LaRouche:
Rohatyn Cannot Duck The Issue
[Source: FT 20.8.01]
WIESBADEN, Aug. 20 -- FELIX ROHAYTYN HEADLINED HIS OP-ED FOR
THE FINANCIAL TIMES, "BACK TO BRETTON WOODS," in which the
former U.S. ambassador to France and longtime Lazard Freres
executive, suddenly announced that he is the one who has been
advocating a new global financial system all the time: "I have
believed for some years that the time has come for a new Bretton
Woods conference. The role of institutions created 50 years ago
needs to be updated to suit the needs of a world that has changed
beyond all recognition....
"In spite of strenuous efforts over the years by the
international financial institutions and the leading
industrialized countries, poverty and disease are still rampant
among most of the world's population, and wealth differentials
seem to be increasing rather than narrowing. I strongly believe
in the benefits of globalization and of modern capitalism but I
also believe these are not obvious to everyone....
"A new Bretton Woods, convened by the President of the U.S.
with the Secretary General of the United Nations, would include
representatives of the developing world as well as of the
developed world; it would also include representatives of
non-governmental organizations and private sector leaders.
"A new Bretton Woods conference with broad participation of
the private sector and NGOs would help stop a trend that will
surely get worse if no action is taken. True, such a meeting
would be controversial but it would be a serious response to real
issues. It would also challenge the protesters to be
constructive. That is very different from holding ever-smaller
meetings in ever-remoter locations while insisting what we are
doing is best for everyone. Historically, such an ivory-tower
mentality has invariably led to the most serious consequences."
(lok)
ROHATYN MUST NOT DUCK THE ISSUE
by Lyndon H. LaRouche, Jr.
U.S. Presidential pre-candidate for 2004
Friday, August 24, 2001
During recent years, all substantive forms of proposals for
holding a New Bretton Woods conference has been associated,
increasingly, internationally with my name. Institutions of
governments have taken preliminary action in furtherance of the
discussion and adoption of my proposals.
Now, Felix Rohatyn has claimed that he is proposing a "New
Bretton Woods" conference; but, he makes no reference to the
proposal by that name already on the international agenda. The
implied question is, whether Felix is claiming to have invented
the wheel, or does he intend to suggest that he is supporting the
proposal already on the table, the one made famous
internationally by me and by groups of elected parliamentarians
who have circulated resolutions internationally in support of my
proposal? The obviously urgent question is, therefore: Does he
accept my definition, or is his statement intended to function as
yet another delphic deception of the credulous?
Since the present international monetary system is currently
in the process of disintegrating, the question whether Felix
means to support my proposal, or something different, must be
clarified, urgently. We can not have two brands of medicine
circulating under the same brand name, the one therapeutic and
the other deadly poison. Therefore, Felix must respond to my
challenge on this matter, and publicly.
To simplify the problem, I challenge Felix to answer the
following questions publicly.
1. FACT: "New Bretton Woods" has come to be
understood in relevant official and other
international circles, as signifying a
replacement for the catastrophically and
cruelly unjust, failed, present International
Monetary Fund system. By the presently
failed international monetary system, is meant
the change from the original, protectionist
form of fixed-exchange-rate system, to the
floating-exchange-rate system introduced in
August 1971. Therefore, the proposal for a
New Bretton Woods, signifies abandoning a
presently failed system, in favor of building
upon a preceding Bretton Woods System
which worked very well, despite the abuses
within it.
2. QUESTION: Does Felix Rohatyn accept that
widely accepted definition of the term "New
Bretton Woods"? If so, he should say so
publicly. If not, then, he should change the
name of his proposal, to avoid misleading the
public. (This might be regarded as
tantamount to a "truth in lending" clause.)
3. FACT: During the 1995-2000 interval, U.S.
investors, alone, lost trillions of dollars in one
of the great financial chain-letter swindles of
modern history, the so-called "New
Economy" bubble. Many national leaders,
including leading Presidential candidates,
continued to promote that "new economy"
swindle as late as the Year 2000 U.S.
Presidential campaign. During that campaign,
I warned against being duped by that "new
economy" propaganda, and warned of new
general financial crisis facing the world, either
during or immediately after the 2000
campaign. From about the time of the
inauguration of President George W. Bush,
Jr., the "new economy" bubble has burst,
investors duped into supporting it have lost
trillions of dollars, and the role of the U.S. as
the world's "importer of last resort" has
collapsed.
4. QUESTION: I have been warning investors
and others internationally, of the danger of
this financial bubble, and related blunders of
our own and other governments, over years to
date. When did financial expert Felix
Rohatyn first issue a public warning against
this gigantic hoax? Did he publicly warn
Democratic candidate Al Gore, to cease
misleading the public on this issue? Did he
ever publicly endorse my specific warnings on
this account, at a time when his support might
have helped present millions of Americans
from being duped into investing in that
bubble? Now, that the "new economy" hoax
has exposed itself, the foremost financial
crisis in the U.S. now, is a gigantic real-estate
bubble, being constructed under the pretext of
consumer-credit generation, but for the deeper
and darker purpose of inflating real-estate
values temporarily to cover for the looming
embarrassment of leading banks; this was
already well known to experts of Felix
Rohatyn's experience and rank during the
Year 2000 U.S. Presidential campaign.
5. FACT: Since about the time of the
inauguration of the administration of
President Jimmy Carter, there has been a
persistent, catastrophic collapse of the share
of national income of the lower eighty-percent
of family-income brackets. Combined with
the collapse of neglected and looted U.S.
basic economic infrastructure, and the looting
of our nation's physical productive capacity
by exporting U.S. job-places to cheap-labor
markets, the net effect of U.S. policies under
the 1971-2001 floating-exchange-rate
monetary system, has been an accelerating
collapse of the physical productive potential
and welfare of the U.S. and its people,
especially those in the lower eighty percentile
of family-income brackets.
6. QUESTION: Does Felix Rohatyn recognize
these facts? Does he recognize that the U.S.
and world economies have suffered an
accumulation of changes in policies, from
those of the 1945-1963 period, which have
now proven themselves to have been systemic
follies? Does he recognize the need to return
to the policy-making matrix which was
characteristic of the Franklin Roosevelt
Presidency and post-war U.S. practice, prior
to Richard Nixon's pro-Nashville Agrarian,
"Southern Strategy" campaign of 1966-68? Is
Felix prepared to admit and state openly, that
we must fix what misguided post-1966 U.S.
leadership, such as that under Presidents
Nixon and Carter, broke?
7. FACT: Felix Rohatyn is sufficiently well-
informed and intelligent to know, as many in
high public office today do not, that there
were several features of the original 1945-
1963 functioning of the Bretton Woods
System which were essential to the post-war
reconstruction of the economies of the U.S.A.,
western Europe, and elsewhere. We may be
certain that he knows, that these conditions
included a system of administratively fixed
exchange-rates, without which low-interest
rates in medium- to long-term international
loans and investments were impossible to
defend. We may be certain that he knows,
that the creation of the mass of public and
other credit required for post-war
reconstruction and growth, could not have
been defended without a system of regulation
essential for long-term investments in basic
economic infrastructure and productive capital
of agriculture, industry, housing, and urban
infrastructure generally. We may be certain
that he knows, that these measures included
protectionist forms of medium-term to long-
term trade and tariff protection of productive
investments, and also capital controls,
exchange controls, and financial regulation.
We may be certain that he knows, that
reinstituting such measures is indispensable
for recovery from the presently onrushing.
chain-reaction collapse of the world's present
financial and monetary system.
8. QUESTION: Is he prepared to state publicly
his commitment to restore those features as
the foundation on which a New Bretton
Woods agreement would be premised from
the start?
9. FACT: The only durable source of real profit
of a national economy as a whole, is from the
employment of labor in scientific and
technological progress, and in increasingly
energy-intensive, capital-intensive modes.
Otherwise, the generation of any average
apparent rate of profit in a national economy,
will occur either through looting of natural
and other preexisting resources, or in as the
purely fictitious financial gains of the type
associated with the recent and current stock-
market and real-estate bubbles. The current
U.S. energy crises, the currently accelerating
U.S. health-care crisis, and the galloping of
the U.S. national current accounts deficit, are
merely typical of the inevitable results of
trying to substitute various forms of so-called
"post-industrial economy," for the old-
fashioned, "blue-collar"-centered real
economy. It is impossible that Felix Rohatyn
does not know this.
10. QUESTION: Will he say it?
Otherwise, I think that Felix Rohatyn would not have any
formal disagreement with the following elements of my proposal
for immediate emergency action, as I outlined some of these
essential points in my recent address to Mexico's accounting
profession.
It is obvious to me, and to a significant number of other
relevant persons from various nations, that there are three
essential steps to be taken to bring the urgently needed form of
New Bretton Woods into being.
First, there must be intensive discussion of the required
terms of a New Bretton Woods among those who have both the
professional and related competence to discuss such technical
matters of global and national policy-making. These layers must
not only design the set of specifications on whose adoption the
success of the mission will depend absolutely; they must
distinguish between requirements which do not admit of competent
compromise, and those choices which are in fact available to the
political and related institutions which must adopt the draft New
Bretton Woods reforms.
Second, this first group must educate the relevant political
institutions, who, today, do not have any predetermined
competence in the technical side of these matters. The issues
must be laid on the table, clearly setting forth to the political
and related institutions of relevance, what choices are available
to them, as distinct from certain elements which can not be
compromised, if the system is not to fail from the outset.
Third, this must be accompanied by an energetic, therapeutic
reeducation of the general public in the rudiments of the
difference between the awfully failed system now collapsing
around their ears, and the principles of the new system which
they must support, and in which they must find their
opportunities for productive participation.
Let us cut through the usual "spin" and other delphic
propaganda, and have some clear answers on the matter of the
facts and questions I have set before Felix Rohatyn.
For more information,
contact: Ferguson
For Congress, or call: 1-781-380-4001; or fax: 1-781-380-
4029.