From Volume 7, Issue 39 of EIR Online, Published Sept. 23, 2008

Ibero-American News Digest

Brazilian: Read LaRouche To Understand Global Crisis!

Sept. 19 (EIRNS)—Reading Lyndon LaRouche's textbook So, You Wish to Learn All About Economics? is the only way to understand what's behind the blowout of the global economy, writes Brazilian commentator Leandro Diniz e Silva, in an article published in the Sept. 19 daily O Globo. Other economists who focus only on "monetary" issues, "ignore the totality of the physical economy," Diniz states. But LaRouche's book proves definitively "that mere regulation of the monetary sector is not now, never was, and never will be efficient for dealing with any economy, anywhere."

"According to LaRouche," Diniz underscores, "the physical economy is the only one capable of serving as the basis for the solid growth of societies. He clearly shows that no economy is sustainable, unless a considerable portion of its production is converted into technology for the production of capital goods, machine-tools, and equipment."

LaRouche shows that usury should be banned, or taxed to the maximum, Diniz asserts. "To leave the economy in the hands of unscrupulous networks that manipulate entire markets for their own monetary profit, is not even admissible for any sane person charged with the care of his nation's economy."

Ibero-Americans Recall Success of FDR's New Deal

Sept. 20 (EIRNS)—As the global financial system crashes, an increasing number of Ibero-American commentators are recalling how Franklin Delano Roosevelt's New Deal lifted Americans out of the Great Depression. Although none of them really grasps that today's crisis is a systemic one, the implication in their commentary is that something akin to what FDR did is needed today.

"It's time for a New Deal II—Drop-by-Drop Liquidity Won't Do It," was the headline in the Sept. 18 edition of Brazil's Monitor Mercantil, quoting Luiz Gonzaga Belluzzo, economics professor at the National University of Campinas (Unicamp). Slamming the Bush Administration for responding to the crisis by injecting more liquidity into the economy, Belluzzo asserts that U.S. authorities must instead make a "monstrous intervention," directing credit lines into productive sectors of the economy, just as Roosevelt did with his New Deal. "The [U.S.] government has to impose conditions, control and direct credit. There's no other way. The private sector won't do this," he argued.

In an article published in the Sept. 17 edition of Argentina's Página 12, historian Mario Rappoport offers a totally academic accounting of the conditions that led to the Crash of 1929 and the Great Depression, but notes that Roosevelt's New Deal, with its cheap credit and massive construction of public works, "prevented the American way of life from becoming the road to disintegration and decadence" in the United States.

South American Presidents Defuse Bolivian Destabilization

Sept. 16 (EIRNS)—The South American Presidents Club met on an emergency basis in Santiago, Chile on Sept. 15, under the aegis of UNASUR (Union of South American Nations), and acted to defuse the British-sponsored destabilization of Bolivia, including regime change.

Bolivia was wracked by mob violence in the weeks prior to the Santiago meeting, provoking fears of a civil war that could potentially engulf the entire continent. The region's Presidents had been consulting with each other and with Bolivian President Evo Morales constantly, but decided to hold the emergency session in Chile as the situation threatened to veer out of control on Sept. 12. Chilean President Michelle Bachelet is currently serving as UNASUR's president pro-tem.

UNASUR's final communiqué "expresses their fullest and firmest support for the Constitutional Government of President Evo Morales ... [and] warns that their respective governments energetically reject and will not recognize any situation that implies an attempted civil coup," or "compromises territorial integrity."

It is hoped that this intervention might help rein in Venezuelan President Hugo Chávez, whose antics have only benefitted the British war script for the continent. Chávez has said more than once that he will not stand idly by, should Morales be overthrown or killed, warning that he would send Venezuela's Armed Forces into Bolivia. On Sept. 12, the general commander of Bolivia's Armed Forces, Gen. Luis Trigo, issued a statement in the name of the entire military high command, warning Chávez, by name, that no foreign troops or forces would be permitted to set foot in Bolivia. The Venezuelan President then brazenly responded that General Trigo should worry more about U.S. intervention, and prove his loyalty to Evo and Bolivia.

Ecuador Might Suspend Foreign Debt Service

Sept. 18 (EIRNS)—Speaking Sept. 17 at Milagro University, Ecuadorian President Rafael Correa warned that he would consider suspending payment of the foreign debt, should the current global financial crisis worsen, or the oil price drop significantly.

It's worth recalling that during the Depression of the 1930s, every nation in South America, with the exception of Argentina, declared a debt moratorium.

Correa misidentified today's systemic meltdown as "the United States' financial crisis," making the same mistake that many other world leaders have made. But he vowed that were Ecuador deeply affected by it, the "variable of adjustment" would be the foreign debt, rather than any of the important social programs or investments in infrastructure projects which his government considers to be a priority.

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