EIR LEAD EDITORIAL FOR FRiDAY, OCTOBER 8, 2021
Putin Gives an Economics Lesson Against Green Energy Madness
Oct. 7, 2021 (EIRNS)—A generation ago, a schematic of an economic “Collapse Function,” a hyperinflationary breakdown process, was put forward by economist-statesman Lyndon LaRouche at a 1995 conference on Rome, which makes clear the nature of what we see today. Called the “Typical Collapse Function,” or “Triple Curve,” it shows that if physical production is declining, while the volume of financial aggregates is rising, and monetary values likewise are rising to support the difference, there reaches a phase in which shock and blow-out inevitably set in. He released that in 1995. He also warned repeatedly in the years afterward, don’t comprehend things in any of the simplistic terms of mere price inflation, market correction, supply-and-demand, or some single culpable factor. In March, 2000, for example, during the U.S. gas-pump spike in prices, he warned, “This is simply, predominantly—it is not some ‘market this, and market that’—it’s a hyperinflationary process, which has taken off,” and behind it are larger dynamics.
The chain-reactions of breakdown underway today are now dramatic, given the combined effects of decades-long destructuring of production, with whole sectors of manufacturing and agriculture relocated to cheap-labor sites, and concentrated in dangerous ways, Plus, there is decrepit transportation from years of lack of infrastructure-building in the Trans-Atlantic. Add to this, the sweeping deregulation, spot markets, and speculation. You get shortages and spikes in prices in electricity, fuels, and other necessities. No one can pay—no household, business, or government function.
Look at the food chain. World food prices are up year on year by 32.8% in September, according to today’s UN Food and Agriculture Organization index (for globally traded foods). In the U.S., prices for cropland and inputs are soaring. Farmland sale prices in Iowa, for example, are setting new records every month, after rising 10% year on year. In August, there was an all-time record price of $22,300 per acre, but this week came a new record of $26,200 per acre. For fertilizers, five of the eight major types rose 5% in price from August to September; potash jumped up 13%. No new, young farmers can get started; veteran farmers face being driven out of operation.
Lyndon LaRouche, in addition to his conceptual diagnosis of the crises, provided the solutions and the method by which to think our way out of the crises. His June 8, 2014 “Four Laws” embodies the principles for action. This outlook will be featured at the online November international conference by the Schiller Institute, whose weekend dates and times, for two days of deliberation, are now being made final, for the widest possible outreach and participation. An invitation is forthcoming.
What is front and center, at the same time, is the need to completely defeat the green fraud that blames today’s crises on not acting strongly enough against the “climate emergency,” and the “biological diversity extinction emergency.” The green message is: Get rid of people and their activities.
Klaus Schwab, president of the World Economic Forum, states this explicitly in his latest book, and makes special reference to Africa (Stakeholder Capitalism; A Global Economy That Works for Progress, People, and Planet: Wiley, Jan. 27, 2021). After giving specifics on infrastructure building in Ethiopia (rail, agriculture, dams), he says that it has to stop. Such This African development “reveals the central conundrum of the combat against climate change. The same force that helps people escape from poverty and lead a decent life is the one that is destroying the livability of our planet for future generations. The emissions that lead to climate change are not just the result of a selfish generation of industrialists or Western baby boomers. They are the consequence of the desire to create a better future for oneself.” His alternative? He and his crowd of billionaires, royal parasites, mega-cartels and all are proposing “Stakeholder Capitalism Metrics” by which they intend to dictate whether any enterprise (factory, household, farm, railway, school) is allowed to exist or not.
Schiller Institute President Helga Zepp-LaRouche reported on these viewpoints and economic crises on her weekly strategic webcast Oct. 6, saying: “This is fascism, no less than it was with the Nazis.... The present green policy is madness. It is fascism with a green face. It will lead to catastrophic results if it’s not reversed.”
President Vladimir Putin tore apart all the green flim-flam and geopolitical lies from the U.S. and Europe yesterday, at his energy teleconference with heads of Russia’s economics firms and ministries. The Kremlin swiftly made a transcript available, including many interchanges with participants. Putin pointed out all the stupidities of the Trans-Atlantic spot markets, deregulation, speculation, and the green transition to unreliable wind and solar. He said: “As you know, the global energy market does not tolerate hectic moves and vagaries. Investment plans in this area are long-term. Therefore, any abrupt and rash actions may lead, and, judging by the current market situation, ... to serious imbalances like those we are seeing in the European market ... by several unfavorable factors all at once.
“The practices of our European partners [are to blame]. These practices have reaffirmed that, properly speaking, they have made mistakes. We were talking with the former European Commission; all of its activities were aimed at curtailing the so-called long-term contracts and at transitioning to gas exchange trading.
“It turned out—and today this is absolutely obvious—that this policy is erroneous, erroneous for the reason that it fails to take into account the gas market specifics dependent on a large number of uncertainty factors. Consumers, including, for example, fertilizer producers, are losing all price benchmarks. All of this is leading to failures and, as I said, imbalances.”
Near the conclusion of Putin’s energy conference, Boris Kovalchuk, CEO of RAO Group, an electricity export-import firm, added some dark humor: “Mr. President ... In Germany, government agencies produce video clips telling people how to spend winter without lighting or heating, how to put candles into flower pots to warm up a room, and how to make windows draft-proof with duct tape and cling film. Just a few years ago now, this would have been impossible to imagine, as if the Stone Age was back.”