The Nizkor Project: Remembering the Holocaust (Shoah)

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From oneb!!destroyer!caen!uunet!ccs!covici Fri Jan  1 20:33:55 PST 1993
Article: 14317 of alt.activism
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From: (John Covici)
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Subject: EIR Talks to Lyndon LaRouche: 12/28/92
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Date: 2 Jan 93 0:30:21 GMT
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The following interview with Lyndon LaRouche was taken from Executive 
Intelligence Review V20, #2 and was originally broadcast on the radio 
show EIR Talks With Lyndon LaRouche which is available by satellite.

Interview: Lyndon LaRouche

Return to the fundamentals of production-based economics

{The following interview was conducted with U.S.  economist 
and statesman Lyndon LaRouche from his prison cell in Rochester, 
Minnesota on Dec. 28, 1992. The interview was conducted by Mel 
Klenetsky for }EIR'{s radio show ``Talks With Lyndon LaRouche.''}

EIR: We're coming up to the one-year anniversary of the formation 
of Commonwealth of Independent States, and of the Yegor Gaidar 
and Jeffrey Sachs ``shock therapy'' program, which has given 
the former Soviet Union 2,000% inflation. Can any country survive 
that kind of policy?

LaRouche: No, absolutely not. It's a rather complicated but 
important point, important not only for eastern Europe, but 
also for the United States, that no nation, including our own, 
can survive the kinds of so-called free market deregulation 
policies which are currently advocated by the U.S. government, 
by people at the Harvard University economics department, and 
so forth.  It just cannot be done. It is a radical form of monetarist 
policy, absolutely wild, which is guaranteed to destroy any 
economy which is foolish enough to accept such policies.

In the case of the so-called shock therapy, this little fellow 
Sachs, educated in the modern fads in economics, that is, in 
totally incompetent economics, has proposed to use the shock 
therapy {to destroy} the structures of economy which were associated 
with the former communist economies, in order to clear the way 
for the gradual mushrooming, beginning with little peddlers, 
of a new so-called free market economy. And what he gets, is 
a combination, on the one side, of a total destruction of the 
economy, piece by piece; zooming inflation as a result of a 
collapse of the economy--for no other reason--and then a host 
of speculators playing upon the shortages thus created to make 

The image of the Mercedes Benz 600 vehicles in Moscow amid the 
relative hunger, is an example of that, or the virtual total 
collapse of the economy of Poland relative to what it was before 
Sachs got in there. And the same thing is true in the United 
States. Britain is destroyed as an economy, and the United States 
is destroying itself as an economy, all as a result of the same 
kind of philosophy of economics.

EIR: What is shock therapy, and what is a free market system 
and free market policies?

LaRouche: The free market system is insanity. We fought our 
[American] Revolution for independence against the policies 
of what were then called Adam Smith's doctrine of wealth of 
nations, which was a milder, less radical version of free market 
than is being pushed by Sachs and others today.

These fellows look only at buying cheaply, from the cheapest 
source, and destroying every part of the world economy which 
does not meet that price of cheapness. This, in its milder form, 
the Adam Smith form of the British East India Co., destroyed 
many economies. Every time we tried this model in the United 
States, as we did under Presidents Jefferson, Madison, Jackson, 
Polk, Buchanan, or Pierce, we destroyed our economy and went 
into a deep depression. The United States never had a depression 
which was not caused by our submission to some version of this 
so-called free market economy. And the only way we ever got 
out of a depression, was by rejecting that free market economy, 
as it's called now.

EIR: What are the principles of shock therapy?  LaRouche: There's 
no principle at all. You simply

allow no protection for your economy. You drop prices below 
replacement costs; you pile up debt--it looks like a leveraged 

What happened in Poland, for example, as shock therapy, is not 
much different than what happened to Northwest Airlines, which 
is not yet bankrupt, and to a lot of other airlines, which did 
go bankrupt. Somebody moved in with a leveraged buyout; they 
took over the economy, or the company in this case. They piled 
on a lot of debt to cost of acquisition which was piled on the 
company. They sold off and otherwise looted parts of the company, 
cut wages, and so forth and so on--all in the name of paying 
off this debt, which had been created in the process of the 

In the United States, there are a bunch of sharks that do this. 
They'll take somebody, set him up, invest in him, build up his 
company; he'll buy a lot of assets. And then at one point they 
pull the string and artificially drive him into bankruptcy, 
and then, one of the creditors ends up buying out the other 
creditors, taking over the whole company at 20-30@ct on the 
dollar. That's what shock therapy is in practice, as applied 
in Poland.

EIR: Free market and free trade policies are what everyone learns 
when they go to school; they're told that protectionism is bad. 
And yet, what you're telling us is that protectionism is the 
system that built this country.

LaRouche: Yes, precisely. There is the case of Prof. Robert 
Reich, who's been designated by President-elect Clinton to become 
the secretary of labor.  Now prior to that announcement, there 
was much mooting of the possibility that Reich, who presumably 
had been one of the leading advisers to the governor on economic 
policies for his presidential campaign, might become the so-called 
economics czar. There was a great protest from various people, 
saying, well, Professor Reich does admittedly write a great 
deal on economic policy and teach on it, but remember, he's 
not accredited as a tenured professor where he's teaching, because 
he has not qualified himself in the requisite academic courses 
in economics. Now, I laughed about that, and I said, that's 
the very reason he might be qualified.

Anybody who has been educated in the college level, for example, 
in what is called microeconomics and macroeconomics, is unqualified 
to be hired for an administrative position in any branch of 
government or any company firm today.

What is taught as economics in universities today is wretchedly 
incompetent. And the person who has successfully passed the 
courses in those subjects, {is a failure.} If you turn them 
loose in a corporation, they'll ruin it. If you turn them loose 
in a national economy, they'll ruin it.

Economy has nothing to do with this free market nonsense. Economy 
is the relationship of the individual and the society to nature. 
It's a matter of how we, as human beings, manage to produce 
enough and increase our productivity to the point that we as 
a nation, as a people, are able to survive. And we look at the 
nation, and we look also at the individual in that connection. 
We also look at the family, because the family after all is 
the unit which reproduces the individual; and therefore the 
development of the individual within the family, up to the point 
of maturity at least, is the crucial point of the development 
of economy.

Now, you don't develop an economy just simply by producing enough. 
In order to produce, you must have what we call infrastructure. 
You must have water management, land improvements, transportation, 
energy supplies, and so forth, which are all infrastructure. 
You must also have in a modern economy an educational system 
which teaches something which is not the so-called current fad 
in economics. You must also have a health delivery system; otherwise 
your population may be dying of lack of sanitation or lack of 

So, these ingredients called infrastructure, which include the 
local city library for example, are {absolutely indispensable} 
to the functioning of productivity of society. They are the 
first cost of investment in maintaining a modern society. And 
today, we have a collapse in the United States of infrastructure. 
We have a water crisis, which is going to kill us--we're beginning 
to look like Africa, not as bad, but we're headed in that direction. 
We have an energy crisis. We're going to brownouts and blackouts 
with no energy supplies to replace it. We have no transportation 
system; the rail system is collapsed, and rail is still the 
cheapest and best way of long-distance freight movement, apart 
from the bulk freight which we move by water.

We don't have a health care system, our health-care capacity 
is 20% below the needs of the population. We have no educational 
system to speak of.

For example, even Stanford University, which is a highly respected 
university formerly, is one of those which has gone into the 
policy of not teaching students the writings of what are called 
``dead white European males.'' Now it happens that the {bulk} 
of all human knowledge to date involves dead white European 
males of the past 2,500 years, beginning with people like Solon, 
Homer, Plato, Pythagoras, and so forth. All of our knowledge 
is based on the development of the ideas developed by these 
people. And a university which is not teaching the work of dead 
white European males, has no physical science, no music department, 
virtually no literary department--nothing! On the high school 
level, we have again the political correctness program spilling 
down. The ``World of Difference'' program, for example, put 
in by the Anti-Defamation League, is destroying much education 
in parts of the country. But one thing I agree with the {Wall 
Street Journal} on, is that ``political correctness'' on the 
university level is destroying it.

So we have no infrastructure. We don't have a labor force which 
is as qualified to produce as it was 20 years ago, and all as 
a result of these kinds of crazy ideas associated with the current 
fads in economics.

EIR: If you go to an economics class today on the university, 
the main philosophy is the law of supply and demand. Why does 
the law of supply and demand not solve these problems? Why does 
it fail?

LaRouche: It always did. Supply and demand is a piece of idiocy. 
It was dreamed up during the 18th century in particular. It 
was revised in the 19th century.

It's nonsense. If you don't produce the supply, you can demand 
all you want, you're not going to get it. If you don't have 
infrastructure, you won't get it. This is a long and more complicated 
problem, which goes to the axiomatic roots of the incompetence 
of what is taught as economics. Its advocates argue that you 
start with a fund of money. Where this fund comes from, is a 
big mystery.  Then, they argue that there are consumers, who 
buy, and that producers are merely people who go out and work 
as cheaply as possible to satisfy the demands of the consumers. 
And when the consumers don't have anything, the consumers are 
willing to pay a higher price; and when they do have something 
in abundance, they will pay only a lower price. That's essentially 
the whole theory.

The fact of the matter is, that society is based not on consumption--obviously, 
we have to consume. But society is not driven by consumption. 
Society, economies, are driven by production. They're driven 
by the productivity of labor. They are determined by how much 
of the physical needs of mankind can we get from an average 
square mile of land area, by aid of human production. Supply 
and demand has nothing to do with that.

For example, the belief in supply and demand, and the use of 
that as an argument in policy-shaping, is the reason why the 
British economy is the useless rust bucket today, and why the 
United States is headed in the same direction.

We're not being cheated by Japan. We're not being cheated by 
Europe. They're not unfair with us, we're unfair with ourselves. 
We shut down our infrastructure investment, which Japan did 
not do, which Europe has not done to the degree we have. We 
shut down our investment in technology, which they did not do 
to that degree. We did all these crazy things, and we ruined 
our economy.  Everything that transformed us from the world's 
envy in economy at the beginning of the 1960s, to virtually 
becoming a Third World nation today, is the result of our own 
doing, our own stupidity, and what is taught as economics is 
largely responsible for shaping the policies which have turned 
us from a proud, prosperous nation into a junkheap today.

EIR: If the law of supply and demand and free trade policies 
do not lead to infrastructure development, how do you get it 

LaRouche: It has to be done by the state. First of all, you 
have to start with this question of money.  According to our 
federal Constitution, the creation of money and the circulation 
and regulation thereof, is a monopolistic responsibility of 
the federal government.  Under Alexander Hamilton, and under 
all sensible presidencies, the way we've gotten money is not 
to have a Federal Reserve System or any central banking system, 
not to allow it. That's how we're looted.

The way we're supposed to get money, is, as the Constitution 
says, the President goes to the Congress and asks the Congress 
for a bill, which authorizes the Executive branch to print and 
circulate money or to create specie. Acting upon the authorization 
of that congressional bill, the President instructs the secretary 
of the Treasury to proceed. And the proper procedure is that 
the secretary of the Treasury {issues the money,} paper money, 
specie, and so forth, or authorizes someone else to do it on 
the Treasury's behalf, like a printing company or a mint, for 

This money is then properly placed in a national bank. It's 
not spent usually for government expenditures directly. It's 
not paid out by the government. But it's put in a bank. When 
it gets to the bank, it is loaned.  U.S. government money is 
loaned at a low interest rate to governmental agencies such 
as state governments, state projects, or federal corporations, 
that is, corporations which are authorized by the federal government, 
like water project companies or the Tennessee Valley Authority, 
for example. These companies use that money to create wealth 
in the form of infrastructure. The money is also to be loaned, 
mixed with private savings and loans, to private companies for 
worthwhile categories of private investments to build up the 
economy generally. And that's normally the way a healthy economy 
will grow. If it's investing in technological progress, capital-intensive, 
energy-intensive technological progress, such investment of 
federally created money will cause full employment (relatively), 
and prosperity and continued economic growth. And it will not 
cause any federal debt, except the imputed debt of balance sheet 
liability of the federal government to back up its own currency. 
And if the currency is properly invested, there won't be any 
problem on that account.

Our problems today are essentially centered on the operations 
of the Federal Reserve System. That is the key to our economic 

EIR: What is the basic difference between the Federal Reserve 
and the kind of national bank that you're talking about setting 
up? Who controls it?

LaRouche: The Federal Reserve is a private corporation, licensed, 
franchised by the federal government. A group of private bankers, 
domestic as well as foreign (but through domestic banking channels), 
sets up a bank called the Federal Reserve bank. They run it.

Now, they create money. For example, today, the Federal Reserve 
System will issue money at less than 3% to New York bankers 
and similar people. They print it by discount mechanisms. These 
banks in turn will loan that money to the federal government 
by buying federal debt at 5.5%, or something like that, or on 
long bonds they'll go as much as a 5% spread.

So what we have is the spectacle of money which is created out 
of thin air, loaned at 3% or less to banks and others who in 
turn loan that fiat money to the federal government at up to 
a 5% spread. So the debt is being created, the federal debt 
is being built up to bail out the private banks. And the federal 
government, in order to conduct its own operations, in order 
to pay the debt service that it already owes to the banks and 
similar people, borrows money, federal debt, which it pays for 
by this means. And so the federal debt is built up precisely 
because of this Federal Reserve System.

EIR: Assume that we get our infrastructure going again, we create 
a national bank. How does the United States compete with countries 
like Japan and Germany, who are so far ahead at this point in 
terms of infrastructure?

LaRouche: We really don't have to worry about competing, except 
in the sense of realizing that the level of technology in these 
countries represents a standard with which we must have parity. 
We don't have to have exactly the same industries, or the same 
complex of industries they have; but we have to meet that technological 
standard. That means a change in our policies presently; our 
tax policy, our credit policy--all have to change.

For example, let's start with the farmers--agriculture. Most 
people don't know it and most wouldn't even believe it, but 
the United States is a net food importing country. True, we 
export grains, but we are wiping out the American farmer. Why?

The American farmer is being paid far less than it costs the 
farmer to produce. For example, about 90-95% of parity is the 
price the average farmer must have in order to maintain farming, 
that is, to meet the costs of production. We have been for years 
forcing the price paid to the farmer down below 60%, to as low 
as 30%. Obviously, farmers go bankrupt as a result of trying 
to meet those prices.

The agriculture department of the U.S. government for years 
has been run by the grain cartels, chiefly the Cargill firm. 
For example, under President Reagan, we had a fellow called 
Daniel Amstutz in there, who was originally the foreign trading 
executive for Cargill, the largest grain-trading operation, 
running the agriculture department's foreign trade. We have 
people who were former Cargill officials, former Cargill attorneys, 
Cargill assets, running the agriculture department. These guys 
have been looting the farmer. People like Dwayne Andreas have 
been looting the farmer.

So, farmers are going out of business. They didn't go out of 
business all at once; they got into government debt. Then the 
government turned the screws, often illegally, violating the 
law, to put the farmers out of business, even put them in jail, 
for doing nothing other than trying to keep the farm going and 
supplying food to the United States and the world {at below 
the cost of production.}

So obviously, we have to build up the agricultural sector again, 
to the point that we can produce enough food so we're not dependent 
upon foreign countries for our food supply, which is what we've 
done by sinking the American farmer. We have to do the same 
thing in the manufacturing sector. We have to create more jobs 
in manufacturing and transportation and so forth. We have to 
have a larger percentile of the total labor force involved in 
producing wealth and a much smaller percentile of the labor 
force involved in low-grade service industries, or in financial 
services and outright parasitism. We have to have more people 
in production, more people employed in science, and fewer in, 
shall we say, low-grade social services. We have to have a policy 
of capital intensity, that is, a lot of investment in production, 
in machinery, in equipment, and a relatively shrinking percentile 
of investments in the simple direct cost of production. And 
we have to have an emphasis on scientific and technological 
progress. We have to supply the infrastructure, including the 
transportation systems, the energy systems and the water systems 
which are necessary to allow industry and agriculture to function. 
Those should be our objectives.

EIR: Why do farmers need parity to survive?  LaRouche: A high-quality 
farmer will run a family

farm of maybe 400 acres of land. He's a small businessman--actually, 
farmers are among the best small businessmen in the United States. 
They were better at managing the farm than probably 80% of the 
businessmen, including some large corporations, were at managing 
their companies, in terms of efficiency, everything considered.  
They worked harder, they had a higher degree of competence for 
their work, and their product was relatively superior.

Now, parity reflects the average paid-out cost of production 
for these farmers, plus a small margin of return on investment, 
to cover borrowing costs and profits. That's all it is.

So when you say ``parity,'' you're not saying some magic term 
or some made-up term. Parity is simply the average cost of production 
plus a small percentage for borrowing costs and profit. That's 
all it represents. Some farmers are much more productive; therefore, 
that means a fairly substantial profit to them. Other farmers 
are less productive, but we need all of these farmers to produce 
an adequate food supply, and that's the way we calculate parity. 
So when you force prices of commodities {below} parity, you 
are bankrupting farmers.

EIR: Who's forcing them to produce below parity?  LaRouche: 
The U.S. government is backing up the

grain cartel. The grain cartel comes in, cuts a contract, and 
says we'll buy at this price. And they use their monopolistic 
power against the relatively small businessman, the farmer, 
taking him on one at a time, and they crush him. And if the 
U.S. government does not intervene against these monopolies, 
these oligopolies--they're actually violating the anti-trust 
laws, in principle--to prevent them from abusing the farmer, 
then the farmer will be crushed, because the farmer is a small 
businessman up against a giant like Cargill. How is a small 
farmer, grossing a couple of hundred thousand dollars year, 
going to compete in the so-called free market against a $40-billion-a-year 
giant, which, with its friends, the Union-Pacific crowd in Omaha, 
controls the Chicago market, controls the grain trade deals 
in Minnesota? How is that individual farmer going to compete 
in the marketplace, which is rigged by these powerful grain 
cartels, with the assistance of a complicit agriculture department?

The U.S. government creates double talk. They call parity a 
``subsidy'' for the farmer, and say that's coming out of the 
mouths of babies. Bunk. What we're subsidizing, by not maintaining 
a parity policy, is these cartels which are looting the farmer.

EIR: Farmers are being driven off their land. Who's buying up 
the land?

LaRouche: Sometimes they're not even buying the land; they're 
taking the land for a song. There are many people involved; 
it's a complicated question as to what's happening. But we are 
ruining the land. We're forcing the farmer down to dustbowl 
conditions, or something similar, by forcing him to produce 
from stored-up values in the land and in capital goods, until 
the point that the whole machine essentially breaks down. He's 
out of business, saying, ``I just can't do it any more.'' It's 
a cruel story, but the point is, the whole thing is based on 
the lie that parity is a violation of free market; and if Americans 
want to sustain that lie, they're going to find themselves going 
very hungry--because of a shortage of supplies and because we 
can't afford to import them. And the dumb American, who thinks 
that cheap food prices based on a bankrupt farmer is somehow 
good for the consumer budget, who thinks that he or she gets 
his or her food from the supermarket and doesn't have to be 
concerned with the farmer, is going to be punished by his or 
her own stupidity.

We are now in a grievous worldwide food shortage, an acute one. 
People are dying of famine all over the place, for many reasons. 
But essentially the reason that we're having this food shortage, 
is because of the very policies of the U.S. government, which 
many foolish consumers in the United States think are good for 
the consumer budget.

EIR: If the United States is going to restore itself as an economic 
power, it will have to deal with the educational level in this 
country, which, according to statistics, has fallen behind the 
level in other industrialized countries such as Germany and 
Japan. How does it do that?

LaRouche: First of all, look at how we went down.  Forget the 
statistics. They're bunk. Yes, we are falling way behind these 
other countries, no question about it.  That's obvious. But 
we're falling behind ourselves. If we look at the content of 
education in the 1950s and 1960s, the first half of the 1960s 
in particular, when the National Science Foundation grants to 
education were still in progress, for example, the average graduate 
of a university today, including many with doctoral degrees 
in social sciences, {could not pass} a competent high school 
standard of education from that period.

Similar things are occurring in Europe. For example, between 
1968 and 1972, German education was collapsed by the so-called 
Brandt reforms of the late Willy Brandt, who was then chancellor. 
The German who is coming out of a high school in Germany today 
is virtually a barbarian compared with his older brother or 
parent who came out of an equivalent high school in 1966-68. 
So, comparing the United States with other countries masks the 
problem. The problem is worldwide. Generally, the level of education, 
the competence of people graduating from high schools and universities, 
is such that often the university graduate of today would not 
be qualified for a high school diploma in a respectable high 
school, say, of 25 years ago. And that's where the problem lies.

The key to this, which is why I find myself in this uncomfortable 
alliance with the {Wall Street Journal} against political correctness, 
is that if we allow these thugs, the so-called deconstructionists 
(the name they use for themselves), these modern Nietzscheans, 
to use the Modern Language Association and other vehicles in 
colleges and high schools to introduce this political correctness 
program where truthfulness is no longer a standard of teaching, 
but rather sensitivity as they define it, is that we're going 
to find that we have a bunch of barbarians.

I refer people to Jonathan Swift's {Gulliver's Travels,} which 
many people think is simply a children's book; it is not. It's 
a very powerful satire on the condition of England at that time. 
And I refer them to the famous story about the Houyhnhnms--Houyhnhnms 
being horses. Poor Gulliver lands in the land of the Houyhnhnms, 
and he finds that horses, i.e., a parody of the British aristocracy, 
are running the place, and that human beings exist only in the 
form of baboon-like immoral, disgusting, ignorant, speechless 
specimens called Yahoos. And that's what's happening.

Our high schools and universities, and our general cultural 
system over the past 25 years, has been turning the American 
from a proud human being into an illiterate, drugged, ignorant, 
babbling, disgusting Yahoo. And if we want to have a civilization, 
let alone compete, we better start attending to remedying this 
sickness. Do you want your children and grandchildren to be 
a species of Yahoos who are unfit, unqualified, to survive? 
Or do you want grandchildren left behind you who amount to something? 
I think if we focused on that moral question, we would find 
that the economic questions would fall into place for us.

EIR: If we look at the cabinet which is being chosen by Bill 
Clinton, it seems to be a paradigm of political correctness. 
We have a certain number of women, a certain number of minority 
groups. Is this going to present a problem for this country?

LaRouche: Absolutely. One shouldn't look at it too simplistically. 
In framing a government, at least in terms of nominations so 
far, what the Clinton team has done, is to provide an assortment 
of representation to every geographic area of the country, and 
every part generally of the spectrum of the so-called political, 
sociological rainbow. Now, what's been created by doing so, 
in economics, for example, is at least four different mutually 
conflicting points of view on economic policy, all equally represented.

Sooner or later, those conflicts are going to have to be sorted 
out, and something, either one of the four or something else, 
is going to have to take the place of most of the policies coming 
in there.

What you have is really the beginning of a rough-and-tumble; 
not a policy. In this rough-and-tumble, admittedly, we have 
some very bad things. We have this rainbow political correctness 
idea--it's going to be a disaster. None of it's going to work. 
The U.S. economy is going to become worse until it changes. 
So therefore, whatever happens, if the political correctness 
prevails, to that degree you will have a failure. The administration 
is going to have to choose policies, or tilt toward policies, 
which are against failure, which will tend to be against political 

EIR: The backdrop of the incoming Clinton administration is 
a world in turmoil--the former Soviet Union, Europe, the developing 
sector. How do we restore some direction to the world strategic 

LaRouche: I see things becoming much worse than that. The former 
Soviet Union is not going to disappear; at present, it's being 
reconsolidated. What's happened is that the Russian {nomenklatura} 
(some of the old communists, of course, are in it) is sitting 
back and saying, ``Okay, these fellows want independence from 
us.  Let them have it for a while, let them try to swim on their 
own. They'll sink, and they'll beg for us to come back in.'' 
If you look at what's happening, you will find that the communists, 
with the blessing of Lawrence Eagleburger and others, especially 
the British government, that the Serbian fascists of Slobodan 
Milosevic are committing genocidal atrocities, with concentration 
camps and genocide, which are beyond those even of World War 
II.  It's unbelievable. It's the worst extremes of the Nazis 
and beyond that. These are communists. And that's destroying 
that part of the world, threatening a Balkan war there.

The Russians are going to come back as an imperial power very 
rapidly, partly through agreements with forces in China, but 
otherwise, the United States will be disintegrating--while willing 
to play the role of world policeman, we'll collapse on the basis 
of our economic collapse here at home, which is now ongoing. 
So, we're in a terrible mess, and we have to recognize first 
of all that we're in a terrible mess.

EIR: The former President of the former Soviet Union, Mikhail 
Gorbachov, recently said that he expects to see a return to 
some of the integration that existed in the former Soviet Union. 
What is going to happen in terms of the Soviet Union, and what 
will this mean for the world strategic situation?

LaRouche: It's hard to say exactly what will happen. Gorbachov 
is correct in seeing the shift back in that direction. That 
was obvious to me from what I've seen from various sources. 
Some of the thinking among the leading Russian {nomenklatura,} 
back when Gorbachov fell, was that they said, ``Okay, we'll 
go through this period of deconstruction. We'll go through a 
period of placating Jeffery Sachs and the International Monetary 
Fund. We'll go through hell, but we're going to let our people 
see what it looks like. They think that they want the American 
system. Well, let them see what it's like these days. And when 
they get enough of the American system, they'll come back to 

That is generally the thinking in some sections of the old apparatus, 
the {nomenklatura.} And you'll see that expressed among military 
voices more clearly than anywhere else, but the military voices 
are speaking for a broader group of people. This is true in 
Central Asia. The Russian troops will sit back, let the people 
shoot each other; when they get tired of shooting each other, 
and call for the Russian troops to come in and save them, the 
Russian troops will come in and save them--maybe not promptly, 
but slowly. So that process is going on.

To develop these areas, to render them stable, requires fairly 
large-scale infrastructure projects. The problem of the Soviet 
economy, up to the point of the dissolution, was a rapid disintegration 
of infrastructure.  And this occurred for many reasons. But 
this disintegration of infrastructure will prevent any economic 
development from occurring on a large scale. So they're going 
to have to tackle this infrastructure problem. That will require, 
from their standpoint, some sort of integrated effort, and Moscow, 
naturally, would like to have this integrated effort occur under 
Moscow's dominance. And that's what Gorbachov is reflecting 
when he makes those kinds of observations. I'd say that's a 
fairly good estimate of the direction of things. And remember, 
the former Soviets have about 30,000 warheads and a strategic 
naval fleet which is very impressive, so they still are a superpower, 
whereas the United States and Britain and so forth collapsed, 
partly because of this crazy Balkan war which the Anglo-Americans 
started and have kept going. We're going to find that the Russians, 
even though they've gone back a great deal, will be relatively 
stronger, relative to the United States and Britain, than they 
were in '89. Very soon, they'll be ahead, the way things are 
going now.

EIR: In terms of the strategic situation, is there any policy 
that can be quickly pushed in motion in terms of Europe and 
the former Soviet Union, that the United States should be looking 

LaRouche: Yes. Forget the military policies as such; that's 
a longer subject. Go back to fundamentals.  Fundamentals are 
economics. We need to scrap every economic policy which was 
introduced as an innovation during the past 25-odd years, and 
go back to the kind of thinking in economic policy which was 
characteristic of the period of the John Kennedy administration. 
This is the right policy for the world as well as the United 
States.  That's the fundamental thing we have to do, and that's 
what they're blocking on in Washington these days.

         John Covici

From oneb!!destroyer!caen!uunet!dtix!!uvaarpa!murdoch!!prs9k Fri Jan  1 20:34:08 PST 1993
Article: 14318 of alt.activism
Path: oneb!!destroyer!caen!uunet!dtix!!uvaarpa!murdoch!!prs9k
From: (Phil Scarr)
Newsgroups: alt.activism
Subject: Re: EIR Talks to Lyndon LaRouche: 12/28/92
Message-ID: <1993Jan2.031811.8750@murdoch.acc.Virginia.EDU>
Date: 2 Jan 93 03:18:11 GMT
References: <>
Sender: usenet@murdoch.acc.Virginia.EDU
Organization: Neuroclinical Trials Center, University of Virginia
Lines: 24

In article <> writes:
>Interview: Lyndon LaRouche
>Return to the fundamentals of production-based economics
>{The following interview was conducted with U.S.  economist 
>and statesman Lyndon LaRouche from his prison cell in Rochester, 
>Minnesota on Dec. 28, 1992. The interview was conducted by Mel 
>Klenetsky for }EIR'{s radio show ``Talks With Lyndon LaRouche.''}

You forgot CONVICT and CRACKPOT... 1/2 :-)

PHIL SCARR        \      We are Microsoft...     /          (o) 804.243.0229
 University of    /     OS/2 is irrelevant.      \          (f) 804.243.0290
 Virginia,        \     UNIX is irrelevant.      /        prs9k@Virginia.EDU
 Neurosurgery     /     Openness is futile.      \     prs9k@Virginia.BITNET
 HP-UX is my life!\ Prepare to be assimilated... /   ...uunet!virginia!prs9k

From oneb!!destroyer!caen!!!rutgers!concert!uvaarpa!murdoch!!prs9k Sat Jan  2 10:08:41 PST 1993
Article: 14327 of alt.activism
Path: oneb!!destroyer!caen!!!rutgers!concert!uvaarpa!murdoch!!prs9k
From: (Phil Scarr)
Newsgroups: alt.activism
Subject: Re: more LaRouche fascist crap!! ok?!
Message-ID: <1993Jan2.164359.27119@murdoch.acc.Virginia.EDU>
Date: 2 Jan 93 16:43:59 GMT
References: <> 
Sender: usenet@murdoch.acc.Virginia.EDU
Organization: Neuroclinical Trials Center, University of Virginia
Lines: 42

In article (Brian F. Redman) writes:
> (autonome forum) writes:
>>What more need be said???
>>Fight fascism!!!!
>>Beware of LaRouche fascist front-groups!!!
>Could you please substantiate your claim?

Larouche's conspiratorial, dishonest and larcenous tactics have already
landed him in jail.  I don't think much needs to be done to substantiate
ANYTHING negative about LL that hasn't already been done.  The guy's a
loony crook!

Everyone here who believes the Queen of England is:

1) A Zionist Dupe
2) A tool of the Masons
3) An international drug smuggler
4) The Spawn of Satan

raise your hand. (with the exception of #4, LL has claimed the QofE is
all of those things).

>Brian Redman
>"Ah yes, Armageddon. I remember it well."

 ||                                                                        ||
 ||  As evey cell in Chile will tell / The cries of the tortured men       ||
 ||  Remember Allende in the days before / Before the army came            ||
 ||  Please remember Victor Jarra / In the Santiago Stadium / Es verdad    ||
 ||              Those Washington Bullets Again!      --The Clash          ||
 ||                                                                        ||
(--)== === Phil Scarr === Department of Neurosurgery ==(--)

From oneb!!destroyer!!usc!!asuvax!asuacad!idjmw Wed Jan  6 12:21:46 PST 1993
Article: 14427 of alt.activism
Path: oneb!!destroyer!!usc!!asuvax!asuacad!idjmw
Organization: Arizona State University
Date: Tuesday, 5 Jan 1993 15:15:25 MST
From: Jo Namio
Message-ID: <93005.151525IDJMW@ASUACAD.BITNET>
Newsgroups: alt.activism
Subject: Re: EIR Talks to Lyndon LaRouche: 12/28/92
References: <>
Lines: 8

Good old Lyndon L. Many of us active in the Freeze Campaign (you remember,
back in '84) (you must remember, BUSH hasn't forgotten, he's still
whining) are still chuckling over LaRouche's insistence that we
were all KGB dupes and were getting paychecks from Moscow. As for me,
I'm still waiting for that check!


From oneb!!utcsri!skule.ecf!torn!!uunet!ccs!covici Tue Jan 19 07:21:36 PST 1993
Article: 15279 of alt.activism
Path: oneb!!utcsri!skule.ecf!torn!!uunet!ccs!covici
From: (John Covici)
Newsgroups: alt.activism
Subject: EIR Talks with Lyndon LaRouche 01/11/93
Message-ID: <>
Date: 19 Jan 93 7:10:46 GMT
Organization: Covici Computer Systems
Lines: 760

    ``EIR Talks With Lyndon LaRouche'' 
will be broadcast on satellite from 7:00 to 8:00 Eastern this coming Saturday 
night. Radio stations and others may get the program on either of the
coordinates below. Stations may otherwise make arrangements to
obtain tapes of the program for broadcast from the EIR Press
Galaxy 2, 74 Degrees W      |     Satcom C-1, 137 Degrees W     
Trans 3 74.9 mHz NB, SCPC   |     Trans 2 7.5 mHz               
3:1 Companding, Flat        |     Wide Band Video Subcarrier    
   EIR ``Talks With Lyndon LaRouche''
   January 11, 1993 

         - Who Arranged the Assassination of Turajlic -

     MEL KLENETSKY: Welcome to {Executive Intelligence Review'}s
``Talks With Lyndon LaRouche.'' I'm Mel Klenetsky. We're on the
line with Lyndon LaRouche from Rochester, Minnesota. 

     Mr. LaRouche, recently, the assassination of Bosnian deputy
prime minister Hakija Turajlic has brought up the thoughts that
we're back in a 1914 situation, a World War I situation. It's
been likened to the assassination of Archduke Ferdinand. What is
going to be happening in Bosnia and in Yugoslavia, and what can
be done to reverse the crisis, which seems to be deepening, every
single moment? 

     LAROUCHE: Well, first of all, you have to, before trying to
forecast anything--and you cannot predict, you can only forecast,
which means you can only set up the parameters which will lead to
each of the alternative, visible possible results. 

     Now, look at the assassination itself. 

     The UN essentially, under French direction in this case, the
French UN troops' direction, actually {arranged} the
assassination. The French contingent of UN forces was responsible
for taking the vice president[sic] from one location to an
adjacent location. They placed him inside an armored personnel
carrier. On the way out, they dismissed, by orders of the UN
command, several of the armored contingents, elements, of that
assignment, that contingent. On the way out shortly, they were
intercepted by an ``irregular,'' so-called, Serbian unit. And
contrary to all rules, {they opened up} the rear of the armored
personnel carrier, which they're not to do, and stood by while
the Serbians shot the vice president. 

     They are not supposed to, in any case, identify a passenger
in such a convoy. Nor are they, under any condition, to open the
rear to allow inspection, which was the pretext under which they
{arranged} the assassination of the vice president of Bosnia. 

     That incident in itself, is the issue. The issue is not the
Serbs, they do that all the time. They're murderers, they're
rapists--what not, everything you want; that is, these particular
Serbs, the ones who are working under the communist-fascist
faction of Serbians. The point here is, the French unit, under UN
direction, arranged the assassination. That is beyond doubt, it
is beyond question. The rules were broken. The rules were not
broken once, by one accident; they were broken repeatedly and
deliberately, in advance of and during the incident. So there's
no question of that. 

     All right. {French complicity,} under UN direction, in this
atrocity and others, is key to understanding this situation.
Okay. The government of France, specifically a government which
is tied to a very specific freemasonic group, the Grand Orient
Lodge in France, which is the same group which is tied to the
Serbian Lodges: this particular group, together with the British
group around Kissinger's friends, such as Lord Carrington and now
Lord Owen, the U.S. group: not only Kissinger's group but Cyrus
Vance, the Russians, a group in the United Nations which is
reflected in the Security Council by Secretary General Butros
Butros Ghali, and others, are all complicit, {intentionally,
deliberately, before the fact} in this horror show in Bosnia. 
     This was done, to the deliberate purpose of destabilizing
Central Europe. It was done as an {anti-Germany, anti-continental
Europe operation,} initiated by British intelligence, with the
complicity of the French government, and with the complicity of
the U.S. State Department, specifically Brent Scowcroft and Larry
Eagleburger, who were the two key figures, and their co-Kissinger
colleague, Lord Carrington, were the key figures visible in
arranging, {before the fact,} this particular horror show. 

     Once that's in place, then you see the danger of a World War
III. What has happened, is that a Russian faction, typified by
former Defense Minister Yazov {of the Gorbachov regime,} not the
Yeltsin regime, but the Gorbachov regime, set this into place on
the Russian side. This has been a Russian pan-Slavic operation,
with their little Serbian brothers, playing the Serbian front
against the Balkans and against Europe. {Precisely} the kind of
thing against which I warned in a nationwide, U.S. television
broadcast back in 1988, as part of my campaign then. It has come
to pass. And it is this. And if it spreads into conflict
involving Bulgaria, Greece, and Turkey, which will happen if the
Serbs go into Kosova and Makedonia. In that case you'll have a
generalized Balkan war, and who knows what can happen. 

     But the lines are already drawn. The interesting thing is
that {the allied powers of World Wars I and II, are the
governments}--that is, Russia, France, Britain, the United
States--have created the mess, and what we're headed for, is a
Cold War-type conflict with the former Soviet Union in the

- Tavistock Institute-Trained Psychiatrists Behind Mass Rapes -

     Q: Mr. LaRouche, the situation in Serbia and Bosnia has been
called genocide, you called it genocide just a few moments ago.
Is there some kind of psychological warfare that is going on with
the rapes, the murders, the beheading of children? This is a
situation which is unprecedented in the recent period. It takes
us back to World War II and the Nazis. What are we dealing with

     LAROUCHE: We're dealing with a rather complex situation, in
terms of the details. But the details come to a very simple fact.
I say it's complex, because most people don't know some of the
background facts of this, which make the thing fairly simple to
those of us who are professionally qualified. 

     The Yugoslav government, the Tito government, has always
based its concept of warfare on guerrilla warfare. Remember that
the communist military of Yugoslavia under Tito, was forged in
guerrilla warfare. That is, despite its training in modern
warfare, it is essentially a guerrilla or irregular warfare
force. That's its greatest capability. And in the mountainous
regions of Yugoslavia, this is particularly notable.          

     Now, the Serbian forces are divided into several elements.
One is the major Serbian forces based in Serbia directly itself.
And these are Serbian remnants of the former Yugoslav army, which
were dominated by Serbian officers to begin with, Serbian
officers who are generally very close to the Soviet military, to
the Red Army. Very close relationship, even continuing during
periods of apparent conflict between the two states. 

     The Serbian reserves outside Serbia proper, within the
former Yugoslavia, had been formed into Croatian, Bosnian,
Kosovan, Makedonian, etc., special units, quasi-guerrilla type
units. Irregular warfare with artillery plus, and with Serbian
support. Now, the command for this guerrilla warfare, was
technically directed by a unit of the Serbian military or the
Yugoslav military, which is formerly based in the Croatian
capital of Zagreb. This unit in Zagreb was the psychological
warfare unit of the Yugoslav forces, the unit which specialized
in the dirtiest aspects of irregular or guerrilla
warfare. The commanders of these units, especially, notably, in
Bosnia, which are doing the worst atrocities currently; the
commanders of the units which are doing the atrocities in
Croatia, particularly in the case of Vukovar, where war crimes of
a terrible dimension were created there: These people are
{psychiatrists}--military commanders who are psychiatrists,
associated with the Zagreb center of the former Yugoslav Army's
guerrilla warfare/psychological warfare center. These people were
trained in these arts, {by British psychological warfare}--that
is, the London Tavistock Institute, which is an outgrowth of the
Rockefeller-funded London Tavistock Clinic (the Institute by the
way itself was also assisted by the Rockefellers), and is
associated also with the Frankfort School types. 

     Now this group in Yugoslavia, is not only connected to
British intelligence, through people like Fitzroy McLean, who is
still alive (he was Churchill's man, the guy who Churchill used
for the relationship with Tito during World War II which is why
the British supported the Communist partisans there, and also
very close, however, to the Bertrand Russell crowd). Bertie is
one of the dirtiest people you can imagine--was, he's dead now. 

     But these fellows are all very tightly interfaced with
British intelligence. And these guys, received their training
from the Freudians of the London Tavistock Institute. And what
they're doing, in terms of atrocities, is what Goebbels called,
during World War II, {Schrecklichkeit}--{war by terror.} 

     On the mass rape, officials of various governments, who have
been on the ground conducting surveys indicate that {not less
than 20,000 women and children} have been {raped} by Serbian
guerrillas under the direction of these psychiatrists; that many
of these women and children are retained in {rape concentration
camps,} where they are repeatedly raped. And many of the children
being raped, die, as a result of the horror of the rape. This
goes together with the ethnic cleansing, otherwise [called]
genocide; burning down the houses of anyone who is not a Serb, or
killing people who are not Serbs, beheading people, terrifying
them, driving them out. This is all part of {terror,} or is what
Goebbels called {Schrecklichkeit,} using techniques which were
developed, not only out of Zagreb by these psychiatrists, but
developed {in cooperation with} institutions such as the London
Tavistock Institute. 

     And that is the horror which faces us, this kind of warfare.
And we're doing nothing, of course, to stop it. Some people are
complaining about it, but we're doing nothing to stop it. The
worst horror show of the 20th century is now occurring there, and
in effect, United Nations forces, under a French commander, with
the backing of Vance and Owen, and others, are condoning the
continuation of the worst genocide, the worst war crimes, crimes
against humanity of the 20th century, in this location. And
that's the story. 

     Q: This is an incredible story that you're telling, in terms
of the French complicity. Is there an international investigation
into this that is now going on? 

     LAROUCHE: Well, there may be investigations, but remember,
publicly, since this is UN security, and since this horror show
is being run {with the consent} of the Russian, British, French,
U.S., and Israeli governments--as a matter of fact the Israelis
are supporting it, the Greek government is also supporting the
Serbs and so forth and so on. Under these circumstances, the New
World Order which George Bush hailed with the collapse of the
Iron Curtain back in '89 and '90, is the sponsor of this horror
show. And therefore, people who are complaining, and there are
people who are complaining, there are fairly high level people, a
minister was fired in Germany for complaining about this
horror show and the condoning of it; there are people in the
British Parliament who are complaining about it, and elsewhere.
And in France. But at the highest level, of the governments in
power right now, the lid is on, and they refuse to accept the
implications of these facts. 
  - The New Age Ideology: The Extermination of Christianity -

     Q: In the recent period, this use of psychological terror by
irregular forces has been seen, in Peru, for example, used by
the Sendero Luminoso. Is this also a Tavistock operation?

   Now you mentioned Tavistock. It would be also useful to
clarify the Tavistock psychological testing operations that were
used during World War II and how that continued. 

     LAROUCHE: We've warned about the Tavistock operation for
years. We made a major expose of that in '73 and '74. We
published a series of reports, which was captioned, collectively,
``The Tavistock Grin.'' We've mapped the people in this. These
Tavistock people, are New Age; and people have to
realize, to appreciate this, that Sigmund Freud, was a very
evil man, he was very clever in some respects in psychology and
you can't deny his cleverness or some of the things he describes
as psychological phenomena, pathological, actually occur. 

     But Sigmund Freud was a very evil and very dangerous man.
And he is one of the intellectual authors of the processes which
have been applied in the field in this case. 

     If you're looking at Sendero Luminoso, which is, in effect,
supported by a number of governments, for example, Amnesty
International supports, very actively has supported, Sendero
Luminoso and its practices. There are French intelligence
elements which go way back, in the Ayacucho operation [at the
University of Huamanga]. As a matter of fact, it was the standing
joke, and it was a very ugly joke, that you couldn't become a
leading member of Sendero Luminoso, unless you spoke French,
unless you were a French professor. The teacher of Jacques
Soustelle was very keen on setting this into motion. 

     What you're looking at here, is people who are specifically
committed--personally, philosophically--to eradicating
Christianity from this planet. And they're carrying civilization
back deliberately, to a pre-Christian standard of bestiality, to
{paganism.} One of the Tavistock experts, or consultants to
Tavistock, has commented on that specifically, that what this is
doing, by the world tolerating these mass rapes--you know, you
wink at a girl in an office these days, you can lose your job and
go to prison, I guess; but if you commit mass rape in Bosnia,
you'd probably have the blessing of the same U.S. courts that
would support the complaint against sexual harassment in a U.S.
office. That's the nature of things these days--insanity. 

     But what we're seeing, is a breakdown in the morality, not
only of the Serbs, of these communist-fascist types who are doing
this, but we're seeing a breakdown in morality of {all of the
governments} which are participating in condoning and covering up
this atrocity. 

     Q: The New Age doctrine, and its attempts to destroy
Christianity: Can you develop that a little bit for people?
People understand that we're losing our moral base, but they
don't understand that there's a deeper operation involved here. 

     LAROUCHE: This is an old story. It goes back years to the
end of the 16th century-beginning of the 17th century, the
formation of Rosicrucian cults in England and Bavaria and France
and elsewhere, which became known as the Enlightenment, that is,
the Enlightenment of Descartes, Locke, Hobbes, Newton, and so
forth. And certain elements of freemasonry, which were direct
outgrowths of the Rosicrucians, such as the British Freemasonry
in 1640 and later, were essentially these Rosicrucian cults,
which were paganist, pro-paganist, which revived ancient
religions, such as the religions of Hiram of Tyre, pagan
religions of that type. The Isis cult of Egypt, the Magna Mater
cult of the Romans, and so forth, with the idea of eliminating
Christianity and going back to paganism. 

     So, among very high-level and influential circles, there has
been, for some centuries, a lingering determination to bring
about a revival of a kind of world order, a one-world order,
which is modelled upon the pagan Roman Empire. A number of Nazis
and others, such as the friends of Houston Stewart Chamberlain,
the cousin of Neville Chamberlain in England, have argued that
the crime of the Jews, was to bring into being Christianity, and
it was Judaism and Christianity which destroyed the magnificent
Roman pagan civilization, and if we're to get something
``beautiful'' like the Roman pagan imperial civilization back, we
have to get rid of this ``virus'' of Judaism and especially

     Hitler was of those views. Hitler's specific words were,
that his operations against Jews were simply a pilot operation
for his main purpose, which was, had he won the war, {to
exterminate Christianity from this planet.} And not only on
Hitler's side, did we have that kind of thinking, but on the
British side, such as the Houston Stewart Chamberlain side, the
Bernard Shaws, the H.G. Wells, these other Satanic figures, such
as Aleister Crowley, who were sympathetic to Hitler at one point
or another; these characters in the West have been as much in
that direction as was Adolf Hitler. 

     And that's what we're up against, is the influence of that,
through the New Age, the elements of Satanism being purveyed to
our children through the rock-drug-sex counterculture, and other
things of that sort. 

          - The West's Policy Toward Eastern Europe: -
                  - ``Geopolitical Malice'' -

     Q: We have been discussing the breakup of eastern Europe.
Mr. LaRouche, eastern Europe has been subject to political chaos
and the economic policy that the West has offered eastern Europe,
has not been sufficient to deal with the social and political
chaos that's occurring there. What is wrong with that economic
policy, and how can it be changed? 

     LAROUCHE: You've got two things. First of all, there is a
certain element of geopolitical malice in policies such as the
IMF policies toward eastern Europe and the former Soviet Union,
as well as incompetence. They've applied the same policy which
they've applied to developing countries such as South American
countries, which have ruined those economies; or to Africa, which
has turned sub-Saharan Africa particularly into a region of
outright genocide through economic means--Somalia, Ethiopia, has
been living with that for a long time. Kissinger started that war
between Ethiopia and Somalia, back when he was Secretary of State
under Ford, and actually prepared it while he was under Nixon. So
that war, that genocide in Sudan, I know Kissinger's role in
causing genocide in Sudan, as well as in Somalia and Ethiopia. So
these policies are responsible for this sort of thing. 

     Now, the interesting part about the policies, is that in
core, the philosophy, the rhetoric, which is used to justify
these policies, is the rhetoric of Margaret Thatcher and is the
rhetoric of most of our leading university economics departments
in the United States today, as well as people like Senator Phil
Gramm or other people in the Congress, who have been pushing
deregulation, who have been pushing radical free trade, such as
Carla Hills, for example, who is an exponent of the same disease.

     So, what they've done is two things. First of all, they have
tried to bring the whole world into a homogenized arrangement
under deregulation/free trade--which, incidentally, includes the
intention to destroy the sovereignty of the United States itself.
That's the intention of these people. And when they start moving
jobs out of the United States, into Mexico or into the coast of
China, because they say labor is cheaper there, and propose that
a U.S. population with a much-reduced real wage level, instead of
producing its own goods, will now buy them from cheap labor in
Mexico or Communist China, you see that these fellows are very
consciously destroying not only the American farmer, which
they've done consciously, but destroying the sovereignty of the
United States itself. So they're not really misguided in the
sense of having some love for the United States. They have no
love for the United States, not really. They're out to build a
one-world mess. 

   Now what they intend to do, is to keep the domination not of
the United States, but of the wealthy foundations which control
the United States and control Britain and so forth, to make the
Anglo-American section of these superwealthy foundations, the
ruling force on this planet. And one of the things they intend to
do, of course, is to destroy everything that was the former
contending number two superpower--the Soviet Union. So therefore,
they wish to destroy as much as they can of eastern Europe and
the former Soviet Union, prior to the time that Russia, when it
gets fed up with this nonsense, decides to go back and become an
empire again. So that's part of the process. 

     But the gut of the thing, is that these economic policies,
of free trade, deregulation, all this nonsense: this is what has
destroyed the United States over the past 30 years approximately,
since the assassination of Kennedy, particularly since about '65,
'66, when this process of turning us into a post-industrial
junkheap began. And that's what they're applying in eastern
Europe and in the former Soviet Union--{with malice.} 

             - Media Lies versus Economic Reality -
     Q: Most people in the United States feel that free trade,
deregulation, will help them. It will decrease the amount of
government spending, and it will therefore lower the cost for the
middle class, and other types of arguments along these lines. 

     LAROUCHE: I don't know about most people believing that. I
don't think that's true. The media tell us they do. We've got a
lot of homeless people out there, we've got a lot of farmers who
are out of business, about 50 percent of the farmers are being
eliminated from agriculture. We've got people losing their jobs
left and right. Industries are going down. People are going from
jobs in which they can support a family, at least with some
difficulty, but could do it, into flipping hamburgers or flipping
``Hamburger Helper'' disguised as hamburger in some fast-food
joint, at near-minimum wages. 

     I don't think these people {believe} that what's happened to
them, in reducing their standard of living and throwing them into
the street as homeless or so forth; I don't believe that they
think that the economic policies of the past quarter-century have
done them much good or their families much good. 

     What you have, is you have a vocal group of people who
essentially make their living as parasites. For example, the
Yuppies who work on Wall Street, peddling futures and other kinds
of things of that sort--derivatives of derivatives, they're
sometimes called. And these parasites, who think that the world
owes them a living, and who are much touted--people who still
have enough money to buy a copy of the {New York Times} and the
{Washington Post} every day and buy the magazines, and who go to
the fancy restaurants, such as they are. These are the people
whose opinions are quoted, usually. And yes, they're deluded.
Because they think that they're somehow better than the majority
of the people who are out there struggling. And when we talk
about, when will people wake up to how bad the economy is,
generally you mean: When are these jerks going to be thrown out
of their jobs, these parasites, going to be thrown out on to the
streets, to realize that they are not prosperous? They don't care
about the United States as a whole; they only care if they've got
a job, if they think the income is flowing their way, or if they
think they're going to make a killing on their speculation
against tomorrow. 

     So we have news media and others, who are pumping up
so-called public opinion. We have foolish people who believe
differently, who nonetheless think they ought to be overheard
saying that this is good for us. But I don't think the majority
of Americans, if push comes to shove, actually believe any of
this nonsense. 

       - How to Solve the Problem of the National Debt -

     Q: For 60 months we were told, during the Reagan
administration, that we were in a period of economic growth. What
is the difference, when we have the stock markets growing and
people making money, and people working at flipping hamburgers,
and other types of economic development? 
   Why couldn't that growth just continue?

   LAROUCHE: It couldn't. People are not making money. They're
stealing it. These are speculators, Wall Street people. 
   Take the way our national debt is growing. How is the
national debt growing? It's growing because of the Federal
Reserve system, and follow the procedure. Exactly how is the
national debt created? Not this monkey business that Phil Gramm
and jerks--forgive the expression but I think it's
appropriate--around the Congress and elsewhere, say it on the
talk shows. 

     The national debt is created, when the Federal Reserve
system begins by taking paper from a bank, for example, and
discounting it, let's say, today, at less than 3 percent. It then
gives that bank a check in the model operation. The bank
deposits the check with its bank--or maybe this is done
electronically, it's the same thing. That check is processed for
clearing. It goes back to the Federal Reserve, which takes U.S.
currency printed by the Federal Reserve and issued by the Federal
Reserve, and issues that to cover the check. 

     Now in effect, this bank has borrowed the money, which is
created out of thin air, at something around 3 percent, from the
Federal Reserve system. Where did the Federal Reserve system get
its money? From no place. It created it out of thin air, and
loans it at about three percent, to these bankers or others. 

     These fellows turn around today, and they {loan} that money
to the Federal government at a one and a half percent spread,
four and a half percent, up to eight percent--a five percent
spread. And the debt grows and grows and grows. 
     Q: They loan it to the Federal government, you said, or they
loan it to the public? 

     LAROUCHE: They loan it to the Federal government. The
public, they loan it at 18 percent, through credit card debt.
They create it out of thin air, and loan it to the public at,
say, up to 18 percent. They loan it to the Federal government at
four and a half percent. {Federal debt is being paid to this
process chiefly.} The bankers are not in the banking business.
They're in the business of raping the Federal government, raping
the fiscal life of the United States government. And the problem
that Clinton is facing, is that unless he tackles this, there's
no chance of getting a recovery going. There never was a
recovery. That's all bunk! There was a four percent decline,
estimated, in retail sales, relative to a year ago, this past
December. There {was} no recovery. They're going to downsize
these things fast, but for the meantime, they talk about
recovery. They were lying--as usual. As they have since 1983.
Just plain lying. 

     But the public reads it in the newspaper, the public sees it
on these soap operas which are called the evening news
broadcasts, or CNN, which is a big soap opera. And they tend to
believe it, because who are they to contradict such almighty,
wise oracles as CNN? 
     Q: So you mean to say that the banks borrow the money from
the Fed, and then loan it back to the government, make profit
from the government, make profit from the public; how are we
supposed to get rid of the Federal debt? 

     LAROUCHE: Very simply. Go back to the Constitution. The
Federal Reserve has been unconstitutional and illegal therefore
from the beginning. But nobody's had the guts to say so, except a
few people who are called kooks and cranks are saying so--but
they happen to be right. And it's actually those who say the
Federal Reserve is necessary and good for us, who are the kooks
and the cranks. They happen to be the majority. But that's the
way things go, sometimes. 

     Q: When Clinton, Perot, and Bush were asked whether the
Federal Reserve was the problem during the Presidential debates,
they all said no, it wasn't the problem, that the Federal Reserve
has to be maintained. 

     LAROUCHE: Well honestly, I think that none of them
understand anything about it. I know Clinton doesn't--otherwise
he wouldn't have been euchred the way he was. I know that Ross
Perot doesn't understand anything about it. He's probably a smart
huckster, but he doesn't know anything about economics. And he's
showed that repeatedly, in this piece he commissioned to have
these various people write for him, and in some of the things he
said on television, that I witnessed. He has {no} understanding
of economics. You don't have to know anything about how the
economy works sometimes to be a smart businessman, if you're in
the business of fast deals. He said a few useful things, of
course, but they weren't that major. 

     And Bush, of course, was in a state. Bush doesn't really
{wish} to understand anything about economics, and never did.
Bush never made a nickel in his life that wasn't given to him by
his family or by Farish or somebody. So how do you expect {him}
to know anything about economics? 

            - Why Clinton Should Rely On My Advice -

     Q: Clinton comes into office, he's facing a debt which is
$400 billion a year or bigger. What does he do? 

     LAROUCHE: He's going to be in a tough position. Domestic
policy is going to be in tough shape this time around. Clinton
said certain things up through November. Now see what's

    On foreign policy, except for Warren Christopher, who does
know something about the foreign policy establishment, who's in
there as secretary of state, the Clinton administration has
almost no understanding of anything about the world at large.
Very parochial, very ingrown, very attuned into popular opinion
or mis-opinion, misinformation, misinformed opinion in the
United States. He doesn't know anything about the world at large
at all--despite his trip to Oxford. 

     But what the Bush administration has done (I don't think
George has done this, but George has been played, to play a key
role in this), the Bush administration has created, for the
incoming Clinton administration, the biggest thicket of complex
and highly dangerous worldwide foreign policy crises, that any
incoming government has seen, even including Roosevelt facing
World War II in this century. And there's no sign of
understanding what he has to do about it. So Clinton is going to
be so tangled in foreign policy problems, that he's not going to
have much time or energy for domestic problems. 

     On domestic problems, he's simply going to fool around with
his cutting medical care for the aged and the sick and the weak
and the poor, actually. And a few other things like that, because
he's been boxed in to the point, that he actually has no recovery
stimulus program at all left. 

     We're facing a disaster and Clinton's facing a disaster, at
least with the present trends, in continuing from his campaign in
his policy shaping. 

     Q: On domestic policy: What does Mr. Clinton have to do? 

     LAROUCHE: Well, first of all, he has to rely on, I think to
a large degree, my advice, because it's the only thing around
that could possibly save him. 

     This crew that he's got working for him--some of them may be
well intentioned or might become well intentioned; but they
simply {don't know.} 

     For example: He's got a bunch of people who are trained in
economics. They're university-trained in economics. They put
Reich over in Labor with the argument that he hadn't had an
economics education. He probably was the most intelligent of them
in that lot, on economics. He had the advantage of not being
brainwashed by economics at some university. 

     These guys have been trained. They're young people who came
up in the generation that went into college about the early '70s.
They are the post-1968 generation. They have been {brainwashed}
more than the generation before them. They have had no real
education by the standards that we set, say, in the '60s or '50s.
And, when they're faced with these crises, they have their
ideology, the things they've been taught work, they've been
reading in the {Washington Post,} the {New York Times} and
elsewhere, that what they say is a credible philosophy; but {it
doesn't work}--but they believe in it. 

     They have no preparation for turning around. Finding their
whole philosophy doesn't work, their whole policy doesn't work,
and coming up with an alternative. They'll just fumble and
fumble, worse than ever. 

     So Clinton will probably find from {within} his
administration, barring a few old hands that might have some
inkling of what you do in a situation like this, such as
Christopher, who is connected to older people. 

     He has no resources among his young people for dealing with
this crisis. And that's why I say, without exaggeration: If I'm
not loose and supplying the guidelines of what has to be done,
Clinton is going to be the worst catastrophe of the 20th
century--not necessarily because of any bad things he's done
himself, but simply because he lacks the ability--so far--to even
understand what the problems are he faces. 

    - ``Clinton's Economic Stimulus Program Is Tokenism'' -

     Q: Clinton had been talking at some point of an industrial
recovery program, of an economic stimulus program. How does that
compare with the industrial recovery program that you have put

     LAROUCHE: It has nothing to do with it. It's tokenism. 

     Look, we have a problem, in terms of full-time equivalent
unemployment, that is, combining part-time unemployment and full-
time unemployment, to turn it all into the equivalent of
full-time employment: There are {17.3 million people} in the
United States labor force who are unemployed. We have a shrinking
percentile of the employed labor force actually {producing}
anything--that is, producing infrastructure, producing in
manufacturing or in agriculture. We are an {importing nation.} We
do not produce our own food supply any more; we get it from other
countries, because we've eliminated our farmers. We no longer
meet our own manufacturing needs, because we've destroyed the
skills, we've destroyed the industries, we've destroyed the tool
industries. Then we blame Germany and Japan for cheating for not
being as stupid as we are in our economics. 

     We have no infrastructure. We have a water crisis, it's
going to get worse. We're going to have brownouts and blackouts
increasingly. Whole sections of the country will collapse for
lack of energy on the continuing policy. And so forth and so on. 

     So, in this kind of situation, you've got to have a lot of
people put back to work in hard industry, that is,
infrastructure, basically, in manufacturing and also, in
improving agriculture. 

                    - To Create Employment -
          - Clinton Must Take on the Federal Reserve -

     Q: The big question, Mr. LaRouche, is how do we create new
jobs, and the kind of jobs that would make a difference? What
would be your advice to Mr. Clinton in terms of reversing this
economic depression as quickly as possible? 

   LAROUCHE: Very simply, he has to tackle the Federal Reserve
question, and has to tackle the idiots in the public generally,
as well as in the university economic departments. 

   We have the unemployed. We either have, or can secure the
capital goods, the equipment, needed to put those unemployed to
work. All we need is the money, and I mean cash, credit, to
employ both those people at productive capacity, with that
equipment. We have to put things together. 

   Now, any cash we put into this, on the average, we pick the
right things, will bring back more wealth, than is represented by
the cash issue. So therefore, it's an investment, it is not a
subsidy, in the sense of a giveaway. It's not welfare. It's a
productive investment, the best productive investment we can

   Most of this investment, has to go, primarily--that is, as
initial investment, into infrastructure. That means water
projects, rail projects, some highway patching, some bridge
repair, some bridge replacement, things of that sort. Energy. And
so forth. 

   Now, as a result of investing in these projects, these
projects will in turn buy from U.S. corporations, such as the
aerospace automobile complex for building locomotives of the new
type, or building trains for the new rail system, that sort of
thing. So this is the natural stimulant of the economy, which
ensures that for every nickel we invest generally, on the average
at least, we're getting seven cents or something back, in terms
of new physical wealth of a type which we badly need. 

   We're also putting people to work in upgraded jobs on the
average--not only upgraded from unemployment, but upgraded from
going back to technological emphasis in skills. And when you
increase technology, these pay scales, these skills, the standard
of living generally goes up. And that's the way to do it. 

   Now to do that, you have to recognize: We have a hole of
about a trillion dollars a year in our throughput in production,
which is required to balance the tax budget, the fiscal budget,
and all these other things. So what you have to do, is to create
that money, not by the Federal Reserve system--we cannot have the
Federal Reserve issue the credit, nor can we have the money
coming out of there to finance the private credit, to get these
projects going. It won't work that way. You've got that 3
percent, 4 and a half percent to 8 percent, to 18 percent factor.
It would be hyperinflationary, if you tried to stimulate the
economy under the Federal Reserve system. 
   Q: So how do you create the credit? 

   LAROUCHE: You have to create it by the government printing
press as the Constitution specifies. The Congress passes a law at
the request of the President. The President issues the money,
places it on deposit with national banks like the Federal Reserve
institutions physically, which distribute the money as lending
power, to the government, state, and federal agencies, and their
private vendors, to get this economy going. And you have to put
in between a half-trillion and a trillion dollars of that kind of
credit {per year} to get this economy turned around. 

   Clinton's talking at best between $20 and $30 billion a
year. That's a bad joke. Until he gets up to $500 billion a year,
he's not even serious. 

   MEL KLENETSKY: Mr. LaRouche, we'll be back next week. Thank
you very much. This is {Executive Intelligence Review'}s ``Talks
With Lyndon LaRouche.'' 

         John Covici

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