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This transcript appears in the November 25, 2005 issue of Executive Intelligence Review.

The Tasks That Face Us
in the Post-Cheney Era

by Lyndon H. LaRouche, Jr.

This is a transcript of the full text of Lyndon LaRouche's Nov. 16, 2005 webcast in Washington, D.C. He was introduced by Debra Hanania Freeman, who moderated the event. Subheads have been added. The video is archived at

Freeman: It was about one month ago, that Mr. LaRouche addressed a similar audience, in what proved to be not only a historic event, but a prophetic one. And I think that there really is no question that on that day, Mr. LaRouche moved the institutions in a dramatic way. Within days of Lyndon LaRouche's Columbus Day webcast, we saw a tremendous escalation in the drive to bring the synarchist faction in this government—the faction that is led by Dick Cheney, and which is probably best known as the "coup against the constiitution" faction—to its knees.

Literally one week after Mr. LaRouche's presentation here and a dramatic week of lobbying by the LaRouche Youth Movement, and legislators and labor officials from around the United States, we saw two things happen. One, was we saw the first of what promises to be many indictments in what has come to be known as the Plamegate issue, but which clearly has much more to do with the fraud that brought this nation to war. Along with those indictments, we saw Sen. Hillary Clinton step forward and finally take the action that is necessary to begin the process, at least, of saving this nation's auto industry and the vital machine-tool capability that is attached to it. That happened within days of Mr. LaRouche's presentation.

If we fast forward to this current moment, the fact of the matter is that, all over the nation and all over the world, Bush is seen as an ineffective President who is trying to govern from a bunker. And the overwhelming verdict is that, if history is to judge, the largest mistake that George Bush has made in his political career was bringing Dick Cheney along with him in his second term as President. It's our intention to help the President correct that mistake.

Mr. LaRouche's remarks today are directed toward shaping the post-Cheney era in American politics, but I'd like to remind all of you that while Mr. LaRouche must have an eye toward the future, and toward shaping the nation's policies following Cheney's removal from office, we have to operate in the here and now. And we will not rest until Dick Cheney is seen either leaving of his own volition, or leaving in chains, and it's our intention to make sure that this week's activity is a giant step forward in that direction.

There are many more things that I can say. Obviously, events in Washington these days are moving very quickly. Perhaps the most notable event of the last 24 hours was a vote cast in the United States Senate, rejecting the timeline that the Administration has presented on the question of the Iraq war. It is a vote that has much greater significance than the particular issue that it addresses, and by many is seen as a vote of no confidence against this Administration. I think that there will be many other issues to address in the wake of Mr. LaRouche's remarks.

While more chairs are being brought in, I will ask the people who are continuing to filter into the room to please do so quietly, because we do want to start this webcast on time, particularly for the audiences that are gathered around the nation, and around the world, who are listening via the worldwide web. So, ladies and gentlemen, without any further introduction, I'd like to present to you the founder and chairman of LaRouche Pac, the American economist and statesman, Lyndon LaRouche.

LaRouche: Thank you. As a matter of preliminaries, there are two points I think just to warm things up before we really get started.

One thing is an announcement, which I'll just make now, that, according to a scan of the press in Washington this morning, I think one of the big newsbreakers is the suspicion that Bob Woodward, the perennial Bob Woodward, is actually the Judith Miller of the Washington Post.

And secondly, I have a little something for you. There is a suspicion that, one after the other, key members of the Administration are going to be frog-marched into prison [Karl Rove and Dick Cheney frog-marching in time to Alfred Hitchcock's musical theme].

We are at a very interesting point. We've had, in the recent period, a very important victory, but it's a victory in a battle, or series of battles. It is not a victory yet in the war. And today, after covering a few preliminary points, I want to focus on a subject which may be far removed from what you thought about when you entered the room here today, and that is, what do we do with the war? Because when you plan to conduct the war, you obviously intend to win it. But what do you intend to do with the victory? What kind of a peace do you intend to establish, which resolves the issues of war?

The problem is that, today, the world is in the greatest financial crisis in modern history. It's a point of fact that there is no major banking system in any part of the world—in Japan, generally, or in Europe at all, or in the United States. The Federal Reserve System is a collection of bankrupts, of hopeless bankrupts. The banks that are part of it are hopeless bankrupts, largely because of this financial derivatives speculation. In Europe, it's the same situation. There may be some nooks and crannies here and there which are not yet bankrupt, but the major banking system, the central banking systems, the Federal Reserve System, are hopelessly bankrupt. There is no way of settling accounts, to get out of this mess.

In the case of the United States, this means putting the Federal Reserve System into government receivership—the whole system!—because all the components of the system are bankrupt! And therefore, the only thing that can be done is for the Federal government to take the Federal Reserve System itself into bankruptcy, for reorganization, in order to ensure that essential functions of finance are continued, that businesses don't close up, that pensions are paid, and so forth and so on. A similar situation exists in Europe. A similar situation exists in the world.

We have two problems, immediately. One, the problem of how we're going to stabilize the world when it's about to go bankrupt, totally. We don't know what day this will occur. People who try to forecast days don't understand humanity. Sometimes, once in a while, you can know that something will happen on a certain day, but most of the time, what you can know is that you're in a bind, you're caught in a framework, in which the crash is now inevitable, in an estimatable range of time. The day on which it will occur, you don't know, because human beings can make decisions, and those decisions can postpone this event or that event, but at a price. The price goes up. The longer you postpone a bankruptcy, the more bankrupt you become. The longer you postpone recovery, the worse it becomes.

And we have in the room here today, we have people who represent part of the UAW, which has been thrown into virtual bankruptcy. You have General Motors, which is ready to shut down, at least its domestic operations. It means a whole section of the U.S. economy is about to be shut down, and if you take out the auto industry, and take out part of the aircraft industry, we don't have a machine-tool capability. We are no longer a sovereign nation! And there are some people who are going to wait and watch that happen, and we lose our sovereignty and existence. There's only one way to stop it: to put the whole shebang into bankruptcy, and into reorganization, to keep the wheels turning. Now, I'll talk some more about that, but that's the kind of problem we face.

On a World Scale

If we look at this on a world scale, it becomes more complicated. Here, you have to think strategically, and here's where most people won't tend to think in this direction. But somebody has to think in this direction. I think I've got elected for that job.

What we have, is we have a group of nations. There's only one nation in the world that is capable of initiating a recovery for any part of the world, and that is the United States. Either we initiate a global bankruptcy reorganization of the world system, or there is no hope for any part of the world.

The danger is not a Depression. We've had the Depression. We had it in October of 1987. We had a 1929-style Depression, and we fooled around with that. But then the Soviet system collapsed, and then we looted the Soviet system, and we've been living on the gut of the innards, which we've been eating at dinner table, of the Soviet system. We've now run out of that. We have destroyed industries. We've ruined ourselves, very much the way Hoover ruined us in his term, from 1929 on. You know, the U.S. economy collapsed by half under Hoover. It didn't collapse because of 1929. It collapsed because of what Hoover did about 1929! And what Hoover did was the work of a genius compared to what this Presidency has done. We have reached the point of international bankruptcy, so the world financial system—the way it has been operating, especially over about forty years—is no longer viable. This entire international financial system is finished, one way or the other. The question is, are we going to save the nations and the economies?

Now, some people think that an economy is a product of a financial system. They say, "Well, the bankers, oh, they will do something, or they can do something." They will do something! Once they've brought in Hitler, they will do something. And if you don't want a Hitler solution, you've got to come up with something else. You've got to put the bankers into bankruptcy, into receivership.

We have a situation now, as you observe the way our economy has been destroyed. We used to have a lot of farms, independent farms. They don't exist anymore. Brzezinski helped get rid of those, during the Brzezinski Administration, which was sometimes called politely the Carter Administration. Eh? We used to have private industries, we used to have machine-tool shops, we used to have all kinds of industries, local industries. We used to have local businesses, closely held. Not giant corporations. These were the gut of our economy. The giant corporation is not the gut of the economy.

If you look at the gut of an economy, any large corporation like General Motors, the auto industry, the auto industry does not produce—in terms of General Motors—does not produce automobiles! It assembles them! The components are developed by subsidiaries. Its components which are put in, they're largely from smaller industries. We have put out of business the gut of our economy, the people who produce. We call it a "services economy." It's like a house of prostitution, where people get serviced. It is not really an economy.

For Example: Monsanto

For example, Monsanto. Monsanto should be put into bankruptcy, for intellectual bankruptcy. What does it do? Some idiot in a corrupt administration decided they could patent nature. It was Monsanto. They could, by various tricks, say they invented genes! By discovering one. By mapping a gene, they say, we "discovered" the gene. We can now map it. We own it. You want it? You lease it from us, at our prices. So we have a situation where the farmer can no longer produce seeds. He's not allowed to! He can go to jail for producing seeds. He's got to buy them from Monsanto.

We are faced with an ecological catastrophe based on this. Our food chain is based on the homogenization of types of foodstuffs, for a global economy. Now, one of the great things in food security—just as one example of the problem we face—in food security, variation was our defense. If a disease hit a particular type of crop, a particular type of animal, as part of our food supply, or a tree, a type of tree that we needed for our environment, well, some trees would die but other trees, which have a slightly different genetic structure, would not be infected and would not die.

But the way we're homogenizing our food supply, you have one type, it's called the world tomato, the world orange, the world banana. And a simple catastrophe, a genetic catastrophe in the form of a disease, could wipe out that whole supply. It's what Monsanto has done to us. It's not only the United States. They've done it to Brazil, they've done it to other countries on this planet. So we've been under the reign of absolute insanity, of destroying our productive capabilities, and destroying the private initiative on which we used to depend. And making a mystique about the giant corporation.

What we have today, which is where the danger comes from, because what was done to us was not a mistake; it was a crime. It was deliberate. What has been done to us since the reign of Henry Kissinger and Brzezinski, is we have been destroyed systematically, beginning with 1971-72 with the destruction of our fixed-exchange-rate-system, monetary system. And piece by piece, every part of our economy that made us independent, or the economies of other nations, has been destroyed. It's been destroyed by environmentalism, by globalization, by methods of the type I just described to you. We no longer have a residue of private businesses, private entrepreneurships, as being the gut of employment and the gut of production in our economy, or any other part of the world, to speak of.

What we have is giant corporations. These giant corporations are not actually producers, they're slave owners. They're controlled by international financier interests, which do not belong in the United States. Most of these entities, which are powerful, have no loyalty to the United States or to any government. We have been globalized. We have been internationalized. We have now a virtual system of world government, under the power of these bankrupt institutions, these financial institutions, which control the world.

The intention has been to eliminate the sovereign nation-state. To eliminate production as a power of economies. To globalize everything. To produce a world economy, in which there are no nation-states, in which the highest power in the world is international financial wealth, typified by the mentality of someone like, say, Felix Rohatyn of the United States, or people like that, who are part of an international cabal, the same cabal which, on a smaller scale back in the 1920s and 1930s, called the Synarchist International, gave us fascism. Fascism in Italy, 1922. Fascism in Germany, Hitler, done through the Bank for International Settlements. And Hjalmar Schacht, done by what? By the head of the Bank of England, Montagu Norman. With the support of whom? With the support of the grandfather of the present President of the United States, who wrote the order to a German bank, which re-funded a bankrupt Nazi Party in time for Hitler to be appointed as Chancellor of Germany. These same international financier interests, in a greatly bloated, expanded form, have been headed for world government. How did this happen?

The Most Powerful Economy

The United States, of course, came out of the Depression as the most powerful economy the world has ever seen. We were already the most powerful economy in the world in 1940-41, before we went to war. We did not become powerful because of the war. We became powerful enough to conduct the war. Where other countries would have hundreds of pounds per soldier, we had tons! We had the greatest logistical power the world had ever seen. We had 16-17 million people in military service, the greatest army in history. And we saved the world. And we saved it because of President Franklin Roosevelt, who understood what he was doing. Then Roosevelt died, and Harry Truman, who was a pig, took over. And Harry Truman was not the author of the idea. Harry Truman was the guy who worked for the guys who did give the orders, including the people who owned Winston Churchill. We were headed for World War III before World War II ended.

Winston Churchill, for example, wanted to go to war against the Soviet Union while we were still fighting Hitler, and then Roosevelt died, and that sort of succeeded. We had two nuclear weapons which had not been approved, because we hadn't run the tests yet on the—we had three nuclear weapons: one for testing and two were prototypes. They were not production-line weapons, they were prototypes.

One was a uranium bomb, the other was a plutonium bomb. One of each. The original intention had been to use one of these on Berlin, but before we had the job ready, Germany surrendered. We couldn't use it on Berlin. We did, under British direction, destroy a lot of cities which were innocent cities, which were cities of civilians, no military targets, just to prove how nasty we could get. Then, when Truman became President, he was told about the nuclear weapons, and under British orders, we used them on Hiroshima and Nagasaki, civilian targets. We used them because we had them. And we used them because we wanted to start World War III, nuclear World War III. But then, the Soviets, in the course of the late 1940s, developed nuclear weapons and achieved priority in developing an operational model of a thermonuclear weapon. So we shifted to a different policy.

This was all intended. We went into a right-wing turn. We didn't continue our investigation of the Nazis, the Nazi bankers, the funders. We stopped it. Allen Dulles, who became the head of the CIA, brought the hard core of the Nazi system, into the Allied security system, including the CIA. This is the issue we have about the torture thing. The torture mechanism of the Nazis was taken over by the United States and British. It was run from Germany, occupied Germany. These institutions were incorporated into the CIA, into British intelligence and other places, and they resulted in things like the Pinochet regime in Chile, and Operation Condor in southern South America under Henry Kissinger's reign. And that has been going on from the end of the war to the present day.

The Assault on the American System

So this is the kind of world we've been living in. It was intentionally created. The intention was, to eliminate the United States. Because as long as the United States existed in the Constitutional form that Roosevelt represented, fascism could not come back in the world. And finance capital could not become a predator, to eat the world. So the goal was, get Franklin Roosevelt out of the Americas. Destroy the American System. Destroy the American agro-industrial system. President Kennedy was killed, and the program went into full swing. Eisenhower had warned against it, but it went into full swing. So, from the time we went into the Indo-China war, we were headed toward our own self-destruction.

Our adversary was not the Soviet Union. We had an adversary in the Soviet Union, but that was secondary. Our adversary was closer to home, in our own financial system, in our own banking and financial system. They wanted to destroy us.

Look at the effect! Did they destroy us? Look at the standard of living in the lower 80% of our family income brackets, since 1977. There has been a consistent decline. Look at the pattern of our states. Look at the state of Michigan! Look at the state of Ohio! Look at western Pennsylvania. Look at states across the country, especially the northern belt. Look at the Grain Belt. We have been destroyed!

How? By policy. It has been the policy to destroy us. It has been the policy to uproot the United States for once and for all, for what it represents. This is the enemy! This is the real enemy!

Reminds us of Ancient Greece. When the ancient Greeks had defeated the Babylonians—which were then called the Persian Empire, but it was the Babylonian apparatus inside the Persian Empire that ran it—they tried to destroy Greece. They couldn't conquer it. So what did they use? They used subversion. The subversion was called the Delphi cult of Apollo. The Delphi cult of Apollo did what has been done to the people of the United States in the post-war period. Sophistry! Reason went by the boards.

The Congress for Cultural Freedom and other institutions brainwashed your children, or our children. The children who were born after 1945, that generation, was brainwashed! Yes! It's a fact! The explosion of the adults of that generation in 1968, in Europe and the United States, was a reflection of a process of destruction of the minds and morals of the children of the post-war period. And especially the children of the upper class, the upper 20% of income brackets, the ones who were working in suburbia, in the defense plants and things like that. The ones who were going on to careers in the leading strata of society. They were trained to think in a certain way, a method of sophistry.

They were trained to enjoy television, where you saw monsters from outer space eating children. This was your entertainment for the little kiddies huddled around the Big Eye, eh? Our educational system in the late 1950s: We destroyed our educational system by introducing the New Math and other kinds of innovations. Many people have never seen a history book in the United States today. They study current events—maybe. They don't really know anything, but they can pass the test, because the test doesn't test them for anything. We've been destroyed.

We've been destroyed in the same way that, say, the case of Croesus, of a powerful kingdom at one time in Lydia, in Anatolia. And Croesus went to the Cult of Delphi, and said, what's my problem? And he believed them. And he was destroyed.

Greece, the same thing. Believed the oracles, and they were destroyed. Who was the enemy? The oracle. The Babylonian system.

A System of Empire

And we've lived under a system of empire. We had the Roman Empire, which emerged out of the Second Punic War. We've had the second Roman Empire of Byzantium. When that collapsed, we had the Venetian Empire, with the Venetian banking system and the Norman chivalry, with its Crusades, as predators, they destroyed most of Europe and most of civilization, until they collapsed in the 14th Century.

We had the birth of the modern nation-state in the 15th Century in Europe, with the Council of Florence. But then they came to destroy it, and they destroyed it beginning in 1492 with religious warfare, which went on until 1648, the Treaty of Westphalia. And when we thought we'd licked that, they came back with something else, called the British Empire, which started actually in 1763, and the British Empire, or the Anglo-Dutch liberal system, as it's otherwise called, or the Venetian Party, has dominated the world since that time, except for one little republic, which became a giant, the United States. Everything good that has happened on this planet, of any significance, has come from the United States.

For example: Once we defeated slavery, which was a British thing stuck into us to try to destroy us, from the 1820s until the Civil War; once we defeated that, once we went away from a free-trade system back to a protectionist system, the American System, we became a great power. By 1876, at our Centennial Celebration in Philadelphia, we were acknowledged as a great power. And then Bismarck's Germany, in 1877-78, adopted the American System as an industrial model, complete with a social welfare system, which is being destroyed only today.

Russia. The great scientist Mendeleyev, was in Philadelphia, went back to Alexander III, and they launched the great industrialization inside Russia, including the trans-Siberian railroad. Japan, 1877, from the United States, became an industrial nation, and on the road to the power that Japan represents today. China, later on, in the struggle for New China, was a reflection of the same thing, under Sun Yat-sen—all the great things happened.

And then, the British Empire started a war, starting in 1888-90. Bismarck was overthrown, which opened the gates for warfare. The President of France was murdered, to open the gates for warfare. Various things of the same type happened. Japan was urged to betray the United States, and to launch the first war against China in 1894-95, and that led to Pearl Harbor, because the British in the early 1920s had made a treaty with Japan, for naval warfare against the United States. The plan included the plan for an attack on Pearl Harbor. Later the British and the Japanese divided opinion, because of Churchill, on this question. But Japan came on and carried out the plan for the attack on Pearl Harbor, and we had people in our own country that covered up the fact that that attack was coming, which was the famous trial of Billy Mitchell, when he proposed to develop carrier aircraft to deal with what we knew in our military intelligence, was the plan of Japan and Britain for an attack by British and Japanese naval forces against the United States. History changed things. The British came to us to rescue them, later on, but in the meantime, Japan continued the policy, and attacked us at Pearl Harbor, according to their earlier agreement with the British.

The policy was to destroy us! Not because we were that good. We were never quite that good. We had some pretty bad Presidents, you know, and some pretty rotten people here and there, and some rotten practices. But the character of our nation, the conception of our nation as a state, was a product of the best thinking of all European civilization. People from Europe built up this United States of ours, because they wanted a bastion, which would become a model, for them; would set a precedent, for them, to secure the same kind of freedom we had, the same kind of system we represented. And those who represent this idea of financial empire, or a worldwide services economy, which is the same thing as slavery, have been determined to destroy these United States, by one way or the other. If they couldn't take us on by direct attack, they would corrupt us from inside. And the great destruction of the United States has come from the inside, not from external enemies! We couldn't be defeated by any external enemy, unless we destroyed ourselves, inside, first. And that's been the case for the United States ever since Lincoln's victory over the Confederacy, and getting rid of Maximilian in Mexico. And that's the problem we have to understand.

Our Historic Mission

Now, that being the case, we have a mission. We have an historic mission, which goes back much earlier than the 18th Century, much earlier than the 1763 process where we began to fight, to struggle for our liberty. Our mission is to bring forth on this planet, a kind of society, a society of sovereign nation-states, which is a durable form of life for humanity, for generations yet to come.

We're now at the point where, as the financier powers which have brought upon us this latest disaster, and who are behind these poor fools, this poor idiot Bush, the President, and this poor depressed, depraved criminal, Cheney, are being used as tools against us, and the question is, how do we—we now have good signs, we have the signs that our institutions are working. The Congress, the Senate, have shown that it works. The system works, apart from its imperfections. It works, nonetheless! And that is a good system, which absorbs imperfections and yet functions to perform its mission. Our institutions are well-designed, when they're used properly.

We have now won a victory. We have in a sense recaptured our country. Since the summer of last year—we had seen the Democratic Party converted into the anti-Roosevelt party—we have now swung back in large degree to the memory of FDR, and to what he represented. An attitude of, "we can do it again." It's not perfect, but the Senate has shown, and other institutions have responded, that in this country there's still the potential to rebuild and recapture this country to what it represents. And a lot of good things have happened, including the beginning of the frog-march.

But then, beyond that, we have this larger issue. We can not live as the United States today, isolated in a world that's disintegrating. Therefore, we have to think about what kind of a world system is required: Not because we impose it, like George Bush's conception of democracy, but because other nations which may or may not agree with us on many things, know that it is wisdom on their part to cooperate with us to build this kind of a world system.

Now, we're talking of a world system, we're talking, first of all, about the Americas and Europe. The states of the Americas are, for various reasons, particularly since the developments which occurred in them in South and Central America, after Lincoln's victory, they became more and more oriented to the North American system. And what you will find that is generally good in these republics, are constitutional and related legacies which reflect the system of the United States, as in Mexico, as in other countries of the hemisphere. So, if we do the right thing, we will have not too much difficulty in finding a policy with, say, with a person like President Kirchner of Argentina and others; we will have no difficulty in rebuilding the system of the Americas, the sovereign states of the Americas. That will not be a big challenge.

We have, implicitly, the potential with Europe.

America and Europe

Now, Europe is a little more complicated. It's complicated because the British are in it, primarily, and because the French have been taken over by it so many times, especially beginning with Napoleon Bonaparte and the French Revolution. As a matter of fact, because of this, essentially from the time that we won the Civil War, the time of the 1876 Centennial of our victory, of our freedom, Germany has been the key, the current pivot of U.S. international policy outside the hemisphere.

The example of that was the case of Bismarck's adoption of the American System of industrialization, which revolutionized Germany, and revolutionized it, put an American social welfare system into Germany, together with the process of industrialization and protectionism. Our policy was, during that period, up until the turn of the century, as long as Bismarck was in office, in particular, and even beyond that, recurring, our policy was to have peace between Germany and Russia, with the idea that the strategy of the British would be to have a war between Germany and Russia, and would be playing the Hapsburgs in France in that, in order to destroy Europe by playing one part of Europe against the other.

Our policy, from the time approximately of John Quincy Adams, was to avoid, to act to prevent, a war between Russia and Germany, and to hopefully bring France—the France of Lafayette, for example, there were efforts in that direction—to bring France into cooperation with Germany, so you would have a Russia/Germany/France axis in Europe, which would be an axis, a power against the British, and which would adopt the evidence of the American System as the model they would use, because Russia had adopted that in the late part of the last century, of the 19th Century. They had adopted the American System under Alexander III. Nicholas II was a different proposition, but Alexander III, yes. Alexander III was an ally of the United States against the British, in the case of the Confederacy. So we had friends there in Russia. We had friends in Germany. We had potential friends in France, if we could get rid of this Napoleon business, [get it] out of the way, which is still a problem to the present day. And therefore, as de Gaulle attempted to do in his deal with Adenaeur, to try to get a partnership between France and Germany on an equitable basis, for partnership between Eastern and Western Europe, based on the Russia-Germany peaceful cooperation.

Today we have a much larger scope, including that one, to deal with. Today, we have Eurasia, and we'll come to Africa again, which I've mentioned many times— But Eurasia: The countries of China, India, and so forth, are in a sense, entering modern conditions. Not really, though. China is not going to replace the United States. India is not going to replace the United States. Seventy percent of the population of India lives in desperate conditions, and in many respects, worsening conditions. So you can not call the Indian economy a successful model, because it depends upon selling its products abroad at prices which leave 70% of its population in destitution comparable to slavery. That is not a growing power.

India and China

As a matter of fact, in the most recent national election in India, you had a Prime Minister of India, Vajpayee, who was a capable Prime Minister, but he lost reelection because of revolt among the poor people against the negligence of the Prime Minister's party on the issue of the welfare of the lower 70% of the population of India, who demand something better than being neglected.

In China, you have a different situation, but a comparable one. China depends for its export market on using cheap labor, Chinese cheap labor. China's labor is no cheaper really than our labor, except the difference is that in our country, we have a social welfare system. We pay pensions. We maintain a social structure to support the entire population. Now, China intends to do that, but China can not meet that burden of developing its own internal population that's poor, without raising its prices to get fair prices on the world market, which means China's role is twofold. It has two problems. First of all, if the U.S. market collapses, where's China? It goes into a spiral of collapse. If the U.S. market collapses, where does India go? Where does Europe go? Where does India go if Europe and the United States both collapse?

So you're looking at a world which is in danger, and it's in danger because of free trade. You can not maintain this planet as a safe place to live, while you maintain free trade and allow globalization. You must have an American-style protectionist system, in which we have trade barriers. We set up protection so that goods are not produced below the true cost of their production. And the true cost of production is the cost of maintaining the population as a whole, which produces that wealth! Which means pensions, it means social welfare systems, educational systems, health care systems. It means infrastructure in general.

Now, of an economy in general, 50% of any modern economy is an investment in infrastructure. These are investments which run with a lifespan of 25 to 50 years, a 25- to 50-year investment, in dams, power systems generally, water management systems, mass transit systems, high-speed mass transit systems—not all these trucks trying to crowd highways, and turning superhighways into parking lots at rush hour time, but a real system. Power systems which provide adequate power, at the densities we require. Maintenance of our area, so we maintain our environment, maintain our forests, maintain the productive biological structure of our nation. It costs money. It costs effort. And we have to treat this effort as part of the cost of production!

Pensions are part of the cost of production! To provide for the aged is part of the cost of production, because the aged and the young are part of a system, just like children are part of a system. They may not be working. They may not be employed. But they are an essential part of a system, and you have to pay for the system. You have to maintain the system physically, materially. It's called the American System, the protectionist system, which we understood better after the experience of the Depression, and the experience of the successes under Franklin Roosevelt. The world needs a Franklin Roosevelt system.

Now, to have that kind of a system, which means about half of your total investment, in international trade, in fact, about half of that, is in long-term investment, either in basic economic infrastructure, like dam systems, power systems, water systems, whatnot; education systems, health-care systems; but also in high technology, which means capital-intensive technology in agriculture and industry. These also are long-term investments—nearly 10, 15, 25 years, too. A good machine tool—it lasts for a long time, it's adapted to many new things. But it's an investment you must have, and you must maintain it.

So therefore, that means that you have to have a fixed-exchange-rate system. You must fix the prices of currencies among each other, in a fixed way, so that you don't have fluctuations in prices, and rates, and costs on investment. In that way, you can have stable agreements. Because—what?

Creation of Credit

Where are we going to get the capital, to rebuild this world economy? The banks are bankrupt! Where are you going to borrow the money? There are no banking systems that can provide the financial capital for recovery! It doesn't exist! These banks are bankrupt. Where does the money come from? It comes from the creation of credit by governments! In a regulated system. The creation of credit by governments, for the purposes of long-term loans, at fixed prices, for investments in infrastructure, and for providing investments for capital investments in useful industry and agriculture.

These loans, which are what? At 1-2% interest, simple interest, over the long term, run through a banking system which is coordinated by the government, as a national banking system—private banks participating in a system coordinated by government—get this credit out, the way we used war production credit during World War II. You get the credit out, for what are declared to be purposes of national interest.

The first thing, is to try to bring the level of population in production, up to the level that you're above breakeven. Now, if you're operating above breakeven, current breakeven, you're not in bad condition. Therefore, get above breakeven.

Once you're above breakeven, now you bring into play technological progress, which will increase the productive powers of labor and the quality of product. Now you get real growth. And the next generation will be better off than the present one. And so forth and so on. That's the American System at its best.

Now, we had the basis for that, at the end of the war. The basis was provided by the leadership of Franklin Roosevelt, in what became known as the Bretton Woods system. Which was destroyed by the friends of Kissinger, and Shultz, in 1971-72, under Nixon, but was in the process of being destroyed even before that—because the Vietnam War, helped to do that. So therefore, we destroyed the system, we went to a floating-exchange-rate system, we destroyed the world economy, by a floating-exchange-rate system. We no longer had a stable system of credit, at fixed rates, the fixed exchange rates, over long periods, where you could efficiently have the development of economies on a large scale, or the world economy.

We have to, therefore, create that kind of system, again. But this time, we have to create it to include not only the Americas, not only the Americas and Europe, but we have to also include Asia. And if we do that, then we have the means for dealing with a great stain on our conscience: What Henry Kissinger did to Africa.

And Africa is going to require great aid from these countries—not lending, as much as great aid in infrastructure: Because, what we've done to Africa, sub-Saharan Africa, is a crime beyond belief. They do not have the means of recovering on their own. The biological effects that we've imposed on Africa under these conditions, are such that they don't have the ability to rebuild on their own. We must help them. That is our moral obligation. We must give them things, to help get them started. We have to get them through the next generation, to try to get them back on their own feet again, and help them develop.

So therefore, we in the United States, looking at what the Senate is facing today, we have to look ahead. We have to say: We're in a war, against an enemy. The enemy are these institutions, these financier institutions which have come to destroy us, which have almost destroyed our nation, and corrupted our people, as was done to the children born after the close of World War II. That's the first thing. We have to restore the system that was destroyed, rebuild the nation. We have to think about rebuilding the world, and rebuilding as I indicated.

That means, we have to build a world system. And so, the war is against the enemy, who has destroyed us and other nations, by his Delphic methods. But we have to create a system which is accepted by other nations, as a mutual system, and that is the peace. That is the victory. That means that we have to do certain things, not simply because they're convenient for us here. We have to do things, because we have to do them now, or they won't be done by the world, and then we would suffer from that.

If the World Goes to Hell. . .

We can not survive as a nation, if the world goes to Hell. Therefore, the way we act as a nation in our interests, must take into account the effect of our policy, or our lack of policy, on the rest of the world. Because it's the kind of world we're helping to build, in which our posterity will live! And we have to think about the peace, the peace for our posterity: a world in which they can live, for generations to come! We have to build that kind of a system. Our Constitutional system contains that potential: No other nation on this planet has that potential, that we have! Therefore, we have to use what we are; we have to use our heritage for that purpose.

This means, of course, that the planet is getting smaller. Not really, but it's smaller in terms of human action, in the size of human population. This is particularly evident to us in Asia, where the great part of the whole world's population is now located.

Now, we can't maintain the world the way we've been running it up to now. We have to develop new kinds of resources, new technologies, new sciences, new branches of science. We have to engage in a policy of continuing scientific revolution and technological progress. This relies upon what?

It relies on three things: First of all, the quality of intellectual development of our population, including our young—educational systems. Presently, they stink! We have a Youth Movement going, and the Youth Movement is struggling with almost no means, but it's doing a better job than the universities are, in terms of actual knowledge. We can do it. All right: We need a new educational system, an education for reality, an education for science, not this gobbledygook we get for services economy nonsense. "Bend over, I'll service you"—hmm? Right?

Also, we need the application, a technological orientation of entrepreneurship: Because the way you get things done, is—you have to understand the human mind. Some people know how to destroy the human mind, but they don't know how it works. They just don't like it—"Let's destroy it! Destroy it! Grrr! Get rid of it, it's a problem!"

Now, we call it "private initiative," that's a bad word, because of the connotations of it. But, in point of fact, any discovery, or rediscovery, or development of a discovery, occurs primarily within an individual mind, as a sovereign act of an individual personality. And society is a system of cooperation among sovereign, individual personalities. Someone gets an idea, it spills over to someone else, they cooperate, and so forth, and things happen. And therefore, you want a system—you can call it an "entrepreneurial system"—in which the greatest freedom for people is to use their individual minds in collaboration to make things happen, that make things better. And this is usually science-oriented, or science-application oriented. So therefore, you need a system which is a science- and culture-driver system, which should be centered in our educational system.

Now, you need a system which can absorb that, in the labor force. So you need a system of organization of entrepreneurship, in which this natural potential of the educated population is expressed. You don't say, "We're going to prescribe it, you're going to invent this." You prescribe a problem. Somebody comes up with a solution. That's entrepreneurship. So you need that kind of a system.

The Machine-Tool Principle

Now, we have in society, certain categories of people, some of whom are represented here today, who are associated with the machine-tool sector of industry. If you want production, if you want progress, science is not enough.

For example: Suppose you're a scientist, you make a discovery: How do you certify a discovery? Well, you have to design a test apparatus, which actually is a test-of-principle apparatus. Now, in that apparatus, you will have built in something, which actually is new. It tests the principle you have never consciously used before. You're testing to see if it actually works, the way you have conjectured it would. Right? Now, once you've done that, and it does work, now you have a secret you've discovered: That test apparatus, that you designed (and you could probably go back and do a better job of redesigning it later), but that test apparatus you've designed, is the basis for what we call "machine-tool design."

Now, this is the way you take a population which has moderate skills, moderate scientific skills, and through the machine-tool approach, you produce product and systems whereby a large population, thousands of people, can work around a few hundred people, who are involved in machine-tool design. In a sense, the machine-tool designer, by introducing innovation into the productive process, and employing thousands of people in using the innovation, increases the productive powers of labor of the entire population. So, what they're trying to do with destroying General Motors, and the rest of the auto industry—as they're doing, as a productive industry; and the aircraft industry—what they're doing, is destroying the machine-tool capability of the United States! Which means, what? We become Asians: We no longer have the ability to develop technology, we can only copy other people's. We're being destroyed.

And the poor people in the United States, who have come to believe in a services economy, don't understand that. There are people in the Senate, who don't yet understand that. People in other channels of government, don't understand that. People in parties will argue against that! They don't understand it.

But, the success of the U.S. economy depends upon it!

Take the success under Roosevelt: Do you know what we did, in World War II, in going into it? Do you know how many machine-tools were sitting out there with the U.S. government tag on them? We took people who had no machine tools—we mass-produced machine tools under government contract. We leased these out to firms that had government contracts for military and related production. We produced as no one had ever seen production before! With a machine-tool system. Rosie the Riveter became a machine-tool specialist—out of a household! That's the way it worked. That's our system!

Now, the other part of the system, is that, without infrastructure, it doesn't work. Just take a couple of cases—these dams and power station systems. [Figure 1—animated graphic of dams completed in the United States by decade from 1920 on.] We're a country that doesn't give a dam!

Now, take the power systems [Figure 2—animated graphic of nuclear power stations, showing no new stations have been started since 1977.]

All right, now, there's another aspect to this thing. It's not just the fact of nuclear plants, or power plants, or dams.

Power vs. Energy

Let's take power: Now, we use a lot of gasoline, don't we? And natural gas, and so forth. Why do we do that?

Because we're stupid.

Because we take a product, natural gas and petroleum, which comes out of the Earth, at less than a dollar a barrel—now it's rising somewhat. You haul it all over the world, and the price goes up; the cost of distribution is a major part of the cost. And this is not merely a price, this is a cost which comes from absorbing the income from the sale and production and many other things. So that, actually, the price of petroleum is a tax on the world economy. It's a stupidity tax.

In what sense? What should we be doing, instead of petroleum? Well, first of all, there's the direct application of nuclear power. India's now about to go ahead with a program which has been a capability I've been pushing for for some time: India has a very large part of the world's supply of radioactive thorium. And the thorium high-temperature gas-cooled reactor in the 120- to 200-MW range, is about as efficient as anything in the same range for a nuclear reactor. And it does not have the problems of management, that you get with another fission reactor from uranium, or plutonium.

But, in any case, the high-temperature gas-cooled reactor can take water, and turn water into a hydrogen-based fuel. If you have high-temperature gas-cooled reactors in every part of the country, you can produce your own fuel, in that country, from water, or water-based fuels. And the fuel, when consumed, has a waste product . . . called water. Which is not normally considered a contaminant—except among people who don't bathe.

So therefore, now, the idea of energy is also a stupid idea. It was invented by some idiots in 19th Century, who didn't like the idea of power. Energy is an effect. It is not an entity, it's an effect. You get burned, that's an effect. You want to call it energy? Okay, blame energy. You sit out in the Sun too long, you get cooked, that's energy.

But power is a means by which you engage in a transformation of something from a lower state to a higher state; from a lower state of potential to a higher state of potential. Now, when we develop power sources, and power sources per capita and per square kilometer, we increase the potential to increase wealth per capita, and so forth. We can raise the standard of living!

So, why should we haul and stink up the atmosphere, by hauling all this stupid fuel, all around the world? What would we do with this petroleum? Well, petroleum is very useful for the plastics industry; they make plastics out of petroleum. It's a base for that, a product base. So use it! Where do you make your plastics? Well, make them in Saudi Arabia, for example: You got the cheapest petroleum there; make your plastics there. If you're going to ship something, the value per ton is an advantage: the more valuable per ton, the lower the cost of transportation, as a percentage of total product! So, our objective is to increase the efficiency of the economy, so that what you transport, transport something which is more valuable each ton-mile than before. If you increase the value that you transport per ton-mile, you are increasing the productivity of the economy. So, why shouldn't we do that?

To do that, you require things like increasing nuclear power. A higher-density nuclear power. We have to think in those directions. There are many things we have to do.

Biosphere and Noösphere

Now, on top of that: The world is somewhat in trouble. The world as we know it, is divided into three areas of chemical activity. One is the abiotic system. Second, is living processes and their products. The third, is human intellectual activity and its products, which is a growing percentage of the total fossil accumulation of the planet. Now, our objective is, to increase the ratio of human to Biosphere, to abiotic.

Now, what we depend upon when we mine for minerals, we don't go into the core of the Earth to get our minerals. We go into the fossil area of the Earth, which is called the Biosphere. For example: What is a fossil? Well, the atmosphere is a fossil. The atmosphere was produced by living processes. Water is a fossil. It is produced by living processes. The reason we have oceans and rivers and things, is because biological, living processes, produced water. And this water accumulated and it became oceans and whatnot. We produced—the living processes produced the atmosphere, the atmosphere we have, the carbon dioxide. You know, plants love carbon dioxide. Carbon dioxide is not a pollutant. We should increase the carbon dioxide content of the atmosphere: The plants would be much happier, and it wouldn't be inconvenient for us. They grow much better with carbon dioxide—that's what they feed on! That's what a green plant does, a chlorophyll plant feeds on carbon dioxide! It's its favorite dessert. You want to make the plants happy? Give them more carbon dioxide!

What do you do? If you want to have real growth, build a hothouse—you may not like the carbon dioxide concentration, but the plants will be ecstatic, and they'll grow wonderfully for you. They gobble up that carbon dioxide! Just give them enough power and carbon dioxide, and they're happy: They'll produce vegetation like mad.

So, we're now at the point where we have to consider the fact that we are tending to deplete the minerals in the Biosphere. Now, the minerals in the Biosphere, like iron and so forth, we get them because they are concentrated as what? They are part of the dead bodies of living things. You get a potassium concentration, iron concentration, any other kind of concentration: Usually, this concentration is the result of the residue of dead living things. That's how people know how to find these things: They go into areas where they know this kind of development occurs, and they're looking for a residue of a formerly living process of a certain type, and they get iron there, they'll get this there, and so forth. That's the way it works.

So, therefore, we're getting to the point that the planet is becoming somewhat depleted, in terms of the rate at which we're consuming known resources of these types—and we have to start thinking about replenishing them! And that's a problem in advanced physics, of high-power physics. So therefore, the economy of the world is going to have to change, and shift from a low-power-density economy, to a high-power-density economy, so that we can manage the planet with new technologies, where we no longer simply go down there and grab raw materials, which are left over from dead living things millions of years ago; but now, we're capable of regenerating something, rather than simply using it up. We're going to that kind of economy. Therefore, we have to go to a high-power economy, a high-technology, high-power economy. We have to go from a cheap-labor economy, to a machine-tool economy. That's the direction we have to take.

We have to think about a world system, which respects the fact of the nation-state, maintains it. Don't try to globalize the world. No more globalization. Cheney's already too fat.

Looking to the Future

Go to a managed system, where we rely upon our scientific responsibilities for development. Let each nation develop with its culture, in its own way. And what we need is a system of cooperation among those nation-states. The obvious thing is the United States' relationship to its neighbors in the Americas, which is a unit of cooperation. The United States' cooperation directly, for example, with Europe, as with Continental Europe, in particular. And envisaging the cooperation between Germany and Russia, as a pivot for cooperation throughout Eurasia: Because Germany and Russia are key to trade with China, and trade with India, for example, and Central Asia. So then, we have to deal, again, with the African question.

So therefore, we need to create a world system, as a system of cooperation among sovereign nation-states. Doing this as a United States which is proceeding from its own character, its own Constitutional character, its own historically determined Constitutional character. And—maybe the world will stop hating us.

But, that's our responsibility. Not simply to address the problems before us, not to come up with practical, immediate responses to problems. We have to look ahead. We have to look ahead three generations. And we have to take the steps now that are necessary, so that two or three generations from now, when certain kinds of problems become mature, that we have laid the groundwork for the ability of our descendants, to solve those problems. We can not sit back, and just simply put one thing on top of the other. We have to think ahead. We have to think of the past, we have to think of the future, but we have to think ahead.

We need a system for this planet, that will last for 50 to 100 years to come, in terms of relations among nation-states. We need a system of cooperation. We need a system of vision, of where we are going! We need a system of values, of what we value, as accomplishment. We need an orientation toward our children: Especially our young adult children, who have 50 years of work, and influence before them: They are our future! Without them, we don't have a future! And therefore, their fate, for 50 years to come, is us: We will die, but whether our lives mean anything or not, will depend, 50 years from now, on what happens to those young people, what kind of a world we create for them.

That's strategy. Not war. Strategy is strategy for peace, for building a system which is so good, that people don't want to break it, and therefore, you have peace.

Thank you.

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