Depression Hits! LaRouche Vindicated --
Asks Citizenry: Roosevelt or Hitler --
Which Path Will You Choose?

March 12, 2001

"Let me assert my firm belief that the only thing we have to fear is fear itself--nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance."

President Franklin Roosevelt March 4, 1933 Inaugural

March 21, the world's leading economist, Lyndon H. LaRouche, Jr., will speak to an international audience over the Internet, in a webcast which will outline how the U.S. Constitution's General Welfare clause, can mobilize U.S. citizens, not only to stop economic catastrophe, but to launch the greatest economic recovery since the time of President Franklin D. Roosevelt. By the time of that address, it will no longer be deniable, except by fanatically religious cult-worshipers of the now-exposed "New Economy" scam, that the post-Soviet Union collapse "triumph-of-free-enterprise" party is over. All who wish to, can now see the "other shoe"-- the Japan/Europe/U.S. trilateral "global economy"-- dropping, sinking in that ocean of indebtedness that would drown civilization itself, if not for the vigorous action that must proceed from measures proposed by LaRouche.

One year ago, during the Presidential campaign, Democratic Lyndon LaRouche distinguished himself by being the only candidate who was willing to tell the American people the truth about the New Economy. Just one year ago, on March 7, the NASDAQ index had reached its all-time high of more than 5,000. Forecasts were that the NASDAQ would go as high as 10,000. On April 3, 2000, less than a month after this manic forecast, EIR issued a report entitled, "Why the New Economy Is Doomed," with an introduction by LaRouche entitled, "On the Crash of the NASDAQ, Information Society: A Doomed Empire of Evil." Two day later, on April 5, "Wizard of Id" Alan Greenspan spoke at the White House Conference on the New Economy, declaring, "Not only has the expansion reached record length, but it has done so with far-stronger- than-expected economic growth." Republican Presidential candidate George W. Bush declared on April 11 that "America is wealthier than it has ever been." Democrat Al Gore declared May 3: "You will find no greater supporter and admirer of the Federal Reserve and its chairman Alan Greenspan [than me]." By Monday, March 12, 2001, the NASDAQ had crashed by over 60%, to 1924.

LaRouche had been proven right, and Greenspan, Bush, and Gore, dead wrong.

Worldwide, stock indices reflected the collapse of the NASDAQ. Taiwan's index was down 40%; Indonesia's 30%; Tokyo dropped 36%. Japan's collapse, however, is most notable, since it is the second- largest economy in the world. Japanese Finance Minister Kiichi Miyazawa recently stated that Japanese government finances were close to "a catastrophic situation." Japan has over $5 trillion in public and private debt. German commentators have warned that if the Japanese economy goes, the whole world system goes. Indeed, the United States itself is a major debtor to Japan.

Do you think that things are actually better here, in the United States? The U.S. is the world's biggest debtor nation. Consider this: only three American banks---J.P. Morgan & Chase Co., Citigroup, and Bank of America--hold debt obligations combined of $40.1 trillion in derivatives, highly speculative financial instruments. The indebtedness of each of the three, in derivatives alone, is bigger than the Gross Domestic Product of the United States. As an example: For every dollar in equity held by J.P. Morgan & Chase, they have $580 in derivatives.

Over the weekend of March 10-11, Jeff Bezos, CEO of, "Mr. Internet," advised against buying internet stocks, citing the fact that his own company had declined 80% in value in a year. New Economy giant Apple Computer CEO Steve Jobs, has characterized the financial situation as a "meltdown."

Nor is the crisis simply a matter of a financial wipeout for millions of people. The physical economy of the United States has gone into a deep downward spiral, with mass layoffs, a collapse in health care, and hyperinflation in energy prices, which is forcing plant shutdowns, government and corporate bankruptcies, and a dramatic increase in cases of people having to choose between paying their energy bills and buying the food and medicine they need to survive!

LaRouche Was Right!

LaRouche has consistently pointed out two things. First, that the collapse faced by the U.S., and the world, is not a cyclical collapse, like the Depression of the 1930s. It is a systemic collapse, meaning that civilization as we know it, not simply the financial system of a few, or of many, nations is threatened. For decades, LaRouche asserted this same distinction, and was greeted with derision from the semi-literate ranks of academia, and the even more pathetic "entertainment media," sometimes mistakenly referred to as the American "press corps."

In 1973 for example, LaRouche insisted that the Aug. 15, 1971 removal of the dollar from the gold system, thus ending the 1945-1971 Bretton Woods System established by Roosevelt, "pulled the plug" on not only the financial, but the physical-economic system of the world's nations. As a result, unless major investments in the world's infrastructure--water systems, medical systems, and transportation systems--were made, we would see the rise of new forms of disease pandemics, which could wipe out, not only hundreds of millions in Africa and Asia, but perhaps reproduce the conditions of the 14th-Century New Dark Age in Europe, when half the population died in the Black Death.

In January 2000, the National Intelligence Council of Washington D.C., in collaboration with the Armed Forces Medical Intelligence Center, corroborated that forecast. It issued a report entitled, "The Global Infectious Disease Threat and its Implications for the United States," which states on page two that "Twenty well-known diseases--including tuberculosis (TB), malaria, and cholera--have reemerged or spread geographically since 1973, often in more virulent and drug-resistant forms. At least 30 previously unknown disease agents have been identified since 1973, including HIV, Ebola, hepatitis C, and Nipah virus, for which no cures are available."

LaRouche's forecast of 1973 was correct. LaRouche's assessment of the NASDAQ in the 2000 Presidential elections was correct. Yet the American people were not allowed to hear either of those assessments. In 1974, the New York Times began a campaign of slander against LaRouche that continues to this day. In March-May 2000, Democratic Presidential candidate LaRouche's votes were stolen and disregarded by both the Gore wing of the Democratic Party, and by the U.S. Supreme Court, setting the stage for the illegal actions of the Supreme Court in their appointment of George W. Bush to the Presidency after the Nov. 7 election.

Now, reality has struck. We must get the attention of the American people, and fast. There is only one way to do that. We must invoke the precedent of FDR's 19322 institutionalization of the General Welfare clause of the U.S. Constitution.

Why We Must Change

"Inside the U.S. itself, despite the efforts of my own and some other leading Democratic Party circles, to prevent such a catastrophe, there is, realistically, the increasingly awesome likelihood, that the present, Bush, administration, like the Ozymandias of Shelley's famous poem, might be stubbornly doomed to a self-induced, early, imperial disaster. Certainly, only madmen within the U.S.A. would wish such a catastrophe to occur, but only wishful thinking would mislead any leading circles, in any part of this planet, into believing, that a self- inflicted doom of the present U.S. administration is not a probable, catastrophic outcome at this present moment," said LaRouche in a recent speech in Berlin, Germany. This is not a partisan game for a few cheap shots against the Bush administration. For the sake of the nation, and its pivotal role on behalf of all civilization, the Bush administration must be induced to give up its terrible, suicidal illusions now. That can only be done, if the American people fight, and win, a series of battles on behalf of the General Welfare. Certain destruction awaits the American people otherwise. There are two immediate theaters of battle in which this can be done. The first is the area of health care. The second, is the urgent need for the immediate re-regulation of the electricity industry. It is the responsibility of the citizens of this nation--not elected officials, not bankers, not the media, not movie stars--to make this happen. "It is the great paradoxes which confront a people, which are usually the occasion on which a people may choose to make an abrupt change for the better, as we did with Franklin Roosevelt's response to the 1929-33 crisis, or, for the worse, as Germany did during January-February 1933, in establishing the Hitler dictatorship. Those who study such example from history, know that anyone who says, 'You can not change the way the cards have been dealt,' is wrong. Man is distinct among species, as a creature endowed with free will; our responsibility is to cease our piteous whimpering about 'the way things appear' to be, and use that free will to correct our society's mistakes."

Thus, LaRouche commented on the California energy crisis. For, if the people are unwilling to govern themselves, then how can the government that they empower, be called a government of, by, or for the people?

Therefore, don't whine. Fight, and win, those battles that establish the truth: that action to improve the General Welfare is the only just basis for power of any government.

Save D.C. General Hospital!

The leading theater of battle on health care is the fight to save D.C. General Hospital. Over 100,000 Washington, D.C. citizens have no health insurance. D.C. General is the only public hospital in the city. The D.C. Financial Control Board, and Mayor Anthony Williams, are about to turn the hospital over to a group of corporate thugs known as the National Century Financial Enterprises (NCFE), and Doctors Community Healthcare Corporation (DCHC). These outfits have been accused in several states, among them North Carolina, Tennessee, Kentucky, and Massachusetts, of criminal fraud and racketeering. In Boston, the front-group, DCHC, first offered to buy Boston Regional Medical Center for $50 million. Boston Regional accepted this bid, rejecting others. Then, DCHC "negotiated" on the bid for 18 months, during which they "facilitated" an arrangement with NCFE to "finance" Boston Regional with a $16 million loan, so that they could continue to operate during the negotiations. "Meanwhile, DCHC and NCFE took over complete control of the hospital's money, taking all income, making all payments, including to themselves, and keeping all the records," according to EIR researcher Anton Chaitkin. "The resulting nightmare cost Boston Regional the following actual interest rates on NCFE's financing: 1995, at least 34%; 1996, at least 21%; 1997, at least 48%; 1999, at least 30%, each a violation of Massachusetts usury laws."

Why would the D.C. Control Board, supposedly responsible for "straightening out corruption in D.C.'s finances," and the Mayor, want to turn over the city's only public hospital to an outfit like this? It is part of the over fifty-year-old plan called "Negro removal," begun back in 1952 with the razing of the 113-square-block Southwest area of Washington. In one year, the entire neighborhood was gone, and over 25 years passed before its "reconstruction," minus the original population, was completed. "An entire community was demolished and dispersed in the process." It became known as 'Negro removal.' In 1959, Eleanor Roosevelt toured the neighborhood and asked a simple question: "What has happened to the people who once lived here?"

The real estate on which D.C. General sits, is to be "developed" without the people. Therefore, to induce people to leave, dying through lack of medical care is introduced as "a strong incentive." "Washington is the capital of the new Roman Empire. It should reflect what that new empire is all about. America is not 70% African-American, so why should D.C. be? It's time to resolve the problem, by removing the problem." That, not "fiscal responsibility," or even a "lucrative real-estate deal," is the real, Hitlerian thinking behind the hospital shutdown. And African-American politicians are recruited to front for that project, the same way the gauleiters of the Warsaw and Cracow ghettos fronted for Nazi policies in the 1930s (Figure 1).

The attack on D.C. General however, is not merely an attack on its African-American population. It is an attack on the very idea of public health care itself: 58,000 people visit D.C. General's emergency room yearly. D.C. General is not a "dump." In fact, it is one of only two facilities in the District prepared to respond to a biological warfare emergency.

Stop Energy Piratization!

Who would have the power to destroy this 195-year-old institution (founded in 1806)? The same people that have the power to raise the utility rates of the American people through the roof, in the name of lowering prices through competition. EIR researcher John Hoefle points out that, "While the deregulation spin-doctors promised lower electric rates, what they delivered was just the opposite. Californians, for example, saw the price for electricity quadruple from 1999 to 2000. In November and December 2000 alone, Californians spent $9.5 billion on electricity--$2 billion more in just two months, than they spent in all of 1999! Utilities absorbed most of the increase, and are facing bankruptcy as a result.

"Deregulation proved to be a complete disaster," Hoefle concludes. Supply and demand have nothing to do with what is happening. In the case of oil prices, they did not mirror supply and demand, but the prices rose after the mega-mergers of major oil companies (Figure 2). Natural gas prices have gone through the roof, not because of supply and demand, but because they are pegged, arbitrarily, to the price of oil. Natural gas price rises, unlike oil, cannot be blamed on OPEC, because 85% of the natural gas used in this country is produced in the U.S. Still skeptical? Consider this: While the rest of the country was paying $8 per million BTUs for natural gas this past winter, Californians were paying $60 per million BTUs. Why? As Hoefle explains, "In 1996, a group of gas pipeline executives met in a Phoenix hotel, to discuss the 'opportunities' arising from California's newly deregulated electricity market. Representatives (from gas companies) agreed to kill new pipeline projects that would have brought more, and cheaper, natural gas into California."

Defeat the Economic Royalists!

The battle must be joined against the "economic royalists," following FDR's 1933 example. This, however, is not 1933. We will need more far-reaching measures. In the case of health care, we must reopen full- service, fully funded public hospitals, beginning with D.C. General. We must return to the 1946 Hill-Burton Act's commitment to an adequate number of public hospitals throughout the U.S. In the case of the theft-fest referred to as "deregulation," we must immediately re-regulate the entire power industry, and save those corporations, like the utilities in California, through Chapter 11 bankruptcy procedures that allow those firms to keep their doors open and to continue to function.

LaRouche proposes: "Just as the crisis of 1929-1933 brought President Franklin Roosevelt's advocacy of the general welfare to power, so the onrushing collapse of the U.S. economic policies of the past thirty-odd years, may signal another turn, back to the general welfare, like that of 1932-33.... The required intention in the acceptance of the physical obligation to promote the general welfare through economic growth, obliges government to expend great efforts on behalf of its intention to promote the improvement of what we call basic economic infrastructure." This includes hospitals and schools, as well as the national transportation grid, water systems, and electrical grid. "In practice, we find that such public works may be undertaken either solely by the efforts of government itself, or undertaken by privately owned public utilities acting according to regulations provided and maintained by government."

The citizens must force the Bush administration to immediately abandon its folly. Vigorous action must be taken to save the hospitals, the schools, the physical means of existence and production of this nation, before it is too late. Join LaRouche in this battle to make the General Welfare the only authority by which government is empowered to act.


For more information, please call 1-877-520-2167, or fax (201) 641-0453.

See LaRouche's Webcast on March 21, 1 pm, at

For more articles on DC General, see: