From Volume 7, Issue 41 of EIR Online, Published Oct. 7, 2008

Ibero-American News Digest

Mexico: PLHINO or Chaos

Oct. 3 (EIRNS)—If Mexico doesn't implement infrastructure development projects such as the PLHINO (Northwest Hydraulic Plan), Lyndon LaRouche again warned in his Oct. 1 webcast, it will be subjected to economic and social chaos, as millions of Mexican emigrants are shipped back from the United States, under current depression conditions. And it is in the immediate, vital security interest of the U.S., LaRouche reiterated, to participate in projects such as the PLHINO, in order to foster stability and development in our neighbors.

Mexican authorities have finally begun to publicly panic over the fact that the U.S. and global financial meltdown threatens Mexico's very economic existence. Remittances from Mexican workers in the U.S. are plummeting; mass deportations from are occurring; maquiladoras are shutting down; tourism is wrecked by the lack of security in the country; and the drug trade is taking over entire chunks of the country, both geographically and economically.

Treasury Secretary Agustín Carstens admitted to the Senate on Sept. 25 that remittances will likely collapse by $2.5 billion in 2008, out of a total of around $25 billion. Those remittances are the only source of livelihood of millions of Mexican family members of the emigrating workers, and they have been dropping in four out of the last five quarters, at an accelerating rate. On Oct. 1, the Central Bank reported that remittances fell in August by 12.2%, compared with August of 2007—by far the largest drop ever.

The Mexican media are also starting to get real. The daily El Universal ran an editorial on Sept. 26, headlined, "Preparing Ourselves for Hard Times." An historical article in a regional paper reported that, during the Great Depression, something between a half-million to 2 million Mexicans residing in the United States, were deported. "They just put people on trains heading to Mexico," the article said.

Mexican Government Capitulates to Soros

Oct. 3 (EIRNS)—The Mexican government is preparing to open the floodgates for mass "narcotourism," even as the country is being ripped apart by the drug trade, and its industry, farming, and other necessary activities are collapsing. On Oct. 2, President Felipe Calderón sent to the Mexican Senate a bill legalizing the possession of "personal doses" of every drug imaginable. A person who gets caught with up to 2 grams of marijuana or opium, a half a gram of cocaine, 50 milligrams of heroin, or 40 milligrams of methamphetamine, would face no criminal charges.

Barack Obama sponsor and Democratic moneybags, George Soros, and his British legalization mafia, have led the fight to force Mexico to capitulate to the drug trade. Ethan Nadelmann, executive director of Soros's Drug Policy Alliance, immediately issued a statement hailing Calderón's bill, demanding that the United States not try to dissuade Mexico from passing the bill, as occurred when the previous Mexican President, Vicente Fox, retracted a similar bill, and pressing the U.S. to follow suit, and legalize, too.

Recruiting former Mexican President Ernesto Zedillo to the campaign, Soros's legalizers set up a "Latin American Commission on Drugs and Democracy" in May 2008, to mobilize the region as shocktroops for worldwide legalization. Mexico was a target in the Commission's closed-door strategy sessions in early September in Bogota, Colombia, which Nadelmann personally led.

The ruling PAN party, along with other parties, are already on board. On Aug. 17, the leftist opposition PRD party had called for drug decrim, and a "broad national accord" to ram it through.

The PRI party has yet to take a stand on the matter.

Brazilian Economist Calls for New Bretton Woods

Sept. 30 (EIRNS)—Carlos Lessa, former head of Brazil's huge National Economic and Social Development Bank (BNDES), posed the issue of a New Bretton Woods for Brazilian discussion, in a Sept. 27 interview with Terra magazine.

"Russia has already proposed, and France, also: that the world's powers meet, and define a new Bretton Woods agreement," Lessa declared in answer to the question, "What is to be done?" provoked by Lessa's hammering at the popular line that Brazil is prepared to face the bursting of the global financial bubble.

The world's banks are all interlinked through derivatives piled upon derivatives, Lessa said. What have Brazilian banks lost? They are not saying.

On top of this, Brazil faces its own domestic credit bubble. When he headed BNDES, he said, a 50-person team worked for three months to put together a map of priority projects required for Brazilian development. Instead of putting public money behind those projects, an "easy credit" policy was adopted, building up the domestic economy by, for example, offering credit to families to buy cars. As the economy is hit, those families will stop paying their loans, Lessa said. What will Brazil's banks do? Repossess the cars? And then do what with them?

Lessa, however, echoed the widespread delusion that the bursting of the bubble means that the dollar is finished, and that the world will somehow get by without it, failing to understand the fight within the United States over radically reversing policy, as LaRouche proposes.

Crisis Puts Integration Back on the Agenda

Oct. 1 (EIRNS)—The Presidents of Brazil, Venezuela, Ecuador, and Bolivia met in Manaus, Brazil yesterday, to discuss taking action on two cross-continental transportation routes and reviving the Bank of the South project, as an independent mechanism for financing regional integration projects, as the system comes down.

The global financial crisis dominated the discussions, as reality cracks the facade of "the U.S. crisis won't hurt us much" which all four Presidents (Lula, Chávez, Correa, and Morales) had been putting out for public consumption. Brazil's Lula da Silva stated after meeting with Hugo Chávez of Venezuela, that the two agreed that no one knows the actual size of this crisis, which perhaps will be the greatest in the history of the world.

The Presidents announced that they had reached a formula for overcoming some of the obstacles to founding the Bank, which they will discuss with the Presidents of the other three countries who committed themselves to founding the Bank (Argentina, Uruguay, and Paraguay), with the intent of getting the institution underway by December. Due to Brazilian opposition, in particular, the bank had been dead in the water since the founding agreement was signed nearly a year ago.

The two cross-continental routes discussed are an Atlantic to Pacific multi-modal river-and-highway link between Manaus (on the Amazon River) and the Pacific port of Manta in Ecuador, and establishing a cross-Amazon route to connect Manaus with La Paz, Bolivia.

Bilateral agreements signed between Brazil and Venezuela for cooperation on the industrialization of Venezuela range from sales of Brazilian capital goods and machinery, to a Brazilian university providing detailed specifications for the construction of seven types of factories in Venezuela.

Argentine Agro Leaders Threaten 'War'

Oct. 2 (EIRNS)—British financier interests have again mobilized their stooges in Argentina's agricultural sector, starting with the oligarchical Rural Society (SRA), to destabilize the government of President Cristina Fernández de Kirchner. The four agricultural organizations that tried to bring down her government earlier this year, through a four-month-long strike, have announced a new five-day strike, to begin on Oct. 3.

As in their latest action, the producers are protesting protectionist measures the President has taken to defend the population and the food supply, such as restriction of certain food exports and price controls, as well as maintaining export taxes on soybeans and wheat. The agro leaders charge that it is unfair for the government to maintain export taxes at all, when commodity prices are falling, and prices of inputs are rising.

Under the provocative banner of "strike, march, and war," producers intend to block the marketing of grains and beef for export, and hold rallies and protest actions in the country's interior provinces. Although they say they won't interfere with the domestic food supply, they warn they can't guarantee that "spontaneous" protests won't occur, and take matters into their own hands. During the last strike, Jacobin violence targetted producers who backed the government.

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