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This transcript appears in the July 20, 2001 issue of Executive Intelligence Review.

LaRouche's Concluding Remarks
Before the Russian Duma

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At the conclusion of June 29, 2001 hearings before the Russian Parliament (State Duma), which were chaired by Sergei Yu. Glazyev, and at which Lyndon LaRouche presented testimony, LaRouche offered concluding remarks on the previous testimony of Academician Dmitri Lvov. [Subsequently, LaRouche offered an extensive written reply to Academician Lvov's remarks.]

Sergei Glazyev: Dear colleagues, we must conclude our parliamentary hearings. There were very many interesting ideas expressed here, as well as proposals, often contradictory ones. I should like for our guest, Mr. LaRouche, to comment, perhaps, on what seemed the most interesting to him.

Lyndon LaRouche: I would like to emphasize, as most important, what was said by Academician Lvov, with which I concur, and I can add something I consider important, to his remarks.

In 1971, the United States and many Western European countries reached a turning point, with the adoption of the floating exchange-rate system, which meant the looting of the whole world, including the United States. There was no economic growth in the United States in the 1970s. There was monetary gain, but only because those important matters, which Academician Lvov talked about, were ignored. It did not count the cost to the economy, of that monetary growth, the unpaid costs of maintaining economic infrastructure and natural resources.

In that decade—a total of $3 trillion in losses to the U.S. economy. At that time President Carter was in power, and he was the biggest disaster for the U.S. economy, until what we have now. He did more than any other U.S. President to ruin the U.S. economy. He destroyed the system of regulation, the system of protectionism, resource security, and infrastructure. He destroyed the economy.

After Carter, Bush proposed reforms, which continued the looting of the U.S. economy. And with the collapse of the Comecon sector, the British and others started to loot the whole world, just as the U.S. economy was looting itself.

The question here, associated with this trend, is Russia's natural resources. The income from these resources, somehow, does not come back into Russia, and that's a big problem. The natural resources of Russia, and the infrastructure to maintain them, cost money. In any healthy economy, government spending—direct, or through government programs, which support private organizations—for maintaining the basic economic infrastructure, is 50-60% of state spending. If you spend less than 50-60% of your revenues on infrastructure and improving it, if this is not done, the economy is destroyed. This is the responsibility of the state. The state can sometimes give this to private firms, but the state has to take responsibility for paying the costs of maintaining or replacing resources that have been used.

This should be a universal policy; this is a problem, which comes up in developing sector countries. We can create modern industry in Africa, but we can't maintain that industry, because there's no infrastructure. In Siberia, in that part of the former Soviet Union, in the Central Asian Republics, there are very wealthy regions for the development of Russia's economy. And if we have special programs in the framework of regulating the economy, and we say that we should put aside a certain portion of our spending, and impose a special tax, which guarantees us that 50-60% of the national product will be spent to maintain this infrastructure—then, we can make an economic miracle.

But this is the most neglected element of economy, in the past 30 years. The importance is that we used to understand the necessity of maintaining basic economic infrastructure, maintaining it, replacing and restoring the natural resources, which we use.

Glazyev: . . . I think that within a week, some recommendations will be discussed in the Committee on Economic Policy, they will be adopted and sent to the agencies of state power of our nation. And I hope that the leading agencies of our country, the Central Bank, the government, and, of course, the State Duma, will find a use for the concern, and the conclusions made at our parliamentary hearings. And we shall continue to work on these problems.

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