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The Greed of the Vulture Funds Will Backfire:
No, There Is a Limit to the Tyrant's Power

by Helga Zepp-LaRouche
July 2014

Helga Zepp-LaRouche.

July 5, 2014 — The unbelievable scandal around the attempt of the United States to enforce the lunatic demands of the vulture fund NML Capital of Paul Singer against Argentina—with a profit-rate of 1,608% (!) in only six years—is the proverbial last drop which brings the barrel to overflowing. Unlike those many thousands of times when in the past the megaspeculators have wrought suffering and death upon millions of people, and gone away unpunished, this time the U.S. administration, the American Supreme Court, and the afore-mentioned vulture fund have been hit with an obviously unexpected, implacable resistance. All of Central and South America are standing unified behind Argentina, and are saying "No!"

The tremendous audacity with which the vulture funds, with the help of the American courts, are trying to collect the perverse demand for a profit of 1,608% (for junk bonds, which they had purchased at the time of Argentina's insolvency for $48 million, and for which they now want to be paid at the full nominal value of over $833 million, although this would nullify the successful restructuring of the debt by 93% of the remaining creditors and throw Argentina once again into bankruptcy), highlights the character of the system. This system of globalization is nothing more than a gigantic Madoff swindle, a fraudulent Ponzi pyramid scheme, and nothing would be more absurd than to dignify the demands of the hedge fund, like those of the former claims. One might as well agree to a not-guilty verdict for a patricide, just because he pleads that he is an orphan.

The chorus of Latin American foreign ministers, which rallied in full solidarity behind Argentina at the emergency summit of the Organization of American States, was the opening chord of a new composition of a different world financial and economic order, which has to emerge right now. The acting foreign minister of Guyana, Robeson Benn, hit the nail on the head, when he challenged his colleagues to appeal to the American Congress with the demand that they reinstate the Glass-Steagall two-tier banking system, without whose repeal such excesses never could have happened. The vulture funds and their "modern piracy" must be stopped with effective re-regulation of the banking system. These funds have destroyed the well-being and desired progress of all countries with their actions, as you can see now with the example of Argentina. Therefore there is a "moral responsibility of all stakeholders, including the American people and their government, to ensure that countries such as Argentina, which has made significant strides in improving their debt situation, [do not have to adopt measures] which threaten the progress that has been achieved."

"I would like to pose the question, perhaps, as to whether we should not, out of this imbroglio, re-look at the overall question of the repeal of the Glass-Steagall Act in 1999 in the United States, which related to the activity of the banking system, the international financial institutions, mainly resident in the United States and in the United Kingdom. President Roosevelt, of the United States of America, established a banking act, signed off on the Banking Act of 1933, which set up firewalls between the activities of the banks, and on the questions of speculation in the financial system. There is, perhaps, the need now to take a look at putting back in place important sections of the Glass-Steagall Act which was repealed in 1999," Benn further explained.

After Wall Street has employed a whole host of lobbyists and spent hundreds of millions of dollars in bribe money, PR campaigns, and so forth, to stop the reenactment of Glass-Steagall, the genie is now again out of the bottle, and this time for good. Practically all of the foreign ministers of the OAS, minus the U.S. and Canada, naturally, emphatically made the argument that the interests of the murderous speculators should not be placed ahead of the interests of human life. The basic assertion of Pope Francis, which he presented in his Apostolic Letter "Evangelii Gaudium"—that the current world financial system is one that kills—stood plainly before them. Its name was NML Capital.

Venezuelan Foreign Minister Elias Jaua described in detail the exploitation which had been carried out by such murderous vulture funds in Africa, and which have led to the death of millions of people. He described how, for example, Paul Singer's Elliott Management, the owner of NML Capital, which is using Argentina, likewise sued Congo Brazzaville for $400 million, a debt which they had bought for $20 million.

"How many lives could be saved with $400 million?" he asked. "How many people could eat with that sum of money?" He went on to list how many doses of anti-malaria, pediatric hepatitis a, oral polio, and pediatric pneumonia vaccines could be purchased with $400 million. He listed how many tons of powdered milk, rice, or beef might also be purchased with that amount "to feed the people of the world.... $400 million would make a huge difference in world efforts to put an end to hunger," he said. "Who thinks they have the right to deprive people of the right to food, health, integral development—to life itself?" Thus he cut to the chase. NML today has over $30 billion at its disposal, although it originally had been founded with only one million.

Argentina Foreign Minister Timerman declared that Argentina would not be alone on the coming Monday, at the meeting with the so-called "Special Master" appointed by Judge Griesa, who is supposed to preside over negotiations on the debt. "Not only will we be accompanied by all of you, but also by the faces, and the ghosts of all the victims of the vulture funds—and the countries that protect them" (emphasis added). In the words of Timerman resonated a higher law, natural law, to which Friedrich Schiller, in his poem "The Cranes of Ibykus" had given expression so powerfully, with the entrance of the chorus of the Erinyes, and had described the fate of the murderers:

"So tiring never, him we follow,
Repentance ne'er can us appease.
Him on and on until the Shadow
And give him even there no ease...."

The story of Argentina will not end with the meeting on July 7 with the "special master" in New York. On July 15 there will be a meeting in Brazil of the five BRICS states (Brazil, Russia, India, China, and South Africa) with the heads of state of the CELAC states (Ecuador, Costa Rica, Cuba and Caricom), a meeting which, according to Chinese Ambassador to Brazil Li Jinzhang, will initiate a new phase of Chinese-Latin American cooperation.

On July 15-16 the meeting of the BRICS heads of state will occur in Fortaleza and Brasilia, in which the heads of state of all the Latin American countries will also participate. On the agenda will be, among other things, the deepening of cooperation and formalization of the relationship between the Eurasian Economic Union, the Customs Union and Mercosur. In addition President Putin and State President Xi Jinping will have numerous bilateral meetings. President Putin will have a state visit to Argentina before, State president Xi Jinping immediately after the BRICS meeting. Many formal agreements are expected to be signed, for example, for a BRICS Development Bank and a foreign exchange reverse pool. Already in the run-up to the summit several trade and cooperation agreements have been reached, which will no longer be transacted in dollars, but in national currencies. One can assume from that, that the question of a new financial system and a just new world economic order will be on the agenda at all these meetings.

The contrast between the geometry of the trans-Atlantic sector and the European-Pacific sector couldn't be clearer. The region which is dominated by the British Empire—therefore London, Wall Street, NATO and the EU—has not much more to offer than military confrontation against Russia and China, and the dicatorship of brutal austerity to the benefit of the bankers and murderous vulture funds. Russia, China, India and Brazil have come together into a new alliance of sovereign Eurasian and Latin American states, who are cooperating in their common economic, political and cultural interests, and a common perspective for a better future holds them all together.

It is in the interest of all states on this planet, including Germany and the United States itself—bearing in mind the commitments of the American Revolution and Constitution—to collaborate around this idea of the future, and to break the tyrannical power of the British Empire once and for all.

“The Rütli Oath”, from Schiller’s play Wilhelm Tell

No, there is a limit to the tyrant's power,
When the oppressed can find no justice,
When the burden grows unbearable—he reaches
With hopeful courage up unto the heavens
And seizes hither his eternal rights,
Which hang above, inalienable
And indestructible as stars themselves.
The primal state of nature reappears,
Where man stands opposite his fellow man.
As a last resort, when not another means
Is of avail, the sword is given him,
The highest of all goods we may defend
From violence, Thus stand we before our country,
Thus stand we before our wives, and before our children.
—We will become a single land of brothers,
Nor shall we part in danger and distress.
—We shall be free, just as our fathers were,
And sooner die, than live in slavery.
—We shall rely upon the highest God
And we shall never fear the might of men.