From Volume 4, Issue Number 40 of EIR Online, Published Oct. 4, 2005

Latest From LaRouche


Lyndon LaRouche was the guest for two hours on the Jack Stockwell show, KTKK, Salt Lake City, Utah, on Sept. 29.

STOCKWELL: All right, about 8 minutes after the hour: And my guest for this morning, Mr. Lyndon LaRouche. Lyn, you there?

LAROUCHE: Yes, I'm here.

STOCKWELL: Hey! Good. Good, good, good. Always a pleasure to have you here. When I was talking to Don Phau the other day, about the possibility of doing this again, we were discussing—well, it's something that I've been talking about on the radio for some time now, that this explosive price increase that we've seen of not just fuel, but anything related to petroleum; but also the housing that's going on, and the real estate stuff that's going on—even a loaf of bread, for Pete's sake—isn't so much a supply-and-demand thing any more, as much as we're finally hitting what could be one of the most dark periods of our history ahead of us: This hyperinflationary spiral that we have seen hit nations in the past.

And I'm kind of wondering if that might not be what's going on. That is what I would like to begin the show with today. Your take on that, please, Lyn.

LAROUCHE: Well, you have an absolutely new phenomenon. Because this started, actually in 1987: We had the equivalent of a '29 crash in the stock market in October of 1987. Now, this was the point at which the previous Federal Reserve Chairman, Volcker, was leaving. And Greenspan was coming in. And Greenspan said, "Hold everything! Don't do anything. I'm coming in. I've got a new idea."

So, he came up with the idea of using gambling side-bets, as a legalized form of security. That is, in other words, like a couple of side-bettors up an alley: a couple of guys shooting crap, and side-bettors are betting on the outcome of the shot. And now they use this, the bet—the proceeds of the betting on the side-betting, as a part of the real economy, as if it were the main game.

So, by this method, we had, under George Bush I, George H.W. Bush, and continuing from that point on, we had a Greenspan-run, from the U.S. side, promotion of what are called "financial derivatives." Which is a fancy name for gambling side-bets on all kinds of international markets.

In recent times, it's grown to the point, that major institutions such as banks and insurance companies, and so forth, all have their hedge funds, in addition to these other hedge funds sitting out there—with all kinds of financial derivatives: We're talking about many quadrillions of dollars of turnover, of this phony money, like Monopoly play-money, which is now being counted in as part of the economy. And Greenspan is one of the chief sponsors of this.

Now, what has happened is this: There was a hedge fund gamble in the spring of this year. This has been building up, all these years. We had the 1999-2000 crisis, we had the 1997-98 crisis, including the hedge fund crisis then, LTCM. This has still been building up. It's been building up more rapidly under George W. Bush, than it was under Clinton.

Now, it's reached a breaking point, partly helped by the stupidity of the George W. Bush Administration. But internationally, the hedge funds, which made a big gamble, using the wrong mathematical formula, in the spring of this year, got caught! Many hedge funds began quietly being pushed out of business. And you're talking about Cayman Islands and places like that, as a focal point of this sort of thing.

Now, what they did, is, over the years recently, you've had a collapsing of the diversification of the petroleum industry, such that the petroleum marketing, international marketing—it has nothing to do with the Middle East and so forth, as such—it's the international petroleum marketing, which are 7 to 10 contracts may be signed between the time a barrel of oil leaves the Middle East, and it comes onto the market in the United States. So, what these guys did: they used the fact that a small group of people, a financial group, had a monopoly over petroleum, and a lock also on many other kinds of essential materials—they used that, to drive up the price of petroleum at a hyperinflationary rate, over the course of the summer into the fall, which is comparable to what happened in Germany in 1923.

So, we now are in a hyperinflation, which involves several categories: On one side, you have petroleum, with gold, with copper, with zinc, and so forth, with primary materials, all in a hyperinflationary spin, not based on supply and demand, because the demand has dropped. The supply is running way ahead of the demand, in petroleum, in raw materials, and so forth.

STOCKWELL: So, we really have a glut!

LAROUCHE: Oh yeah! So, now what you have—but you have another one! You have inside the United States, inside the United Kingdom, and Australia, and elsewhere, but especially the United Kingdom and the United States: You have a speculation in housing, typified by Fannie Mae, that is, mortgage-based securities speculation. And the banks are heavily involved in this. The amount of mortgage-based security portfolio stuff inside the banks, is enormous.

So now, you have prices in certain areas, like California, around Washington, D.C., certain areas of the United States—high gain rate, while other parts of the country are being depopulated, such as Michigan, Ohio, Indiana, Illinois, so forth, and of course the Prairie States. While they're being depleted in population, you now have a concentration in a few areas: Going South, to traditionally poor areas, where the labor is cheap, and you've got housing build-up there, but it's mortgages. We have shacks going for a million-dollar mortgage, which are really—on the market, they shouldn't be more than $150,000. And people are desperately buying into this.

Now, not only are homeowners buying into this, that is, people who take a place for residence. But you have now, a big market in people who are buying these things, on wild terms, in order to rent them out!

We've reached the point that this thing is about to collapse. You can imagine that a house, a shack, which is a tarpaper shack—glorified tarpaper shack, held together by tacks (if they got the tacks in the right place), which is a fancy-looking exterior, but not much to it in a rainstorm! And these things go up to $800,000, $1 million, in certain areas. And these things aren't really worth that much. Now, you've got people packed in here, trying to buy these things, with interest-only, and no money down. As sort of the worst kind of thing.

This is about to blow.

So that you have in the world market, from primary materials, from things like the housing bubbles, the mortgage-based securities speculation, you have a potential explosion. We are now getting an effect on the world market, which is comparable—it's not identical to, but comparable to 1923 Germany: It's like the summer and fall of 1923 in Germany.

STOCKWELL: Well, looking back at history, at 1923 Germany, there in the spring, as they were starting to move to this explosive inflationary rate, what finally set it off? What could set this off, for us today? I mean, the idea of somebody walking down the street with a wheelbarrow full of deutschemarks [sic—reichsmarks] to buy a loaf of bread is difficult enough to believe ever happened back then—almost impossible to conceive of something like that today.

LAROUCHE: Well, no, it is. The problem is this: This has been going on, as I said, since 1987, when Greenspan and company, decided that using financial derivatives, as if it were money, as if it were real, as a way of postponing a 1929-style depression, in October 1987. That this thing has been contained. It was contained by a number of things: For example, when the Soviet Union collapsed in 1989-1991, these guys moved in, and they picked the bones of the entire former Soviet/Eastern European market. And they looted the place! That helped sustain the bubble. They went through the IT bubble; they went through several other bubbles. Now, always, they contained this hyperinflationary potential, by expanding this fictitious economy. And as long as they had control over the fictitious economy, where they could manage it, with a few big central bankers and others, they prevented the thing from exploding.

You had a similar thing happen in Germany, from 1921 to 1923: The Germans were printing money to try to pay the Versailles war debt. But the thing was contained up to a certain point. In the spring, late spring of 1923, that blew up.

That is what has happened now. We had a controlled bubble, controlled by Alan Greenspan, et al., et al. Controlled over the period from 1987 to the present, with many bumps along the way, and surviving for many reasons. During this period, up until recently, up until approximately the spring of this year, this was under control, because the international financial-monetary system was under control of central bankers. Remember, most of the speculators are large banks who are tied to the central bankers.

So, they had this system under control. The system has now gone out of control, the way it went out of control in Germany in 1923. It's a different kind of situation, because you didn't have financial derivatives then. They had to print the money. Today, you can print money by an optical cable.

STOCKWELL: Exactly, just with a keyboard on a computer.

LAROUCHE: That's right. And nobody knows how much is out there, particularly because these unregistered securities, in terms of hedge fund and similar kinds of transactions.

So now we're at a point, where the thing is out of control. It's been going rotten, all along! But the difference was, it was under control.

Then, you had people—and the people were stupid. I mean, our people, the majority of our people, including high-paid people: Stupid! You tell 'em, the system is collapsing—and it was collapsing, look at the physical collapse: the industries lost, whole sections of the country going under—they said, "No! The economy's doing fine."

What d'you mean the economy's doing—?

"Look at the market! Look at the market!"—talking about the stock market, or similar kinds of financial markets—"Look at the market!"

So, they're sitting there, with their rear ends sticking out of their pants, looking up, and saying everything is getting better, we're getting rich! And the rags are accumulating from the waist down.

STOCKWELL: Well, our one and only steel production plant, here in Utah, is now being dismantled. A lot of it being shipped over to China; parts of the grounds are going to be converted to some other kind of service-oriented business.

LAROUCHE: That's lousy.

STOCKWELL: All right, we're going to go to break. My guest, Mr. Lyndon LaRouche, from Leesburg, Virginia. Traffic coming up here, commercial break. We will be right back! An awful lot more topics to discuss with Mr. LaRouche. Be right back. [break]

Lyn, I wanted to asked you another question regarding the hyperinflation thing we're in. But an off-air caller wanted me to let you know, that often when you've been on the show in the past, you usually would receive a phone call from a very elderly woman, named Helen. Who was a great fan of yours, and always appreciated what you had to say. She recently passed away, and this off-air caller thought you might appreciate knowing that.

LAROUCHE: Thank you, very much.

STOCKWELL: Yes. Now: Back to the hyperinflation, you said something happened this spring to kind of upset the applecart a bit. Is that something equitable to what happened to the LTCM back in the late '90s?

LAROUCHE: Broadly, it is. It's about the same kind of phenomenon. It was never cured. Clinton was about to do something about it, with Bob Rubin, who was then Treasury Secretary—

STOCKWELL: I remember that.

LAROUCHE: In September of 1998. And they backed off, because what happened is, people dragged something out of the basement of the White House, and used it to try to impeach the President in order to defend the thieves on Wall Street! And they tried to make Al Gore President, which would have been like—that'd been something really unpleasant. But anyway, that's what happened then.

But, this has been going on. It was inevitable. I've been telling people, it's inevitable. If you are developing debt, and debt-related obligations, at a more rapid rate than you're generating income, you are going to be in trouble! And particularly, if you're in a hyperinflationary spiral of that type, you are surely in trouble, within a calculated point. We now have reached that point, where the control mechanisms broke down.

And this now becomes very dangerous. Because, a time like this, in history, is a time when wars tend to break out.

STOCKWELL: Well, that's what I wanted to get to, leading up to this direction, because, someone would say, "Well, it's kind of convenient that we've had some recent changes in the bankruptcy laws," knowing what's about to happen financially worldwide, but far worse than just these bankruptcy changes, aren't these the moments that precede dictatorship and world war?

LAROUCHE: Well, it's very simple, but you can be much more explicit about that. It's not a mysterious phenomenon. It's not little green men under the floorboards, who do this kind of thing. It's some very well-known men. And people who are enemies of mine, who consider me very dangerous, in high places—and have considered me very dangerous, since December of 1971, when I made some statements which showed them that I was onto them.

But what's happening is, that you have a group of international financier agencies. Now, we've had this in the past. You've had financial groups which controlled governments, which are more powerful than governments. It was a characteristic of the so-called Middle Ages. That was what the characteristic of Europe was under the British influence. That's what we fought against from 1763 on, once Britain became an empire, at least the British East India Company became an empire, with the victory in the Seven Years' War.

And we began to fight against that, and we created a system which has tended to be outside that European, usury-run system.

STOCKWELL: Okay, I'm going to interrupt you right there. I want to pick that up on the other side of the break: This system that we created, that's outside the British usury system. We have to go to break for just a couple of minutes. My guest, Lyndon LaRouche out of Leesburg, Virginia. We'll be right back.... [break, returns with EIR toll-free number]

Lyn, you were talking a moment ago, about America coming up with a system somewhat different than the British usury system.

LAROUCHE: Well, the difference essentially is this: Is the British/European systems, with some temporary exceptions, the governments were always controlled by private banks, or a system of private banks. In more recent times, this was called an independent central banking system—independent means, it's controlled by private interests, not the government.

What we've had, is a situation in which, in terms of day-to-day practice, as long as these agreements were held up, that private financial interests were more powerful than governments.

Now, in our system, we actually represent a national banking system, by our Constitution: That is, the Federal government, in its control of the creation of currency, and credit against the creation of currency, which is controlled by the House of Representatives and the Executive branch, we are essentially a national banking system. That doesn't mean you don't have private banks—we have them. But the banking system, and everything to do with money, is controlled by the Federal government. That's where our source of credit comes. The states don't have the ability to generate credit, only the Federal government does.

All right: Now, that was modified by the bringing in of the Federal Reserve System through the conspiracy of Teddy Roosevelt and Woodrow Wilson, which is how it worked. So, we've had a modified system.

[Franklin] Roosevelt went back to the Constitution, in the 1930s, that is, in the gold action he took, which was to restore the U.S. government's control over credit, and then use that control over credit to rebuild the economy. It worked.

What you have now, is you have an international financier interest, which is clinically insane as a group. I mean, these guys are Baby-Boomers, they were people who were born after World War II, who came up in that period, and they don't think like serious bankers did, in a time when we were an agro-industrial economy, rather than a so-called services economy.

So, now, you have a services economy mentality, among the people who are running corporations, and they're mostly thieves, as the Enron symptoms tell you! This is what your "quality" management is! Or, GM is in that same category: It's hard to tell the difference between GM management and Enron management. So, this is the kind of situation.

So, these fellows are controlled by international financial interests, including here in the United States. The Bush Administration represents, through George Shultz, is nothing but a representative of this bunch of thieves.

So, the question now, is: We could save the world, we could save the international system, we could save the banking system, by putting it through reorganization, by going back to becoming what our Constitution prescribes under a national banking system, under which the Federal government controls the creation and regulation of national credit; we keep the private banks that are essential functioning; we generate credit to rebuild the economy to levels of activity, where we're above breakeven; and we begin to get our muscle going in the world again, the way we haven't in a long time. Now that can all work.

But, the problem is, you've got insane private bankers, of the Enron mentality type, who are now running large parts of our corporate structure and run parts of our political system: Wall Street, for example. And therefore, they're insane: They say, that no government must be more powerful than private bankers. They're saying the private bankers must run the world: We had such a system, it was called the medieval system, which collapsed in the 14th Century in a so-called New Dark Age. These guys are more stupid, than the bankers who collapsed the system in the 14th Century.

I know these guys! They are stupid! They are stupid because of their ignorance; they don't know what an economy is, they don't understand what production is, they don't understand what physical wealth is, they don't understand infrastructure: They understand nothing! Except so-called "making money."

STOCKWELL: Yeah, they just look at the bottom line, and shareholder interest.

LAROUCHE: They are the bottom line! They're called bottom feeders!

STOCKWELL: [laughs] Lyn, what happened to the Republican Party? It used to be the party of the small-town businessman. You know, generally, the Middle West, kind of mainstream, very conservative group of people who held to productive concepts. Now it seems the Republican Party is nothing but a bunch of people who are owned by the gas and oil business.

LAROUCHE: Not really, and that is beginning to change. That's been pretty much the appearance of things. But also, the Democratic Party, too!

STOCKWELL: Well, I don't leave them out, no.

LAROUCHE: They've also enjoyed the corruption. I think they're coming out of it a bit, at least in the Senate. But, what's happened, is, there's also a change in the Republican Party. You know, the grass-roots Republican Party, not the freak show, George Bush's and Cheney's freak-show crowd—that's not the Republican Party. And many members of the Republican Party, especially running for Congress this coming next year, are thinking about that!

Their interests lie, and the country's interests lie, in the privately—that is, the closely held—private entrepreneurships. Not the big, super-corporations, where the stockholders fly in and out overnight, like bats. But the businesses which are there to stay, which represent the state, represent the community, which give you the spread of development of the entire national economy, in agriculture, industry and other things. They think that way. That's where their guts are.

Now, they're looking at George Bush's reputation, and the reputation of Cheney, and they're looking at things like this, you know—"let's change the government without DeLay"—which is the slogan today.

STOCKWELL: Yes, "without DeLay," right. I wanted to get to DeLay. We'll get to that shortly.

LAROUCHE: Well, fine. But there is a Republican movement, which we see in the Senate, in a tendency, especially on May 23rd of this year, a tendency toward bipartisan coalition, among what you might call "standard Republicans," that were old-fashioned Republicans—and Democrats—

STOCKWELL: Against the current regime.

LAROUCHE: Against the Enron mentality. Look, George Bush is created by Enron! They should have taken him off the market when Enron closed down! [Stockwell laughs]

STOCKWELL: We've got to go to another break in just a moment [gives out EIR number]. About 20 minutes before the top of the hour, you're listening to the Jack Stockwell radio program. Lyndon LaRouche is my guest today, live from Leesburg, Virginia.

Lyn, we were talking a moment ago, about this coalition, a bipartisan coalition that seems to be forming in Congress, that may actually want to demonstrate some backbone, and stand up against the Enron interests, the Bechtel interests, the George Shultz interests. Where did, or how did, Harry Reid suddenly develop some backbone?

LAROUCHE: Well, he always did have backbone. But, he was put in a situation as the Minority Leader of the Senate, where he had the need and opportunity to express it. This came out of the aftermath of the last election, Presidential election, when a few days after the Democrats came out of the ether, a few said: Look, that was a swindle. George Bush robbed and stole the election—not George, but his henchmen. Get off the floor: Bush is lame-duck. Certify him as a lame-duck—


LAROUCHE: Yeah, and we had him as a lame duck. He still is a lame duck. He's got no wings and lots of feathers.

So, what happened is, they began to move against George's Social Security rip-off operation. And George got stuck there. Cheney is mad. He's dangerous and mad. He got us into this Iraq War, that they cooked up, is not working out. It's a hopeless war, it will never be won in its present form. We're going to get out of there soon, or we're going to be there forever! If we're around! It's not going to work. This whole thing is—it's insanity in conception. And the military, the professional military, except for a few nut-cases, knew that from the beginning. So, it's disintegrating.

Now, you see the disgusting behavior of the President and Vice President, in the case of lack of preparations for Katrina, and that's easy to see, because you compare the way Clinton reacted, the way he set up FEMA, made it a part of the cabinet combination, and how we were set up to deal with catastrophes—and you look at the way Bush behaved. Bush and Cheney just disappeared. They're playing games. Nothing was done. We had from Aug. 2nd: We knew this thing was going to happen. We didn't know exactly where it was going to hit, but we knew the whole coast area is extremely vulnerable! Because it's been ruined in the past 40 years, through economic decline, and nothing has been done. The programs we had earlier, from Betsy, were never put into effect.

Remember, Betsy set Lyndon Johnson into motion—

STOCKWELL: That was '65, wasn't it?

LAROUCHE: That's right. And the program was never conducted. And the condition along the coast, is far worse today, economically, in that region, than it was then! So, we have let the nation go virtually to hell. And they were sitting there—we still had resources to do things. We didn't do them, because the President was "on vacation." He should have stayed on vacation, and let somebody else take over—and keep Dick Cheney with him, wherever they go.

STOCKWELL: Well, there's even more coming out of Texas now, than just hurricane leftovers, and that's an indictment on Congressman DeLay.

LAROUCHE: Yeah, you know, this is—the system reacts. People know that this country doesn't have a chance under George W. Bush and Cheney: They've got to go.

Now, under right conditions, you'd have some senior Republicans, with the blessing of Democrats, would walk into Dick Cheney—and probably to George Bush, but Dick Cheney first—and say, "Dick, you know, you could get out of this without going to jail." Essentially delivering the same kind of message, and reassurances that were given to Richard Nixon on the relevant occasion back in the 1970s. And Cheney would go. And then Bush would go. And we'd sort the mess out.

And we'd get ourselves a Presidency now, by a bipartisan agreement of Democrats and Republicans—at least all the sane Republicans and the Democrats—which would function. Then, we could do something.

We're now in a situation where the United States has a golden opportunity, to do something to bring the international system back into order. We could do it right now.

STOCKWELL: Is this move against DeLay, a fire across the bow of Cheney's ship?

LAROUCHE: I think it's more! I think this move is, people realize, what I just said, and they realize that the Republicans are fine people, that is, the coalition types. But they weren't willing to act. So somebody in the system, decided to do the obvious: Start pulling the thread on the knit sweater. And that's what the DeLay thing is.

The DeLay thing has been sitting there. You've got two things that have been sitting there for some time: One is Cheney, and Libby and company, and Addington, in the Vice President's office. This involves the Valerie Plame affair, the so-called Joe Wilson case. That case, if pulled, would put Cheney out—shortly.

Then, you have the DeLay case. The DeLay case, you know, you've got murder cases involved on the Abramoff side. You've got a conspiracy to commit murder, which has come against two people who are with Abramoff, and Abramoff and DeLay are the same thing. DeLay has now been hit, in this area, on the 2002 election business. The two things are tending to come together. If you pull out DeLay, and you find that Blunt has got to go. Everybody who has been picked as a replacement, that they wanted to put in there, to replace DeLay "temporarily," so-called, has got to go, too! They can't have them! There's a problem with them!

So now, you have a tendency to break up this sordid bloc of control, by a machine, a Republican machine which is right-wing-controlled, or -nut-controlled, inside the House of Representatives. And the situation, where you have a lurch toward cooperation among Republicans and Democrats in the Senate. So, you've got people who realize, we have to do it.

We have to do something, to get a Federal government functioning, the Executive branch functioning. It does not function now! We're in the worst crisis that we've ever faced, in terms of its potential, globally and otherwise. We have to act now. And these two clowns, Cheney and Bush, are in the way. And the way to do it, it takes too long to impeach the thugs. We just have to go in there, and say, "Boys, you got an option, a really good option: You can avoid imprisonment. Just go, quietly."

STOCKWELL: Isn't this part of the reason behind choosing John Roberts as Chief Justice, so that, if this ever does get to an impeachment level, they've already go an ace up their sleeve?

LAROUCHE: This is a real problem with this Roberts thing, it's not settled yet. It seems to be settled, but it's not.

STOCKWELL: Well, they claim he'll be a shoo-in today.

LAROUCHE: I know. It could happen, but it still is not clear. Because the issue is this: John ducked all the issues that are relevant. The issue is—and the issue is not settled, because the majority of the Supreme Court is not yet in the hands of George W. Bush—even with Roberts in there. Roberts did never face a tough question. He slid in, without a tough question. The tough question is: What do you think about the Preamble of the U.S. Federal Constitution, and the concept of the General Welfare? [Stockwell laughing]

STOCKWELL: Yes, precisely!

LAROUCHE: Because—the point is, how can a man who does not accept the fundamental law of the United States, be a Chief Justice? And my gutless friends in the Senate wouldn't do anything about that, for various reasons. And that's where our dear friend from Nevada came in, and was willing to fight on this thing, and realized he had to. You can not have this!

Now, the composition of the Supreme Court has not changed essentially, ideologically, up to this point. If Justice O'Connor is removed and replaced by someone of the same type, then we're in trouble.

STOCKWELL: Yes, we're in trouble. Hold on, we're going to go to a break. Mr. Lyndon LaRouche is my guest.... [break]

We've only got a couple of minutes left before the top-of-the-hour news break. My guest is Lyndon LaRouche from back in Leesburg, Virginia. We just arranged this at the last minute, for this interview today. You can get a free copy of what we've been discussing just by calling 888-347-3258. Refer to our interview this morning.

Lyn, we've just about a minute and a half before we're going to be interrupted again. But, you were saying—you know, what is O'Connor's motivation here, to even stick around? Is there enough life left in her, to resist the Bush regime? To try and stick this out, until Bush goes down first?

LAROUCHE: I think so. I think that's fair.

STOCKWELL: I mean she knows very well, that if she's replaced by another John Roberts type, who believes that the President can order torture, that the President is pretty well free to do whatever he wants to do, in the sense of imperialist invasion of other countries, in violation of the declaration of war concept in the Constitution; if we get somebody else in there like that—and with Thomas and Scalia—we could be in some serious trouble.

LAROUCHE: Well, I think we're not going to make it that far. I think the crisis is coming on now.

What I'm looking at internationally, as well as here, I'm looking at the system as a whole. And the system is an international system, not just a U.S. system, it's not a sense of separate elements: We're interactive now. I don't think the system's going to hold on that long. I think we're now in the end-game routine.

STOCKWELL: And this is what you said, then, precedes, has historically preceded international war, on a much larger scale than this Iraqi thing.

LAROUCHE: Well, this is a different kind of war.

STOCKWELL: Asymmetrical.


STOCKWELL: Let's pick up with that, and your take on our current situation in Iraq. It looks like any day, we're going to attack Syria, any day we're going to attack Iran. Someone called a while ago, and said they read somewhere on the internet, that somebody's already firing something inside of Israel right now. So, let's start with that when we get back from the other side of the break.

We're be right back. My guest Lyndon LaRouche for the next hour, don't go away....[break] All right, 9 minutes after the hour. My guest Lyndon LaRouche, live from Leesburg, Virginia. Lyn, you there?


STOCKWELL: All right! Now: We started to talk about Iraq. I had a question for you, because now, we have in this current administration something new under the Sun: a President that just because he feels like it, can go declare war on anybody. And unfortunately Congress will go along with him, the courts will go along with him. I'm sure, at this point, the Founding Fathers must be somewhat mortified, as to what they've seen us to with their handiwork—which wasn't the absolute best thing at the time, but now, it seems to me to be almost done for. I've been talking to my audience for the last 60 days, anyway; you know, here's another day, we haven't invaded Syria yet, but don't get out of the currency wars, because we're going to go in there any moment. Is that still a possibility, from the way you see things, that the only way this current administration can save their backsides, unless they get overpowered by some Republican team that tells them it's time to go home, is to propel us into further war activity, in Syria or Iran?

LAROUCHE: Well, it's not really this Administration. These fellows are stooges.

STOCKWELL: Well, okay. Granted.

LAROUCHE: The issue here, is you have a faction of international finance, which is, as I said before: They're committed to making sure that in this crisis, they come out on top, and government goes down. They're determined to eliminate many governments of this planet—just eliminate them. They're determined to bring the governments they don't eliminate, fully under submissive control, as virtual errand-boys for these kinds of banking groups.

Now, they are not all wise. In matter of fact, they're rather stupid. Compared with banking power, financial power, in previous generations, these guys are really stupid. And they can't do anything right. They can not win, but they can cause the world to lose. Take the case of Iraq, for example: There's no way that that can be won as a war. That was known from the beginning. What people didn't understand, that the people behind Cheney did not intend to win a war: They intended to set fire to Asia. In other words, they intended a non-winnable war in Iraq, and they got it! They're determined to have non-winnable wars elsewhere.

Now, look at the Iraq situation, to get a clear picture of what this is: We do not have, as the United States, any more—we do not have the ground forces to control territory, anything. We don't have the ground forces to control the territory of Iraq, let alone something else. So therefore, what you've done, is, you've created a situation where conventional warfare, as we used to understand it—troops marching to war, winning war, declaring a victory, and then leaving—that is not possible right now. We're now at a point, where these idiots are playing into the worst kind of a situation: Despite our big nuclear weapons and so forth, we can not win wars! In the conventional sense of winning wars. We can only cause trouble, and in the end, the trouble we cause, will eat us up.

Therefore, the question is this—forget this bully, bully, bully, war, war, war stuff. Yes, we need defense capabilities, and so forth. I would build them. But: we have to deal with these problems by diplomacy. For example, take the case of Iran: Now, Iran was provoked, and the reaction that they had in cancelling their membership in the NPT, was predictable. You want to have that? You force the issue? You get it! Now you got it!

The problems with North Korea. Most of these problems we have, where there's some reality to the problem, or some conflict, we could deal with this very successfully by the right diplomatic approach. We don't do it. We used to have diplomats, and we do have people, still, who are experienced people who know how to do this. There's not a single problem on this planet, that can not probably be dealt with successfully, without shooting anybody.

Terrorism, for example: What's being done on that, is crazy! It's wrong! What you have to do, is starve it out of existence by—stop provoking! Stop putting oil and gasoline on the fire! Get more allies. Get more people who will join you for the sake of stability, and isolate the problem, isolate this isometric problem. We can do that. We can do that with help of economic development.

But we don't have—the government of the United States is presently insane. And the bankers who control it, are insane, at least the controlling factor. It's not a hopeless situation, because in a crisis like this, as you've seen from the Senate, and you've seen from bipartisan tendencies in the Senate: You've seen that there exists, still, in this country, with all the shortfalls that our people have, we still have the character and capability of making the kinds of decisions, which can deal with our problems, and enable us to do a good job, in bringing the rest of the world around us, some of the international problems.

STOCKWELL: Hence this growing coalition, then—bipartisan coalition. And the indictment of DeLay, that this—whatever you're referring to, that still exists, is suddenly coming together in a much more visible, tangible manner, especially when indictments show up. And maybe something will happen here pretty quick, with a little walk into the Oval Office.

LAROUCHE: Well, Jack, you know something about this situation. Our government, our Federal government, for example, is not merely composed of elected officials, or a few top appointees.


LAROUCHE: Our government is composed of a lot of servants of government, in the Executive branch, the committees of the Congress, and so forth. It's composed of people who are no longer in government, or who are not in government, like me! But who are part of the system. And, we are concerned about this country. While politicians walk in and out of office, with a very short locust-like attention span, sometimes, because of the pressures on them, those of us who are behind the scenes, who are thinking, are looking at our country and saying: "We've got to save our country."

Now, in this process, you have a sluggish process in the system, in the institutions of government, which include former intelligence people, as well as active ones; diplomats, so forth; military, everything—you have the people who do care about the country. They do have the ear of many of the Senators and so forth, in our system. You have governors and other people around the country, who are part of the system—they do have concern for this country. Now, obviously with a situation like this, with a crisis shaping up, this machine, however slowly, begins to move: We're determined to save our country; we're determined to save the world. We know the United States has to do it—we have to take the lead. We're not going to run the world, but we're going to save the world.

And so, you get things like this DeLay problem: DeLay was a vulnerability of the enemy, and people are moving on it. Cheney has a vulnerability in his office, with his staff in the Vice President's office: That is a nest of vulnerabilities. You can't get a replacement that's acceptable right now, for Tom DeLay in the House of Representatives. Blunt won't stay. They've got a list of these guys, and I look at the list—they can't stay, they're not going to hold up.

So, you've got a situation, with these prosecutions, against Abramoff; the murder indictment, conspiracy to commit murder indictment, which goes to Abramoff, which goes to DeLay. So, you have the case of the Plame case, which goes to Cheney; and Cheney's office, which, if it goes to Cheney's office, it goes to him—he's out. Cheney's sick. Very sick. Very endangered.

So, you've got a situation, in which the institutions of government, can tend to orchestrate the situation, in such a way that, we, however sluggishly, may come back to our senses in time—at least sufficiently back to our senses, to bring some of these things under control. My job is to alarm people, activate people, especially in these institutions, not only in the United States, but also in Europe and elsewhere. And we're getting some motion! We're getting some motion. It's not guaranteed—

STOCKWELL: As I read newspaper articles from around the world, stuff that's in Die Welt, stuff that's in Le Monde, British papers, English translations of Pravda, and some of the Middle Eastern publications, I see your name appearing all the time. I don't see it here!

LAROUCHE: It's here.

STOCKWELL: You know what I mean—I don't see. No, that's true! That's true! I have: New Yorker, a few other places, little references here and there. But, what I'm referring to, of course, were mostly headlines in foreign newspapers.

LAROUCHE: I'll tell you—you've got some bankers who control most of the mass media in this country, and they hate my guts! [laughs]

STOCKWELL: Well, of course!

LAROUCHE: And—they're afraid of me! [still laughing] So therefore, you get in the mass media, you get the obvious result. That's the way these clowns play the game.

But, it doesn't change it, you see? The point is, they think that by orchestrating opinion, orchestrating public opinion through the mass media that they control society. Yeah, they influence things, a bit. But they don't control society. In the bottom line, people are motivated by their interests, they're motivated by what happened to them in New Orleans; they're motivated by what happened in Texas. They're motivated by the loss of jobs, they're motivated by the fact that General Motors is about to disappear, along with Delphi, and probably Ford, and so forth. They're motivated by the fact they have no Social Security, or they're losing it. They're motivated by this and that.

So, there are people who realize that this system, and its present leadership, is not working. And they can not be—you know, everyone says, "But look at the market, look at the market! Wall Street's going up!" And they say, "Yeah, but we just lost our town!"

STOCKWELL: All right, we'll pick up with that, as soon as we're back. More traffic—don't go away....[break] All right, 23 minutes after the hour of 8 o'clock here in the Intermountain West, Sept. 29, 2005. You're listening to the Jack Stockwell radio talk show program: My guest this morning, live from Leesburg, is Lyndon LaRouche...[gives EIR number].

So, Lyn, we were talking about Iraq. And you know, it's at moments like this, when—we've had some off-air calls, you know, "when's it going to go?" and "how much longer do we have?" And you know, you're more of a forecaster, than you are a predictor. And it's like Jesus says, when you see the change of the wind, and when you see the clouds, you know that summer is nigh, and this kind of stuff, and the leaves on the trees. And, as we look around us right now, and you look at what happened financially, this last spring, what's happened with GMAC, what's happened with Ford Motor Credit, and their involvement in hedge funds instead of the automobile business. Other people as well, involved with the auto industry, having some serious—that's why we have all these fire-sales of cars, of course. And then, the warnings! The warnings that are coming out of significant personalities, in European financial circles who are making comments: It's, "get out of the American market"; "watch out, it's any day, now."

Can you put any kind of a threshold on this at all?

LAROUCHE: Well, I think it's a mistake to ignore the fact that human will power gives choices. And in calculating what is likely, you can't look for a crystal ball. You've got to understand the system, understand the process, and understand that the system is operating between limits, boundary conditions. And that for every action, there will be a countervailing action, which in part, involves the human will, the human individual will. And therefore, you can not predict. There's no magic. There's only science. If you have a good scientific understanding of the situation, you can come up with a good estimate of what the range of possibilities are. I'm probably as good at this as anyone, and I know what my limitations are. And I don't predict. I warn people that this is what the consequence would be, if a certain decision is made. And that stands. That you can't change. You can find, maybe, other alternatives in some cases, but usually not. That often you have to make a decision that's given to you, it's handed to you. You have to settle that problem.

So, we're right—. We're at the edge—we're at the time you should be acting. We're at the time, when citizens should be acting. If citizens don't act, we're going to pay the price. If they do act appropriately, we have a chance. And that's what you get in life. You don't get guarantees. You get options. And somebody else makes the decisions to what finally happens. We have the power to pick options, that's all; and if we wait around, and wait for some miraculous guy, who's going to give us last minute when we can jump out of the car or whatever—that's foolish. You have to say: Well, what's our policy? What is the problem? What should be our policy?

And that's the way to it. Don't look for predictions; don't look for guarantees. There are no guarantees! Free will exists. People respond, willfully, to situations. You've got to look at the boundary conditions, which predetermine what kind of reactions will work, and what kind will fail. That's all you've got.

STOCKWELL: Well, Lyn, this last spring, when Harry Reid and several others finally decided to stand up to the administration, in the sense of this filibuster stuff and the up-and-down votes, and then all of a sudden, several Republicans started to come forward as well, I'll tell you, that really gave me a boost in my hope for the future of this country!

LAROUCHE: Yeah sure! That's good. That's what you have. And you have setbacks. Every time I get something happens that's good, I find that the following day, we get a setback. And we keep on doing it, we keep on fighting; and that's what keeps us going.

STOCKWELL: Where do you get your—determination, every day, with what you're up against, with what you know, with what you understand, with having served as a political prisoner, with the possibility of anything crazy like that happening again, some time: What is it that's in your mind, when you get up in the morning, to go out there and make yourself fit for the task?

LAROUCHE: Well, you know, most people who claim to be religious, aren't. They're religious in a certain manner, but they don't believe in immortality. If you realize that you are living mortal life, which has finite boundary conditions, a beginning and ending, then you don't look at your life in terms of what you get out of it, like an animal. You think about what you're doing, what your mission is in life, what you should be doing, in terms of the consequences of your having lived.

Now, when you do that, and you know, I'm stuck with about 3,000 years of history of European civilization which is the central feature of my consciousness at all times, I always look at these things from the standpoint of ancient Greece; the horror of the Roman Empire, which I hate; the horror of the medieval system, which I hate; some of the modern things, which I hate. And I'm rather proud of our country, for good reason: Because it was created by good people with a good intention. And it's the best in the world, if we can make it function.

So, I sit here. I try to play my job as a patriot. I'm 83, I'm not looking forward to 20 more years of expectations, and I do what I'm supposed to do: And I enjoy doing that! I'm happy doing that. I'm not looking for instant gratification, for physical immortality, or riches or anything of that sort. I just enjoy doing what I do, because I'm happy with being who I am. It's that simple.

STOCKWELL: Do you believe that life goes on after death?

LAROUCHE: Oh sure! We are immortal. I mean, our physical bodies are not immortal, but if you think about what the difference between a man and an animal, is, you know that difference. You know that the human being is something which occupies an animal-like body. And when you look at the role of what the human being is, scientific discoveries, ideas, so forth; you look at the history of mankind for thousands of years, what do you have? You have the history of ideas. The history of social processes which are centered on ideas. And you realize that what you leave behind, are what you set into motion. And especially the ideas which you've helped to create or transmit.

And you know, just as the way that Rafael Sanzio did this thing in the Vatican Museum, which was once the Papal palace, the School of Athens: And the figures in that School of Athens are people who represent many generations, including Rafael himself, who stuck himself in there! And you realize that this is a collection of people who live in a timeless immortality, as personalities; each with a different place, physical place, and difference place in time. We all interact, and this is humanity. This is our culture. And if you find your citizenship in being in that kind of place in this culture, that's happiness!

STOCKWELL: In the time that's left between now and the election next fall, the mid-term, because you—I'm going to move in a different direction here; you defined the President as a lame-duck. These guys have their back up against the wall—not these guys, but the controllers, the handlers, whatever you want to call them: the Bechtels, the George Bushes, Raytheons, Rockwells, GEs, everybody that put them into these positions, they're going to be scrambling at this point in time. Surely—now you refer to them as being insane—but surely, they can see the writing on the wall. Surely they can see that they may need to back down, from this warlike posturing they want to do, or the entire planet can go up in flames.

LAROUCHE: In the past, if you look at the 14th-Century Dark Age, you would say—and knowing what these people are, by that standard—you would say, "No. They won't. They're not that smart. They're essentially, intrinsically dumb." People confuse the power that these fellows wield, now, with the assumption that they have an innate power, some innate capability: They don't. To me, these guys are ridiculous. I have no respect for them, as human beings. For George Shultz, for example—no respect for him! From my standpoint, he's a nothing. He's a failure. He's a human failure.

So, I'm not impressed by these guys, and I don't think anybody else should be. They're dangerous. They're like a predatory animal in the landscape. They will kill. They will do all these things—that has to be taken into account. But, they are not omniscient. They are not people who will see the handwriting on the wall. If they saw the handwriting on the wall, they wouldn't be who they are. They wouldn't want to be who they are! Nobody who knows what humanity is, would want to be one of them. I can't think of anything more miserable, than being one of them.

STOCKWELL: And being one of them, this sort of human being you're describing, is pretty well what has held European culture for thousands of years, now, under a rather strict hold, in their less-than (I don't want to say, perfect), but less-than-operable forms of government, the parliamentary form of government has allowed this stuff to continue to be fostered. But here in this country, with men and women of some backbone and some determination, and some understanding of our Preamble, we, probably alone from any other country on the face of this planet, can actually stem this tide, and do something starting in Washington, D.C.

LAROUCHE: Well, yeah, sure. For example, I'm as you know, in touch with circles in Europe. And some of them fairly influential. And they know what I'm doing and they agree with me: That the United States and certain forces in Europe, must come to a common agreement on certain modes of actions which will enable us to get out of this mess. It can be done. And there is that consciousness.

Look, the way the country was built, we were built largely by Europeans; the population were largely Europeans. Of course, I've got an Algonquin Indian stuck in my ancestry, but otherwise, it's all pretty much Europeans. And, we built this country. We built it, because Europe was a failure at the time. We hoped that by building a country here, that we would set into motion something that would go back into Europe, and bring Europe up to the same goals we had. But, it was Europeans who made us possible. We are, essentially, Europeans, predominantly. That's our culture.

And there is an affinity, a recognition of that among knowledgeable people in Europe. We realize the United States is a special nation, which the Europeans depend upon, for its being itself. And that's the way they think. And that's the way I think. I count on them understanding this, and I try to get our people to understand it.

We can win this fight. We've got no guarantees—

STOCKWELL: I'm sorry, we're going to be coming up to a break here, shortly. When we get back, I'd like to turn back towards we were talking about earlier, that there are people in the government, not elected people, but people who are long-term civil servant kinds of people who had built careers, moved up the chain of command. Elected officials come and go, but these guys, these girls are there all the time. And some of them, their job in the government is just that, to that end, a job; to other people, they're very devoted to their country, very loving patriots. What are you in touch with, what do you have contact with, that indicates that even in a bipartisan sense, throughout Washington, through the rest of the country, though the Department of Defense, the Department of State, intelligence circles, that these people are about themselves to pull the plug, and push whatever needs to be done, to bring an end to this current administration? I'd like your input on that as soon as we get back....[break]

Lyn, back to that question there before the break: What do you and your intelligence people and everything pick up is a sense of things, right now?

LAROUCHE: Well, I'm sort of in the middle of things, Jack.

STOCKWELL: That's why I'm asking.

LAROUCHE: Internationally, I mean—people forget the fact that I had a little agreement with Ronald Reagan, for example, on what became known as the SDI. And Reagan was really for that—Reagan, as you know, used to denounce Kissinger regularly as the worst thing on Earth, for getting us into this mess of Mutual and Assured Destruction. And so, I went, talking to the Reagan people during the period of the 1980 election period and immediately afterward. And when he was being inaugurated, I went down to Washington, to meet with the crowd, present my shopping list of options for the government for the new administration. And one of the things that the Reagan people adopted, which led to my setting up a back-channel for Reagan with the Soviet government, was what became known as the SDI proposal.

Now, we're coming up toward Oct. 12, Columbus Day. And on Columbus Day in 1988 in Berlin, I delivered an address which was later reported by television in the United States for a national broadcast, saying exactly what was going to happen: It would start in Poland, the Soviet system was coming down; the Eastern European system would come down starting with Poland first; it would be soon. Berlin would become in commitment for the new capital of Germany, again; the Soviet Union would collapse. And we had the opportunity for cooperation to rebuild a lot of things.

A lot of these things happened. But, what happened was, I was in the jug, and I was in the jug largely because of this. These guys wanted me out of the way. None of them thought the Soviet system was coming down—none of them! Including George H.W. Bush himself. He had no idea it was coming down. I said so—but they wanted me out, because of the SDI.

Now, as a result of that, I had, in the process, built up a lot of alliances for the United States, around this idea, among the military and others in various parts of Western Europe and elsewhere, as well as the United States. So, because of this, and because of some other things I've done, I have a lot of respect for what I do and what I think in relevant circles internationally. And over the years, I maintain direct and indirect contact with these circles. And we represent, in our discussions, a fairly good way of estimating what is happening on this planet now. We don't have all the answers, but we're close enough to the answers, to know what we have to investigate to get the answer we want.

So, I have an intelligence capability of this type, which is good—very good. Inside the United States, the same thing: People are afraid to be seen with me, in light of the press. But we do do our work. And therefore, that's what I represent. I'm this ol' geezer who has this history, and these kinds of connections, and we are concerned about the world. We are concerned about the United States. And naturally, we gravitate together, those of us who are concerned about the United States, who are concerned about the world, we gravitate together, to share thoughts and share ideas.

STOCKWELL: I have seen, occasionally, certain verbiage, that I have heard you use, and then suddenly it shows up in some Congressman's mouth, or some news magazine, article, or writer, or editorial here and there, so I know that your influence is spread an awful lot more around this planet, than some people, particularly want to mention—just as you said there, they don't necessarily want to be seen with you in public. As that meeting that occurred—I don't know if it was at the Press Club, or where it was a few months ago, I read about it: Where Greenspan, you were standing there, and Greenspan—someone wanted to know (it was either Greenspan or Kissinger, one of the two), someone asked them if they would like to meet Mr. Lyndon LaRouche. And they said something like "Oh no!" and turned and went in the other direction.

LAROUCHE: No. Greenspan walked into me. It was at the President's annual press event—walked into me, there in—it was in Washington Post room. And walked up to me, and he stuck his hand out and he shook my hand. And I said, "Ah, hi. My old enemy!" He almost melted, at that point—"I need a drink! I need a drink!" He went over to the bar, and he began guzzling at a great rate.

Then he went out in the hallway, where I was standing, and he signaled to a couple of the Secret Service guys to come in watch me! For fear that I'd approach him and talk to him! I had no intention to approach him and talking to him. I just thought, it was a nice encounter, "Okay, we want to chat, buddy?" And it would be an historic chat, but Mr. Greenspan is not up to serious historic chats, these days.

STOCKWELL: Well, I don't know how many tricks he still has up his sleeve.

LAROUCHE: I don't know what he has up his sleeve—it may be his arms!

STOCKWELL: We're quickly running out of this whole thing. How high can this interest rate—now that they've turned the interest rates around and they're going back up, are we going to see what Volcker did?

LAROUCHE: No. This won't work. If they put high interest rates, it'll just collapse the system. There's nothing they can do, within the terms of the system. Nothing!

STOCKWELL: And hence, your answer to all of this, for the Federal government to move in, to put the Federal Reserve into bankruptcy. Do whatever's necessary to preserve and save Social Security, private pensions, retirements, everything, keep all the local banks open, and just redirect the flow of credit from this international financier system back into a government system of credit, the way the Founders intended to do it; the way Roosevelt rebuilt this country, starting in the '30s, that's about the only answer there is to this mess right now, isn't it?

LAROUCHE: Well, what we have, the possibility is—. We're bankrupt. The world is bankrupt, financially. Derivatives, financial derivatives can never be repaid. Obligations on financial derivatives, forget it! They can never be repaid. If you have an asset in a financial derivative, write it off, it's never going to be paid, in principle.

What we can do is this: We can put the system into bankruptcy, through governments, starting with the U.S. government, to put the banking system into bankruptcy reorganization; to keep the doors open, to keep the banks functioning. Now then, we're going to have to use Federal credit, long-term credit, and a system of international agreements on tariff and trade agreements and loan agreements, for a period of about 30 to 50 years, of various large-scale projects, infrastructure projects which are required, globally. We're going to organize a boom, to immediately bring the U.S. economy and other economies, physically above breakeven, on current account.

We're going to have to have a system which is a regulated system, like a fixed-exchange-rate system. We're going to have to start issuing credit, at low interest rates, between 1 and 2% fixed interest rate, over the long term. Were going to have invest that money, not on the market: We're going to invest it in projects, starting with large-scale infrastructure projects, power projects, railway projects, water-management projects—all the kinds of things that are infrastructure. We'll use the infrastructure investments in order to stimulate the private sector. For example, the automobile industry. The automobile industry, together with a smaller part of the aircraft industry, represents the machine-tool capability of the United States. That is the key to a recovery. We're going to have to preserve that infrastructure, that industry, where it exists, as in Michigan, Ohio, and so forth.

Then, we're going to have to use that, to get a high-tech accelerator into productivity: because it's the machine-tool sector of the economy, backed by science, which makes labor more productive in general. We're going to have to grow. And we're going to have to accept the fact that we're going to have sit back and work the hard way, and grow for about 50 years: Then, our grandchildren, or the grandchildren of the present generation, will prosper. We can do that. We must do it: It's the only option we have.

STOCKWELL: All right. All right: I think that'll pretty well do it. Lyn, I want to thank you very much for being a part of the show today. Always, always a pleasure to have you on the program, and to listen to what is in your mind, and what is going on right now. I'm always encouraged to find that, although there are people who are headed for the hills [LaRouche laughs], and burying themselves in whatever holes they can in the Caymans, or running wherever they can to get some kind of protection, you're still right out there on the front line, and I have the deepest respect for you and your organization, because of that. [repeats the phone number]

Lyn, I want to thank you once again, for being part of the show.

LAROUCHE: Thank you. Good to be with you.

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