Trump vil samarbejde med Kina om Bælte &
Vej / Indsats for Glass/Steagall optrappes:
LaRouche PAC Internationale Webcast,
23. juni, 2017

… Ifølge det Kinesiske Udenrigsministeriums rapport om mødet, responderede præsident Trump til denne udtalelse fra rådgiver Yang ved at sige, at han – præsident Trump – ville være åben over for at samarbejde med Kina om Bælte & Vej Initiativet og hermed relaterede projekter. Han sagde, han er tilfreds med de positive fremskridt, der er sket i de kinesisk-amerikanske relationer, siden sit møde med præsident Xi i Mar-a-Lago. Og han meddelte, at han planlægger at besøge Kina inden for det næste (nuværende) år.

Matthew Ogden: Med mig i studiet i dag har jeg Paul Gallagher, redaktør for EIR’s økonomiske stof, og som har været meget aktiv i Washington, D.C., i den eskalerede kamp for genindførelsen af Glass/Steagall og resten af hr. LaRouches Fire Økonomiske Love i Hamiltons tradition. Han har mange opdateringer til os på denne front. Og via video har vi Diane Sare, LaRouche PAC Policy koordinator for New York, med os fra Manhattan. Hun har netop skrevet en artikel med titlen, »Gullivers rejse til Manhattan! Kun LaRouches Fire Love og Kinas Bælte & Vej Initiativ kan løse Manhattans infrastrukturkrise.« (EIR, 23. juni). Som vi alle ved, venter »Helvedessommeren« forude i New York City, mht. transportinfrastruktur.

Jeg vil straks begynde med nogle meget signifikante udviklinger i kampen for at bringe USA ind i den Nye Silkevej, ind i Kinas Bælte & Vej Initiativ. For det første vil jeg rapportere direkte, at Xinhua, et kinesisk nyhedsmedie, rapporterer, at præsident Donald Trump i går mødtes med Kinas statsrådgiver Yang Jiechi i Det Hvide Hus, og til statsrådgiveren Yang sagde, at USA er villig til at samarbejde om projekter relateret til det kinesiske Bælte & Vej Initiativ. De to havde dette møde i Det Hvide Hus som en del af statsrådgiver Yangs besøg til Washington; dette var et møde på højt niveau. Og, iflg. nyhedsrapporter, sagde Yang til præsident Trump, at Kina var meget tilfreds med, meget glad over og satte meget stor pris på det faktum, at Trump-administrationen havde besluttet at sende en repræsentant på højt plan – Matthew Pottinger – til at deltage i Bælte & Vej Forum i Beijing i sidste måned. Vi har rapporteret, at denne repræsentant for USA var en beslutning i sidste sekund fra Trumps side, og at det var en meget god beslutning. Rådgiver Yang sagde også til Donald Trump, at Kina ville være villig til at arbejde sammen med USA om Bælte & Vej Initiativet. Ifølge det Kinesiske Udenrigsministeriums rapport om mødet, responderede præsident Trump til denne udtalelse fra rådgiver Yang ved at sige, at han – præsident Trump – ville være åben over for at samarbejde med Kina om Bælte & Vej Initiativet og hermed relaterede projekter. Han sagde, han er tilfreds med de positive fremskridt, der er sket i de kinesisk-amerikanske relationer, siden sit møde med præsident Xi i Mar-a-Lago. Og han meddelte, at han planlægger at besøge Kina inden for det næste (nuværende) år. Dette blev bekræftet af udenrigsminister Rex Tillerson i en pressekonference, han holdt onsdag. Præsident Trump rapporterede ligeledes, at han ser frem til igen at mødes med præsident Xi Jinping ved G20-topmødet i Hamborg, Tyskland, i juli måned. Det var første punkt, og det er naturligvis en meget signifikant udvikling.

Det andet punkt er, at der samtidig, dagen før dette møde mellem præsident Trump og statsrådgiver Yang, var en møde på højt niveau mellem tidligere kinesiske regeringsfolk og amerikanske erhvervsledere på højt niveau, i regi af et bilateralt eller fælles møde, der fandt sted mellem USA’s Handelskammer – der repræsenterer førende, amerikanske erhvervsinteresser – og Kinas Center for Internationale Økonomiske Udvekslinger, der er en regeringstilknyttet tænketank med base i Beijing. Under dette møde udstedte disse to grupper et fælleskommunike, der promoverede fælles samarbejde mellem USA og Kina.

Her følger resten af webcastet på engelsk:

So, I’m going to put on the screen here a picture of this
meeting that occurred [Fig. 1].  As you can see, it’s the 9th
U.S.-China CEO and Former Senior Officials Dialogue; jointly
sponsored by the U.S. Chamber of Commerce and the China Center
for International Economic Exchanges.  What the joint communiqué
reports is that not only would the U.S. businessmen be interested
in joint cooperation on the Belt and Road, but they would also be
interested in cooperation on building U.S. infrastructure here
domestically.  So you can see here a direct quote from their
communiqué.  This is under the subtitle “Strengthening Investment
Cooperation Under the Framework of Belt and Road Initiative and
Through Other Means.”  So, here’s what it says:
“Investment is an important driver of China-U.S. trade
relations and the growth of the two economies.  There is great
potential for the two sides to further expand mutual investment.
China’s Belt and Road Initiative, which has spurred investment in
infrastructure building, will considerably broaden the space for
Chinese and U.S. investment and open many opportunities for
Chinese and U.S. companies to cooperate in third countries.
Significant participation by U.S. companies, including in
partnership with Chinese companies, can make new contributions to
the furtherance of China-U.S. economic and trade relations.  In
certain areas, U.S. companies can offer the world’s best
technology and management capability, thereby helping to insure
smooth and efficient completion of Belt and Road projects.
Infrastructure building in the U.S. will generate an enormous
need for investment, and the new U.S. administration has
indicated that this is a major priority.  China has strong
capabilities and cost advantages in infrastructure building,
including the building of urban roads, expressways, fly-overs,
high-speed rail, and ports.”
It goes on to say: “Chinese companies and financial
institutions are ready to contribute to this effort through
financing and through the provision of goods and services.
Chinese investment in certain areas of U.S. infrastructure
development has the potential to help strengthen business
relations between the two sides, and in some cases, speed up
completion of the needed projects at lower cost and with greater
efficiency.  Both sides agreed that the two countries can engage
in full cooperation under the Belt and Road Initiative and
through a number of other means, including the Asia
Infrastructure Investment Bank, the World Bank, and other
multilateral investment and financing institutions.”
Then it has a subtitle:  “Agreed Action”
“Within the next twelve months, the CCIEE and the U.S.
Chamber of Commerce will organize a conference on the Belt and
Road in China or in the United States; which will allow the
Chinese side to brief the U.S. side on the Belt and Road plans,
including initiative content, current progress and projects that
might be appropriate for U.S. company participation, including in
partnership with the Chinese companies.  The U.S. side will brief
the Chinese side on the latest infrastructure developments in the
United States and share reflections on pathways for Chinese
companies to participate in U.S. infrastructure revitalization
initiatives.”
So, this is a very important development.  And now, third,
here’s an article from {China Daily} which reports on a rather
extraordinary forum that happened in San Francisco yesterday,
which was titled “2017: U.S.-China Transportation Cooperation
Forum.”  Before I get to the next slide, just see here, the
beginning of the article.  It’s titled “Chinese Builders Wanted
in the U.S..”  The beginning of the article says, “Chinese
infrastructure techniques are urgently needed to rehabilitate
America’s poorly maintained and in some cases dilapidated bridges
and road system, industry experts from both countries agree.  The
fact that the U.S., the world’s most economically and
technologically powerful country, should import fast-train
know-how from a developing China, reflects a new normal for
China-U.S. cooperation and communication.”  Then, the article
quotes Chinese Consul-General to San Francisco Luo Linquan, who
gave the keynote.  He said, “China and the U.S. cooperation on
the infrastructure front is posed to become the new highlight in
the trade engagement between the two countries.  California along
with its neighboring states has especially close trade relations
with China,” he added. “The import and export volume between this
region and China has mounted to more than $201 billion in 2016.
The One Belt, One Road Initiative was conceived in China,” he
added, “but it provides a global platform for economic
development for all the countries participating.”
So clearly, all three of these are extraordinary
developments, highlighted by this meeting in the White House,
where Donald Trump said — according to Chinese reports — that
the United States would be happy to participate in the Belt and
Road Initiative.  This is clearly coming along very rapidly; and
as Helga LaRouche said when she was briefed on these developments
earlier today, she said “Remember, it was only three years ago,
in 2014, that the LaRouche movement put out the call for the
United States to join the Silk Road.”  I think you can remember
the pamphlet that was printed by the LaRouche Political Action
Committee that was called “A Hamiltonian Vision for the Future of
the United States:  The United States Joins the New Silk Road.”
But Helga LaRouche said, at that point — 2014 — this idea was
almost unheard of.  But now, as you can see from these
developments and otherwise, this initiative has really gained
prominence and is becoming a dominant reality.  It is very
urgently needed.  “We’ve seen a very significant victory,” she
said, “on this front; and we should recognize it as such.”  She
said, “I think an appropriate for this is ‘Ideas Matter; Ideas
Shape History’.”
I think you can really expect the consolidation of this with
the meeting between Trump and Xi at the G20 summit in July.  And
I think we can also see some dramatic developments between the
potential for a bilateral meeting — and this is becoming more
solid as the days go on — between Trump and Putin.  But, as the
lead article on the LaRouche PAC website states very clearly
today, although it’s widely expected that President Trump and
President Putin will meet for the first time on the sidelines of
this G20 summit, it’s very clear that the opponents of this
world-changing event of the United States-Russia-China
cooperation, are doing everything they can in an hysterical
fashion, to try to undermine this before it ever happens, to
force the cancellation, to cause it to become totally hostile, or
to cause there to be no positive progress that can be made out of
such a summit.  You see this crazy Russian sanctions bill that
was rammed through the Senate 98-2; you can see the efforts by
the U.S. forces shooting down this Syrian jet over Syrian
territory, which has the potential to develop very rapidly.  This
forced the Russians to again terminate the non-confliction
hotline between the United States and Russia.  You can see Steve
Mnuchin’s efforts to levy new sanctions against 38 Russian and
Ukrainian firms and individuals.  Then you can see this F-16 that
buzzed the military aircraft that was carrying Russian Defense
Minister Shoigu.  All of these are very dangerous, and are
obviously planned to try to derail any potential for a positive
relationship between the United States and Russia.
One only has to read this hysterical article in the
{Washington Post} today, “Obama’s Secret Struggle to Punish
Russia for Putin’s Election Assault,” which only continues this
false narrative.

PAUL GALLAGHER:  Not so secret.

OGDEN:  Not so secret.  So, that gives you a picture of
where we stand, but a very optimistic picture, as Helga LaRouche
underlined; if we see in terms of the potential for this United
States New Silk Road, New Paradigm consolidation.  But it’s very
urgent that this happen as well.  That was why I asked both Paul
and Diane to join me on the show today.
First, I’d like to ask Diane to go through a little bit of
what you have in this article.  As I said, it’s titled “Gulliver
Travels to Manhattan! Only LaRouche’s Four Laws and the Belt and
Road Can Save Manhattan Infrastructure Crisis.”  So Diane.

DIANE SARE:  Sure.  I was inspired, if one can call it that,
by my attendance at a Cranes, New York real estate conference,
where they had three panels.  The way it was billed was that —
and they had the CEO of the Port Authority, and the building
trades union, and Staten Island and Brooklyn.  And given what’s
about to happen here, which people may or may not be aware of,
basically we are at a total breakdown point in the greater
Manhattan area.  During the day in Manhattan, you have about 3.1
million people; at night, it’s about 1.8 million.  There’s
something between 1.5 million and 1.8 million who commute into
the city to the island of Manhattan on a daily basis.  That’s a
very large traffic flow.  Penn Station handles about 650,000
people a day; I think that’s triple what it was built for.
Similarly, every other major transit point, whether it’s coming
in from Long Island and Brooklyn across the East River, or coming
in from New Jersey on the western side, everything is completely
overloaded; at or well above capacity.  So now, the system itself
is anywhere from 70 to 100 years old, and very little maintenance
or repair or upgrading has been done.  We’re using switching
systems which were built before World War II largely; I think
they’ve modernized one line so far, and another one will be done
in a few years.  It really is insane.
So, I went to this conference, because starting on July 10,
since there were two train derailments in early April in Penn
Station on the tracks there, they’ve decided they cannot put off
repairing those tracks.  But of course, to repair tracks, then
you cannot use them while you’re repairing them.  They’re saying
they’re going to have to reduce the traffic coming in from Long
Island by 20%; I don’t know what the percentage is from New
Jersey, but it’s probably something similar or greater.  I know
the commuter routes from Essex and Morris Counties, which include
commuters coming in from Pennsylvania who go to various places
and then take a train into Penn Station, that’s all going to be
rerouted into Hoboken; the PATH system which is also overloaded.
At any rate, these repairs start on the 10th of July, and they’re
going to be going on for at least six weeks or longer.  Who
really knows, frankly?
There’s no redundancy.  This is a system that any section of
it that you shut down, if you’re talking about transit points
that are already functioning or not functioning I should say, at
over capacity.  And you’re going to add 20% more traffic, or 30%
more traffic, or 50% more traffic to it; you could have a total
breakdown of everything.  None of the plans I’ve seen so far
really are adequate.  I don’t know what they’re going to do as
they get closer; maybe they’re going to have to have people come
into work on rotating shifts, people’s hours are going to change,
I don’t know.  But at any rate, I was hoping that this conference
might address it.  What I heard there — and it’s not as though
these speakers were completely incompetent or were not aware of
the crisis in some way — but what you saw was that people’s
thinking has been so warped.  One, as I said in the article, by
this Bertrand Russell legacy that there’s no such thing as a
creative idea, or a new idea; but that everything is an algebraic
system of linear deduction.  Of course, from that standpoint, you
could never conceptualize where this region should be in 50 or
100 years.
So, the things that they were proposing be done, like
turning Rikers Island into a part of LaGuardia Airport —
LaGuardia Airport, as people may know who have travelled into New
York, is very much overloaded.  They don’t have the space for the
number of flights that are coming in, and they’re projecting that
by 2030 there will be another 30 million people per year trying
to fly into the city.  So, how do you handle this?  They said,
well we need 75 more flight operations per hour.  Taking over all
of Rikers Island for this and a new wastewater treatment plant,
only gives you an increase of 30 more flight operations per hour.
So, why would you do that?  What is the point of investing in
something that doesn’t even meet either the current needs or what
you are projecting?  It’s really insane.  So, you have that
factor; and the other factor is the funding, which I think Paul
may deal with more; but the idea that everything can only be done
through public-private partnerships.  As people know, my
colleague Bill Roberts has an article in the same issue of {EIR}
about the Soo Locks, where of course they figured out in 1986
that this is a key transshipment point for coal and other things
in the United States; and they really needed to be repaired and
modernized.  So, this was approved in 1986, but they concluded
that you’d only make back 75 cents on the dollar of what was
invested.  Clearly by Bertrand Russell-type methods, where it’s
all linear, because if you cause 11 million people to be
unemployed, which is what would happen if this thing wasn’t done,
that’s not taken into account.
Similarly, the speaker at this conference from Brooklyn,
showed pictures of the damage from Hurricane Sandy, which were
horrific; I was here in New Jersey when that occurred.  We didn’t
have electricity for about two weeks; it was very damaging, very
devastating.  There were several proposals made in 2009 at a
conference in Manhattan for storm surge barriers.  My favorite
was a five-mile one that went from Sandy Hook in New Jersey to
the Rockaways.  So you go across the whole area before you even
get to Staten Island, and it would have an underground tunnel and
it would have gates that came up; but normally the ocean would be
flowing through.  I think that would cost something like $6
billion.  I can see these silly accountants with their
mathematical methods saying $6 billion, what’s the profit?  Well,
how about saving $80 billion?  $6 billion versus $80 billion in
damage when you get one of these storms.  But nonetheless, they
decided not to build it, and we got what we got with Hurricane
Sandy.  So, because of the way people think in terms of
worshipping money, as opposed to seeing money as a means of
credit generation, or as a means of figuring out how to measure
the cost of an improvement that you need; which will lead
ultimately to the increase in the productivity of your
population.
What does it mean when you say we want our standard of
living to be higher?  Well, that doesn’t mean having seven
television sets in every room as opposed to one, or something
like that.  When you say the standard of living, we mean things
like life expectancy, being free from disease, being better
educated.  How many Americans speak only one language, and maybe
that’s an exaggeration to say that Americans even speak a
language.  Many people now do not have a very good command of the
English language, which is our language in this country.  In
other words, how many Americans know how to read music?  How many
Americans have conducted basic scientific experiments in school;
have ever tried to make a painting or a work of art or write a
poem?  In other words, by standard of living you mean that
there’s a life expectancy which allows for a young person to be
educated to the age of 22, 25, 28; and then that person has an
adult lifespan in which they’re still developing and learning.
You can get human beings developing a quality of genius which
contributes to the future for all mankind.
The only reason for money, is to create a situation where
you can think in those terms.  That the people living 100 and 200
years from now will live longer, be healthier, be better
educated, and be better; which is what you would want.  Who
really wants to be the best of all time?  That means, in effect,
that your life is meaningless, if everything coming after you is
going to be worse than you.  So, that’s the point of economy; but
none of these people was thinking that way at all.  It really
struck me that here we are sitting on potential complete chaos;
you already had two weeks ago, there was a subway that got stuck,
and it didn’t have air conditioning because the power was out.
So you had people packed in this car, and the temperatures were
getting to 100 degrees, it was like a sauna in there.  No one
could move for 45 minutes and they were on the brink — as you
might imagine — of getting completely panicked.  Happily, no one
had a heart attack or other medical disaster, but it does make
people nervous.  A few days ago, another subway car was stalled
out, so people went out the back exit and got down on the track
and started walking to the station.  That’s extremely dangerous.
What happens if you lose all order because people just panic
because they don’t know if they’re going to reach their
destination?  They don’t want to be stuck in a subway for hours
on end.  We’re really on the brink of a situation like that.
People would be prepared to tolerate hardship if they knew that
there was a plan to actually address it.
For example, if President Trump, as a result of his
dialogues with Xi Jinping and President Putin, were to say “Look,
we actually think the Bering Strait tunnel should be built within
the next decade; and we’re going to launch a crash program with
China and Russia to develop high-speed rail corridors across the
United States.  So that Manhattan really should be connected with
Paris; and that’s something that will happen.  I’m going to
initiate that in my Presidency, and it’s something that will be
completed during a future administration.”  Now knowing Trump,
he’d probably say “Well, it has to be done within my first term.”
But at any rate, what would that mean for Manhattan?  What kind
of infrastructure would you want to have in place?  If you had
high-speed rail connecting Washington D.C., Philadelphia,
Manhattan, New York City, and Boston, then you would know that
you might have a free flow of people in the entire northeastern
coastline — this huge metropolitan area — because you’re
talking about taking an hour to travel from D.C. to New York.
So, what does that mean?  What do you want New York City to look
like under those circumstances?  Maybe we have to consider taking
advantage of this massive 22% of New Jersey’s land areas in the
Pine Barrens, and convert part of that into a large city where
part of the population of New York City could be relocated, while
you build something which is actually appropriate.  But no one is
thinking in this way.
Apparently, plans have been made, as we know with the Soo
Locks, plans have been made.  There are engineers who are highly
competent who are aware of these things, who know that there are
limits on the life expectancy of cast iron and things like that.
They may have long life expectancies, but there is a point at
which things begin to corrode and things like that.  So, plans
have been made, plans exist.  But where do you get the funding to
implement it?  What is the magnitude of these plans?  If the
population were aware that such a thing existed, that is was
going to be set into motion, then people would be prepared to put
up with a certain amount of hardship; probably very happily,
knowing that their children were going to live in a much more
beautiful and functioning location than we currently do now.
So, this is the battle.  And I think Matt, what you reported
just at the beginning of this show, in terms of the commitment of
President Trump to work with the Chinese, the commitment of the
U.S. Chamber of Commerce explicitly to collaborate with the Belt
and Road Initiative; this is extremely promising, and should
absolutely be promoted.

OGDEN:  Well, I think those scare stories you have from New
York City should probably encourage people that this is a rather
urgent initiative.  I know from talking to Paul, that you have a
few more scare stories that you might want to share with us.  I’m
going to just let you go through a few of those also.

GALLAGHER:  Well, I’m going to come back to this.  I wanted
to just briefly sketch the fight around Glass-Steagall; but I’m
going to come back to this in particular on the character of the
PPPs — public-private partnerships — as actually “poison pill
policy,” which is really threatening this entire potential for
collaboration, China-U.S. collaboration both on the Belt and
Road, and also starting with the Bering Strait Tunnel.  Also in
regard to infrastructure in North America and infrastructure in
the United States.
But on Glass-Steagall, let me just indicate, you have a very
stark comparison in terms of infrastructure investment between
the United States and China.  In the United States, about $300
billion is invested in infrastructure every year, and that is,
every school, every hospital, every road job, every subdivision’s
new sewer and water and optical fiber, and so forth — that is
absolutely everything, public, private, local, Federal, amounts
to about that much investment.  In China, the four major state
banks which provide the credit for the infrastructure
breakthroughs that have been made in China, those four banks
issue about $140 billion worth of credit annually for high-speed
rail in China alone.  And just that form of advanced
infrastructure and just that public investment by those four
national banks:  the Exim Bank, the China Development Bank, the
other China policy banks, as they’re called.  That investment in
just high-speed rail is half of the total investment made by the
United States — public, private, in every form, on every kind of
infrastructure and every public band-aide that’s put on, and
claimed as infrastructure, every year.
In addition, those banks in China have invested and
committed $300 billion just in the three years since the Belt and
Road Initiative of President Xi began to take off, and that $300
billion invested and committed by those banks is outside China.
So that’s going on simultaneously with the large-scale
investments in completely frontier, including things like maglev
subways, in the major cities of China, and there are many, many,
many major cities in China as people know.
So this is widely in the financial press in the United
States and Europe, the old imperial liberal order defends itself
by saying, “This credit issuance of China can’t possibly be
sustained.  There will be a tremendous, earthshattering collapse
of all of this infrastructure credit, because the banks — it has
dwarfed even what the Federal Reserve has done for the banks
here, and for a good purpose, and it can be sustained; it’ll all
blow up.”  There is a very fundamental difference here, though,
in that China, for the last 20 years has had bank separation; it
has many shadow banks, it has a lot of investment companies
involved in broker-dealers, but they are completely separated
from the both private commercial banking system, which they want
to build up further, and also from this kind of public banking.
So that these banks are not involved in the $550 trillion
derivatives exposure of the banks in London and New York.  These
banks are not involved in securities speculation.  They are able
to handle bankruptcies; they’re able to handle non-performing
loans when they appear in various sectors as the economy
develops.  So, Glass-Steagall, although they don’t call that law
“Glass-Steagall” in China, that bank separation is important to
what they are able to do and the fact that they’ve been doing it
now for 20 years on a level of spending nearly 9% of their GDP on
new infrastructure every year, for more than 20 years.  Compare
that to the United States, which spends about 1.3% of its GDP now
on infrastructure annually. They’ve been able to do that, and
keep it up.
Now, we’ve been fighting for Glass-Steagall in Washington.
It’s really taken on much more of the characteristics of a good
brawl, in the recent weeks.  It’s become a big public fight, for
one thing, where you have on the one hand, especially for the
last two months, three months,  — on the one hand, you have all
the financial press and the major national {Wall Street Journal,
Washington Post, New York Times}, running all kinds of editorials
and op-eds on why Glass-Steagall is not necessary, why it’s
terrible, why it’s completely outdated;  it was only repealed 20
years ago, but it’s completely outdated, practically a relic of
the Middle Ages, why it didn’t have anything to do with the crash
in 2008, and so on and so forth.  You have that going on, you
have think tanks in Washington, like Heritage Foundation and
American Enterprise Institute running whole events which consist
of nothing but examining Glass-Steagall.  I went to one recently,
at the American Enterprise Institute, where six different
speakers were attacking Glass-Steagall.  The only person in the
room who was fighting for Glass-Steagall was me, and I was not
one of the speakers.
So you have these kinds of attacks on it, but also the
sponsors.  The main sponsors of the House bill, Marcy Kaptur (D)
of Ohio, Walter Jones (R) of North Carolina, the Republican main
sponsor, have started to really fight publicly.  They had a
public press conference when they introduced the bill three and a
half months ago with 25 sponsors.  They now have about 55
sponsors as a result of fighting for it publicly since then.
This is a much faster rate of getting sponsors onto the bill than
was the case in the last session, where eventually there were
about 85 sponsors after two years of work.  But in this case, the
week before last they had a congressional briefing for the staffs
of Congressmen throughout the House, about somewhere between 35
and 40 other Congressmen sent their staffs to this briefing, so
it was really quite a packed event in one of the office
buildings, to take notes and report back to their Members of
Congress.  And not only Kaptur and Jones, but also experts from
the AFL-CIO, from the Americans for Financial Reform, from Public
Citizen; Nomi Prins, an independent, former investment banker and
author on banking, independent expert — they all testified.  And
this is causing a tremendous amount of discussion throughout the
House in particular.
On the Senate side, the leading sponsors have all made it a
point to draw out the Treasury Secretary Steve Mnuchin, and make
it clear that what he was advising Donald Trump to do during the
campaign essentially, was not the real Glass-Steagall or anything
like it; but rather Mnuchin’s advice to Trump during his
campaign, was to talk about Glass-Steagall while Mnuchin
privately was designing something which was really Wall Street
deregulation like the bill that recently passed the House.
So the fact that they have really broken Mnuchin down on
this and made him say “No, no, no, I don’t believe in anything
like separating commercial and investment banking.”  This has
also dramatically clarified issues for people in both the Senate
and the House.  And secondly, we have begun to get close to the
mobilization of large organizations, large trade unions,
coalition organizations like Public Citizen, and in this I don’t
mean them endorsing Glass-Steagall, I mean them mobilizing their
hundreds and hundreds of thousands of members to demand this from
Congress.  We’ve come very close to getting to that stage, and in
particular you saw last week a broadcast that Public Citizen ran
on their Facebook page with Rep. Marcy Kaptur, in which they were
motivating and calling on their reportedly 400,000 members to go
after Congress to get this.
So the objective is to get from the 55 sponsors now to 100
— fast.  Because it’s not so important in the Senate, to pile up
a lot of sponsors — there are only a 100 Senators. It’s very
important in the House, when the leadership of both parties is
against Glass-Steagall, which they are: Both the Republican and
the Democratic leadership do not want to see it; the Democratic
leadership wants to cling onto this failed Dodd-Frank Bill, and
pretend that Obama came up with something nice there.  And the
Republican leadership wants to give Wall Street every kind of
deregulation that they’ve ever asked for.
So in that situation, it is crucial to get to 100 sponsors.
This is the stated objective of the major sponsors in the House
and when they do that, then they really want to go public and
start to hold the kind of press conferences and press bugging of
other Members which will get widely covered in the media and
really  make this into a bigger brawl.
So that’s just an indication of some of the things we have
been getting going.  And one of the arguments that Jones and
Kaptur have started to use, for example when they — I didn’t
mention this, but they also went to the Rules Committee when it
was marking up this crazy Republican deregulation bill called the
“Financial CHOICE Act.”  They went to the Rules Committee with an
amendment that said, strike CHOICE Act, take it away, and put
Glass-Steagall reinstatement in its place, and that’s our
amendment.” So they got to make a fight in front of the Rules
Committee on that.
But they’ve begun to make the very coherent argument that
not only did Glass-Steagall’s elimination lead directly to the
crash in 2008; there’s no need to go over this now, it’s the most
obvious thing in the world to most thinking Americans.  It’s like
the guy who ate nothing but McDonalds food for four months and
after four or five months his organs were failing, he was
catastrophically obese, he was near death!  And this is like
saying “there was no connection, there were other factors that
brought this guy into this condition.  It wasn’t the McDonald’s
Big Macs that he was eating.”  That’s what it amounts to to tell
Americans that less than 10 years after getting rid of
Glass-Steagall, the whole banking system blew up simultaneously,
which has never, for all of the major banks to be bankrupt at the
same time, as Ben Bernanke admitted they were, has never happened
in the entire history of the United States.  It took less than 10
years without Glass-Steagall to bring that about.
So they also are now arguing that the period in which
Glass-Steagall was in effect, which is also the period in which
the biggest infrastructure investments in new infrastructure in
the United States were being made, from the ’20s, up through the
end of the ’60s and into the ’70s, that that was a golden era of
productivity in the United States.  We had a banking system then,
which concentrated not only on loaning to  — but you see it in
many examples of the history of that period — concentrating on
making commercial and industrial loans to businesses for
expansion and for participation in major projects.  You don’t
have that kind of a banking system without Glass-Steagall;
instead, you have a banking system which wants to underwrite bond
issues for only the biggest corporations, with which they can
play around with their stock prices and so on.  And it brings the
entire economy down.
It gets us right back — and they’re making now the right
argument and very powerful argument, that if we want to rebuild
the United States, and particularly build new, frontier new
infrastructure in the United States, we have to have a commercial
banking system which is separated from securities broker-dealing
and speculation in the derivatives markets; and which is
concentrating on household lending and commercial and industrial
lending to the companies participating in these great projects.
Now, public-private partnership is, again, back to Treasury
Secretary Mnuchin, the conference that was held in Washington
last week, SelectUSA, which was a conference trying to get
foreign investment in the United States.  So this is the Treasury
Department; you’ve already given the context for this, along with
what Diane reported, in terms of the imminent potential,
absolutely imminent potential for large-scale investment,
particularly from China in an infrastructure build in the United
States.  instead, what the Treasury Secretary went there and
offered was, he said:  We want this kind of investment and
public-private partnerships are critical.
Suffice it to say, never in the United States has a major
infrastructure project or major new element of the infrastructure
of the United States, {never} has such a thing been constructed
with a public-private partnership, let alone by private
investment alone.  The Transcontinental Railroad was by no means
a public-private partnership.  And these things simply don’t
work.  The investors in them want their capital back in 10 years,
and they want 10-12% rates of interest in their invested capital
during that 10 years.  Well, that means they want it back, if
it’s anything major, while the thing is still not finished, and
still not being used to a full extent; and they want to
absolutely rob the public taxpayers whose money is going into
such a project.  It simply cannot work, and it will sabotage
foreign investment in new infrastructure building in the United
States if this method is used.
We have a threadbare public investment in infrastructure
now.  What President Trump has spoken about, the time has run out
for him and for the Congress to implement it.  They have to now
create, immediately, a National Bank on the order of $1-2
trillion in capital, in the way that Alexander Hamilton and his
successors in the American System built such National Banks
starting in 1790, through the 19th century.  They have to create
such a bank {now}, so that there is a credit institution here, to
cooperate with the credit institutions like those in China that I
was discussing earlier.
Otherwise, we are really facing disaster.  I’ll give you an
example:  I went to  a Congressional hearing yesterday and talked
to some of the witnesses who were involved in exactly trying to
organize some of the infrastructure developments that Diane
indicated are so needed in the New York area.  One of them is a
bridge over the Hackensack River near Secaucus, New Jersey,
called the Portal Bridge, which is 108 years old.  It was
designed in the 19th century, completed in 1910.  It has ships go
under it by splitting the bridge, but opening as a drawbridge.
All of the rail traffic, freight and passenger, between Florida
and Massachusetts goes over that bridge — all of it!  And that
bridge, when they open it to get a ship go through, when they try
to close it now, 9 times out 10, according to the fellow who
spoke to me there, 9 times out of 10 it doesn’t close properly,
so that rails don’t align.  And they then send workers out on the
concrete abutment of the bridge with sledgehammers, and they
hammer at the iron trusses of the bridge to get the rails to
align.
All that it would take is for them to be able to unable to
get them to align, once, and as he estimated, that would be a
single-point loss of potentially 10% of U.S. gross domestic
product.  Right there.
And then you have, in the Poe Lock, the potential failure of
the Poe Lock between Lake Superior into Lake Huron, and the whole
Mesabi Iron Range, and all of the ships which are carrying all of
the strategic metals, the iron, the coal coming out of Northern
Minnesota, Ontario, the Mesabi Range, all of that would be
stopped:  another 10% of the gross domestic product of the United
States would be frozen and they estimated up to 11 million jobs
would be lost.
So you say, “well of course, they’re replacing this bridge
at Hackensack,” but actually, they’re not!  They don’t have the
funds!  They have a plan, it’s all worked out, it’s engineered,
but the replacement is not under way.
So you have here, the makings of a movie you could call it,
a suspense thriller: “The Bridge over the Hackensack River.”  But
with 10% of the U.S. economy hanging on the guys banging those
rails back into place, but there is not any funding arranged to
replace that bridge.  And you can multiply that for all the other
things that have to be done.
We’re very far from the frontier, national high-speed rail
network, nuclear desalination plants, the Western water
management systems,  — we’re very far from the frontiers in
space infrastructure that we have to be building. We’re actually
threadbare in terms of just continuing to use, and have an
economy, what we already have.
So there’s no time at all left, for these wonderful
prospects by the discussions with the Chinese now at the highest
level, between President Trump and one of the tope people in the
Chinese government, State Councilor Yang Jiechi, for these
wonderful prospects to be backed up by the institution which
issues credit for the United States, a Hamiltonian bank for
investment.  It must be formed.  It must come out of the Congress
with the drive from the White House in order to get it done.

OGDEN:  As you said, time is running out: We’re five months
now into the Trump administration, and you highlighted the role
of Steve Mnuchin:  I think this continues to be a very bad
element in the Trump administration.  And the kind of support
that Trump gained from his support for Glass-Steagall during the
Presidential election campaign, is something that has now — that
has to become visible.  That has to become a visible, vocal, sort
of element from the population, from the constituency.  And I
just want to put on the screen the URL that we have for the
mobilization that we have for H.R.790: That’s the bill that’s in
the House, the “Return to Prudent Banking Act” —

GALLAGHER:  The Glass-Steagall bill.

OGDEN:  Which was introduced by Marcy Kaptur and Walter
Jones.  This is the return to Glass-Steagall.  As you can see,
this is the website:  http://lpac.co/hr790  And I think that this
goal of reaching 100 cosponsors in a very short amount of time,
is a very tangible goal that we can mobilize for, along with this
vision of, the United States joining the New Silk Road.  But
Paul, as I think you just laid out very clearly, that is
impossible without Glass-Steagall.  You cannot set up the kind of
national credit institutions, the national banking credit
institutions that would channel that kind of joint investment
into this infrastructure in the United States, without this
critical first step of the return to Glass-Steagall.
One thing I wanted to ask you about, Paul, is just the
prognosis on how close we could be to another disastrous blowout
of the trans-Atlantic banking system.  I know Nomi Prins did an
interview a few months ago with you, where she highlighted a few
of these things with the corporate debt bubble.  But that’s
something that Marcy Kaptur cited in her testimony to the Rules
Committee, and I think that element of urgency is also necessary
to put in here.
[https://larouchepac.com/20170319/interview-nomi-prins]

GALLAGHER:  We don’t know how much time, because it’s
impossible to put a finger on a date when a really huge and
increasing unproductive debt bubble, in this case, as
Representative Kaptur identified, the corporate debt bubble in
the United States, when it’s going to blow up.  But, the size of
corporate debt in the United States has doubled in seven years,
from about $7 to about $14 trillion, with really the great
majority of that tremendous debt expansion being used for what
they call “financial engineering” by large companies: Meaning
buying back their own stock, mergers and acquisitions, finding
ways to increase the dividends they give to their stockholders,
increasing their own executive compensation — all of this kind
of financial engineering has used in various years up to 80-85%
of this new corporate debt.
What has really suffered in the process has been business
capital investment and the commercial and industrial lending,
which it depends on. So that that tremendously expanding bubble
has stopped expanding.  And this has been noted  rather suddenly,
by everybody from the IMF to individual bank research teams,
since April of this year, that suddenly that tremendous expansion
has stopped; as happens with an immense bubble that’s about to
explode, and it started to shrink.  And there was a report put
out by UBS bank in Switzerland about two weeks ago which caused a
certain amount of alarm, because they found that what they call
the “credit impulse,” had gone negative in the last six months —
they’re talking globally now — meaning that the second
derivative, the rate of the rate of growth of business lending
around the world had suddenly in the last six months become
negative.  And that is something which virtually always points to
a bubble about to collapse.
This is a very huge one, indeed.  The IMF estimated that if
interest rates were to go up sharply in the United States, 20% of
all the companies in the United States would default.  That’s way
above the rate of defaults on mortgages even at the worst 10
years ago; and the whole thing would come crashing down.
So we need the reorganization of the banking system,
urgently, for that reason, also in order to make the commercial
banking side of it proof against this kind of a blowout.  And so
you don’t have, again, a situation in which the bankruptcy of any
investment bank, let’s say, becomes, almost overnight, the
bankruptcy of every major U.S. based bank as happened in late
September 2008.

OGDEN:  I would say, this is real policy.  This is what
anybody who’s serious is discussing right now.  And the failed
decision by the Democratic Party, for example, to just be the
party of resistance, is increasingly proven to be an increasingly
proven to be very ill-advised policy.  And I think even Sen.
Chris Murphy made some headlines this week where he said:  Look,
none of my constituents are talking about “Russia,” when I go
home.  They’re talking about jobs, drugs, poverty.  They’re
talking about exactly what we’re discussing here!  Hmm, gee,
maybe we shouldn’t be pumping anti-Putin propaganda all day every
day.
So, I wanted to ask Diane, you know, we’ve had some
surprising reports — or surprising for some — from the streets
of Manhattan, where you would assume because of the 24-hour-a-day
anti-Putin propaganda that people are being inundated with, that
this would be the only thing that’s on people’s minds.  But as we
saw, the reality on the ground in New York is the collapsing
infrastructure.  This is what people are actually interested in
talking about.  And we’ve had some rather surprising readings
from the population there in New York and northern New Jersey, in
the recent weeks.

SARE:  Sure.  We’ve had numbers of teams set up by the
roadside in New Jersey or right in the middle of the large
sidewalks in Manhattan, with giant signs saying “Defend Trump.
Stop Here.  Donald can’t do it alone, join LaRouche PAC.  The
U.S. must join the Belt and Road.  Russia-Gate Is a Comey Plot!”
And many people are coming up to our tables and we’re actually
getting a very hot response, much more intense than at any period
since the election, with people coming over saying, “You know, I
thought I was the only one.  The propaganda is so intense, I
don’t dare to say that I supported Trump at my workplace.”
We had a very strong response also in Connecticut, Long
Island, Jersey and Manhattan per se, where we are getting this
type of response.
And I also just wanted to add, in light of this crazy
continuing of the story about the alleged Russian hacking which
somehow caused people to change their mind on how they were
voting.  Remember we did just did have the special election for
Congress, in South Carolina and Georgia, where the Democratic
candidates, one of whom I think spent $33 million or some
absolutely obscene amount of money, and still lost the election.
And it’s not because the Republican candidates were so brilliant;
it’s because the population has really had it and this is where,
if President Trump moves in a very big way, very public way to
embrace the Chinese offer, to reinstate the Glass-Steagall Act so
we can have a sane banking system, and to launch some of these
infrastructure projects on a Federal basis, you would just see an
incredible upsurge of support.  And most of this vicious,
including assassination threats and so forth, these attacks on
the President, would simply evaporate and the people that persist
would be shown for the paid agents of the British Empire and
George Soros that they are.

OGDEN:  I think it was clearly said by Helga LaRouche:  We
have a very significant victory to claim, I think both in terms
of the further consolidation of this idea that the United States
should join the New Silk Road, and the fact that these
discussions are now going on at the very highest level between
the United States and China.  But also in terms of this fight for
Glass-Steagall and as Paul said, this is something that LaRouche
PAC has been directly involved in, on the forefront of leading
for year — 2008, 2009?  Lyndon LaRouche’s call at that time was
for a complete bankruptcy reorganization of the economy.  It was
initially the Homeowners and Bank Protection Act and that became
this idea of the Four Laws.

GALLAGHER: August 2007 was the Homeowners and Bank
Protection Act.

OGDEN:  That’s right. So now we’re coming up on 10 years!  I
think that’s widely recognized, the leadership that the LaRouche
movement has played, including on Capitol Hill from the sponsors
of this legislation.  So this decision now to mobilize and to
really enter into a brawl, the fight is on on that front and we
have a responsibility to pour as much as we can, from around the
country, in mobilizing on that front, too.
I think that’s a good conclusion for our webcast here,
today.  Thank you Diane, for joining us from New York, and thank
you very much Paul for joining me here.

GALLAGHER: A pleasure.

OGDEN:  Stay tuned to larouchepac.com and we’ll talk to you
soon.