From Volume 37, Issue 20 of EIR Online, Published May 21, 2010

Ibero-American News Digest

Lessons of Argentina for Greece and Spain: Forget Bailouts, Restructure!

May 16 (EIRNS)—Argentine President Cristina Fernández de Kirchner repeatedly warned over the past week that the bankers' dictatorship imposed on Greece and other European nations, is "doomed to failure," as it imposes policies similar to those which led to social upheaval and default in Argentina.

The Greek bailout is intended to "bail out the financial system," Fernández charged in a May 10 nationally televised speech. She compared the Greek plan to the fraudulent $20 billion debt-swap swindle in 2001 in Argentina, which imposed brutal austerity, even as the financiers knew full well that it would blow apart and lead to default in a matter of months.

The subject of her speech was the announcement of a plan to refinance 89% of the debt of the provinces, freeing up resources to address social problems and economic development. She explained that she is adopting such measures "at a very special time," not only for Argentina, but for the world, "where we see there is an attempt to apply the same prescriptions [to Greece] that were applied to us, and which provoked the explosion of 2001."

"Here you have a policy that intends to shrink a country's GDP, while at the same time, [making] it pay more debt than it had when the crisis began. It doesn't take an economist to see that, if, as a result of the [austerity] adjustment, my accounts and my numbers shrink ... it's obvious that I'm not going to be able to repay the loan they've just given me."

The architects of these policies "are repeating policies, which, in reality, are an attempt to rescue the financial system. We feel that these policies are doomed to failure, and that's why we don't apply them in our country," she said.

The next day, former President Néstor Kirchner, the current President's husband, who forced a debt restructuring upon Argentina's creditors during his term in office (2003-07), to save the nation from disintegration, told a political gathering in the city of Córdoba:

"I'm warning the people of Greece and Spain to beware" of the IMF's austerity policies. The IMF's "adjustment" policies "didn't meet the global needs of nations" like Argentina, "which were in a very grave situation because of those very same policies." Evidently, "the IMF today continues with the same prescriptions, the same thinking, the same concepts. That's why we believe that, other than bailing out financial groups, [these policies] serve no other purpose than to [impose] austerity and cause nations to suffer."

"Thus," the former President concluded, "we respectfully say to our Spanish and Greek brothers, beware the IMF's prescriptions."

Sonorans March for PLHINO Water Projects

May 12 (EIRNS)—Some 30,000 people marched in Ciudad Obregón, Sonora on May 5 against schemes by Mexican billionaire Carlos Slim, a front-man for Prince Philip's World Wildlife Fund (WWF), to privatize water in the desert state. This was double the size of the first march of a couple of months ago; the main speaker was Alberto Vizcarra, the leader of the LaRouche movement in the northwest of Mexico. There were 500 tractors in the march.

The slogan was: "No to the Novillo; the PLHINO and desalination are the solution." The Novillo is the PAN government's plan to build a canal from the Novillo Dam on the Yaqui River, which now provides water to the Yaqui Valley farmers and others, to transfer water to the city of Hermosillo, and privatize it to Carlos Slim interests and others. The PLHINO is the Northwest Hydraulic Plan, the long-planned but never implemented project to create one unified water system across the three northwest states of Nayarit, Sinaloa, and Sonora, bringing water into the dry northern region through a series of dams, tunnels, and canals.

Vizcarra reported that "we made an alliance with the Yaqui Tribe [of Indians] which we called the Yaqui River Pact. Cuauhtemoc Cárdenas contacted us, and we are scheduling a visit of his to back the Pact, and in defense of the decree issued by his father, Gen. Lázaro Cárdenas, which from the building of the first dam on the Yaqui River established that water is for the production of food, and not for private speculation. With this we have broken the attempts to isolate us, and are forcing a national discussion."

Vizcarra's speech, widely covered in the local media, also received some national coverage. He focussed on those who want to "steal the water of the Yaqui River and hand it over to private interests that, like vampires, are flying over Sonora," adding that the movement would not be stopped by "the mountains of lies nor the mountains of dollars of Carlos Slim." Both Lázaro Cárdenas and the Mexican Constitution of 1917 affirm that "water is a strategic good for economic development and the benefit of the entire population."

Vizcarra's other theme was that today's movement must answer to both Mexico's past and future. "The spirit of Cárdenas and Norman Borlaug is now here. They see us and they hear us." Borlaug, the late American agronomist, is well known and loved in Sonora, since he worked there for years for his Green Revolution.

"We will not be drowned in localism.... [We will] make Sonora the birthplace of the Hydraulic Revolution which the future of Mexico urgently needs.... From the mountain of the future, we can see that victory is ours," Vizcarra told the marchers.

Brazil Promises No Crisis Will Hit 'Us'

May 14 (EIRNS)—It's the well-known first sign of financial trouble: ministers and central bankers issuing repeated statements that "there's no crisis here." On May 11, Brazilian Finance Minister Guido Mantega stated that no one should be worried about the fact that the "Greek crisis" the week before had caused $2 billion to flee Brazil. Brazil's economy is in such excellent shape, he lied; with $250 billion in reserves to cushion it, that $2 billion in capital flight barely made a dent. Brazil is "inoculated" against crisis, he boasted.

Central Bank chief Henrique Meirelles spent the week assuring investors (publicly, at least), that Brazil is closely watching the development of the crisis in Europe, but has all the needed tools to confront with serenity any possible impact.

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