August 4—With banks and related financial institutions crashing in the U.S. and worldwide almost by the minute, American statesman and physical economist Lyndon H. LaRouche, Jr. opened his July 22 international webcast (see pp. 2-3) with the following pronouncement: “The first thing to settle, is that the present international monetary-financial system will die, and will never recover. This system is finished.”

Indeed, even as U.S. Treasury Secretary Henry Paulson tried to arm-twist the U.S. Congress for hundreds of billions or trillions of dollars to attempt to bail out mortgage giants Fannie Mae and Freddie Mac, along with the entire U.S. banking system, a Wall Street insider privately informed LaRouche’s political action committee (LPAC), that there are now over 1400 banks on the U.S. government “watch list” of endangered institutions! Panic is setting in, in the U.S., in Europe, here in Australia, and elsewhere, as even sober-minded businessmen have started pulling their money out of the banks.

LaRouche speaks with unparalleled authority. The world’s leading economist, he has forecast the twists and turns of the present crisis for decades, since even before U.S. President Richard Nixon took the dollar off gold in 1971, ending the postwar Bretton Woods fixed exchange rate system, and ushering in the present, London-centred free trade, “globalist” system of monetary speculation, which has savaged the actual physical economy of most of the world. LaRouche devoted his July 22 webcast, whose opening echoed his prescient webcast of almost precisely one year before (see box), to the three-part solution which must be adopted worldwide, beginning with the U.S.: 1) His Homeowners and Bank Protection Bill must be passed immediately, for a moratorium on all home foreclosures and to put the U.S. banking system under bankruptcy reorganisation, to keep banks’ doors open for essential community functions, 2) A two-tier credit system must be established to provide federal credit at 1-2% for productive enterprises and infrastructure, while letting rates float up for other, nonessential purposes, 3) The U.S. must take the lead to organise a “Four Power” alliance of itself, Russia, China and India, to inaugurate a new world monetary system, to replace the present, disintegrating British imperial “globalist” system.

Meanwhile, here in Australia...

Like the major U.S. banks, each and all of Australia’s “Big Four” (National Australia Bank, ANZ, Commonwealth Bank, and Westpac), are utterly, and irrevocably bankrupt, both because Australia’s own free-trade centred economy is bankrupt, and because the “Big Four” are integral parts of a global speculative bubble measured in the hundreds of quadrillions of dollars, which is now exploding.

Contrary to the earlier hype that “Australia will be insulated from a U.S. downturn”, because of its allegedly great financial management, the word is now out internationally that Australia, like its imperial master in Britain, is in far worse shape than the United States. Typical was a July 31 article in Britain’s Daily Telegraph, “Australia faces worse crisis than America”, by its widely- read International Business Editor, Ambrose Evans- Pritchard. He catalogued just a few of Australia’s problems: that National Australia Bank was just forced to admit that “its AAA-rated securities are virtually worthless”; that Australia has an astounding “current account deficit of 6.2% of GDP”; that “household debt has reached 177% of GDP, almost a world record”; and that our high interest rates and resulting inflow of foreign “investment” (speculation) means that Australia “will now have to generate 4% of GDP to meet payments to foreign holders of its assets ... twice as high as the burden faced by the US”. He could have added that our foreign debt is a staggering $1.039 trillion, and that one million Australian households will be “mortgage stressed” by December, many of them already in foreclosure. Oh, and $60 billion of our $1.3 trillion in superannuation has just officially vaporised—which is just the tip of the iceberg. In fact, barring the kinds of sweeping bankruptcy reorganisation outlined by LaRouche, you can forget your super, full stop.

But the good news is this: LaRouche’s associates in the Citizens Electoral Council have been preparing for this moment almost ever since we were founded twenty years ago. So see below and page 4 for some of the LaRouche-inspired measures which this country must urgently adopt, if we are to survive the worst financial crash in human history.