From Volume 7, Issue 40 of EIR Online, Published Sept. 30, 2008

Ibero-American News Digest

Argentina to U.S.: Go Back to FDR, As We Did

Sept. 26 (EIRNS)—Speaking before a packed audience at New York's Council of the Americas Sept. 25, Argentine President Cristina Fernández de Kirchner told this gathering of U.S. business elites that Argentina had built its way out of the 2001-02 economic depression by copying Franklin Delano Roosevelt's New Deal policies, based on infrastructure development and the "real," rather than speculative, economy. These are the policies that made the United States "great," she reminded her audience, and could do so again, were they to be adopted.

In the Argentine case, "we argued that in times of depression, and collapse of activity, public works and infrastructure play a formidable and dynamic role," Fernández said. And, "we didn't invent this—we copied it from you, from the post-1930 New Deal, when that great President Roosevelt launched the New Deal and used the instrument of public works as the great reactivator of the economy."

She reported that "certain circles" with whom she discussed this philosophy, responded with skepticism. "Once, someone very important told me that it wasn't really the New Deal that made the United States great, but war. I replied that I didn't think that was true." What made the United States great, she said, was the "production of goods and services," and using its knowledge to develop "the real potential of its people," just as Argentina is doing with its current production-oriented economic model.

Far from rejoicing in the decline of the U.S. economy as Venezuela's Hugo Chávez has done, the Argentine President assured her business audience that the current crisis doesn't mean the end of capitalism. "You must all remain very calm," she advised. "I believe that a different kind of capitalism will emerge, based essentially on the real economy which made this country great." It is time to identify the causes of today's crisis, and "having done so, remove them, change them, and start to do things differently."

A fundamental cause of the today's crisis, was the breakdown in "the logic of capitalism," which had always been based on the idea that money is earned through the production of goods, services, and know-how. "The financial system believed it could ... reproduce money independent of this circuit of goods and services and knowledge," Fernández said, pointing to the "parallel" speculative economy with its exotic financial instruments. The financial system "should be reconceptualized so as to occupy its true role ... as a motor, as the great financier and sustainer of production and generation of wealth and consumption through the issuance of credit."

Lessa: Brazil Needs Exchange Controls, Fast

Sept. 22 (EIRNS)—Carlos Lessa, former head of Brazil's giant National Economic and Social Development Bank (BNDES), today urged the Lula da Silva government to once again impose exchange controls, if it hopes to minimize the effects of the global financial crisis upon Brazil. Lessa's call was made in an interview with the official news agency, Agencia Brasil, which posted the interview prominently on its website, under the headline: "Lessa: To Say that the Country Is Immune to the Crisis Is Irresponsible."

The "almost arrogant" statements by government officials that Brazil is prepared to face this crisis, scare me, he said. "It is an optimism bordering on irresponsibility." The crisis is the result of more than 30 years of progressively unregulated financial expansion, with a multiplicity of financial assets which do not correspond to the development of the productive base. "This is what we call a bubble. And a bubble, when it explodes, leaves practically nothing behind," Lessa warned.

This crisis will affect the economy of the U.S., and then China, and thus Brazil; as world liquidity "violently" collapses, our companies will be unable to roll over their foreign credit lines; speculative capital will leave, and reduce our foreign reserves as it does so.

The first step the government should take to protect its currency, is to impose exchange controls; capital entering the country must be required to register with the government, and not be permitted to turn around and leave within a very short period. Likewise, importers should be required to keep their dollar accounts in the country, and register them with the government, as used to be done, he said.

In the last two weeks, Lessa is suddenly being sought out by the "mainstream" national media, after having been largely silenced since November 2004, when Wall Street/London financiers ordered the Lula government to remove him from the powerful state development bank, or else.

Mexican National Weekly Carries Slander of LaRouche

Sept. 25 (EIRNS)—Lyndon LaRouche is famous in Mexico as the American leader who has vociferously defended Mexico's sovereignty against genocidal financiers for more than three decades, particularly since his friendship with President José López Portillo (1977-1982). Attention to his ideas is soaring, again, as a new generation of young Mexican leaders are fighting to save their nation, and humanity, in the LaRouche Youth Movement.

So, it is not surprising that one of the nation's leading news weeklies, Julio Scherer García's Proceso magazine, included in an article parading as an expose of neo-nazi activity in Mexico in its Sept. 25 edition, the pathetic slander that "the followers of Lyndon LaRouche" exemplify U.S. financing of ultra-right organizations in Mexico. The source of that lie was a cowardly former member of the LaRouche movement, Juan Cedillo, who went to work instead for the enemies of LaRouche, and Mexico.

For its part, Proceso, still proudly describing itself as "the great magazine of opposition" to the administration of López Portillo, has functioned for three decades as a leading voice of left-wing bankers' synarchism in the country.

Without Reconstruction, Haiti Faces Mass Death!

Sept. 23 (EIRNS)—The extent of death and destruction in Haiti, after four deadly tropical storms, was reviewed today at a hearing of the Western Hemisphere Subcommittee of the House of Representatives Foreign Affairs Committee. At least 70% of the crops were destroyed; hundreds of people are dead, with hundreds more wounded; 10 bridges are out; 850,000 people are displaced within the country (out of 9.4 million); most water is unsafe. At present, the USS Kearsarge, from the Southern Command of the U.S. Fourth Fleet, is providing a floating hospital of 53 beds and four operating rooms; 253 metric tons of goods, and four helicopters; and emergency bridge engineering work.

Rep. Maxine Waters (D-Calif.) and several colleagues testified before the committee, demanding that the U.S. send $300 million in aid of all kinds, which was requested in a Sept. 12 letter by her and 67 House colleagues, sent to House Speaker Nancy Pelosi. But so far it hasn't happened; a certain amount of aid is flowing in from Brazil, Canada, the U.S., and other sources, on a piecemeal basis.

Likewise, this week, UN officials reported that a "flash" appeal made two weeks ago for $108 million in aid funds, has been met, with only $3.7 million pledged. This latter appeal was made by Sir John Holmes, UN Undersecretary for Humanitarian Affairs, almost in the spirit of putting it "out there" to fail, while no true re-building effort is contemplated.

Haiti, already forced into abject poverty under globalization, has been hit this season by the deadly sequence of four hurricanes and storms in rapid succession: Fay, Gustav, Hanna, and Ike. The storm destruction points up the necessity all along, for the presence of electricity systems, transportation, ports, health care and education facilities, food stocks, and agro-industrial installations.

Western Hemisphere Subcommittee chairman Eliot Engel (D-N.Y.) gets the Grim Reaper award for praising a proposed Brazil-Haiti partnership to plant jatropha—the inedible oilseed used for biofuels—as a re-forestation crop on Haitian hillsides, to deter flooding, because it is a "disincentive" for poor people to cut it down, since it makes bad charcoal. But the only reason Haitians have denuded their hillsides for charcoal, is that, lacking electricity, it is their only fuel source for cooking!

All rights reserved © 2008 EIRNS