DIALOGUE WITH LAROUCHE:

'When Do We Get To
The Breakdown Point?'

Q: I am not an economist; this is an extremely difficult science, a lot of talk with few concepts.... A lot of people make a lot of suggestions, and really don't know what they are talking about.

The only solution in the face of chaos, could be either that the large corporations wake up, or that we have to demand from them much more than they politically wish. I would like to know what you think about this subject.

LaRouche: Very simply: It comes from leadership. Don't wait for chaos; it may be too late. France could have been saved before July 14, 1789. The constitution of Bailly and Lafayette, had the king not rejected it, would have meant a great revival of France. As a result of the failure to enact that constitution, July 14, since 1789, has been celebrated in France.

I believe that people here, in Brazil, are thinking about the same thing. So don't wait for July 14, 1789 to hit Brazil. Therefore, the time to act, is as soon as possible. But, you have to wait for that hot moment where the response will be forthcoming, but don't wait beyond that.

Then, who can lead? What can you and the people you typify or represent do, in terms of leadership? If the people of Brazil, or a significant number of them, smell a disaster now coming across the border from Argentina towards Brazil, and say: "What do we do?" Someone has to answer. You, and people you know, must undertake the responsibility of educating yourselves and the people you know, in the practical aspects of this problem. If the people trust you, if they believe in those ideas, then under those conditions of crisis, you can be victorious. That's the lesson of history, repeatedly.

And therefore, the time to intervene, in that way—but the key thing to emphasize is, these kinds of changes never come from bureaucrats. They come from people who think as individual persons.

Let me just add one thing. In the German military system, as developed initially by Scharnhorst and then by the old Moltke, the principle of training of the non-commissioned officers and officers was called the Auftragstaktik, which means a mission orientation. Think of this from an entrepreneurial standpoint. Any lieutenant, any sergeant, assigned a mission, will probably face a situation entirely different than he expected. At that point, the outcome depends upon the ingenuity and the creativity of that lieutenant or that sergeant.

This was the secret of the German combat capability: Auftragstaktik. That's why the German unit was generally more effective than any other unit. There are many examples of that in U.S. military history, too. The point is, the entrepreneurial viewpoint is typical in society, because the successful entrepreneur applies the principle of Auftragstaktik to the economic situation he deals with.

Q: What is the future, in your view, of countries such as Brazil, particularly looking at the United States as one of the biggest players in the world, and keeping in mind that you have different factions, different tendencies? We, in Brazil, have been negotiating. We have been making concessions, and taking somewhat less. But, I would like to focus on what is happening today. Just this week we have been suffering a tremendous problem, paying the price of something which might happen, with candidates who might be elected in Brazil's general and Presidential elections this year, and may be a problem. As a Brazilian, I have been trying to figure out what can be done, what we can do to change that. To my mind, its largely speculation. If the United States—specifically the United States—would take a position in this case, we could probably avoid a lot of headaches.

LaRouche: For example, look at the case of—three different cases: Argentina, Brazil, the United States. Each of which has the same problem, but with different specific characteristics.

Argentina is in the most advanced stage of explosion. If the IMF proposals for Argentina, which are now being delivered, are accepted, then the nation of Argentina will disintegrate, almost instantly. Because those conditions do not allow the nation to exist as a nation. Chaos will be the result.

Now, take the case of Brazil. One gentleman who is very clever, in Brazil, has forecast great trouble for the first quarter of the year 2003. That is, the national debt, the ability to pay the debt, and the dollarization of the debt.

The United States is in a similar condition, but different. We are about to go under. We have a number of internal bubbles—the real estate bubble. The United States system is the greatest financial fraud on this planet right now. This thing is nothing but fraud, holding up Wall Street. And I mean fraud in a way that would cause a gangster to blush! Enron is only the tip of the iceberg. The worst danger in the United States is the real estate bubble, better called the "mortgage bubble."

If the United States does not receive about $3 trillion a month right now, in influxes, from sources like the Japanese—the Japanese money-printing press—and if the Japan money-printing press breaks down, then the United States dollar goes under.

Europe, the same kind of condition. Germany, same condition. Italy, a little more stable, for different reasons.

So, we are in a situation, where, by the Fall, by the end of September or beginning of October, we are entering an impossible area, beyond which you cannot calculate.

Now, this is the reason for the military problem. Why this push for a war in Iraq? There's no good reason for a war in Iraq. Nor does the United States have the capability to conduct such a war. They cannot go in and—and they have lost the war in Afghanistan already, and they want to go to war in Iraq. By all military standards, the Afghanistan thing is a defeat. They took the devil's son, and they got the devil himself.

So, under these conditions, the desperadoes in the United States believe that only a war will enable them to control the political situation inside the United States and in other nations.

So, obviously, in my position, I do certain things. As you may know, not everybody in the United States is an idiot. It only appears that way. There are—I have some old friends, and people who are not necessarily friends, but who respect me, and actually, we talk. And I press them: We've got to do something about this. And therefore, when I talk abroad, I say things that nobody else has the guts to say—not because I am foolish—even though that's dangerous. But in a sense, I was elected to do it. You know, like you're a soldier, and you're sent out to do a mission, you do the mission.

A True Conspiracy

Therefore, my being here, for example, in Brazil. Brazil is the key country of all South America, strategically. It's extremely important that I state here the same thing that I'm saying in other countries, so that people in Brazil know what I'm saying; so you can react to what I am saying. How you react to what I am saying is very important to people in the United States and elsewhere.

We are engaged in a true conspiracy. Not those nutty drawings that they make of conspiracy, but a real one. We discuss the situation. We discuss the ideas. We consider the possibility of agreement on ideas. We assess interests. We try to come to a common thing we agree on. I'm in the process of trying to push that kind of discussion internationally.

For example, last week I was in Abu Dhabi. I was there to give the keynote speech at a conference on petroleum, and I've had certain influence in the area recently. I also have my friends in India. So, in these discussions—I think the problem is, there is not enough of this discussion occurring across borders. Because no country can act completely independently on these issues—not even the United States. We must discuss what we're going to do about the situation.

The danger now, is we're not discussing what we should be doing. We are discussing how to try to keep this system from collapsing. How to work within the sinking ship, instead of saying: "The ship is going to sink, let's get off it and pick a new ship."

That is the great danger: that we're not discussing the alternatives adequately. And people scream. You say: "Go back to the original Bretton Woods agreement. This ship is sinking, let's try the other one; at least it worked. And what do we do?"

So, if we can come to an agreement on ideas, as a result of discussion, then we can discuss internationally, we can act in concert to cause governments to change their opinion.

Permit me to be very delicate, as delicate as necessary. You have a movement of chaos loose on this planet, it's called anti-globalization. It officially is led by a British agent, Teddy Goldsmith, who led a conference at Porto Alegre some months ago. That is the palpable, major internal danger to Brazil right now. And when I talk to people in Brazil, I find this subject comes up. And I say: "Well, what are you worried about? He's a globalizer, to globalize the non-existence of the nation-state, using Jacobin-terror methods."

Why is he able to attract people? As long as you say, "We've got to go with globalization," how can you fight him? How can you? You have no credibility. A question was asked of me in the discussion earlier: How do you deal with the people, and their representatives? You have to know how to deal with people, and the people want to know what the alternative is to the misery which they see coming down upon them.

And this movement—that movement at Porto Alegre—has no right to claim to be the anti-globalization movement. I am the anti-globalization movement, to save the nation state!

Q: I have followed your magazine, and the presentations which are published in the magazine. And your presentation was quite clear and objective.... If we consider how the two curves are diverging in ever greater fashion, between the production and the financial, it appears inevitable that a collapse of the international financial system will occur. And the realization of a New Bretton Woods has been proposed, but there is no sign, not in the United States, nor in Europe, nor other countries, that they are moving in this direction. Therefore, do we have the time to change this reality, and create a consciousness in favor of a new meeting? Or, will we have a collapse before this could happen? What is the envisioned time frame? How much time do we have available to avoid the collapse, if we do, indeed, have any time? This is my question.

LaRouche: This is a very difficult question to answer in particular, because—I think some of you have seen people going into bankruptcy. Some of you have been privy to some of the financial paper studied in those bankruptcies. And you ask the question: When did that firm go bankrupt? Usually, most firms went irreparably bankrupt long before the public knew about it. That's the situation with the United States economy right now.

The United States economy is bankrupt. Look at the current account deficit. Look at the way in which foreign investment into U.S. financial markets, plus the Federal Reserve money-printing—like Germany in 1923—is postponing the day of reckoning.

Now look at the pattern of bankruptcies in the United States: Enron; almost the entire so-called New Economy sector; international telecommunications—bankrupt! So that the United States is already bankrupt, hopelessly bankrupt. There are actually outstanding probably over $400 trillion of derivatives obligations hanging around in the system, which are nothing but gambling side-bets. They are not investments.

The question is, when do we get to a breakdown crisis, as opposed to a bankruptcy? It is the political power of the United States to extract, from Japan and other countries, the support needed.

Take the case of Argentina. Why is the crazy IMF sending these gravediggers down to Argentina? And you have these foolish people in Argentina, with blowtorches, trying to go in and get the money out of the bank. When there is no money in the bank. So what the crazy IMF is doing, is demanding conditions of Argentina, which are causing the disintegration of Argentina as a nation. Why are they doing that? To maintain the principle that any debt which is owed to a New York banker will be paid, if they have to sell the Argentine babies for hamburger to do it!

You are dealing with a system which is of that character. So it's now. The question is, when do we get to the breakdown point? And we're close to it. Germany is operating at a loss. The entire European Union is operating at a loss. Spain is about to go under because of the chain-reaction effects of their investments in South America. So, this is the problem.

So, we have a window of opportunity, before a political breakdown occurs, in which to come to our senses. But, as in a bankruptcy, if you've been through it, as I know from former times as a consultant—I used to be the undertaker.

Q: Yesterday, the Italian Security Minister was here, who fights organized crime.... How much money is in the hands of organized crime today, and is outside the control of the Central Banks?

LaRouche: It's hard to say, because there is obviously no difference between organized crime and these kinds of things. [Laughter] For example, take the case of the so-called Mega group in New York. The Mega group is composed chiefly of the leadership of U.S. organized crime, including the Bronfman family, which owns Senator McCain, which owns Senator Lieberman. When you look at the way the United States is structured, absolute gangsterism, including drug money laundering, [is very important].

The United States said, "We are going to go after the Colombian terrorists." Well, they won't go after the Colombian terrorists. They won't. Why? Their money's involved! Why do you think Grasso went down to Colombia to meet with the FARC? Why do you think Soros does the things he does? Because the financial derivatives and related leveraging of drug money in the international market, is the major prop. That's the problem. There is no difference.

Moderator: It is said, that one can agree or disagree. But I believe that all of us agree that Mr. LaRouche is a man of courage, because to say these things, about organized crime, is unusual in Brazil; I don't know about in the United States. I know his ideas from his books, and people may disagree in many things, but people should reflect on it....

As he said: either we organize ourselves another boat, or we are going to have to fix the boat. I prefer to stay in the boat, and try to seek the best solution. And the best solution, evidently, will come not from what people wish, but from what people are able to achieve, when they make decisions.... And since all citizens are involved in these decisions, reflect upon Mr. LaRouche's words. Because one can analyze them, and there could be differences of analysis, but one should not ignore them.

Many thanks to all of you for your presence, and many thanks to Mr. LaRouche for the opportunity for a dialogue on what Brazil will face internationally.