From Volume 4, Issue Number 21 of EIR Online, Published May 24, 2005

Western European News Digest

German Leaders Sign Call for New Bretton Woods

Professor Dr. Hans-Herbert Haase, former leader of the Free Democratic Party (FDP) caucus of the State Parliament of Saxony, signed the call for a New Bretton Woods Conference circulated by Helga Zepp-LaRouche, during the recent German electoral campaign. Formerly, Haase was a member of the parliament of Saxon-Anhalt, and the leader of the FDP (liberal) faction there. Also, Col. (ret.) Juergen Huebschen, who recently granted an interview to EIR, sent in his signature on May 17. Other new signers include:

Prof. (em.) Dr. Josef Gruber, Honorary President of the German Association for Space Energy (GASE), Hagen, Germany;

Dr. Ing. Hans Juergen Gottwald, Clausthal-Zellerfeld, Germany.

Italian Senator, Russian Economist Sign NBW Call

Italian Senator Luigi Malabarba, the group-leader of the opposition party "Rifondazione Comunista," and a member of the Senate Intelligence Committee; and Russian economist Prof. Dr. Stanislav Menshikov, who taught economics at various universities, most recently at the Erasmus University of Rotterdam, The Netherlands, have signed the call for a New Bretton Woods. circulated by Helga Zepp-LaRouche.

Over the years, Professor Menshikov had many intensive discussions with Lyndon LaRouche, spoke at various international conferences of the Schiller Institute and at EIR seminars, including the Berlin seminar in January 2005.

Nationwide Public-Sector Strike in France

The May 16 strike, hitting predominantly administration and transport jobs, was called by the labor unions in protest against a government decree that henceforth, Pentecost Monday will no longer be a paid holiday, and instead will be a normal workday. The government's intention was to collect a larger part of the 9 billion euros which it wants to spend for its "Plan Borloo," a French version of the German Agenda 2010 budget cuts, but with a bit more of a "social face."

The considerable turnout for the strike, not only signals more labor union protests to come during the next few weeks, but it may also influence the outcome of the French referendum on the EU Constitution, on May 29, turning it into a vote of broad discontent with Paris.

German Residents' Assn. Attacks Private Equity Funds

Anke Fuchs, the president of the German Residents' Association (DMB), on May 16, criticized moves by private equity funds, like Cerberus and Fortress, the main actors in a takeover offensive, which in the past five years has grabbed 600,000 apartments, turning them from public-sector property into private property. This comes at the expense of the residents of those apartments, because the funds want to make a profit of 7-8% for their investors, which cannot be done, for legal reasons, through increases in the rents, but only through aggressive sales of apartments to new owners.

The managing director of the DMB, Franz-Georg Rips, told EIR May 16 that there is enormous pressure on the public-housing sector in Germany, created by about 20 billion euros in such funds that seek profitable investments. He said that during the past five years, 1.2 million Germans have been victimized by this aggressive takeover drive, and ironically, Social Democratic Party-led administrations, at the Federal, state, and municipal levels, have played a prominent, negative role by selling apartments to such funds.

Small Shareholders Has List of Worst 'Bank Robbers'

The association of small shareholders in Germany, SDK, has compiled a "Black Book on the worst bank robbers of 2004," which are firms that are infamous for their greed in the takeover scene. The book lists Deutsche Bank, and numerous non-German names, for example, Blackstone, Carlyle, Citigroup, JP Morgan Chase, Morgan Stanley, Royal Dutch Shell, and Yukos.

Majority of Dutch Citizens Oppose EU Charter

Even in the (rather unlikely) case that a small majority should emerge in France in favor of the EU Constitution, in the referendum on May 29, a "no" in the Netherlands can still block the charter. The charter goes into effect only if all 25 member states of the EU ratify it.

Latest opinion polls see more than 50% of the Dutch opposed, with only 28% in favor of the Constitution.

German Neo-Con Attacks SPD, Social Market Model

German neo-con Peter Glotz claims that the Social Democratic Party's support of the social market economy is a thing of the past.

In a commentary in the May 20 Rheinischer Merkur weekly, Glotz wrote that SPD chairman Franz Muentefering's attacks on capital funds miss the real target. The "real" problem, according to Glotz, is that "Anglo-American financial capitalism, or rather the digital capitalism based on modern data and information technology, is on the brink of breakthrough in Germany."

"Rhenish Capitalism," Glotz added, "is disintegrating," and the same is true for the social market economy model which the SPD keeps fighting for. "Sufficient economic growth" to achieve full employment, is not possible, either, anymore, Glotz wrote, adding that this development implies "trouble," massive social conflicts, for which scenario Muentefering seems to prepare himself.

Royal Mail Demands Bailout of Pension Fund

The Royal Mail, Britain's postal service, is making huge dividend payments, while demanding that the government bail out its pension fund, media reported May 18. The Royal Mail is still state-owned, but the drive is on for privatization, which will be one of the contentious issues for Prime Minister Tony Blair's new government. Its financial director, Marisa Cassoni, reported May 17, that despite its report of record profits, the Royal Mail is "technically insolvent." Its pension deficit is 2.5 billion pounds, under old accounting standards, but under the new international financial reporting standards (IFRS), the pension deficit is 4.6 billion pounds.

"This produces a negative balance sheet," Cassoni said. "Technically the business is insolvent, which means that we can't pay out dividends." The Mail wants the government to be responsible for 220,000 current pensioners of its pension fund, begun in 1969. By dumping at least half of its pension obligations on the government, the Royal Mail would be able to raise up to 5 billion pounds from what chairman Allan Leighton, who wants to partly privatize the Mail, called "some nice banks."

The Royal Mail posted profits of 537 million pounds for 2004, and therefore paid out big bonuses, up to 2.2 million pounds for executive directors, and regular workers got about 1,000 pounds each.

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