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Glass-Steagall Will Revive The Economy of Living People

by Lyndon H. LaRouche, Jr.
June 29, 2013

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EIRNS/Stuart Lewis
Lyndon H. LaRouche, Jr.

Well, let me say that, what I’m going to deal with here, is an important question and a rarely understood question. It deals with the question of economy, the principles of economy in which I am somewhat of an expert, and goes into the question of Glass-Steagall.

There’s a difference between the economic roles of animals and people, and the rates of creativity among men or beasts. The recent decline of the trans-Atlantic economies, including that of the U.S.A., has threatened the doom of civilization, now. The Queen of England, the Queen Empress of much of the world, for example, is actually, in a sense, what we have to oppose in dealing with this.

The national economy, the economy of living people, which I’m addressing now, takes into consideration the actual physical effects on the economy and on the population. The method that is generally used for economy is based on sense-perception. It’s based on simple sense-perceptions of observation, and that does not work. Because the fact is that the ordinary economic measures of comparing the amount of money you spend, to the amount of result you get, is misleading.

We have, in the course of recent years, or recent decades—actually, it goes back to the 1960s—that we have lost our productivity per capita; the United States is no longer as productively efficient as before. Other things, which do not contribute to the actual net physical output of economy, have taken over, and the increase of this process has brought about a breakdown of the entire trans-Atlantic economic region. There are somewhat different reasons for Europe’s collapse and that of the United States. The United States is still stronger, because of our political structure, than the nations of Europe, which are on the verge of a general breakdown.

However, in the United States itself, the hyperinflation which is existing here, and the crushing of the net output of production inside the United States, have brought us, first of all, to a straight physical tendency for a breakdown; but it also is worse, because we have a hyperinflationary factor in terms of the Wall Street crowd and the corresponding British elements. These elements have brought us to the point of a general breakdown.

For example, the amount of debt which is represented by Wall Street and by similar organizations in Europe, vastly outweighs any true value of what is produced in the United States or Europe. We’re on the point of a general collapse, because the debts represented by the Wall Street crowd and similar kinds of things, are so vast, relative to a collapsing rate of net physical output in our U.S. economy, that we are on the verge of a total breakdown. And only if we address that particular problem, can we expect to deal successfully with what threatens our nation, in particular, right now.

We are crucial. If we proceed as I would propose, the economy of the United States, the physical economy, will have a certain effect which is very significant. First of all, what’s happened is, that what we spend, because of the collapsing rate of productivity in our economy, which is part of the green policy, has caused the greatest rate of collapse of net productivity the United States has ever experienced. So, you can blame the green policy, which was pushed, of course, by George Bush and other people of that type, and now, Obama; that these people and their policies are bringing us to a point of absolute breakdown.

If we were to agree to actually pay the demands of the international, that is, the trans-Atlantic in particular, region, then we would be wiped out quickly. And, in matter of fact, those debts, as of now, will never be repaid. Which means, as we’ve seen recently, that we had a formula called the “bail-in.” What this means is that the debts, the undeserved debts, of the speculators are gobbling up all that’s left of the possibility of real incomes inside the United States, as in Europe. So therefore, what we’re heading toward is a point at which the bail-in process, is accelerating to the point that there is nothing much left for the population of the United States. In fact, now, the discussion is, to eliminate all people who are living, who are presently in their 60s! That’s the current policy.

In other words, the point is coming where they will never pay these debts; they never could pay these debts! The speculative banking systems of Europe and the United States, could never pay these debts, and therefore, never will. And if you are one of the people who is being cheated, your case would seem to be hopeless, unless we bankrupt them instead.

Glass-Steagall: Bankrupt the Speculators!

Now, that could be done very simply: Just take Glass-Steagall, as it was originally installed under President Franklin Roosevelt, and that itself would simply call into question every amount of this speculative investment, by the speculators of Europe and the United States. And if we held our ground, they would go bankrupt.

Well, that’s not a catastrophe, because they didn’t have any wealth to speak of, really. They were just looting us, looting our people, looting the world. So therefore, the Glass-Steagall policy, if instituted now—as we’re on the verge of reaching the goal of reinstating Glass-Steagall—would shut down all those things which are worthless values, both in Europe and elsewhere, as in the United States. So this reorganization, of putting the speculative parts of the system into bankruptcy reorganization, at the same time we put in Glass-Steagall, would mean that we can immediately launch the process of a recovery of the U.S. economy. And other nations, in parts of the world, could do the same thing, or do something similar, for example, as in Europe or elsewhere.

But it means bankrupting the speculators! These guys have incurred debts in the quadrillions, that they can never pay. Therefore, they should be foreclosed, as swindlers and bankrupts, and relieved of their debts, by eliminating their possession of those debts as assets. That would enable us to restart a recovery of the economy in the U.S. itself, but would also provide the stimulus and incentive for Europe to do something similar. And other nations to cooperate similarly.

We’re presently on the verge of several things: First of all, we’re headed in the direction of thermonuclear war, global thermonuclear war. Now, we have powerful forces, such as Gen. Martin Dempsey [chairman of the Joint Chiefs of Staff] in the United States, whose particular assignment is to prevent that from occurring. And that’s very valuable. But the danger still exists.

So therefore, what we have to do, is make sure that the debts—European and other debts, the speculative, gambling money—do not become a means of threatening wars over financial and related issues. We simply have to insist, we’re going to bankrupt, close the books on all the undeserved claimed assets of the speculators in the trans-Atlantic and other regions. That will enable us to launch a recovery.

However, the recovery is not so easy. Because if you look at our agriculture sector, the Western plains, out toward California: Look what California used to be! It was a prize in World War II and on. And then it was crushed and looted. We have farmers committing suicide, because they’ve lost their careers, they’ve lost the meaning of their lives as farmers. Bankruptcy throughout this region; sudden collapse of households; more bankruptcy. We’ve lost the cattle we used to have in California. We’ve lost the ability to grow crops in the middle of the United States, because we’ve allowed things to run the water supplies down so low! We’ve killed our cattle!

We don’t have the means to sustain the economy. We have a bunch of clowns, who are taking the foodstuffs, the food produced, and turning it into gasoline, or similar kinds of things! And that amount of looting of the food supplies which were produced, and turned into kerosene or something like that, is actually creating a threat of mass starvation inside the United States itself.

So what this means, essentially, is, first of all, we have been greatly injured, actually since the assassination of John F. Kennedy. We have been actually on a measureable, physical decline, in the productive powers of labor per capita in the United States, since we got involved in the Vietnam War. That Vietnam War was a turning point from what had happened under President Kennedy, and now has turned us into losers. It’s been a long process. We’ve had some Presidents who meant well, but didn’t succeed too well, and we’ve had other Presidents in more recent years, who have actually been part of the process of destroying the U.S. economy, and bankrupting and looting the American people! And those kinds of Presidents, of course, should not be kept in office in the United States at these times.

But we have a situation where we have a hopelessly wrecked situation, in the western and central area of the United States, and in California, which used to be the richest part of the United States. And this has been done, by a matter of policy which has been launched under several Presidents of the United States. In other words, our own people, our own citizens, have collapsed and have caved in to these kinds of policies. Now, the time has come, we’re past the point that we could really be prosperous ever again, in terms of current trends, and therefore, we now have to think about not only stopping this stuff, foreclosing these kinds of speculative operations which are ruining us, but also, beginning to build up again, build our economy up again.

It’s going to be difficult. And it’s going to require a cessation of the emphasis on the so-called green policy. If we continue the green policy, which is why people are turning foodstuffs into gasoline—that thing must be stopped. That must be cancelled. No more conversion of precious and short food supplies into fuels. It’s a very “fuelish” thing to do!

So that’s where we stand.

We Have To Fight Our Way Back

Now, if we wish to recover, we can. The means exist. I know the means. But it’s going to be tough. We don’t have the ability to grow food, in areas such as California, which is one of the richest food suppliers in the United States, or in the Central Plains regions, or down in Texas. The loss of cattle in particular, is grievous. And there’s no hope right now for any significant sudden recovery. We’re going to have to fight our way back.

We’re going to have to go to more thermonuclear technologies, in order to accelerate our ability to increase the usable power needed for, say, a NAWAPA project, to rebuild the economy that we lost, since the deaths of the Kennedy brothers, back in the 1960s.

It’s been a march, step by step, down, down, down, down, down! And the time has come, where you had Presidents who were not such bad people, but they didn’t perform too well, or they weren’t able to perform too well over other people who were controlling them, and we’ve had Presidents who were skunks, particularly recently. I can think of prominent cases of real skunks. And we don’t need those.

So we have to have a fight, and to win the fight, we’ve got to go with the Glass-Steagall policy; we’ve got to take and try to get it on an international basis, not just a U.S. basis, and use that as a basis for organizing a recovery of the economies, which means the standard of living, food supplies, and so forth of the relevant people. And if we do this, we will free ourselves of the current, very deadly and growing threat of a thermonuclear war.

A thermonuclear war, which, if started in the eastern part of the Mediterranean region and neighboring places, and spreading to other places, if it occurred, would mean the virtual extinction of the human species.

Now, General Dempsey, our General Dempsey, and other people of similar persuasions, have been working hard to fight against that possibility! But the possibility is nonetheless still growing, and it’s growing because our President of the United States currently is for it! The British monarchy is for it, though many Britons themselves, otherwise, are not. And there are similar things spread throughout Europe.

So we’re at the edge, where unless we have a general reform, which takes down the political power of certain forces in the United States and elsewhere, who are responsible for the various kinds of susceptibilities and other problems we have; unless we take that down, we could lose it. We could lose it all!

And anyway, the fact is, the policies that have been creeping in, more and more, in the United States, since the beginning of the 1970s—those policies are the things that, gradually, step by step, have ruined us so far. And I think nobody who’s serious, would deny that we’ve been ruined, especially people who remember what it was like in the 1960s or even earlier. We have been ruined.

We can get it back. We’re not going to get any bonanzas suddenly; we’re going to have to work hard to deal with this problem. But if we do, we can exert the kind of leadership which the United States has represented in its entire life since our establishment of our Constitution. That standard can be revived, and that courage and confidence can be revived.

And if we do that, we’ll immediately save our nation from the great dangers which threaten us now, but it will also open the opportunity and the stimulus, for gathering in other nations to cooperate with us, nation, by nation, by nation—sovereign nation, by sovereign nation, by sovereign nation. No empires, none of these double things. If we do that, we can have won back our republic. And more than that, we can have turned the direction of the movement of human development away from the downslide, the catastrophe which strikes us now, and begin to move things, with cooperation among nation-states, all the way up!

It’s the only option we really do have! There are no schemes or other options waiting out there, to deliver a miracle to our shores. We have to do it.

The Only Option

Now, in terms of how this could happen: If we wish to, we can restart our economy immediately with Glass-Steagall. In fact, the idea of using Glass-Steagall or similar kinds of measures among other nations, would work, but it’s going to be a little bit difficult. So therefore, we’re in a situation, where if we can get that kind of cooperation by our initiative, we will find ourselves able to assist nations in Europe and elsewhere to do something approximate, at least, to what we will be doing by reestablishing Glass-Steagall as our national standard.

If we bring people together on the basis of our national standard of that quality, they may not all accept Glass-Steagall as such, but they will accept something which goes in the same direction. On that basis, we have a basis for productive cooperation, and with productive cooperation, the hope of the world is great, because a relief from the kinds of ugly, crushing oppression, which hits the United States now, and hits nations in Europe, continental Europe in particular, worse in the main than it’s hitting us—we bring those forces to join together in cooperation, to eliminate this speculation, eliminate this fake money, eliminate these fake promises, and get back to a hard dollar, get back to the policies that go with a hard dollar, in the tradition of our nation.

That can work, but it’s the only option we really have. And beyond that, anything better means that we stir up the imagination, the creative imagination among at least some of our people. And that revival of that kind of imagination, of creative imagination, is the one thing which can promise us the kind of future we can now see, that a simple action by us, could do for the United States.

Glass-Steagall will save the United States, provided, that the condition of other nations does not drag us down. If we do Glass-Steagall in the immediate days and weeks ahead, that will assure that this nation is going to continue to live, and survive. And if we do that, nations in Europe which are tied into other agreements and other arrangements, will abandon those relationships and join us! And they, too, will tend to join with the idea of a Glass-Steagall system, rather than the kind of swindle which is operating now.

That’s our best option. We can do that. And well, anyway, that’s what I have to say.