In this issue:

IMF Hitman Anoop Singh Promoted

Singh and Krueger Squeeze Argentina

IMF Mission Arrives in Argentina with New Outrageous Demands

U.S. Plays 'Russian Roulette' with Ibero-American Nations

'Failed State' Label Used To Plan Argentina Takeover

Free-Trade Policy Drives Argentines to Garbage Dumps

Wall Street Cheers Over Release of Financial Looter Cavallo

LaRouche Was Right About Plot To Annihilate Republican Military Institutions

Drug Legalizer Soros Muscles into Brazil Elections

From the Vol.1,No.15 issue of Electronic Intelligence Weekly

IBERO-AMERICAN NEWS DIGEST

IMF Hitman Anoop Singh Promoted

The International Monetary Fund's Special Operations Director, Anoop Singh, has been promoted to head the Western Hemisphere Division. The move is a real provocation to Argentina, which has protested Singh's imperial arrogance as he negotiated with the Duhalde government, and has also accused him of lying about the position of foreign banks in Buenos Aires, vis-à-vis the government's plan to voluntarily swap frozen bank deposits for government bonds. Spitting on the Argentines, IMF head Horst Koehler issued a statement lauding Singh for having "demonstrated strong operational and intellectual leadership in a variety of assignments." Singh will now oversee IMF activities in 34 countries, and will report directly to Koehler.

Singh previously served as Deputy Director of the Asia and Pacific Department, and held senior positions in the European, Policy Development, and Review Departments. He has also headed IMF missions to Australia, China, India, Japan, Thailand, and Indonesia.

Singh and Krueger Squeeze Argentina

The IMF's Anoop Singh is organizing to stop any agreement with Argentina, unless the Duhalde government scraps its plan to allow depositors to voluntarily swap their frozen deposits for government bonds, as part of its strategy to gradually undo the freeze of deposits ("corralito"). In a confidential, and very harshly worded, document presented to the IMF's board last week, Singh imperiously demanded that Argentina make its swap plan compulsory, arguing that this should be a new conditionality for any agreement signed with the IMF.

Backed by U.S., British, and Canadian banks which operate in Argentina, Singh threatens in his document (to which the Argentine newspaper Clarin had access) that "we won't move forward" until there is more discussion, and "greater clarity on the policies which Argentina will apply." Singh argues that the just-enacted deposit swap plan, which will allow depositors to use their government bonds to purchase tangible goods such as cars, homes, large appliances, etc., will permit a continued "leaking" of funds from the banking system—funds which are used largely to buy dollars, thus driving up the price of the dollar, and causing hyperinflation. It is irrelevant, he says, that the Argentine people and Congress oppose a compulsory plan. Singh also demands that privatized utility companies be allowed to raise their rates. Significantly, Singh criticizes the Argentine legislature for drafting laws that would still allow for prosecution of those guilty of financial crimes. The IMF had forced Argentina to revise its "economic subversion law," which enables the state to prosecute bankers who defraud the people or the nation.

Finance Minister Roberto Lavagna told the IMF he does not want Singh to head up whatever IMF mission is sent to Argentina.

IMF Mission Arrives in Argentina with New Outrageous Demands

The IMF had announced June 11 that an "advance" mission would arrive in Buenos Aires June 13, supposedly to negotiate a new agreement. But doubts have already been raised about the mission's purpose—the infamous Anoop Singh won't be involved in the initial discussion process, but will arrive in 15 days—and moreover, the Fund has made clear it expects immediate action in three areas, beyond what the Duhalde government has already done. Heading up this mission is John Thornton, a Briton who has worked closely with Singh. The Argentines' urgency in coming to an agreement as soon as possible, is that it must pay $1 billion to the IMF on July 17.

Now the Fund wants provinces to sign "definitive" agreements with the Argentine Federal government to reduce the deficit by 60% (the earlier agreements were only "preliminary"). It wants President Duhalde to veto articles taken from the now-defunct economic subversion law and incorporated into the penal code (the incorporation of those articles would mean that bankers and businessmen guilty of financial crimes could still be prosecuted). Third, the IMF wants changes in the government's plan to undo the bank deposit freeze, to make it obligatory (rather than voluntary) for depositors to swap their frozen funds for government bonds, and demands also some kind of "monetary anchor" as a defense against hyperinflation. What form the latter would take is unclear.

U.S. Plays 'Russian Roulette' with Ibero-American Nations

"With your treatment of Argentina, you are playing Russian Roulette with the Southern Cone.... If you let Argentina go under, every Latin American country will ask, what's the use of being a U.S. ally?" These remarks came from Rodolfo Gil, Argentina's Ambassador to the Organization of American States (OAS), in a conversation reported by Clarin on June 7, with Assistant U.S. Secretary of State Otto Reich and Roger Noriega, U.S. Ambassador to the OAS. In the discussion, which occurred during the OAS meeting in Barbados June 2-4, both Reich and Noriega reportedly indicated that "the Bush Administration gave instructions" to the IMF, to show more flexibility toward Argentina, and get moving on negotiations for an agreement.

'Failed State' Label Used To Plan Argentina Takeover

The imperial framework of British writer Sebastian Mallaby is being used to declare Argentina a "failed state," one that would require supranational intervention establishing it as a protectorate, 19th-century-style. This is the topic of widespread debate inside Argentina and in the United States, according to Clarin's "Zona" supplement of June 9. Mallaby and his ravings against the nation-state and national sovereignty were exposed by EIW earlier this year.

The "protectorate" proposal, made a few months ago by MIT Professors Rudiger Dornbusch and Ricardo Caballero, suggesting that a team of foreign experts be sent in to Argentina to manage its finances—it is too incompetent to do so itself—is just the tip of the iceberg, Clarin says.

At the U.S. Army War College, Prof. Robert Dorff says there's no doubt that Argentina is a failed state, given the existence of 18 currencies and powerful governors who can block the President. While Dorff says the U.S. should help Argentina change its economic policies, which he identifies as the source of the political crisis, he emphasizes that the danger is that the weakness of failed states can contaminate an entire region, leading to generalized chaos. Professor Pablo Stiller of the University of California at Berkeley told Clarin that the Dornbush plan wouldn't work in modern, democratic Argentina, suggesting instead having the World Bank or Inter-American Development Bank monitor austerity accords between the government and the provinces.

While the Dornbusch/Caballero proposal is different from 19th-century strategies, because it doesn't call for military intervention, says Clarin, the 19th-century idea of establishing a protectorate over unruly nations is alive and well. Evidence of this, says Clarin is the article by Sebastian Mallaby in the April 2002 issue of the Council on Foreign Relations' journal Foreign Affairs.

Feeding the "failed state" imperialism were statements by Curtis Struble, Assistant U.S. Secretary of State for Inter-American Affairs. Speaking in Madrid, Struble said there could be a political collapse of Argentina, "with unforeseen results," but added, "I think it can be avoided." Struble repeated the line that the Duhalde government "still has to take a series of actions," of a financial nature, especially relating to the banking system. He asserted that Argentina's crisis is due to "deep structural problems," which will require years to resolve, before any recovery can be contemplated.

Free-Trade Policy Drives Argentines to Garbage Dumps

As of June 2002, an astounding 51.4% of Argentina's population is now classified as poor, according to the government's own Siempro agency, which operates out of the President's office. This means that out of 36 million people, 18.2 million are poor; worse, of that figure, 8.3 million are children under the age of 18. To put it more starkly: 66.6% of the country's 12.5 million youth (under age 18), are poor, and in the country's interior, the percentage rises to 80%. In Greater Buenos Aires, 70% of all children under 18 are poor. Of 8.3 million poor children, 4.1 million are indigent—their families cannot provide them with basic food or clothing. The incidence of malnutrition among children is increasing rapidly.

In December 2001, there were 7 million poor children in the country. In only five months, that figure has increased by 1.3 million, a rate of 250,000 per month.

According to the government's statistical agency, INDEC, rapidly rising food and household costs are causing an increase in poverty at the rate of 762,000 people a month, or 25,000 per day. INDEC reports the cost of the basic monthly market basket increased by 35.7% in the first five months of this year. Last December, a family whose monthly income was less than 461 pesos was considered poor; now a family earning less than 626 pesos is poor.

Nor is it just the unemployed who are poor, but now also the majority of those still holding jobs, for whom the average monthly wage is 569 pesos. Half of the 8 million salaried workers earn less than 400 pesos a month.

The number of people classified as indigent, who cannot even purchase the most basic foods, is growing at an even more rapid rate than general poverty. In 1998, some 28.9% of the poor were indigent; today that figure is 42.6%. Thus, extreme poverty has become incredibly widespread in this resource- and food-rich country, with the attendant consequences of malnutrition and lowered life-expectancy. Argentina now has rates of indigence higher than those of many other Ibero-American countries. Throughout the mid-1970s, only 5% of Argentine households were considered poor.

On June 7, the French news service AFP reported from Buenos Aires that Argentines are reduced to scavenging in the garbage dumps. "Armies of people in rags, of all ages, go through the streets of the capital each night, overturning the garbage in search of leftover bits of food," AFP reported. Many of these are skilled workers from the textile and construction sectors, which have collapsed.

Wall Street Cheers Over Release of Financial Looter Cavallo

On June 8, Argentina's Domingo Cavallo, the former Finance Minister, was released from jail, following an appeals court ruling that there is insufficient evidence to keep him on charges of "aggravated contraband," relating to illegal arms sales to Croatia and Ecuador in the early 1990s. The Washington Post, at least, was happy. Its correspondent Anthony Faiola chirped that former Finance Minister Cavallo is "one of Latin America's most celebrated economists," whose detention sparked a "worldwide campaign by leading economists, who bought newspaper ads"—in the New York Times, among other places—"and wrote opinion columns calling for his release." Cavallo's Wall Street cronies had screamed that the former Finance Minister's April arrest was proof that Argentina lacked "juridical security," and that the government was trying to "distract attention" from the financial crisis.

LaRouche Was Right About Plot To Annihilate Republican Military Institutions

The Peruvian daily La Razon, which has taken the point in opposing the drive by the George Soros-bought Toledo government to decimate Peru's defense forces, last week ran a lengthy opinion column by Army Col. Jorge Salcedo Moron (ret.), entitled: "Objective: To Disappear the Peruvian Armed Forces."

Colonel Salcedo writes that the ongoing judicial witchhunt against the military heroes of the "Chavin de Huantar" hostage-rescue operation in 1997, appears to be "one of the last actions of the methodology adopted to obliterated the Peruvian Armed Forces." Salcedo says that this methodology has been denounced by "U.S. world social fighter Lyndon LaRouche since 1993, when the book The Plot To Annihilate the Armed Forces and Nations of Ibero-America" was released. Salcedo says this methodology is part of the "New World Order" which, through globalization, seeks to impose "a hallucinatory economic system [which] sees the Armed Forces of our nations as the major obstacle to its ends." This is what happened to the Argentine Armed Forces, continues Salcedo, "which are now praying to God that their nation doesn't get into an international conflict," and it appears that Peru is on the same path. The government of Alejandro Toledo was placed in power, says Salcedo, to achieve this purpose, and it is now working against the Armed Forces, in order to, "without greater nationalist opposition, insert us within globalization which would be genuine treason against Peruvian society by our political leadership, since they would be condemning Peru and its people to being one of the permanently underdeveloped nations in that globalized world."

Salcedo concludes by calling on the Peruvian people to rally in support of their Armed Forces, even if it means demanding a referendum to do so.

Drug Legalizer Soros Muscles into Brazil Elections

Derivatives king George Soros, a patron of the global plan to legalize mind-destroying drugs, stuck his snout into Brazil's Presidential elections with an interview to Folha de Sao Paulo's Clovis Rossi, in which he said Brazil has no choice but to elect the current government's candidate, Jose Serra, as President.

Soros said that if "Lula" da Silva of the Workers' Party (PT) were elected, the financial markets would drive Brazil into "chaos." If Serra were elected, however, the markets would recover, because Brazil is "the best student" of the hegemonic world model. This reality isn't democratic, he commented, but he said the U.S. today is like "ancient imperial Rome. Only the Romans voted. In modern global capitalism, only the Americans vote. The Brazilians don't vote."

The interview had its intended diversionary effect: the President, various candidates, Lula's PT Party, and various party spokesman issued statements commenting on Soros's interview—building up Lula as the candidate whom megaspeculator Soros opposes (even as Soros is financing a good chunk of the PT's campaign). As one PT leader chuckled, the last thing the government's candidate needed, was to be identified as Soros's candidate for President.

Interviewer Rossi noted in his article, that Brazilians should remember that Argentina was "the best student" until it collapsed, and has now been left to its own fate.

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