From Volume 7, Issue 51 of EIR Online, Published Dec. 16, 2008

United States News Digest

The Blagojevich Scandal: A Shot Across Obama's Bow?

Dec. 12 (EIRNS)—Given the unhappiness of the British backers of George Soros, about the incoming President's choices for the Cabinet so far, it's legitimate to raise the question of whether the Blagojevich scandal is being used as a shot across the bow of the Obama Administration. Supporting this idea are two news developments:

First, the London Financial Times runs a lead editorial today on the Blagojevich scandal, in which, while arguing that Obama is unscathed so far, it outlines a series of questions that he had better answer, to remain in the clear. Noting that this is the first scandal of his administration, before he's even in office, the FT hints that there may be more to come—which could be read as a veiled warning that he had better "behave."

Second, we have received confirmation from reliable sources, of the New Statesman report that the Fabian Society and Soros circles are extremely unhappy about the Obama Cabinet thus far. In addition to the obvious institutional forces who have been appointed in the national security area, the nomination of Eric Holder is particularly galling to Soros, because Holder has a record of staunch opposition to any form of drug legalization.

In this context, the heavy media coverage targetting Obama with the Blagojevich issue—from the same British-linked media which promoted him—could be read as a warning shot, that the President-elect should not cross those who paid to put him in office.

Pelosi Railroad of Rangel Will Be Delayed Past Jan. 3

Dec. 12 (EIRNS)—House Speaker Nancy Pelosi's intent that the Ethics Committee's investigation into allegations involving House Ways and Means Chairman Charles Rangel be resolved by Jan. 3 "went up in smoke," according to the "Capital Journal" column in today's Wall Street Journal, when the Ethics Committee announced that it would add the matter of whether a tax benefit for Nabors Industries was connected to a contribution by its CEO to the proposed Charles Rangel Center. Rangel had requested that the Ethics Committee investigate this.

Democratic aides say the investigations may last through January—a real "forced march" for the Ethics Committee, which usually investigates over months, or even years.

The WSJ reports that Rangel will have a lot to say about Obama's agenda, since the Ways and Means Committee originates tax and health spending. "A huge amount of the high-priority agenda of the Obama administration will work its way through the Ways and Means Committee," says Thomas Mann of Brookings. "Not having a strong chairman is clearly a liability."

However, author Gerald Seib admits, "The betting among House Democrats is that Rep. Rangel will survive. Mr. Mann of Brookings agrees, that unless the Ethics Committee's report is 'scathing,' "since "Rangel is widely liked and respected, he'd probably survive and carry on."

Schwarzenegger Pushing California Over the Cliff

Dec. 12 (EIRNS)—The situation facing the State of California worsens daily, with a constantly growing deficit, and a dysfunctional approach, on all sides, in addressing the crisis. Late on Dec. 10, prior to a meeting with legislative leaders, Gov. Arnie Schwarzenegger proclaimed that the state is "headed toward a financial Armageddon," then attacked the leaders he was scheduled to meet with. Not surprisingly, the State Senate Republican leader declared negotiations "dead," following another unsuccessful session, stating that the meeting was undermined by Schwarzenegger. Senate Republican leader David Cogdill said that "bullying the legislature" won't work in getting a budget passed.

What has everyone in a deepening state of hysteria is the acceleration of the rate of collapse of the state. After announcing in early December that the deficit for the current fiscal year, which ends June 30, 2009, had reached $11.2 billion—after the legislature had made more than $7 billion in cuts and postponing payments—new figures released yesterday show that this shortfall has now ballooned to $14.8 billion, and the two-year deficit (until June 30, 2010) is now close to $42 billion! According to Schwarzenegger, the deficit is growing by $28,000/minute, and $40 million/day.

The drop in revenues is emptying the state's coffers so rapidly that $5 billion in public works projects will be halted next week, to preserve cash. One recently retired legislator said, "This is worse than a meltdown. There is no motion toward a solution. There are no adults involved, and Schwarzenegger seems bent on blowing up any opportunity for compromise." He added that, though things are deteriorating "right before our eyes," there are still illusions that things can be resolved, "as if by magic."

Soros Grabs State Positions That Control Elections

Dec. 10 (EIRNS)—According to the website of the "Secretary of State Project," created in 2006 by the George Soros apparatus, the state position of Secretary of State, with power over the election process, has recently been won by candidates sponsored by the Soros Project in Ohio, Montana, Missouri, Iowa, Minnesota, Nevada, and New Mexico.

Writing for the Norfolk, Virginia Examiner, former Denver election commissioner Jan Tyler reports that the "Colorado Secretary of State's position is up for grabs. Many questioned why Governor Bill Ritter would appoint a committee to recommend a candidate when he has the authority to do so on his own. Instead of giving us confidence in the Governor, we should be skeptical. George Soros' Secretary of State project works behind the scenes to influence the Secretary of State positions. They have been successful in Ohio and other states. Shouldn't someone be asking what George Soros is up to in Colorado?"

'Keynes vs. FDR' Crosses the Atlantic From London

Dec. 10 (EIRNS)—Pennsylvania Governor and Democratic Party "infrastructure" spokesman Ed Rendell started his speech to the U.S. Chamber of Commerce in Washington, D.C. on Dec. 9 by promoting John Maynard Keynes against President Franklin Roosevelt. FDR "didn't do enough spending" to stop the Great Depression; Keynes understood that; today we've got to spend like Keynes, was Rendell's overall message.

Challenged at his press conference by LaRouche organizers ("Why are Democrats promoting Keynes against FDR when Keynes' model for his economic theory was Nazi Germany?"), Rendell recanted immediately, "I meant Krugman, not Keynes, I didn't know his history," the governor said. True enough: Economist Paul Krugman—about to be given the Nobel Prize, which usually rewards the embarrassing complete failure of an economist's forecasts—had just given interviews calling for unlimited U.S. deficit spending on Keynes' model; and, very few Democrats know or understand Keynes' pro-Nazi history in the 1930s, or his intense opposition to FDR's Bretton Woods international credit policy at the end of World War II.

Triggering Rendell's remarks was an editorial promoting Keynes against FDR in the governor's hometown newspaper that morning, the Philadelphia Inquirer, "Old Prescription for Current Economic Chaos." The paper declared, "Ironically, Pres. Franklin Delano Roosevelt, closely linked to Keynes historically, never practiced Keynesianism to its full extent ... economic historians said. The U.S. economy only revived when factories revved up for World War II."

The "Keynes vs. FDR" polemic has been featured in such British press as the Telegraph, the New Statesman, and the Guardian since the U.S. election. It was pushed on Dec. 8 by Nobel-"certified idiot" economist Joseph Stiglitz, who echoed President Richard Nixon's pathetic remark, "Now, we are all Keynesians," as Nixon dismantled FDR's Bretton Woods system in 1971 and set loose decades of floating-exchange-rate speculative bubbles. Keynes was a lot worse than Nixon. While Franklin Roosevelt prevented the United States from going fascist, by implementing the New Deal recovery, and then mobilized the defeat of fascism internationally, Keynes spent much of that period on the side of tyranny, with his admired ally, Reichsbank chief and then Nazi Economics Minister Hjalmar Schacht.

But what Keynes' admirers won't forgive FDR for now: He didn't bail out the banks, but put them through bankruptcy reorganization.

Detroit Goes To Seed

Dec. 8 (EIRNS)—Where once there were factories, homes, and schools, the shrinking population of the country's 11th largest city has to content itself with turnips. The auto industry, which employed 1.9 million in the 1950s, now has fewer than 850,000. "People are moving out of the city, trying to find work," David Martin of Wayne State University's Urban Safety Program told Bloomberg News. Those who stay "can't afford to move out."

Some 55,000 city lots are considered unproductive because they bring in no taxes. The city is blighted with tens of thousands of abandoned homes, and enough acreage in abandoned lots to fill the city of San Francisco.

Detroit's City Council unanimously endorsed LaRouche's Homeowners and Bank Protection Act; but with the Act's policies yet to be enacted by Congress, much of Detroit has resorted to thinking small, way small. One such idea is "urban farming."

"Mini-farms," not much bigger than an immediate-family's cemetery plot, are being encouraged. Six acres, so far, have been sliced into 500 Dark Age micro-garden plots. "We plan to triple that every year," said Michael Travis, deputy director of Urban Farming, the Detroit-based nonprofit corporation that helps clear land and provides topsoil and fertilizer. That would mean a whopping 12 acres by next year.

Founded by pop signer Taja Sevelle, Urban Farming, which has operations in seven other cities, has relied on corporate backing from such companies as Home Depot and Whole Foods Market. Harvests are sold in markets or donated to soup kitchens. This year's produce was picked "quickly because people need food so badly," said Sevelle.

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