LaRouche: Only Solution to the Crisis, For Europe and the World, Begins With U.S. Restoration of Glass-Steagall

June 8, 2010 (LPAC) —Lyndon LaRouche issued the following statement on the solution to the global financial crisis today.

"German Chancellor Angela Merkel believes that austerity measures are necessary at this juncture. If so, that is an understandable mistake by her. This suggests that the root of her mistaken policy would be her intention to 'work within the existing system,' without considering those reforms in the system without which the already approaching early doom of Europe under the existing system were virtually inevitable.

"The only solution is to be premised on the immediate alternative of the combination of a predominantly global installation of a multi-national fixed-exchange-rate form of Glass-Steagall-modeled international credit system, as a sudden replacement for the existing monetarist systems.

"As I reported on an occasion last evening, this requires the immediate ousting of the current U.S.A. President Obama, who is presently, and completely, a self-doomed British puppet, and the U.S. adoption of both a Glass-Steagall system and a commitment to immediate resumption of a fixed-exchange-rate system. This reform must be made as a credit system, rather than continuing with a monetarist system.

"It is essential that the U.S.A. accompany its own U.S,A. reform by the announcement of its commitment to professing immediate extension of membership to both a Glass-Steagall system and a fixed-exchange-rate credit system to willing European and other nations.

"It must be recognized that there are presently two financial systems operating as one. On the one side, there has been an accelerated collapse of purchasing power for matters of the real economy, at the same time that there is an implicitly hyperinflationary expansion of purely fictitious forms of monetary emission.

"Thus, throwing the fictitious mass of derivatives and their like overboard will not shrink the real economy, but, rather, quite the contrary, allow for the immediate massive creation of credit for restarting and expanding the real economy, a mass of state-created credit, run, to a large extent, through a protected system of commercial banking, and a physical-economic stimulus for the entire economy prompted by state-generated large-scale habilitation of basic economic infrastructure. The appropriate forms of infrastructure will inevitably create a market for credit productively employed in agriculture, manufacturing, and functionally related production categories. This will, in turn, provide for a natural and rapid re-expansion of tax-revenue base of nations."