Show: The LaRouche Connection

Episode: 0730 President Omama's Options Part 1.mpg

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Episode Description:

On January 16, one week before Barak Obama’s inauguration as the 44th President of the United States, and again two days after the inauguration, on January 22, Lyndon LaRouche issued gripping and concisely organized calls, in the form of two international webcasts, to the incoming President and those in the broader institution of the Presidency, to immediately put the world financial system into bankruptcy reorganization. Without this measure—which so far almost no “experts” have been wiling to contemplate—no other reforms stand a chance. This edition of The LaRouche Connection features Mr. LaRouche’s opening remarks and the first question from the discussion session of the January 16 event, moderated by Debra Freeman.

LaRouche: “The problem here is that, as most of you know, the President has not spoken on the actual, crucial issues of world economy. Nor has anyone else, really. Before the public, there has been no competent discussion of the most crucial issues which threaten and face the world today.”

A year and a half ago, on July 25, 2007, in an international webcast, Mr. LaRouche had publicly forecast a breakdown of the international financial derivatives bubble—a bubble on the order of magnitude of about $1.4 quadrillion dollars. This bubble is still growing today, until we get rid of it, which we must do, and soon.

LaRouche: “We are never going to bail out the $1.4 quadrillion worth of inflating claims against the world economy. We are going to have to wipe out most of the financial claims from the books! We’re going to have to put the world, which we have to save—a physical world—into protection, by eliminating the greatest part of the nominal financial claims, held by financial institutions of the world today. If you don’t do that, you can not save the world physical economy from a general breakdown, which would mean the world’s population would probably sink from about 6.5 billion to about 1 billion, within a generation or two.”

What Mr. LaRouche had forecast was not a spinoff from a breakdown of the mortgage sector into the general economy, but a systemic breakdown of the entire financial-economic system.

LaRouche: “The secondary factor in this, was the fact that the U.S. economy, actually since 1968, has been collapsing in physical terms—per capita and per square kilometer.” Ditto for Europe and the countries of the former Soviet Union. There’s nothing you can do, in terms of reforming the present system, to prevent the entire planet from going into a Dark Age. There is a way out, however!

LaRouche: “You can get out of this mess, very simply: Go back to our Constitution, and go back to thinking of Franklin Roosevelt, as of 1944. Put the world through bankruptcy reorganization, and change away from this monetary system we have, and go to a credit system, as understood in the early days by Alexander Hamilton.”

There is another step which must be taken: And that is to confront and destroy the “British Empire.” “That’s what’s running the world today—a usury-ridden, financier system, which is now breaking down. Putting the entire world system through bankruptcy reorganization will, in effect, eliminate the present Anglo-Dutch-Saudi empire, that is, the banker, the financier empire.” How to do this?

LaRouche: “We’re going to create [a] system of cooperation among nation-states, of the type envisaged by Franklin Roosevelt in 1944, end all traces of imperialism, end all globalization, and go back to the sovereign nation-state and its people. And do it on the basis of the famous principle of 1648, the Westphalian Principle.” With an initial combination of the four largest powers—the U.S., Russia, China, and India—we can use the Hamiltonian model of the U.S. credit system—national banking—to create a sufficient combination of power, to force through the needed bankruptcy reorganization of the world.” Either we do this, or we’ll not survive.

Mr. LaRouche then discusses the difference between Physical Economy and Money—a difference most of us have failed to understand. Physical economy involves matters of square area of territory; energy flux density of baseline power sources; per-capita and household health, and longevity; technical methods of production. He provides case examples of India and Africa.

LaRouche: “We’ve got to stop talking about money, as such, and realize that money is merely a means of exchange. We must regulate it; we must regulate banking. We must go back to the kind of banking that we had under Glass-Steagall. We must separate the banking, in which you put your money, if you have it, for deposit, which the local community depends upon for its lending practice and so forth. We must put this section of banking back into business! As chartered banking, under government protection. We must take the other part of banking, the high-risk part, separate it, look at the garbage, and put the garbage through cancellation. Financial derivatives don’t contribute anything to a world economy. It’s gambling debts, and the policy of the U.S. government is, ‘We don’t pay gambling debts.’ We must protect those state and local banks which are chartered banks of deposit, as the reference point for investment. We must provide the credit, generated by a Federal credit system.”

Having cancelled the bogus claims against the economy, we must then create a new flow of credit, under our Constitution, to ensure that the local chartered and local national banks are able to perform their traditional function, in cooperation with government, for creating a system of long-term credit, to generate the rebuilding of our economy: agriculture, industry, infrastructure.

We must also concentrate on increasing the energy flux density of our baseline source of power. This means going with nuclear fission in a big way, on the way to deployment of thermonuclear fusion. We must transform our system of transportation from the current one based largely on individual automobiles and highways, to one based largely on high-tech mass-transit, especially magnetically-levitated trains. “We need to go back to more distribution of production away from a few large centers of mass industry, into regional development; smaller industries, more emphasis on closely-held corporations. We need to rebuild the idea of a community, where you can walk to work in a quarter-hour or half an hour each way, at most.” We have to shift toward long-term investment in new water systems to prevent flooding and replenish our fresh water supplies, by especially mass desalination of seawater. These are 25-50-100-year investments, in which we will cooperate with other nations to mobilize the low-cost credit to bring all this into being.

LaRouche: “We have to enter into cooperation with nations such as China, Russia, and India, and others, as a bloc, to create the kind of world that Franklin Roosevelt envisaged before he died. To rebuild a world, free of imperialism—and he meant British imperialism—which is what our destiny was. We have to think that way. We have to have leaders who will think that way and talk that way. We need above all, a President, who will think that way.”

From the Discussion Session:

Composite Question from many sources: “When you talk about new international arrangements, and most specifically, your four-nation agreement…why do you not consider a 1.2 billion population which serves as the majority population in more than 56 countries and as a minority population in many others? What I am talking about are the number of people in the world today, who are followers of the Muslim faith.”

[For a complete transcript of the webcast, see EIR magazine, Vol. 36, No. 3 (Jan. 23, 2009), pp. 4-15. On line at]

Release Date: Feb. 2, 2009

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