Schiller-Institute : The euro is bankrupt not the drachma

With the Greek Parliament's Debt Truth Commission having just found Greece's entire debt to the Troika to be "illegitimate and odious," {EIR} Founding Editor and economist Lyndon LaRouche today called attention to the "overall picture on euro debt.""You cannot sustain the euro system, it is intrinsically bankrupt," LaRouche said. "If you base a `debt deal' on that system -- any `debt deal,' that deal will fail. The fraud of what Wall Street and London banks are calling `their debt assets', has to be eliminated, because populations -- not only the Greeks -- are being beaten down by worthless claims. {Cancel} those claims.

"Relieve the nations of the claims of this speculation, these `investments' in gambling bets, and an opening is created for internal economic development of European nations and the United States.

"The solution is an international policy of Glass-Steagall banking; agreements among these nations to implement Glass-Steagall principles.

"Most important by far:" LaRouche said, "Restore the Glass-Steagall Act to force in the United States. That is the driver for this whole effort. That opens up the issuance of national credit for productivity and development."

In an analysis released in late February of this year, LaRouche had already referred to the entirety of what is called "Greek debt" by the euro institutions and the IMF, as a giant swindle, consisting of massive transfer payments from European taxpayers to bankrupt megabanks.

The finding of the Greek Parliamentary Commission sustains that, provides a firm foundation for the Greek government's position, and will also encourage many forces in other falsely over indebted European countries such as Ireland, Spain, Italy, Portugal, and others.

The Debt Truth Commission finds: "All the evidence we present in this report shows that Greece not only does not have the ability to pay this debt, but also should not pay this debt, first and foremost because the debt emerging from the Troika's arrangements is a direct infringement on the fundamental human rights of the residents of Greece. Hence, we came to the conclusion that Greece should not pay this debt because it is illegal, illegitimate, and odious."

LaRouche also addressed the campaign by forces behind German Finance Minister Wolfgang Schaeuble, to force Greece out of the euro system.

"Again, the euro system is bankrupt," LaRouche said. "If Greece goes out, goes back to the drachma, the negotiated value of the drachma can be increased significantly, and problems solved. It is not correct to say that the drachma must collapse in value against the euro.

"The pressure on Greece is coming from the London-Wall Street banking system, and the claims of that system are worthless. Its speculation on unpayable debt has to be cancelled.

"The euro will be falling because of its bankruptcy; the value of the drachma against the euro can be maintained, and may go up.

"Again, the critical action is Glass-Steagall in the United States, and force it in European countries.

"With that, the United States and Europe can generate national credit institutions, linked to the BRICS' new international development banks, and issue a surge of credit for productive employment.

"The Greek Parliament has thus done a service to the future, if we take the right actions now," LaRouche concluded.