Lyndon LaRouche, 
økonom og tidligere  præsidentkandidat ved Det demokratiske Partis primærvalg i USA.




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Lyndon LaRouche made the following remarks on Oct. 31, 2007.

As you should know--let me make it clear, the
present international monetary system is effectively now
finished. The date on which the collapse will actually occur, or
officially, is not yet determined--these things can not be
precisely predicted, because there are too many factors--but the
situation in the U.S. currency is absolutely hopeless. There's no
possibility of a recovery, there's no possibility of a cessation
of the present monetary crisis.

If it were to continue without remedy, then you would say,
the chain-reaction effect would probably be a general collapse of
the international monetary-financial system. However, there are
things that could be done, to stop the process. I'm the author of
one of the proposed pieces of legislation in the United States,
which will stop the process. What is required is, to actually set
up new international monetary system, a provisional one, to
replace the present world monetary system, to stop the process of
foreclosures, to fix and freeze some of the relative values of
currencies internationally, until nations can come to an
agreement to reestablish a new, emergency fixed-exchange-rate
system. It's the only possible way in which a general,
chain-reaction collapse of the entire international
financial-monetary and economic system could be prevented.

Therefore, the question before us, is, in addition to the
importance of understanding that there is {no possibility that
this present U.S. dollar system will not collapse, and will not
take the world system down with it}, the only alternative is to
introduce a new monetary agreement, which can stop the measures.
What that would involve is this: I have proposed, for example,
the legislation which is now being debated in the Congress and in
the states, and that is to establish what we call a "firewall":
Is to have a Federal law enacted, which would stop proceedings on
all foreclosures on mortgages, and put the system under
bankruptcy protection, to stop this foreclosure process, which is
going to become worse, in any case; and secondly, to provide
Federal protection to certain categories of banks which are
nationally-chartered banks or state-charter banks.

We must freeze the system. There is no way in which you can
reorganize the system in its present form. You must first
{freeze} it. And the first step, is to stop all action on
foreclosures on mortgages. If a mortgage is foreclosed, you stop
the proceedings. If a bank is in jeopardy, the bank is protected.
And there will have to be special laws then passed to regulate
what will paid and what will not be paid at this time.
The second thing that's required, apart from this, is a
change back in the direction of a fixed-exchange-rate system of
the type of we had under Roosevelt, and afterward into the
beginning of the 1970s. Only a fixed-exchange-rate system can
stop the bleeding, and create the circumstances until which
control can be reestablished.

Now, to do this, to get that, requires the cooperation of a
number of major powers. The United States must agree with Russia,
and with China and India, among others, to actually put such a
measure into action internationally. If that is done, then we can
create the opportunity for negotiating a new international
monetary system, which will tend toward a fixed-exchange-rate
monetary system of the type that Franklin Roosevelt established
in 1944-45. And that is what we must do.

We also have to make other changes. We can no longer have a
floating-exchange-rate trade system. We must go back to the idea
of emphasis on physical values and related values. For example,
what we set up, particularly since 1970-71, we created this
floating-exchange-rate system, the post-Bretton Woods system,
which had the purpose of shifting production of goods away from
Europe and the United States, and into poorer countries where
labor was cheaper. So we have exploited cheap-labor markets in
the world, to rely on production, and we have taken the
production {out} of the United States and out of Western Europe,
and of course, the former Soviet Union was also looted in the
same way.

So therefore, we have to recognize, that by relying upon a
cheap-labor economy, we have actually, in fact, lowered the total
level of production and productivity per capita worldwide. We
have to change that. There are two ways: First of all, we have to
have a general expansion of long-term investment, in physical
investment, starting with things like transportation and power.
We have one project, which is a Russian project, but not only a
Russian project, which is the development of a railway tunnel
through the Bering Strait. That would not be simply a tunnel, and
the work has already started in Russia on doing this, the
preliminary stages. That would mean that essentially, you've
taken the entirety of Northeast Asia, which is an area of large
raw-materials deposits, essential deposits, and you've opened
this up for development, which will be the extension of the
Trans-Siberian Railroad route into the Bering Strait area.
This is essential, because, in the world today, if we're
going to meet the demands of populations for improvements in
physical living standards, we must increase the production of
materials for improved living standards, including power,
including water-management, the whole works. In order to do that,
we must tap into, and organize on a wiser scale, the
raw-materials supplies. Now that means cooperations among

We have several major shields which are crucial: You have
the Eurasian shield, which is largely concentrated in what was
the former Soviet Union, the largest single area of major sources
for humanity, especially with respect to Asia itself, where you
have a population which is very poor, and to increase the
physical standard of living in these areas, requires a great
expansion in the production and recycling of essential raw
materials, as well as transportation.

You have a second area, which is in Africa: Africa has to be
protected. It has one of the major raw-materials sources in the
world. Africa's development is necessary for this reason.
We have also in South America, a very large and
underdeveloped raw-materials resources, which will require
large-scale transportation and power, and similar kinds of
networks to develop these resources.

We have, at the same time, is to realize that these
improvements are long-term: We're talking about capital
investments in raw materials and infrastructure, which involve 25
to 50 years or longer. The railways are very long; large-scale
water systems are long investments. Therefore, we must have
long-term agreements which provide for the capital to create
these improvements. At the same time, we must restore the
responsibility of Europe and North America for becoming, again,
sources of production of high-quality capital goods, for the
development of other countries. There is development of capital
goods in China and other countries, but it's not sufficient. You
must have a higher level of development of capital goods,
worldwide, to meet the requirements of a world population.

So therefore, we're talking, essentially, about 50-year
treaty-agreements among the nations of the world, creating a new
monetary system, and making agreements as part of this on lines
of development: for example, major transportation. We've now come
to a point where we're developing improved railway systems as an
objective. Most nations agree upon this. It's also understood,
that much of this should be magnetic levitation systems, rather
than track systems. We need to connect the parts of the world
which have raw materials and require them, through large-scale,
ground-based systems. Air transport is not efficient. The cost is
too high per pound. Water is not sufficient--water-based
transportation--because for high-value goods, the delivery is too
slow, and too limited.

Therefore, the expansion of the
ground-based transportation systems, including rails and
including magnetic levitation systems, is necessary to meet these
requirements. These are long-term investments.
Nuclear power is absolutely required: There is no substitute
for nuclear power. There are complements for nuclear power, but
no substitutes. Because the problem here, is not simply quantity
in terms of kilowatts. The issue here is the
temperature-equivalent, what we call the energy-flux density of
power sources: Because we are going to have to stop moving
petroleum, internationally, as a source of power.

We can not misuse water resources as a source of power. We have a shortage
of fresh water. Therefore, we need nuclear power, high-density
nuclear power, of the type of the high-temperature gas-cooled
reactor, with which to make water -- that is, freshwater out of
saltwater, because we have a shortage of freshwater sources.
Especially India, for example, the southern part of India is
destitute, for lack of freshwater resources. And the only
solution there, is high-temperature gas-cooled reactors, or
similar kinds of nuclear reactors, which can desalinate seawater.
On the other hand, at the same time, rather than relying all
round the world, in terms of shipping oil into all parts of the
world, we are going to be able to produce fuels from water, with
high-temperature gas-cooled reactors and other kinds of nuclear
processes. We can make synthetic fuels from water, with
high-temperature gas-cooled reactors. We can not make it
economically, any other way.

So therefore, we will have essentially, a water-management
cycle, complemented by use of petroleum, which will become
increasingly significant as a source of raw materials for
production stock, and less and less on long-scale transportation.
Natural gas we will use as an opportunity arises.
So, we're at a point now, where I must say, my government,
the United States government, is clinically insane. That's the
only fair way to describe it. We have--I think everybody knows,
that the Vice President of the United States, with a certain
section of the military, the Air Force, is planning to open up
very soon with an attack on Iran, which is supposed to be a
"block-buster attack"--an intense one, with super kinds of
explosives. This is insane. Everyone in the world who knows about
this, is frightened by the implications of it, because the effect
of such an attack would be chaos, and the spread of chaos: It
must be stopped.

We have a President who frankly is insane. And that's our
situation here--so it's a desperate situation. You have the
financial community in the United States is clinically insane:
They're desperate! You're going to see the major financial
powers, inside the United States, toppling, one after the other.
How rapidly, is not certain, but the rate would be great: Whether
it's going to be two or three times as fast as it is now, it
probably will be in that order of magnitude. And by the end of
the year, and the beginning of next year, you will see a
shattered U.S. financial system, and as a result of that, a
shattered European financial system, with terrible effects on
Asian countries.

So therefore, that's our situation. It's one in which
understanding is required. As I've indicated, there are topics
which have to be discussed among nations, among all nations,
which are not now being discussed adequately. {This present world
system, this present world monetary-financial system can not
survive! Under any circumstances.} A new system is required, with
policy agreements, treaty-agreements among leading nations,
especially including Russia, China, and India, and the United
States: With those kinds of policy agreements, we can take
actions which will prevent global chaos, and can give us
negotiating room for setting into place new institutions required
to work our way out of this problem.

We need, also, again, a vision on {how} we're going to
approach that. We have to eliminate this post-industrial society.
All the ideology of the post-industrial society must be
eliminated, otherwise, there's no chance for humanity. You can
not tolerate what Al Gore represents, unless you want to destroy
humanity. It's not tolerable.

We have to go back to a high-tech, science-driven approach
to economy. And this means, first of all, the emphasis, as I
said, on large-scale infrastructure investments, and to create
large masses of credit, not only to fund long-term infrastructure
improvements, but also to fund the productive industry, of
private industry, which will be stimulated by the production and
development of major basic economic infrastructure.
These are the alternatives.

What is needed, to do this, is more discussion, in nations
and among nations, about the kind of subjects I just spoke of.
Without discussion, obviously, we will not come to agreement.
These are things that have to be agreed upon, which have not been
discussed, which are not on the table now, as negotiating points,
and therefore, people assume things are going in a different

But the thing to understand: This is not just a U.S. crisis,
nor is it just primarily a U.S. crisis. It's a crisis of the
dollar, which is a crisis of the world financial system, because
the dollar is still the denominator of the world financial system
and economic system. But if a collapse of the dollar occurs--and
we're now down 30% in the recent period, of collapse in the value
of the dollar--if that continues, and a breakdown of the U.S.
financial system occurs without remedies, then you will see,
Europe will go down totally, the British will go down totally,
even though they're now partly a factor causing the problem, but
they'll go down totally; and the rest of the world will go down,
because a collapse of Europe and the United States, will mean a
collapse of the world economy as a whole.
This is a high-tech world. We have a population over 6.5
billion people. We can not sustain a population of 6.5 billion
people, and their aspirations, without a high-tech economy, and a
global one.

That's our situation.