Cause and Effect
23 March 2020
LPAC—Often, the single biggest obstacle to solving a problem is misidentifying its cause. This is especially the case during times of great social and economic turmoil, of a “phase shift,” such as today. The old “rules of the game” have stopped working, including those that seemed to explain cause-and-effect in normal times. Yet many people, even well-meaning ones, fall back on old, dysfunctional ways of thinking about how the world actually works.
Why is there a global coronavirus pandemic? It is not because “the Chinese like to eat live bats”; it’s not because some nasty intelligence agency cooked up a biological weapon in a secret lab somewhere (although the open advocacy of such Malthusian genocide by the likes of Prince Philip gives pause for thought); and it’s not because these are “natural phenomena” that always happen, that you just have to let run their course.
The world is being swept by a coronavirus pandemic today for precisely the reasons Lyndon LaRouche warned this would happen, and for none other: a drop in mankind’s potential relative population-density to levels consistently and dramatically below the actual population. That occurs, LaRouche specified, as a result of financial and economic policies that favor speculation over scientific and technological breakthroughs, and associated expanded physical-economic production. In a Jan. 17, 1998 speech to a Schiller Institute conference in Virginia, LaRouche warned:
“We are on the edge of the greatest financial collapse known in the history of European civilization since the Fourteenth Century, what was called the New Dark Age, part of a process in which approximately half the population of Europe was wiped out through disease and famine, and various kinds of insanity. The culmination of that, then, as today, was a collapse of the financial, banking system, the so-called Lombard banking system. During that period, half of the municipalities, the parishes of Europe, vanished. One-third of the population of Europe, in a fairly short period of time, vanished of disease, and famine, and strife. We are on the verge of such things, not only in Asia, not only in South America, but here in the United States itself. Not some time in the next century, but this year.”
In that same address, LaRouche stated: “Look about us. Don’t take one event at a time and try to explain it. Look at the process.”
The deadly coronavirus threatening the human species, and the equally deadly $1.8 quadrillion financial cancer that has metastasized throughout the trans-Atlantic financial system, are part of the same process—they are effects produced by the same cause, and therefore subject to the same solution.
Lyndon LaRouche once called for politically burying Wall Street and the City of London so deep, that you wouldn’t even be able to smell the stench anymore. That burial has a name: it is called Glass-Steagall—the bankruptcy reorganization of a cancerous trans-Atlantic financial system to put the speculative assets in deep freeze, while maintaining the vital functions of commercial banks related to the population and essential physical production.
Simultaneously with that measure, Lyndon LaRouche specified in his famous Four Laws, it is necessary to establish Hamiltonian national credit systems to fund actual development; create a New Bretton Woods system to jointly promote high-productivity global infrastructure projects such as the World Land-Bridge; and foster advanced scientific research in fields such as fusion, space sciences, and optical biophysics. That argument was summarized in remarks on March 21 by his widow, Helga Zepp-LaRouche:
“You have to go for Glass-Steagall; now! Don’t wait! Don’t put it on the back burner. President Trump promised in the 2016 election campaign many times that he would implement Glass-Steagall, and now is exactly the moment to do it.
“What that means is the exact same measures like those of Franklin D. Roosevelt in 1933 must be implemented exactly like that. My late husband always stressed, ‘Don’t change a thing.’ The arguments that the markets today are more complicated and they need derivatives, he always categorically rejected that. Basically it would mean that you put a firewall between the commercial banks and the investment banks; and put the commercial banks under state protection so that they can continue to provide credit to the real economy, the small- and medium-sized firms, trade, retail, all these things which are essential for the real economy. But you separate the investment banks completely. That means the investment banks should no longer have access to the savings of the commercial banks, and they should not be bailed out through taxpayer money.
“Since some of these products are complicated, because the pension funds and other valid things which belong to the life savings of the people, in the meantime, are interwoven with the derivatives and the whole casino aspect of the financial system. This is why you have to have a pause; you have to freeze everything and then a state commission has to investigate what is valid in those assets and they have to be protected and separated. That may be complicated, but it has to be done.
“Then, obviously, if you eliminate the investment bank part of the financial system, you won’t have enough liquidity. And this is why Mr. LaRouche said this is the moment when you have to re-establish Hamiltonian banking, you have to establish a national bank—not only in one country but practically in all countries—and then you have to connect those national banks through fixed exchange rates. You have to make long-term agreements among them for investments in well-defined projects of reconstruction; reconstruction of the health sector, protecting and rebuilding sovereignty in the agricultural area to reconstruct war-torn regions like Southwest Asia. Remedy for good the reasons why the African continent and other countries from the Southern Hemisphere are so vulnerable; which means you have to, in earnest, start industrializing these countries, the countries of Africa and countries of Latin America and Asia, and you have to help them to build infrastructure as the precondition for industrial production and the development of agriculture.
“And that way you create the conditions to create a sufficient health system in every country. All of that has to be done simultaneously, and obviously it will not go smoothly, but if you don’t go in this direction, the danger is that not only the coronavirus will come back with a vengeance, but there is absolutely nothing which will prevent the outbreak of new viruses and new diseases.
“And therefore, this is an absolute must that we correct the mistakes of the last several decades, especially the last 30 years of deregulation of the markets, of giving every right to the speculators and cutting down on the common good.”
That was Lyndon LaRouche’s policy recommendation for rooting out the cause of the problems we face.