in defense expenditures, and budget process reform ." to continue with the budget summit barring some high-profile No press conference was held and all interviews were re­ move by the President indicating his willingness to raise fused. Key White House officialswere carefully kept away taxes. The budget talks had become deadlocked. New budget from the press for the firstfew days-under the assumption cuts proposed by Officeof Management and the Budget di­ that the uproar would die down in 24 hours. rector Richard Darman-$5 1 billion, which would be taken The New York Post on June 27 carried a front-page article primarily from domestic programs-were rejected by the with a picture of a worried Bush and the headline "Read my Democratic negotiators. Although they were wholly pre­ lips ...I lied!" The New York Daily News ran the headline pared to gouge the budget and raise taxes, they were not "Bush's lips say the 'T' word." On radio talk shows through­ prepared to pay the political price of being the ones to make out the country, President Bush was portrayed as a political the proposals. Meanwhile the White House had to revise its

68 National EIR July 6, 1990 forecasts of the costs of the S&L debacle, a revision which Washington Post and the New York Times, indicate that there required $100 billion in cuts in other areas, in order to stay is a consensus at the top about the envisioned austerity pro­ within the deficit limits mandated by the Gramm-Rudman gram. "The President has concluded that tax increases are law. necessary, along with other changes as specified in the state­ The President, terrorized by the onrush of a major finan­ ment, and we share the President's view," commented Senate cial collapse, was willing to eat crow in order to break the Majority Leader George J. Mitchell (D-Me.). Sen. Jim Sass­ stalemate. The months of financialmanipula tions by the Fed­ er (D-Tenn.), chairman of the Senate Budget Committee, eral Reserve were no longer sufficientto keep the speculative said with regard to the President's statement, "We decided ' bubble from bursting. The growing cost of the cleanup of the we're not going to stand around and beat him on the head thrift sector, now estimated at roughly $300 billion over the and shoulders. He made the pledge, and now he's rethought next to years, and the collapse of the junk bond market, the it." Democrats are trying to be "even-handed," said Sasser. last-ditch attempt to pour high-risk liquidity into faltering The Washington Post thought that Bush "did the right U.S. financial markets, led to warnings by President Bush thing," while the New York Times felt that he had "crossed earlier this year that he was concernedabout the danger of a the verbal threshold to sane policy." "recession"-in spite of administration rhetoric about "90 months of continual economic growth." The honeymoon is over The other major factor which obviously led to the Presi­ Now that the President has revealed his true colors, as dent's decision was the need to convince the Japanese (now one commentator remarked, "The honeymoon is over." As in the midst of trade negotiations with the U. S.) that Bush the "kinder, gentler" rhetoric of the Trilateral President turns was prepared to deal with the budget deficit. Without the sour in the light of his switch on the tax issue and the ever flow of Japanese capital into the United States, the U.S. more brutal expression of his administrative fascist regime, financialmarkets would have collapsed a long time ago. popular anger is growing. As LaRouche, whose uncomfort­ able presence for the regime has been making itself felt in The austerity to come almost daily campaign radio ads on the Washington, D.C. Bush undoubtedly hopes to achieve the consensus with all-news station, has stated, "What better should determine the Democrats necessary to carry through a brutal austerity the outcome of the fall elections than the economic mess policy. The other elements of the program, announced to­ which Mr. Bush has bequeathed the nation, including the gether with the "tax revenue increases" indicated what was collapse of the banking system which Mr. Bush and his in store. "Entitlement and mandatory program reform" essen­ friends have vigorously supported? ...It is Bush and his tially means gutting of social programs which have been the friends who supported similar Wall Street policies which only means of staving offstarvation for the growing mass of have ruined the country." people living at or near poverty levels in this country. Medi­ Although there is a consensus at the top between the cal assistance to new and expectant mothers is being drasti­ Trilateral President and the congressional leadership, there cally cut. In the nation's capital, public funds to shelters for is a growing polarization between the Washington adminis­ the homeless are being slashed, and city workers are being tration and the rest of the country-a fact notlost on Demo­ given mandatory furloughs in order to cut their working cratic or Republican congressmen, Who must prove their hours. credibility in elections this year. Rep. Beryl Anthony (D­ In a further move to indicate the President's willingness Ark.) said bluntly, "I'm chairman of the campaign committee to parley, the White House also announced on June 26 that and we'll make it a political issue." it is shooting for $25 billion more in budget cuts, some of The White House "spin doctors" are going to findit diffi­ which was to come from defense. cult to control the firestorm of outrage unleashed by the hy­ Meanwhile, the rage of the population at the enormity of pocrisy of the Bush regime. This is pilrtially reflected in the the crisis is being redirected to scapegoats like S&L execu­ results of a Republican Party poll, published in the Washing­ tives, who are being branded as scoundrels and criminals, ton Times on June 24-before the President's public shift on and whom Bush vowed to throw into jail. What congressional the tax issue-which found the "largest confidence disparity candidate Lyndon LaRouche, himself a victim of the Justice we have ever tested" between a President's approval rating Department's system of vindictive prosecution, character­ (71 %) and the number of people wHo think the country is ized as "administrative fascism," is rapidly becoming a re­ heading in the right direction (36%). Only 22% of those ality. polled expressed "strong support" for Bush. Sixty-eight per­ cent do not believe the country is on the right track, and 60% No real disagreement at the top think the country is definitely"off on the wrong track" (the The lame reaction to the Bush announcement by the Dem­ most pessimistic reading in two and a half years). Only 7% ocratic leadership, as well as the words of praise showered think the economy is improving, and 46% think it is definitely on the President by the Establishment media such as the getting worse.

EIR July 6, 1990 National 69 Murder, suicide, starvation, death: u. s. Supreme Court protects them all by Linda Everett

In its first euthanasia ruling, the U.S. Supreme Court June nasia mob shuddering. It found that a patient's right to priva­ 25 ruled 5-4 that it is constitutionally permissible for states cy does not allow refusal of medical treatment under every to require "clear and convincing proof' that an incompetent circumstance; that Missouri law embodies a strong state poli­ patient wants to die before allowing life-support or food and cy that favored preservation of life; and that Cruzan's state­ water to be removed. The ruling, in affirming a state's right ments that she would not want to live as a "vegetable," made to make laws that uphold the state's interest in protecting the a year before her accident, were "unreliable for the purpose lives of its citizens, appears to espouse some sentient notion determining her intent." of the inviolability of human life. It does not. Others decide your 'right' to die Just as the majority ruled that states may choose to de­ Chief Justice William Rehnquist delivered the majority mand procedural safeguards of the highest evidentiary degree opinion in which Justices Byron White, Sandra O'Connor, to determine an incompetent patient's treatment wishes, it Antonin Scalia, and Anthony Kennedy joined. The Court also endorsed a sweep of state laws and court rulings that sees the right to refuse treatment on the common law held eschew such protections and allow the murder of patients "sacred" right "of every indiIVidual to the possession and under the most specious circumstances. The young woman control of his own person, free from all restraint or interfer­ this decision saved from a starvation death in Missouri, will ence of others (1891)." "Every human being of adult years probably just be moved to the next state where her killing and sound mind has a right to ;determine what shall be done could be legal. In this decision, the Supreme Court swept with his own body (1914)." The logical corollary of the aside American jurisprudence once bornof natural law , gut­ doctrine of informed consent, the Court states, is the patient's ted the Constitution of its sanctity of life premise, and then "right not to consent, that is, to refuse treatment." discovered a constitutional rationale for murdering the sick Quoting major court decisions that made euthanasia legal and influencing the vulnerable to commit suicide-both bet­ over the last 15 years, the Court details how states have ter known as your "right to die." demonstrated their "diversity" in dealing with right-to-die - The Supreme Court admitted, for all the wrong reasons, issues. It is no coincidence that the most far reaching rulings that starving patients to death was no differentthan removing dealt initially, like the Nazi euthanasia program, with the other forms of medical treatment (after all, murder is mur­ most vulnerable patients, the ones who could not fight back. der), but then pronounced that "the United States Constitu­ Karen Ann Quinlan's right to privacy (to refuse treatment tion would grant a competent person a constitutionally pro­ and protect her bodily integrity) was not lost while she lay tected right to refuse life saving hydration and nutrition." This unconscious; her parents exercised it for her by having her "sensitive" decision, as U. S. Solicitor General Kenneth Starr respirator removed. In Saikewicz, the court reasoned that a characterized it, condemns tens of thousands of vulnerable retarded adult facing chemotherapy has the same rights to patients. privacy and informed consent as a competent individual "be­ The case before the Court involved the Cruzan family's cause the value of human dignity extends to both." The court request to remove the feeding tube that sustains their daughter decided what treatment the incompetent patient would have Nancy, 33, who has been unconscious for seven years since wanted, using a "substituted judgment" standard. an auto accident. State hospital employees refused to starve The Supreme Court writes that in Saikewicz, the Massa­ her. A lower court finding that state and federal constitutions chusetts court found the state's interest in the preservationof embody a fundamental right to refuse to withdraw "death life as "paramount and . . . greatest when an affliction was prolonging procedures," was reversed by the Missouri Su­ curable, 'as opposed to the State interest where ...the issue preme Courtin an outstanding ruling that still has the eutha- is not whether, but when, for,how long, and at what cost to

70 National EIR July 6, 1990 the individual [a] life may be briefly extended.' " In other ies" (McConnell). The Court defended Missouri's strict proof words, life at its terminus or for the chronically ill or uncon­ laws, because "Most states forbid oral testimony entirely in scious-is of less worth. The Court cites cases in which determining the wishes of parties in transactions which, life-sustaining care is terminated by someone other than the while important, simply do not have the consequence that a incompetent patient who exercises the patient's right to self­ decision to terminate a person's life does." An erroneous determination using formulations like objective standards, decision to withdraw life-sustaining treatment is "not suscep­ best interests standards, limited-objective standards, or pure tible of correction." The decision to stop feeding Nancy Cru­ objective standards. It gets worse. zan will be "finaland irrevocable." Among the state statutory laws the Supreme Court feels In a concurring opinion, Justice O'Connor cites court are exemplary "resolution(s) of these issues," is a California decisions and pro-euthanasia diatribes from the (now de­ court's authorization of conservators, relatives, or "other funct) President's Commission, the American Medical Asso­ persons" to make life and death decisions for a patient with­ ciation, the Hastings Bioethics Center, and the U.S. Office out his prior consent. That court reasoned that "to claim that of Technology Assessment's Task forceon Life-Sustaining [a patient's] 'right to choose' survives incompetency is a Technologies and the Elderly, to promote the use of the legal fictionat best," but, the respect society accords to per­ Euthanasia Society'S living will, or powers of attorney in sons as individuals is not lost upon incompetence and is best which you appoint a proxy to make or carry out your treat­ preserved by allowing others "to make a decision that reflects ment decisions once you are unable. This is a horrible charade [a patient's] interests." The California State Deputy Public that denies any "protected" right to informed consent. Not Defender, aghast at the thousands of lives at risk with this only are the elderly manipulated and frightened into refusing statute, brought the case to the U.S. Supreme Court which treatment, patients are yanked off life-support, denied care refused to hear it. The patient, William Drabick, was starved and food, and condemned to slip deeper into coma because to death. The Court cites rulings that allowed conservators of willful decisions not to treat them. to murder patients because it was in their "best interests"­ Justice Scalia agrees with the majority opinion, but says but evidence indicates that only a liable hospital, in one case, "the federal courts have got no business in this field." Justice and the state budget, in another, were served. In a New Jersey William Brennan's position is that it 'is none of the state's ruling, after an unconscious woman was starved to death business if a person wants to commit suicide, while Justice with the court's permission, the guardian was implicated in John Paul Stephens says the "choices about death touch the the suspicious deaths of his first wife and a former compan­ core of liberty," and are best leftup to individual conscience. ion, and possibly others. With the Court's approval of "Right Scalia says the states have the power to prevent or prohibit _.to Die," we can expect to see even greater disasters. suicides even by force, including suicide by refusing critical treatment-but they are also free to permit them! "Starving Liberty to die? oneself to death," he adds, "is no differentfrom putting a gun The Court infers that a competent person has a constitu­ to one's temple as far as common-law definition of suicide is tionally protected liberty in refusing unwanted treatment concerned." Scalia says he does not mean to suggest, howev­ from the Fourteenth Amendment's guarantee that no state er, that "I would think it desirable, ifw¢ were sure that Nancy shall "deprive any person of life, liberty, or property, without Cruzan wanted to die, to keep her alive by the means at issue due process of law." Since these rights must be exercised fo r here. I only assert that the Constitution has nothing to say on an incompetent patient, states like Missouri have a right to set the issue .. ..The Court ...has no authority to inject itself up procedural safeguards that demand "clear and convincing" into every field of human activity where irrationality and proof of a patient's wishes expressed when competent. The oppression may theoretically occur." U.S. Constitution does not forbid the establishment of this Justice Brennan's dissent, with Justices Thurgood Mar­ requirement, the Supreme Court said, since it grows out of shall and Harry Blackmun, and Justice Stephens's separate the state's interest in the protection of human life. "The dissent, differ from the majority ruling only in the degree of States, indeed, all civilized nations--demonstratethe ir com­ cold-blooded abhorrence of natural law--ofma n's capacity mitment to life by treating homicide as serious crime." The to surmount, through progress, nature's limits on life. Both Court adds, "We do not think a State is required to remain dissents slam the majority variously for not making euthana­ neutral in the face of an informed and voluntary decision by sia a fundamental civil right or for not giving young, injured a physically-able adult to starve to death." children a way to assure against unwanted treatment. Both But the Court forgoes these protections, as many states assert patients should be allowed to be killed if families would they cite allowed initial euthanasia rulings on little more prefer pleasant memories of his or her better days-and not than a relative's comment that "Auntie never liked doctors" of their "degraded" state-as though the dignity of man and (Conroy), or the patient "mentioned ten years ago while the good he contributes is physically posited in a leg or breast watching TV that she would not want to live like a vegetable" or consciousness. Even in illness, our patients call upon us (Jobes), or "my wife always had a phobia about head injur- to produce a greater good, a cure, and to fightfor life.

EIR July 6, 1990 National 71 whom were assassinated by Baader Meinhof terrorists, were targeted by the Anglo-Soviet establishment for advocating Mandela raises funds, such ideas for the industrialization of southernAfrica and the continent. hopes in New Yo rk On June 22, political prisoner LaRouche commented, "I am extremely happy that Nelson Mandela is free and that he has been received as well as liIe has in the United States. He by Dennis Speed deserves it. . . . I don't like his present sanctions program, for a very simple reason, with which I think he, on reflection, Nelson Mandela's June 20-22 fundraising trip to New York would agree. I'm not concerned only with South African City provided a respite from almost two years of seemingly blacks; I'm concernedwith over 400 million blacks through­ unending racial confrontation. Murders of blacks in Howard out Africa, who are threatened with, and actually undergo­ Beach, Queens, and Bensonhurst, Brooklyn, along with ing, genocide, under the infl/.lence of policies, which were black-Asian and other "ethnic" disputes, provided the condi­ set into motion by the famous mass-murderer, Robert Strange tions under which New Yorkers took the opportunity of Man­ McNamara, when he was at �e World Bank; Henry Kissing­ dela's visit-

72 National EIR July 6, 1990 The Robinson memorandum exposes the fact that the warningsLaRouche received before hi" conviction were true and is proof that George Bush has given the ADL a "lettre de cache" to make sure LaRouche never gets out ofja il alive. The memorandum spends 20 page$ recounting the ADL lies that LaRouche fundraisers illegally target the elderly. Robinson then lies about the subsequent Virginia state prose­ ' Strike force demands cutions of LaRouche's associates, and asks the Parole Com­ mission to consider civil suits by contributors Yoder and Overington, featured on a recent NBC national television that LaRouche broadcast attacking LaRouche, as part of the same conspiracy for which the defendants were convicted. not leave jail alive The memo states that two finns named as prinicipal bor­ rowing agencies in the "loan conspiracy" for which The Get LaRouche strike force, over the signature of Assis­ LaRouche and associates were convicted, were forced into tant U.S. Attorney Kent Robinson, filed a memorandum in bankruptcy, but omits to say that a federal bankruptcy judge, June with the U.S. Parole Commission demanding in effect Martin v.B. Hostetter, ruled in October 1989 that the U.S. that Lyndon LaRouche not leave jail alive. governmentacted in bad faith in filing the bankruptcy initia­ Robinson also demanded that LaRouche's co-defen­ tive in violation of its legal requirements for doing so. dants, William Wertz and Edward Spannaus, be given the "This appears to be a case where the criminal prosecution latest possible release date from prison and no parole. served not as a deterrent to committing further crimes, but LaRouche was told before his December 1988 conspiracy rather as an educational tool on how to commit crimes more conviction, by representatives of the highest levels of the effectively," Robinson writes, in blatant disregard of the Anglo-American Establishment, that they had rigged his con­ facts. viction all the way up through the Supreme Court, and that "This is not a typical crime and these are not typical he would spend at least 10 years in prison and not come defendants," the memo goes on, betraying the Task Force out alive. The IS-year sentence imposed by Judge Bryan in view that further political activity is the real "crime" for January 1989 was calculated precisely on that basis. which LaRouche and his associates have been jailed. In fact, on June 11, the U.S. Supreme Court decided \ not to even hear the appeal of LaRouche and his fellow 'No contrition' appellants, filed by a team of lawyers led by fonner U.S. Robinson continues, "None of the defendants have ever Attorney General Ramsey Clark. LaRouche's frameup con­ admitted to any wrong doing. None have showed contrition viction has drawn international outrage, particularly in Eu­ orremorse . On the contrary, they have aggressively contend­ rope and LatinAmer ica, for the blatant way in the defen­ ed that they are the victims of a political vendetta (a claim dants' constitutional rights were trampled, a story recorded repeatedlyre jected by the courts). None have taken any steps in the book Railroad! and most recently brought to the atten­ to stem the bloodletting represented by the continuing frauds tion of the Conference on Security and Cooperation in Eu­ of their subordinates Billington and Asher. They simply do rope , the "Helsinki" commission (see EIR , June 29, 1990, not regard themselves as boundby the same laws as the rest p. 38). of us. PresidentBu sh could still order the release ofexculpatory "This case . . . establishes to a moral certainty that the evidence, suppressedin the railroadtrial of 1988, that would defendants will break the law again. The contempt for hu­ provethe total innocence of LaRouche and his associates. manity they have shown has not changed. Their belief that their need for money overrides the interestof individuals in ADL imprint their own property has not changed. It is just a question of TheRobinson memorandum, 22 pages oflies and venom, who, and when they will rob again ...this case presents bears the unmistakeable stamp of the Anti-Defamation extraordinary circumstances calling for the Commission to League of B 'nai B'rith. Its appearance in this fonncoincides arrive at a release date outside the guidelines. withthe fact that theAD L's role inthe frameupof LaRouche "Whatever range the Commission 'employs, the release and his associates was smoked out in court hearings in Roa­ date arrived at should be at the highest 'end of the applicable noke, Virginia, this past spring. Once the ADL was exposed range. Society has the right to be protected fromthese defen­ in Roanoke, it became necessary for the ADL to cover its dants. Their sentence has not served its deterrenteff ect until tracksby getting the U. S. government to tell theParole Com­ the defendants and the organization they control stops steal­ mission what the ADL wanted to say, to make sure LaRouche ing, and until they acknowledge that they havedone wrong. is kept incarcerated. They have not shown themselves entitled to reenter society. "

EIR July 6, 1990 National 73 Cheney told the horror story in the hopes of holding off Senate budget cuts which would produce a 35% cut in forces, Americans reject and a draconian policy proposedby the House Armed Servic­ es Committee which would cut forces by 50%, requiring Bush defense plan the military to close one-third to half of all military bases worldwide. No sooner had Cheney presented his "worst case scenario" than the President announced a new round of tax by Leo F. Scanlon hikes and budget cuts. The cuts endorsed by the House and Senate Budget Com­ Despite years of anti-defense propaganda from the White mittees have unleashed an economic crisis in the defense House, Congress, and the news media, a recently released industry. The situation has become so severe that the Air poll confirms that over 80% of Americans believe that current Force has begun pointing to the precarious financial position defense spending is either "just about right" or "not strong of McDonnell Douglas, primecontractor on the C-17 trans­ enough." Perhaps to the surprise of the pollsters, only 8% of port, to illustrate the danger of the present course. The plans those polled said that the United States should cut its military to cut production of the C-17 .ignore the fact that McDonnell presence in Europe at this time, and 90% said that the U.S. Douglas is over $1.5 billion in debt, partly because of its should either "wait and see" about the outcome ofthe prom­ $400 million investment in the program, according to Air ised Soviet reforms, or should simply "rule out cuts all to­ Force acquisition chief Maj . Gen. Steve Croker. He told the gether. " Senate Armed Services Committee that eliminating the 1991 The poll results, reported by Paul Nisbet, a senior analyst purchase of the C-17 would "drive McDonnell Douglas to with Prudential Bache, contradict all the pundits who have make those same dollars OQ fewer aircraft to repay those been fraudulently reporting that a wave of isolationism is loans, perhaps increasing the aircraft's cost. " sweeping the U.S. in the wake of Gorbachov's reforms and In fact, McDonnell Douglas has already begun a shut­ the political upheaval in Eastern Europe. More fundamental­ down of its St. Louis operations in order to improve "profit­ ly, the polls reveal the lack popular support for Bush adminis­ ability" and assuage its creditors. The layoffs , which could tration policies, which other polls have been manipulated to reach more than 7,000 in 8t. Louis alone, will push the conceal. unemployment in the metropolitan area above 6% according Opinion research organizations showed similar attitudes to Missouri officials, and stupies indicate that about 80,000 in the period before the last two summits, illustrating that the jobs in Missouri ultimately could be at risk from budget cuts administration's "Gorbymania" has not been echoed by the currently planned. citizens. Now that the Bush adminstration has admitted that The devastation caused by this approach to the economy the mass layoffs and economic devastation wrought by the is being repeated in dozens' of areas around the country, first round of defense cuts will be followed by deeper reduc­ as small engineering shops .,.nd manufacturing facilities are tions and higher taxes, the stage is set for the Congress to shutting down production lines built to supply the major walk into a political buzzsaw during the upcoming campaign weapons producers. This in tum drives up the cost of every period. nut and bolt in every weapons system, and scatters to the wind the teams of engineers lind skilled workers essential to Budget cuts presage economic crisis maintain production. In short, the Bush budget is destabiliz­ The cycle of defense budget cuts followed by further ing the infrastructure of the manufacturing sector of the demands for overall budget savings is beginning to look like American economy. a runaway train, despite administration efforts to maintain The folly of attempting to run the Defense Department the facade of control over the process. on the basis of a collapsing economic base has provoked On June 19, Defense Secretary Richard Cheney made chaos in the office of the Secretary of Defense. Cheney has public the contents of a study done for the White House­ attempted to rationalize the cuts by conducting "reviews" Congress budget summit, which illustrated the effects of which allegedly balance budget considerations against strate­ different levels of defense budget cuts proposed by the sum­ gic military needs. One plan for cutbacks in acquisition of miteers. The administration proposal, aimed at savings of major aircraft systems was publicly mocked by a leak which 10%, would cut 10 Army divisions, five strategic bomber exposed the fact that the Navy had withheld significant factu­ squadrons, two aircraftcarriers and associated battle groups, al information bearing on the potential costs of their advanced II Air Force wings, two Navy air wings, 50% of the Minute­ fighterprogr am. man missiles, almost 20% of Poseidon-Trident missiles, The C- 17 cuts are based on a similar "review" which nearly 25% of total naval vessels, some 442,000 active duty justifiesreduced need for stllltegic lift capabilities. Accord­ military personnel, and 260,000 from the Guard and Re­ ing to a staffer in the Officeof the Secretary, the only analysis serves. This represents a drop in force structure of 25 %. offered to support the cuts was "j ust a bunch vu-graphs."

74 National ElK July 6, 1990 KissingerWa tch by M.T.Upharsin

meeting report that eco-fascism was gangster companion, who is forcing Dr. K, Bilderbergers, also on their agenda. IMF-style austerity upon Eastern Eu­ One Bilderberger was overheard rope through his new post as Bush's push George's tax hike saying: Coordinator for EasternEuropean Af­ When the powerful Bilderberg group "George will do all right on the fairs. Unless these emerging democ­ met in secret in Glen Cove, Long Is­ environment-he has to buck a bit racies accept "Adam Smith free mar­ land, one item that was high on the now for the sake of the right wing. ket" programs that have destroyed agenda was to push through a tax hike Whether the money comes through Ibero-America and Africa, Fat Larry of the sort that President George Bush the World Bank or otherwise , the refuses to give them a dime to buildup has just signaled he would accept. United States will pay its share .... their economies. Prominent among those attending the "About a world war for the envi­ Sources close to David Rockefel­ three-day confab, which started on ronment, George will have to do some ler have told EIR that Dr. K's piggy­ May 9, was Dr. Henry Kissinger, who grandstanding about U. S. spending bank is using his post as chairman of is also a member of the executive com­ money right now. And you know the Council of the Americas to peddle mittee of David Rockefeller's Trilat­ why, don't you? this increase in IMF quotas. Thus, Da­ eral Commission. "Yes, he is going to raise taxes in vid appeared before a May 23 meeting Sources who penetrated the inner­ some way-something we have want­ of the Joint Economic Committee of sanctum of the meeting say that de­ ed for a long time. He will have Congress to peddle the Bilderberg mands for "George" to repudiate his enough problems from the right on plan, giving a speech that was pre­ campaign pledge not to raise taxes that. We've gotten the word on that. " approved by "George." was on everybody's lips. It now ap­ pears that "George" has bowed, puck­ ered up, and kissed the Bilderbergers in an appropriate spot. The Bilder­ Bleeding U.S. Royal summons bergers knew that "George" would not taxpayers for the IMF nets Bush officials refuse. Afterall , as a former Trilater­ al, "George" has always been a "kiss­ Another issue dear to Dr. K' s heart The Bilderbergers had plenty of op­ ing cousin" of the Bilderbergers. and that of his piggybank, David portunity to push their tax hike It seems, from the internal com­ Rockefeller, was very much on the scheme upon a bashful Bush adminis­ ments at the Bilderberg meeting, agenda at the Bilderberg meet, name­ tration. Among those office holders "George" just had to play "hardto get." ly hiking the tab world governments whom the Bilderbergers summoned to Said one Bilderbergerto another: "I tell pay the International Monetary Fund Glen Cove were: Vice President Dan you, we do not have to worry about (lMF). One day before the meeting­ Quayle; Secretary of Defense "Dick" George, either on the environmental an unlikely coincidence-the IMF an­ Cheney; White House Chief of Staff project or the tax issue; he will do ail he nounced it would raise quotas on John Sununu; and, to create "biparti­ can in his own way." The problem, he member-nations by 50%, which san consensus," Speaker of the House said, is that "domestic politics" would means a $12 billion increase in pay­ Thomas Foley (D-Wash.), who had require "George"to do "certain things" ments by U.S. taxpayers. also attended the Trilateral Commis­ but, he stressed: "It will all come out all As every Ibero-American can tell sion meet. right-you'll see." you, it is not just the American taxpay­ The Bilderbergers, who draw to­ As EIR previously reported, the er who suffers from IMF levies. The gether European royalty with the main item on the agenda of the earlier, IMF's austerity dictatorship has American Establishment, politely April 21-23 meeting of the Trilateral caused negative growth rates in the threatened that should "George" fail Commission behind closed doors in Third World, inflicting genocide be­ to follow their agenda on taxes, the Washington, D.C., had been how to yond Adolf Hitler's wildest dreams, environment" and the IMF quota in­ push through the Clean Air Act­ while similar adherence to IMF condi­ crease, then the meeting of the Group something that the "Trilateraloids" tionalities may shortly topple the Sol­ of Seven would "chastise" the U.S., know will shut down much of the re­ idarnosc governmentin Poland. blaming world economic problems on maining U.S. industry and agricul­ As EIR has elsewhere reported, it its failure to raise taxes and to reduce ture. Sources inside the Bilderberg is Fat Larry Eagleburger, Dr. K's the budget.

EIR July 6, 1990 National 75 Congressional Closeup by William Jones

Banking Committee elections. "We will take a meaning­ Democrat as a bludgeon to force the less vote," commented Sen. Howard meets in Houston on S&Ls West Qermans to provide that which Metzenbaum (D-Ohio), "so that some The House Banking Committee held a the U. S. no longer deems a necessity. campaign operatives can try to blud­ hearing on the S&L crisis in Houston, At the end of a long war, which cost geon senators who are willing to stand Texas, an area which has been hard the U.S. a great deal of money and up for the Bill of Rights and vote hit by that crisis. lives, it was deemed feasible to main­ against this amendment. " Committee chairman Henry B. tain military commitments so as not to Many senators were concerned Gonzalez (D-Tex.) warned that the have to fightanother war. If Schroeder that playing fast and loose with the has her way and the U.S. reneges on tentative steps taken in Texas toward amendment process could lead to fur­ that commitment, in a world filled recovery were threatened by the S&L ther attempts to amend the Constitu­ with a great deal of uncertainty pre­ crisis. Although praising Bush for ad­ tion on relatively frivolous issues. cisely because of the enormous chang­ dressing the S&L crisis in his inaugu­ The amendment came in the wake es in the Soviet bloc, the costs of this ral address, Gonzalez said that the of a Supreme Court decision declar­ neo-isolationism may be much greater Resolution Trust Corp. , which was set ing unconstitutional a congressional than even Pat Schroeder is prepared to up to deal with the crisis, was "creep­ statute which made flag burning il­ pay. ing along like a dime-store opera­ legal. tion." "The sense of national urgency just hasn't been there," said Gon­ zalez. Democratic gubernatorial candi­ o.sing bill passes date Ann Richards noted that many of H chroeder calls for despite Bush's objections the "bad loans" supposedly made by S bringing troops home The Senate passed on June 27, in an S&Ls were not bad at all. Richards Rep. Pat Schroeder (D-Colo.), a overwhelming 96- 1 vote, a $17.6 bil­ said the "system is causing the prob­ member of the House Armed Services lion housing bill, which is intended to lem. . . . It is a process gone crazy. " Committee, has proposed cutting combat homelessness and move low­ U.S. troops abroad fewer than 20,000 and moderate-income Americans into worldwide . Present U.S. military home ownership. The White House commitments involve an out-of-coun­ had threatened to veto the bill, which F lag amendment killed try deployment of 400,000 American was $4 billion more than President in both chambers military personnel, with over 300,000 Bush had requested. The Senate followed the House on of these deployed in West Germany. A bill pending in the House re­ June 26 in rejecting by a 58-42 vote In a Washington Post commentary quests $28 billion for a federal hous­ a proposed constitutional amendment published on June 24, Schroeder ing program. that would have allowed Congress and claimed that with "dual-basing," Secretary of Housing and Urban state legislatures to ban desecration of which means having the logistical Development Jack Kemp argued that the American flag. The vote fell nine backup for the troops provided for by allowing states and local governments short of the two-thirds necessary for the basing country, U.S. troop com­ to directly finance new construction approval. Twenty Democrats joined mitments could be reduced to one­ and rehabilitation, which the bill man­ 38 Republicans in voting for the twentieth of present commitments! dates, could lead to the same kinds of amendment, while 7 Republicans vot­ Schroeder assumes that countries fraud and abuse within HUD pro­ ed with 35 Democrats against it. like West Germany can cough up the grams that are now being investigated Although the House rejection of money to provide for these bases, by Congress. the amendment a week earlier virtual­ since they are "now willing to pony The Senate voted on the housing ly doomed it, Senate Minority Leader up $450 million for interim stationing bill the same day President Bush re­ Robert Dole (R-Kans.) pushed for a of Soviet troops in East Germany. " neged on his "no new taxes" pledge. vote in the Senate in order to get sena­ The ugly necessity the West Ger­ By publicly backing off on his elec­ tors on record on the issue. The Re­ man governmentis faced with, ofhav­ tion promise, President Bush hopes publicans hope to use the vote as an ing to "buy" permission for German that the Congress will be forced to issue in the upcoming congressional reunification, is used by the Colorado gouge spending on social programs

76 National EIR July 6, 1990 even more than it would otherwise be said was "its lackluster performance "Now when the President has pre­ prepared to do. The actual amount of in prosecuting the savings and loan sented us with a clear set of chal­ money that will be spent on housing crooks." lenges," they said, "these same people programs will, however, not be decid­ 'These people are thieves, and the suddenly decide that we cannot afford ed until Congress begins dealing with American people want to see them be­ to rise to those challenges." Walker appropriations bills later in the ses­ hind bars ," said Annunzio. proposed instead · across-the-board sion. At that point, the money author­ Many of the S&L executives, fol­ cuts in the other NASA programs in ized by the Senate could be signifi­ lowing the outlines of the liberalized order to restore a pdrtion of the explo­ cantly gouged, in an environment legislation allowing S&Ls to get in­ ration funds! heated by budget deficit hysteria. volved in high-risk real estate specula­ tion, are being scapegoated for the monstrous boondoggle which the thrift industry has become. A good many thrift owners have also been hinese activist urges ouse ethics panel C H strong backers of Democratic political against MFN status stalls on Frank case candidates, thus setting up Democrat­ In hearings before the Senate Finance The House Ethics Committee has ic politicians as part of the S&L Committee on June 20, Chinese activ­ postponed until afterCongr ess's July "sleaze." ist Feng Congde s�id that the United 4 recess a meeting to conclude its in­ In the latest move by Attorney States should not extend Most Fa­ vestigation of allegations against Rep. General Richard Thornburgh's vored Nation status to the People's BarneyFrank (D-Mass.). "sweep" operation, Hal Greenwood, a Republic of China. Feng is a member The panel had been scheduled to Minnesota fu ndraiser for Democratic of the advisory committee of the Inde­ meet on June 26 and was expected to Gov. Rudy Perpich and the former pendent Federation of Chinese Stu­ rule on a split vote that the Massachu­ head of Midwest Savings and Loan, dents and Scholars, and husband of setts Democrat be given a mild written was charged in a 40-count indictment Chai Ling, the famous leader of the rebuke. Committee sources indicate for S&L fraud. Perpich called the in­ Tiananmen Square revolt. that they will admonish him on two dictment a political move by the Re­ "Extending MFN status at this issues related to the probe-the fixing pUblican administration against him time," said Feng, "would not only of traffic ticketswhile Steve Gobie, a and his backers. harm the already deplorable human male prostitute, was serving as a per­ rights situation in China, but would sonal aide to Frank, and the sending also represent a serious blow to re­ of letters on congressional letterhead formist and progressive elements in to court officers supervising Gobie' s China today. . . . Because of the im­ probation on several felony charges. nger rises over portance China attaches to MFN sta­ Frank, a homosexual, admitted A NASA budget cuts tus, an unconditional renewal of MFN hiring Gobie as a personal aide, but Republican congressmen expressed status, as the President has proposed, denied Gobie's allegations that he their dismay over the cuts made by the would send the same message to knew Gobie was running a prostitu­ House in the NASA budget. On June Beij ing as National Security Adviser tion service out of Frank' s Capitol Hill 21, Rep. Robert Walker (R-Pa.), the Scowcroft's visit last December sent. apartment. ranking minority member of the Worse, it would signal the abandon­ House Committee on Science, Space, ment of those who' languish in puni­ and Technology, and House Republi­ tive detention." can Whip Newt Gingrich (R-G a.) held Feng noted that; the Chinese lead­ Dems demand tougher a press conference criticizing the sub­ ership is still "detaining tens of thou­ action against 'S&L crooks' committee's cuts in the space explora­ sands of non-violent pro-democracy Rep. Frank Annunzio (D-lll.) showed tion program. prisoners, refuses to allow free emi­ that he belongs to one of the more The Congressmen derided their gration, maintains a de facto martial foolish and suicidal species of Demo­ Democratic colleagues who "for years law over Chinese students in the U . S., crats, when he on June 26 criticized ...have been deriding the lack of a persecutes religious groups, and ha­ the Justice Department for what he goal in the U.S . space program." rasses Chinese students in the U.S."

EIR July 6, 1990 National 77 National News

the police-like operations of its professional S&L to dhallenge government actions in the staff. The staffis organized along the classic illegal takeover of the thrift industry. lines of a secret intell igence service, bearing The �uit is against the actions of Office NAW AP A cov�red as a remarkable resemblance to the CIA ­ of Thrift Supervisionregu lators who moved from which the ADL has recruited some of against franklin on the basis of OTS "pre­ solution to drought its members .... The ADL's clandestine dictions� that it would fail within a year. The idea for a North American Water and arm is euphem istically known as the Fact The bank has been transformed into a large Power Alliance, to bring half-again as much Finding Department. It is this component operatioh dealing in junk bonds and futures water from Canada and Alaska as is current­ which operates the ADL stable of secret contracts - all according to rules set out by ly used by the lower 48 states, was covered agents - informants, infiltrators, instiga­ Congress - and continues to have a positive front page by the June 21 Los Angeles tors, et al. In a number of instances over the net worth despite the legal and administra­ Times. past 20 years, the ADL has been implicated tive costs imposed by the government NAWAPA, designed by the Ralph W. (although never prosecuted) in murders, seizure. Parsons Co. and backed by Lyndon provocation of riots, bombings and other Franklin chairman Ernest M. Fleisch­ LaRouche and his associates, could supply serious crimes," the newsletter read. man, a tux lawyer and financial"wh iz kid," the water needs of the western portion of claims tl!lathe simply succeeded at what de­ North America "for at least the next hundred regulati6n demanded, and the government years," according to Nathan W. Snyder, di­ shut him down anyway. Franklin is the sec­ rector of technology for the Parsons Co. ond largest institution o\vned by the RTC, The Times reports that Parsons is start­ Corporations giving and is five times larger than Charles Keat­ ing once again to lobby in Washington for ing's Li�coln Savings and Loan. the project, which was designed nearly 30 millions to greenies years ago. In an expose on May 7, Legal Times, a Washington newsletter, reports that major coporations are giving millions of dollars to environmental groups to set a profitable Europe asks U.S. fo r agenda for themselves. I deatljl penalty stay Marchetti attacks ADL, According to Legal Times, Dean Bunt­ rock, head of Waste Management, Inc., has A resol�tion passed by the European Parlia­ organized crime links given over $1 million over the past three me nt on May 17 appealed to the United New American Vi ew, a fortnightly newslet­ years to environmental groups, including States t@ halt the use of the death penalty, ter published by Victor Marchetti, attacked $135,000 to the National Audubon Society and specifically asked Vi rgini a Gov. Doug­ the Anti-Defamation League in its June 15 "to support lobbying for more stringent reg­ las Wilder to reopen the case against Joseph issue i n an article en titled "Anatomy of a ulation of industrial wastes," and $117,500 M. Giarratano. Nightmare - The ADL Has Grown to to the National Wildlife Federation "to in­ The I resolution states that Giarratano Frightening Proportions." vestigate the potential for strengthening pol­ "has been on 'death. row' in Virginia since The article reviews much of the material lution control laws in Latin America." 1979, Was condemned to death on the basis firstpublished by EIR on the ADL's links to In exchange for contributions to the Na­ of very ¢ontroversial testimony," and called the Meyer Lansky organized crime empire tional Wildlife Federation, NWF head Jay upon "the Governor of Virginia, L. Douglas and its current links to international drug­ Hair has lobbied for legislation that would Wilder,lto ensure that the case of Joseph M. money laundering. benefitthe corporation, and set up private Giarratano is reopened and that the fresh The newsletter reports that former ADL meetings between Buntrock and EPA head eviden4 is assessed in open court in order national chairman - now honorary chair­ William Reilly. Following one of these to avoid the possibility of executing an inno­ man - Kenneth Bialkin, "is one of the most meetings, the EPA intervened in a North cent man." powerful attorneys in America today - and Carolina court on behalf of Waste Man­ The resolution also refers to the death probably one of the most corrupt." "Today, agement. sentence imposed on Dalton Prejean in Lou­ Bialkin is a senior partner in the world's isiana, �'a 30-year-old black U.S. citizen, largest law firm,Skadden Arps, which was who was sentenced in May 1978 for the deeply involved in the looting of the Ameri­ murder pf a white policemHn." It notes "that can stock market and savings and loan in­ evidenc� to the effect that Prejean had suf­ dustry.. ..Some of these schemes ...are S&L suit first test fe red brain damage, was borderline mental­ believed to have been cover for the launder­ ly retarded and under the influence of alco­ ing of drug money. of illegal takeover hol and drugs at the time of the murder was "The ADL's vast power in American An upcomi·ng trial in Topeka, Kansas, in a not preSent at the sentencing hearing." politics and society today is grounded in the suit brought by Franklin Savings and Loan, Stressing that the Louisiana Board of Par­ wealth and influence of its leadership and will provide the firstoppor tunity for a major dons and Paroles has recommended that his

78 National EIR July 6, 1990 Briefly

• IN AN ADL move for gun con­ trol, Edward Weidenfeld, vice chair­ man of the Anti-Defamation League's Washington Affairs Com­ sentence be commuted to life imprison­ In another decision June 21, the Court mittee, said June 5 that "Jewish secu­ ment, the resolution appeals "to the Gover­ ruled 6-3 that evidence seized by pol ice rity concerns are best served by mak­ nor of Louisiana to commute the death sen­ who search a home without a warrant can be ing firearms more difficult for tence." used at trial if the police were admitted by extremists to obtain, rather than by The resolution also calls "on the various someone they reasonably believed had the encouraging their proliferation States of the Union in which capital punish­ authority to consent to the search - even if among the generlll population." ment is still used to review their legislation it turns out later that they were wrong. with a view to abolishing the death penalty." In another case, the Court ruling hit the • GEN. MANUEL NORIEGA political patronage system, ruling 5-4 that can pay his lawyers after U.S. prose­ the Constitution forbids use of partisan con­ cutors agreed to unfreeze up to $6 siderations as the basis for hiring, promot­ million in funds in European banks. ing, or transferring most public employees. Their alternative, to prove that all Silverado closure hung Many believe that the ruling will. be used Noriega's funds were drug monies, to break any independent political machine would have revealed U.S. govern­ on Bush election that would be considered unfriendly by the ment payments to Noriega. Kermit Mowbray, the former president of unfolding administrative police state. the Federal Home Loan Bank of Topeka, • JESSE JACKSON "must have a Kansas, testifiedbef ore the House Banking magnetic attraction for the camera" Committee June 19 that officials in Wash­ because he pops Up for everymedia ington ordered him to delay closing the event, Tony Kornheiser wrote in the bankrupt Silverado Savings and Loan until Bush policy is to end June 24 Washington Post in a spoof after the 1988 election in which George on Jackson's ego, "No matter who's Bush won the presidency, the Washington timber industry making news, Jesse is right there at Post reported. Bush administration pol icy is "the elimina­ his side.. ..You can't crop him out Mowbray testified that on Oct. 21, tion of the timber industry, " Bill Denn ison, of the photo." 1988, the Colorado thrift commissioner in­ the president of the California Timber Asso­ formed him that the state-chartered thrift ciation, charged in a statement released fol­ • USDA DAIR:Y analysis section would be closed by the end of the month. lowing the administration's June 22 ruling head Charles Shaw said we should He relayed the information to Washington; that the spotted owl is a "threatened" "kick the dairy farmer out of busi­ three days later, on Oct. 24, 1988, unnamed species. ness," the Junei 22 Pennsylvania officialsin Washington asked that the c1os: Speaking for the industry, Dennison de­ Coatesville Record reported. The pa­ ing be delayed for two months, he testified. clared that "7.1 million acres of productive per called Shaw'slremarks "obscene, The politically motivated delay added sub­ forest land in Northwestern California and a perversion of the spirit of America. stantially to the cost of salvaging the thrift. the Sierras face total shutdown on July 23" · ..The small farmer was the back­ Bush's son Neil Bush sat on the board unless Interior Secretary Manuel Lujan and bone around wHich America was of Silverado, but federal regulators also re­ Agriculture Secretary Clayton Yeutter re­ built." portedly delayed closing the bankrupt First ject the ban on timbering proposed to "pro­ I RepublicBank Corp. of Texas until after the tect" a bird that has thrived during more than • THE BISHqP Msgr. John J. Texas primary in 1988 to avoid embarrass­ a century of timber harvesting. "If the worst Fitzpatrick, Brownsville, Texas, ing George Bush. case plan is put into place by the U.S. gov­ has charged that his diocese "is part ernment, 111,000 could be unemployed" in of the Third Worl d , " with some com­ California alone, he said. munities so poor that they don't have "Our only chance to stop this is to make running water and some with up to the decision makers inside the Washington, 95% of their citi�ns' carrying hepa- Supreme Court rules D.C. Beltway understand that real people titis. are going to suffer for their reluctance to opinion can be libelous stand up to the truth ....The Endangered • WILLIAM $AFIRE suggests The Supreme Court ruled June 21 that opin­ Species Act was not meant to be the Califor­ breaking up the U.S. in a commen­ ion can be libelous. The majority opinion nia Rural Poverty Act of 1990." taryin the June 2$ New York Times. was written by Chief Justice William H. Dennison warned that "if politically in­ The U.S.A. is really three countries, Rehnquist. It said several lower courts have clined bureaucrats seek to bend the Endan­ Safireclaims: the Northeast corridor; been wrong when they assumed that state­ gered Species Act to serveother ends, spe­ the "Confederacy Plus" including ments of opinion were automatically shield­ cifically the elimination of the timber California; and "God's Country," the ed from libel suits and ruled that expressions industry, then either the law has to be tight­ Great Plains and upper Middle West of opinion can be the subject of libel suits if ened, or new people need to be brought in stretching to the Northwest . they contain "false and defamatory" facts. to administer the act. "

EIR July 6, 1990 National 79 Editorial

Mideast war alert

There are increasing indications of a buildup of tensions government, a deal in fact exists between Rabin and the in the Mideast, despite Israeli disclaimers to the con­ Likudniks to establish a national unity war government, trary . Breaking a six-year policy of refusing to talk to with Rabin participating in a major capacity. This will the United States, Iraqi President Saddam Hussein told be the government that launches the Mideast war. the Wall Street Journal of June 28 that such a war is This scenario is highly credible, with one proviso: inevitable unless the U.S. blocks Israel's thrust against If such a war does occur, it will fall within the game the Palestinians. plan of Anglo-American/Soviet condominium politics; The context of the interview was the formation of it is entirely coherent with the recent escalation on the a new hardline government in Israel, combined with environmentalist front. A war in the Middle East means U.S. moves to break off talks with the Palestinians. an oil shortage and energy crisis. This will drive up oil In a similar interview the week before , Jordan's prices and will put the Europeans and the Japanese in King Hussein compared the current escalation to the the position of having to go to the Soviets for secured tensions which developed right before the 1967 Arab­ oil deliveries. Israeli war. The stated policy of the new Israeli govern­ Mideast wars are never as they seem. We know ment, to make the absorption of hundreds of thousands from past experience, that the Israelis usually call upon of Soviet immigrants the top national priority, has not the Syrians for cooperation when they wish a provoca­ helped the situation. More than 10,000 Soviet Jews are tion for a military adventure . This time, an Arab-Israeli arriving in Israel each month , which makes Housing war has already been prediscounted by the Anglo­ Minister Ariel Sharon's assurances that Israel does not Americans, some of whom support it, wish it. This is intend to immediately move them into the occupied also known to the Soviets, among others . territories less than credible (considering his generally A war today in the Mideast would would have a aggressive attitude on the subject) . profound cultural , as well as economic effect-particu­ The official view of the Bush administration is that larly if nuclear or chemical weapons were used. It while war is neither imminent nor inevitable, the situa­ would tend to heighten the mood of cultural despair tion is deteriorating. Sources close to the administra­ upon which "eco-paganism" is now feeding. Cults such tion, however, report that Israel is preparing for a Mid­ as Gaia, which say that the Earth Mother must be served dle East war, which it is likely to start with a with blood, not to speak of the more outspoken Earth "preemptive" raid on Iraq. First !ers , who wish to see the world's population re­ It is rumored that financingfor this-to the amount duced to half a billion, would welcome a Mideast war. of $25 billion-will come through drug money-laun­ And of course , such a catastrophe would place a serious dering and other dirty operations by people like Ivan obstacle in the way of present German plans for eco­ Boesky and Michael Milken. According to this ac­ nomic development. count, the plea bargain agreements struck by Attorney This is a war which should not be allowed to hap­ General Richard Thornburgh with these two characters pen . To stop it, means thatthose forces who recognize effectively shut down an ongoing investigation into the that their interests run counter to the Anglo-American magnitude and whereabouts of those funds . game plan for the Aquarian Age, must stop playing Despite the word circulating around Washington by the rules of the condominium. The failure of any that the Bush administration has a plan to help install Westernleader to recognize free Lithuania was a disas­ Yitzhak Rabin as head of the Labor Party and then as trous capitulation to condomium politics. Such a failure prime minister, replacing the Shamir-Sharon hardline of nerve must not happen again.

EIR July 6, 1990 National 80 �ITillSpe cial Reports Comprehensive, book-length Project Democracy: The 'Parallel Govern­ ment' Behind the Iran-Contra Affair. Order documentation assembled by #87001. $250. EIR's intelligence and research Germany's Green Party and Terrorism. The staffs . origin and controlling influences behind this growing neo-Nazi political force. Order #86009. The 'Greenhouse Effe ct' Hoax: A World Fed­ $150. eralist Plot. Order #89001. $100. Moscow'S Secret Weapon: Ariel Sharon and Global Showdown Escalates . Revised and the Israeli Mafia. Order #86001. $250. abridged edition of the 1987 report, second in The Trilateral Conspiracy Against the U.S. EIR's Global Showdown series. Demonstrates that Constitution: Fact or Fiction? Foreword by Gorbachov's reforms were designed according to Lyndon LaRouche . Order #85019. $100. Mqrshal Nikolai Ogarkov's war plan for the So­ Economic Breakdown and the Threat of viet economy. Order #88008. $250. Global Pandemics. Order #85005. $100. AIDS Global Showdown-Mankind's Total * First two digits of the order number refer to year of publica­ Victory or Total Defeat. #88005. $250. tion.

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Crime Wave of the

Who is righ t? I '90s

New York Archbishop Cardinal John O'Connor has denounced heavy metal rock as "a help to the devil" and said that "diabolically instigated violence is on the rise." (March 4, 1990)

But the Federal Bureau of Investigation's expert, Kenneth Lanning, claims: "Far more crime and child abuse has been committed in the name of God, Jesus and Mohammed than has ever been committed in the name of Satan." (June 1989)

Satanism: Read the definitive study by EIR 's inves­ Crime wave of the '90s tigative team, including: The Matamoros murders; Manson; the Atlanta child murders; the satanic roots of 'rock.' Plus, "The theory of the satanic personality," Order the "Satanism" Report. by Lyndon H. laRouche, Jr. Learn the Make check or money order payable to: $100 extent of the satanist epidemic, who its EIR-News Service postpaid high-level protectors are-and why some P.O. Box 17390 per copy officials want to cover it up. 154 pages. Washington, D.C. 20041-0390