Rhodes Dialogue: Common Good Is Aim Of Economic Activity

EIRNS/Stefan Tolksdorff

LaRouche is joined here by some of the other speakers and participants at the Rhodes Forum; he is seated, second from left; Helga Zepp- LaRouche is standing, far left.

 
The strength of the seventh annual conference of the World Public Forum in Rhodes, Greece, which met October 8-12, 2009, lies in the fact that it emphasizes the concept of a “Dialogue of Civilizations,” for solving problems. Again, this year, it gathered over 500 academics, religious leaders, economists, politicians, artists, and journalists, from 60 countries, to discuss various subjects.


While last year’s conference, also in October, was strongly impacted by the dramatic development of the financial crisis, just after the bankruptcy of Lehman Brothers, the mood among many conference participants this year, was one of deep skepticism toward the official line, claiming that, “the worst is over,” and, of a certain foreboding that the main brunt of the crisis has yet to hit.


The environment of the conference was in stark contrast to the reality of the strategic and historical situation; debates and many productive discussions took place here, in the quaint fishing village of Kallithea on the Aegean island of Rhodes, while, in the rest of the world, the collapse of the real economy continued apace, “irrational exuberance” was once again sweeping the financial markets, and financial institutions left no doubt of their intention to have the world’s people pay for the crisis, by brutally cutting living standards.

Participants explicitly expressed the conviction that the current global crisis is a result of the fact, that so many decision-makers have reneged on their responsibility for the common good. In the final discussion of the concluding plenary session, one participant was broadly supported when she said that the current crisis is due, in large part, to the crisis in leadership among the established elites.

The final declaration states:

Point 2.1: “The global economic and financial crisis has not ended yet. It is obvious that this crisis cannot be fought with the traditional economic and financial tools only.”

Point 2.4: “The ultimate target of all economic activities should be the common good of human beings and not the agglomeration of capital. The focus of economics should be on the benefit and the bounty that the economy produces, on how to let this bounty increase, and how to share the benefits justly among the people for the common good.”

Call for 'New Ethics in Economy'

Noteworthy, is a reference to the latest encyclical of Pope Benedict XVI, in Point 2.5: “We need new ethics in economy instead of prevailing consumerism on the one hand and unbridled free-market capitalism which culminates in so-called share holders values on the other.”

Point 2.8: “We welcome the call of many religious leaders for ethics in economy, and, in particular, that of Pope Benedict XVI in his encyclical letter Caritas in Veritate for a civil economy re-embedded in civil society that transcends the old secular dichotomies of state versus market and left versus right.”

The most concrete proposal for creating a civil economy was made by Lyndon LaRouche (see full text of his address), who is very well-known in Russia for his theory of physical economy, and whose contribution this year was commented upon by Russian experts. The speech that this author gave to the 2008 conference, on the LaRouche Plan for reorganization of the financial and economic systems, was published in the 2009 Conference Bulletin.

Various participants in the discussion this year said they thought that the G20 Summit in Pittsburgh, Sept. 24-25, was nothing more than a PR operation, and, that the measures taken had simply postponed the death of the system for a time. An important theme was the awareness that the global crisis demands a new definition of the notion “happiness,” and that the answer to this question is not to be found in the material domain, but on a spiritual level.

The initiators of the World Public Forum—Vladimir Yakunin, president of the Russian Railways; Jagdish Kapur, chairman of the Kapur Surya Foundation in India; and Greek businessman Nicholas F.S. Papanicolaou—deserve thanks for having founded the “Dialogue of Civilizations.”

by Helga Zepp-LaRouche

October 2009

What Is a New Bretton Woods Financial System?

The original Bretton Woods system came into being at a conference of 44 nations beginning on July 1, 1944, in Bretton Woods, New Hampshire, convened on the initiative of U.S. President Franklin D. Roosevelt. On July 22, the group agreed to create an International Monetary Fund (IMF) and a Bank for Reconstruction and Development, later known as the World Bank. The main purpose of these institutions was to deal with the economic problems of the European countries that had been devastated by war. They began to function in early 1945, as World War II was nearing its end.
The core of the new system was the arrangement for fixed currency parities, which would make it possible to revive world trade. The value of the dollar was pegged to a specific weight of gold, and, until the end of the 1960s, it functioned as the accepted substitute for gold. Exchange rates of other currencies were to be changed in relation to the dollar or gold, only as a measure of last resort, after national policy measures had been exhausted. Long-term investment and trade could thus be undertaken on a stable currency background, and risk of dramatic currency losses and speculation was nonexistent at that time.

From the beginning, however, there were clashes between the "free-trade" colonial policies of the British delegation, and the concepts of President Roosevelt, who had told Britain's Sir Winston Churchill as early as 1941 that the United States was not going to fight the war in order to restore Britain's colonies. After Roosevelt's death, unfortunately, his understanding of postwar economic policy was abandoned by successive Presidents (with the exception of John F. Kennedy), and the IMF and World Bank increasingly came to play the role of instruments of neo-colonial looting, on behalf of the British-based financier oligarchy. When President Nixon finally took the dollar off its gold backing in 1971, the Bretton Woods system became defunct.

In calling for a New Bretton Woods, Lyndon H. LaRouche, Jr. has specified five steps that must be taken today:

1. Governments must not attempt to bail out the speculators. Let the derivatives market and other paper values collapse as they may: it's only paper! The only necessary action of government on this account, is to protect people, productive enterprise, and useful trade in hard commodities and science-related services.

2. The credit and issued public Treasury debt of national governments must be protected at all costs; otherwise, the necessary measures of economic recovery and growth would not be possible.

3. There must be no mass evictions, or breaks in continuity of operations of essential production and distribution of goods and essential services. During the 1929-31 Depression, terrible blunders were imposed upon the Hoover administration by Andrew Mellon et al. This must not be repeated today, in any country.

4. The President of the United States must act in concert with other governments, to put the existing financial and monetary system into bankruptcy, and to put a new world monetary system into place.

5. A global recovery program must be adopted to foster immediate recovery in world hard-commodity trade, and to provide an urgently wanted general stimulant for the private economies of the participating nations. The core of such a recovery program is the Eurasian Land-Bridge, creating corridors of high-technology infrastructural and industrial development, with "spiral arms" extending to Africa and the Americas.

Background: See William Engdahl, "What the Bretton Woods System Really Was Designed to Do," EIR, Aug. 15, 1997.