June 11th, 2002

The following was posted at the Rumor Mill News Forum earlier this week.

Mental Illness Grips Large Portion of Americans


It is affecting top political circles, including the President and the White House, much of the general population.

It takes the form of the denial of the economic collapse, even though people are faced daily, with the contrast of a catastrophic collapse of the economy and the financial markets stumbling around, as against the hype coming out of the news media and the government asserting that the future is bright, and that things are getting better every day.

Many people don’t want to think what their lives would be like, if the whole system goes down, so they deny that it could happen to them.

They may not openly deny the crash, but they deny it in the way they act, in the movement of hands and feet.

Some people act, in true schizophrenic fashion, as if the crash is a {political} event, but, if they maintain a little life outside of politics, then the crash won’t affect them BECAUSE THEY ARE NOT PREPARED PSYCHOLOGICALLY TO CONTINUE TO LIVE IN A WORLD IN WHICH A GENERAL MONETARY-FINANCIAL COLLAPSE HAS OCCURRED.

The President and the White House are also in a state of denial. Their reaction takes the form of an hysterical desperation reflected in much of what the Administration does.

They are trying to conceal reality, by concealing it and burying it, from the process of public opinion.

The Administration is deathly afraid of the effect of the economic collapse on its own program, that it will ruin everything they think they are trying to do.

Take recent events, like the Halliburton-Cheney scandal, or the Enron collapse and fiasco. Look at the whole list of these scandals and collapses. What will be the impact of a cascade of such events? We will see a national panic, and people will be asking Bush, “What do you have to say now, President Hoover?”

As to the financial markets, they are not going to make it through September. July and August are likely to be a very tough period, characterized by increasing turbulence.

The financial establishment may try to come up with various measures to deal with it, but the turbulence is going to be one step ahead of them. It’s different, but also the same, as what happened in Weimar Germany, where there existed a situation of increasing turbulence, and the attempts to deal with it through various hyperinflationary measures didn’t work, any more than they will work today.

This is the context in which to see the crazy “anti-terrorism” reorganization announcements made by the Bush Adminstration, from the reorganization the FBI, to the scrapping of the FBI guidelines, to the President’s announcement of the creation of a “Department of Homeland Security” Thursday night.

Just as the reorganization of the FBI shifts the priority from law-enforcement and prosecution of crimes, to “prevention” of terrorist attacks, the new Homeland Security Department will absorb a number of agencies with a long tradition of law enforcement, including Customs and Secret Service. Except that the declared mission of the new Homeland Security Department is not law enforcement, it is supposedly “preventing terrorist attacks.”

The attitude of the architects of these monstrosities, is that we don’t need law-enforcement — we just pick our targets and shoot, or point-and-shoot. The directionality is toward a new Gestapo. This means, among other things, that the nation’s traditional law-enforcement capabilities are being destroyed, in the name of “prevention.”

Of course, when we are dealing with Bush or Ashcroft, we are dealing with people who aren’t too bright. It may not even be clear in their minds what they are doing, and truly there is a large component of incompetence in these schemes.

But fundamentality, we know what is driving these crazy schemes, whether it is Ashcroft’s “preventive” measures domestically, or Rumsfeld’s utopian “preemptive” military policy abroad — it is the financial and economic collapse.

The following headlines illustrate my point:


” Goldman, Sachs and Co. sponsored the 90-minute conference call with Central Bank chief Arminio Fraga, Deputy Finance Minister Amaury Bier, and the head of monetary policy at the Central Bank, Luiz Fernando Figueiredo. One participant said afterwards, that “basically Fraga said, `Look what we’ve done in the past, and you will see that we always did what was necessary to soothe tensions[sic].'”

Another said there was no new information on the call, “but just the fact that they did it at least tells the market they are aware of the problems.” Investors reportedly pressed the Central Bank to take action, including, if necessary, spending some of its foreign currency reserves to stop the drop in the real and bonds.

The smooth talk is credited with Friday’s small rises in the currency, the benchmark C-bond, and the stockmarket, after six days of each-day worsening drops. The rises did not, however, change the fact that Brazil’s debt, at current values of the real and current levels of country-risk, cannot be rolled over for long. The real closed for the week at 2.6280 to the dollar, while country risk has soared to just over 12%. What the latter means, is that if Brazil hopes to sell comparable bonds to U.S. Treasury bills, “the market” demands it offer 12% more than the going U.S. Treasury bill rates, or over 17% interest — a prescription for rapid default.

[Source: Bloomberg, June 7, Correio do Povo, June 5]


“Armies of people in rags, of all ages, go through the streets of the capital each night, overturning the garbage in search of leftover bits of food, while others, more organized, carry what’s been thrown out in rickety trucks … to sell it on the black market,” AFP reported out of Buenos Aires. Whereas people once looked only for leftover food, in recent months they also eat rats, mice, frogs, and toads, reports a director of a school in a poor neighborhood. The Buenos Aires government calculates there are 25,000 beggars each night scrounging in the garbage in the capital.

A university study of General Sarmiento, a poor district in the west of Buenos Aires, found that 60% of those reduced to scrounging the dumps for food and recyclables to sell, “are former construction, textile, and restaurant workers who lost their jobs in the last five years. They work with their families, exposed to pollution and with a life expectancy of 35 years, when 70 is the expectancy of the rest of the Argentines.”

[Source: AFP, El Nuevo Herald (Miami), June 7]


Two United Nations agencies have issued a report on starvation and disease in southern Africa. Almost 13 million people are at risk of “mass starvation,” and rampant AIDS infection rates are aggravating the crisis.

The worst humanitarian disaster in a decade threatens the region, say the UN Food and Agriculture Organiztion (FAO) and the World Food Program (WFP) in a joint statement. The WFP calculates that 7.7 million people are facing starvation now in Lesotho, Malawi, Mozambique, Swaziland, Zambia, and Zimbabwe, and this figure could rise to 12.8 million by year end.

At a meeting in Johannesberg to coordinate relief efforts, delegates agreed that the response must go beyond food aid to include access to clean water and health care, focusing on AIDS, cholera and malaria.

[Source: AFP wire, “13 Million Hungry in Southern Africa,” June 7]


A decrease of 243,000 workers, and the unemployment rate fell, between April and May, from 6.0% to 5.8%, the U.S. Department of Labor’s Bureau of Labor Statistics reported today. But while there is an attempt to portray this as a sign that the “recovery” is at hand — for example, Reuters, “Jobless Rate Drop Shows Gradual Recovery” — the opposite is true.

Further, when one looks at {EIR’s} real unemployment rate, one sees the breakdown of the U.S. economy.

* The BLS reports that during May, the level of unemployment fell by 243,000 workers to 8.351 million workers, but during April, the level of unemployment had risen by 483,000 workers; the fall of unemployment in May, only matched half the rise in unemployment in the month before.

* The unemployment continues to strike the manufacturing sector with great force, and in May, a futher 19,000 manufacturing jobs were eliminated. Since July 2000, 1.761 million manufacturing payroll jobs have been eliminated from the U.S. economy. Of these workers, since July 2000, the economy has eliminated 1.443 million {production manufaturing} workers’ jobs, which means those workers whose scientific alteration of nature, advances human existence.

Since the beginning of the year, there has been repeated talk that the loss of manufacturing jobs would stop — yet the number of manufacturing jobs eliminated keeps rising, indicating something wrong with the backbone of the economy.

Source: (EIRNS)–June 7

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