testimony appears in the July
6, 2001 issue of Executive Intelligence Review.
ZEPP-LAROUCHE TO THE RUSSIAN DUMA:
As a War-Avoidance Strategy
is the presentation of Helga Zepp-LaRouche to the Russian State Duma's
Economics Committee, on June 29, 2001 in Moscow.
the 1995 Halifax summit, but above all, since the Russian GKO crisis and
the near-collapse of the world's biggest hedge fund, LTCM [Long Term
Capital Management], the governments of the G7 have had recourse to only
one measure: pumping unbelievable amounts of liquidity [into the markets].
The speculative bubble in the "New Economy," which was the
direct result of this liquidity pumping, has burst, and inflation, which
had earlier represented asset-price inflation, is now spreading as
commodity-price inflation, with a tendency towards hyperinflation. At the
same time, due to internal economic breakdown, the United States is losing
its role as the importer of last resort, which has hit Asian exports
particularly hard: The tendency towards depression is increasing
worldwide: banking crises, mass layoffs, depression. What is threatened,
is a breakdown of the global financial system, of a sort not witnessed
since the Fourteenth Century.
this development foreseeable? The answer is, loud and clear: Yes!
in November 1989, after the fall of the Berlin Wall, signs of the
dissolution of the Warsaw Pact and the Soviet Union emerged, Lyndon
LaRouche warned that it would lead to a catastrophe, if one attempted then
to replace the collapsing economic system of the East, with the equally
bankrupt free-market system of the West. The paradigm shift, over the
preceding 25 years, which, through a long series of neo-liberal steps, had
undermined the foundations of the economy, in favor of speculation, would
inevitably lead to the collapse of the system.
proposed, instead, to go back to the principles of physical economy, in
the tradition of Leibniz, List, Mendeleyev, and Witte. He presented the
grand vision of a program for the "Paris-Berlin-Vienna Productive
Triangle," as the locomotive for infrastructural and economic
integration of Eastern and Western Europe, and for the development of the
East. This concept called for the integration of the no-longer-divided
industrial centers lying within the Triangle—the size of Japan—and the
most developed industrial capacities in the world represented there,
through modern infrastructure, like the Transrapid [magnetic levitation
railway]. Investments in frontier technologies were to enhance the
productivity of labor power and productive plant facilities, as well as
exports, especially in technology and capital-goods sectors.
this "Productive Triangle," so-called development corridors were
to radiate out, from Berlin to Warsaw and St. Petersburg, via Prague and
Kiev to Moscow, and through the Balkans to Istanbul. Integrated
infrastructure projects, with high-speed railways, highways, and
waterways, and computerized railway stations, were to constitute the
transportation arteries of these 100 meter-wide corridors, along which the
most modern technologies and industries could be brought into the East.
of dealing an economic death blow to the allegedly obsolete industries of
the Comecon, as the reformers of the IMF and shock therapy did, the
industries of the East, though obsolete from a world-market standpoint,
could, as valuable industries of the East, have been utilized, and could
have played a meaningful role in the construction of the transportation
arteries and networks; only then, after they had been "used up"
in a certain sense, would they have been idled.
warnings of the danger of the free-market economy, as well as his vision
of the "Productive Triangle" as the motor of a reconstruction
program for the East, and thereby the core of a global reconstruction
program, were spread by myself and other members of the Schiller Institute
to all leading circles in Eastern and Western Europe, beginning in January
1990, through numerous conferences, as well as to the broader public,
through our publications. Had these programs been implemented at that
time, they would have led to the biggest economic boom of the century.
the great opportunity, to place East-West relations, for the first time in
the Twentieth Century, on a completely new basis, of peace through
development, was missed. Margaret Thatcher, François Mitterrand and
George Bush [Sr.], chose the geopolitical option of excluduing Russia as a
potential competitor, from the world market, and reducing it to a
raw-materials exporter. Bush proclaimed the "New World Order,"
which, like globalization, turned out to be the expression of
1991, when the disintegration of the Soviet Union rendered necessary a new
political and economic perspective, LaRouche proposed extending the
"Productive Triangle" to the "Eurasian Land-Bridge,"
which should run along three main corridors: "Corridor A," the
Trans-Siberian railway and the line of the ancient Silk Road;
"Corridor B," from China, via Central Asia and Eastern Europe;
and "Corridor C," from Indonesia, through India, Iran, and
Turkey, into Western Europe.
an entire system of auxiliary corridors, the whole Eurasian continent was
to be connected. These corridors were not supposed to be just transport
connections, but infrastructure arteries, around which advanced
technologies could be brought in, so as to no longer merely extract raw
materials, but to process them on the spot, and in this way build up
modern industries. So, for the first time, these landlocked areas of the
vast Eurasian continent could enjoy the same geographical advantages that
were previously the privilege only of territories with access to the
service existing populations and the expected population growth,
especially in the densely populated areas of Asia, approximately 1,000
cities were to be built along the corridors. Inherently safe nuclear
reactor models, such as the High Temperature Reactor, were to be built to
supply abundant energy to industry, agriculture, and cities. Between 1992
and today, the Schiller Institute presented the conception of the Eurasian
Land-Bridge—including its extensions via the Bering Strait into the
Americas, and via the Middle East into Africa—as a global reconstruction
program for a just new world economic order, to literally thousands of
conference and seminar audiences in all five continents.
the Beijing "International Symposium on the Development of the
Regions along the New Eurasian Land-Bridge," a conference which took
place after two years of intense preparation on the suggestion of the
Schiller Institute, and in which Dr. [Jonathan] Tennenbaum and myself
participated as speakers, we escalated this organizing. We also, in the
same time frame, organized a series of seminars with participants from the
various cultures of Eurasia, to deepen the understanding of each other's
scientific, economic, philosophical, and cultural traditions—and where
they are similar, to deepen the foundations for a dialogue among our
cultures. I can proudly say, that we have created a worldwide movement for
the Eurasian Land-Bridge!
the fact that I am a German citizen, I wish to address the issue also from
a specific German point of view. On one level, it is self-evident that the
development of Eurasia is in Germany's fundamental self-interest. Because
of the relative scarcity of raw materials, the German economy only
functions if it concentrates on continuous progress in science and
technology and their application in the productive process, and if Germany
has expanding markets with ever more prosperous customers. Under the
regime of the "free market" and "globalization,"
Germany has lost many of its traditional markets, and, therefore, needs
the Eurasian Land-Bridge perspective.
a deeper level: We in Germany remember very well the connection between
depression and war. In light of the threat of a global depression and the
many already obvious dynamics, out of which new terrible wars could
develop, it is useful to review the debate which took place in Germany
during the world economic crises in the 1930s. The transcripts of a secret
conference of the Friedrich List Society of Sept. 16-17, 1931, were first
published in 1991. The subject of the conference was how to boost the
economy under conditions of the simultaneity of a depression and a crisis
of the financial system. Among the participants were Reichbank President
Dr. Hans Luther, and about 30 leading bankers, industrialists, and
economists. The keynote speaker was Dr. Wilhelm Lautenbach, an important
economist and high official in the German Economics Ministry.
his memorandum, he [Lautenbach] argued: "The natural course for
overcoming an economic and financial emergency" is "not to limit
economic activity, but to increase it. Under crisis conditions, the
market, the sole regulator of the capitalist economy, does not provide any
obvious positive directives." In a depression and/or a financial
collapse, there would exist the paradoxical situation, that "despite
curtailed production, demand is less than supply, thus leading to the
tendency to decrease production further."
budget cutting, which reduces public contracts and mass puchasing power
even further, nor lowering the interest rates, nor tax cuts, can solve the
problem, but rather, they aggravate it, argued Lautenbach.
key to the solution is to use the "surplus of commodities, unused
production capacities and unemployed labor. "The use of this largely
unutilized latitude for production is the actual and most urgent task of
economic policy, and it is simple to solve, in principle." The state
must "produce a new national economic demand," but it must
"represent a national investment for the economy. One should think of
such tasks as ... public or publicly supported works, which signify value
added for the economy, and would have to be done anyway, under normal
conditions"—for example, roads, highways, and railroads.
then argued that the initial boost of infrastructure and investment
projects would lead to an upward juncture of the whole economy, and that
the [increased] tax revenue of the rejuvenated economy would be larger
than the initial credit lines given by the state.
the Lautenbach plan of 1931 been implemented, the economic and political
conditions would have improved in such a way, that the National Socialists
would have had no chance to come to power, and World War II could have
realization of the Eurasian Land-Bridge is, therefore, today the best
war-avoidance policy. It also represents the necessary vision of hope for
the populations, which deserve a better Twenty-First Century than was the