From Volume 7, Issue 44 of EIR Online, Published Oct. 28, 2008

Western European News Digest

Sarkozy: NBW Meeting Must Not Be 'A Missed Rendezvous'

PARIS, Oct. 24 (EIRNS)—Today's Paris daily Le Figaro, commenting on U.S. President George Bush's decision to hold a "G-20 summit" to discuss the global financial crisis, rather than a G-13 summit as proposed by French President Nicolas Sarkozy, says that "the White House has enlarged the format of the conference to the maximum by inviting 20 countries around the table. The Elysée sees it as an American trick to compromise the success of this initiative that leaves the Republican establishment partially skeptical."

Sarkozy, in his speech yesterday in Haute-Savoie, after explaining the New Bretton Woods initiative, said that Bush agreed that the Nov. 15 summit "should not be a meeting for nothing. And I will not go to attend a failed rendezvous."

Sarkozy Calls for Fixed Exchange Rates, Will Visit Asia

PARIS, Oct. 22 (EIRNS)—French President Nicolas Sarkozy, in his speech yesterday before the European Parliament in Strasbourg, proposed that a "fixed-exchange-rate" system be reconsidered, and called for integrating China, India, Indonesia, Japan, and others in the effort to create a New Bretton Woods. He said that he and European Commission president José Manuel Barroso will travel this weekend to China to discuss their participation. According to the Elysée, Indian Prime Minister Manmohan Singh has already agreed that his country will attend the enlarged G-8 + G-5 meetings, starting next month. China is also expected to agree.

Italian Senator Supports New Bretton Woods

Oct. 25 (EIRNS)—Sen. Mario Baldassarri, head of the Italian Senate Finance Committee, endorsed key aspects of Lyndon LaRouche's New Bretton Woods proposal, including the idea of freezing speculative claims. He was one of three speakers yesterday at a conference organized in Ascoli Piceno by industry and labor organizations under the umbrella of Confapi, an association of small and medium-sized industries. Over 100 people attended. The other two speakers were Claudio Celani, coeditor of the EIR Strategic Alert Service, who gave the keynote presentation, and Alfonso Gianni, former Undersecretary of State of the Prodi government (2006-08).

Although both Baldassarri and Gianni praised John Maynard Keynes' 1936 analysis of the Great Depression, they agreed with Celani that a New Bretton Woods system must be based on the principles of the Treaty of Westphalia, as an agreement among sovereign nations. This was President Roosevelt's view, not Keynes', although there is much confusion on the matter among economic policymakers today.

Italy's Tremonti Raises Westphalia Principle

MILAN, Oct. 20 (EIRNS)—"The thing we need at the moment, on a different scale, is not a mere second Bretton Woods; rather something which could be the closest possible to the Westphalia Peace Treaty," said Italian Economics and Finance Minister Giulio Tremonti tonight. "Bretton Woods ... is the mercantile and financial version of a peace treaty."

Characterizing the current situation, Tremonti said that "today, the balance in the world has changed; we have an additional political body, the G-8; but in the end, a treaty is lacking. And we cannot imagine that the current G-8 reproduces the strength that America had at the time" of Bretton Woods. This is why, he thinks, "we need to find a different structure, which introduces a treaty."

Tremonti spoke during the presentation of the book The Paradox of the Euro, by Lorenzo Bini Smaghi, one of the heads of European Central Bank.

Rocard: Crisis Goes Back to End of Gold Peg in 1971

Oct. 23 (EIRNS)—, a left/liberal website in the United States, today published a translation of an interview in the French publication Le Temps, with former French Socialist Prime Minister Michel Rocard, on the international financial meltdown.

Rocard said, "I'm convinced it all goes back to the dollar leaving the gold standard [sic] in 1971.... That led to an absence of fixed reference points—which pushed the financial world to invent more and more mechanisms to protect itself against the hazards of exchange-rate movements. Those mechanisms came together as derivative products. Little by little, these products' level of uncertainty became too big, and there was a bubble effect.

In fact, the Bretton Woods system did not use a "gold standard," but was a "gold reserve" system. Gold standards of the past were a means used by the London-based financier oligarchy to prevent governments from issuing credit in the national interest.

Britain's Mr. Malaprop Attacks New Bretton Woods

Oct. 20 (EIRNS)—British scribbler Sebastian Mallaby tried to poison the international discussion among heads of state of a New Bretton Woods conference and new monetary order—discussion featuring wide and important coverage of the author of the New Bretton Woods idea, economist Lyndon LaRouche, in the nations involved.

Mallaby, who used to write in praise of hedge funds and global imperialism in the Washington Post and Foreign Affairs, now has a fellowship at the Brookings Institution. He recently used his Brookings spot to stage a televised promotion of George Soros's current book on financial markets.

Mr. Malaprop's attack make clear how much the Anglo-Dutch oligarchy fears LaRouche's New Bretton Woods.

BAE Officials Are Suspects in Fraud Investigation

Oct. 23 (EIRNS)—Swedish state television reports today that 12 officials of the British defense contractor BAE Systems are suspects in the Serious Fraud Office (SFO) investigation of the company's financial relations with Saudi Arabia and other foreign customers. Although it does not say whether the named officials (CEO Michael Turner, former CEO Richard Evans, and Julian Skopes, former chief of BAE in Eastern Europe) are under arrest or being investigated now, it states that the SFO has issued a search warrant against one of the men.

Among those taken in for questioning and then released was Count Alfons Mensdorff-Pouilly, who allegedly served as bag-man for bribes that were paid to Czech government officials to secure the sale of Saab Gripen fighters.

Swedish state TV, which made a number of groundbreaking documentaries about the BAE-Saab briberies in Eastern Europe and South Africa, states that, according to the SFO, 12 people are under investigation.

The arrests and interrogations have been going on for two weeks, but have been otherwise blacked out in the media.

Iceland Being Given the 'Versailles' Treatment

Oct. 24 (EIRNS)—Icelanders feel they are being given the same treatment as Germany was given at the Versailles Conference after World War I, despite the fact that they never launched a war. Germany was subjected to devastating reparations requirements, among other measures, which destroyed its economy and its national sovereignty.

It is reported that the International Monetary Fund refuses to consider any loan to Iceland until it settles its banks' debts to British companies and individuals. The latter apparently is demanding the Iceland take a £3 billion loan to pay off British depositors. Icelandic parliamentarian Petur Bloendal said it is unlikely that parliament would approve the British loan, saying that the demands by the British and Dutch "amounted to the equivalent for every Icelander of three or four times the reparations that were imposed on Germany after World War I," according to the London Times.

Foreign Minister Gisladottir added, "We are not prepared to bind the nation to this burden that Britain is referring to because we believe it would be beyond our means."

All rights reserved © 2008 EIRNS