The American political activist Lyndon LaRouche (1922–2019) and the LaRouche movement have expressed controversial views on a wide variety of topics. The LaRouche movement is made up of activists who follow LaRouche's views.
LaRouche's economic policies call for a program modeled on the economic recovery program of the Franklin D. Roosevelt administration, including fixed exchange rates, capital controls, exchange controls, currency controls, and protectionist price and trade agreements among partner-nations, although Roosevelt generally pursued trade liberalization. LaRouche also called for a reorganization of debt world-wide, and a global plan for large-scale, continental infrastructure projects. LaRouche rejected free trade, deregulation, and globalization.
Economics and politics According to Matko Meštrović, emeritus senior research fellow at the Institute of Economics of Zagreb, Croatia, LaRouche's economic policies call for a program modeled on the economic-recovery program of the Franklin D. Roosevelt administration, including fixed exchange rates, capital controls, exchange controls, currency controls, and protectionist price and trade agreements among partner-nations, although Roosevelt generally pursued trade liberalization. LaRouche also called for a reorganization of debt world-wide, and a global plan for large-scale, continental infrastructure projects. He rejects free trade, deregulation, and globalization.
Marxist roots Lyndon LaRouche began his political career as a Trotskyist and praised Marxism, but he and the National Caucus of Labor Committees abandoned this ideology in the late 1970s. From then on, LaRouche no longer opposed private ownership of the means of production, and his analysis of political events is no longer phrased in terms of class.
According to Tim Wohlforth, during and after his break with Trotskyism, LaRouche's theory was influenced by what he called his "Theory of Hegemony" derived from Vladimir Lenin's view of the role of intellectuals in being a vanguard helping workers develop their consciousness and realize their leading role in society. He was influenced by Antonio Gramsci's concept of hegemony as an intellectual and cultural elite which directs social thought. LaRouche's theory saw himself and his followers as becoming such a hegemonic force. He rejected Gramsci's notion of "organic intellectuals" being developed by the working class itself. Rather, the working class would be led by elite intellectuals such as himself.
LaRouche was influenced by his readings of Rosa Luxemburg's The Accumulation of Capital and Karl Marx's Capital developing his own "theory of reindustrialization", saying that the West would attempt to industrialize the Third World, particularly India, and attempt to solve the economic crisis both by developing new markets in the Third World and using its cheap and surplus labor to increase profits and minimize costs (see neocolonialism). To oppose this, LaRouche argued for a "reindustrialization" of the United States with himself at the vanguard of the effort allowing him to personally resolve the crisis of capitalism. Though his arguments had since been stripped of their Marxist language and citations, his core theories had remained essentially the same since the late 1960s.
Dialectical Economics
In the book Dialectical Economics: An Introduction to Marxist Political Economy, which was published in 1975 by D. C. Heath and Company under the pen name Lyn Marcus, LaRouche tried to show that numerous Marxists—ranging from the Monthly Review group to Ernest Mandel, Vladimir Lenin, Leon Trotsky, Joseph Stalin, Mao Zedong, Fidel Castro and the "Soviet economists"—had failed to understand and to interpret correctly Marx's writing. Marxists he admired—apart from Marx himself—were Rosa Luxemburg and Yevgeni Preobrazhensky.
According to a review by Martin Bronfenbrenner in The Journal of Political Economy, about half of the book was devoted to dialectical philosophy, "with a strong epistemological stress", with the other half devoted to discussions of economic and general history, anthropology and sociology, and actual economics, including a surprisingly large helping of business administration—Bronfenbrenner noted that LaRouche seemed to have "more private-business experience than the great majority of academic economists", including a familiarity with the way speculative overcapitalization, operating at the borders of white-collar crime, creates "fictitious capitals" that later do not match their actual earning power. Like Thorstein Veblen, LaRouche subscribed to an overcapitalization theory of economic depression.
According to Bronfenbrenner, LaRouche viewed conventional economics as a "withered arm of philosophy", which had taken a wrong turn toward reductionism under the influence of British empiricists such as John Locke and David Hume. LaRouche's definition of reductionism was as follows:
The fundamental fallacy of ordinary understanding is the delusion that the universe is reducible to simple substance, or—the more Hume-like view—that the content of human knowledge is limited to simple-substance-like, self-evident sense perceptions. This discredited outlook—whether it takes the naive mechanistic [form] or the equivalent mechanistic outlook of empiricism—is termed reductionism. All varieties of reductionism are formally premised on the fallacious assumption of formal logic, that the universe can be represented as discrete points interconnected by formal relations.
From this it followed, Bronfenbrenner said, that LaRouche viewed bourgeois economists' concern with prices as reductionism, versus the Marxian concern with values. The reductionist fallacy then lies in adjusting a value theory like labor theory to fit in with price theory; in LaRouche's view, economists should work in the opposite direction.
According to Bronfenbrenner, LaRouche viewed capitalist America as headed for a kind of fascism not much better than that of the Nazis; but he noted that LaRouche's own vision of socialism, and the trade-off between necessity and freedom in a centrally planned economy, seemed apt to result in the justification of a different kind of dictatorship:
Judging from his controversial manner, [LaRouche] impresses at least one reader as a Me-for-Dictator type to whom it would be dangerous to entrust the task of drawing any boundary between the domain of freedom and that of necessity or order.
LaRouche's campaign platforms The campaign platforms of LaRouche and his followers have included these elements: A return to a gold-based national and world monetary system, and fixed exchange rates; and replacement of the central bank system, including the U.S. Federal Reserve System, with a "national bank"; A war on drug trafficking and prosecution of banks involved in money laundering; An emphasis on large-scale economic infrastructure, including the building of a world land bridge of railroads and a tunnel under the Bering Strait, the building of nuclear power plants, accelerating research on fusion energy, the North American Water and Power Alliance, and rebuilding or nationalizing the country's steel industry; A crash program to build particle-beam weapons and lasers, including support for elements of the Strategic Defense Initiative (SDI); Opposition to the USSR and support for a military buildup to prepare for imminent war; Growth in food production and a farm debt moratorium; Low interest rates and opposition to the Gramm–Rudman balanced-budget law;
Later orientation According to China Youth Daily Online, LaRouche was once a Marxist, but later supported heavily regulated capitalism. He supported public control of financial capital and low-interest loans. Lyndon LaRouche ... used to endorse Marxism, but later switched to supporting the American-style capitalist economy. ... He also states that if the public controlled the financial capital and revitalized industries with low-interest loans, American people can return to the spirit of innovation.
LaRouche said banks should not be bailed out, but be placed in receivership by the state. He said that a "firewall" should prevent state aid from being diverted to speculative entities, which should be allowed to fail, and that such failures would clean up the financial markets.
LaRouche expressed belief in the principles of the New Deal of President Franklin D. Roosevelt, favoring state intervention in the economy. LaRouche also stated support for the approach of U.S. Treasury Secretary Alexander Hamilton, who established a banking system geared to develop production.
Italian Economics Minister Giulio Tremonti said that he had encountered LaRouche at a debate held in 2007 in Rome, and that he appreciates LaRouche's writings. According to an article by Ivo Caizzi in Corriere della Sera, a group of Italian Senators led by Oskar Peterlini asked the Berlusconi government to tackle the financial crisis using legislation developed by LaRouche in 2007. The legislation proposed that public money should save only the commercial infrastructure required for the financing of productive enterprises.
The "Triple Curve", or "typical collapse function", is an economic model developed by LaRouche which tries to illustrate the growth of financial aggregates at the expense of the physical economy and how this leads to an inevitably collapsing bubble economy. According to the China Youth Daily Online interview, LaRouche's main point is that the real economy (production) is dropping while the nominal economy (money and financial instruments) is going up. As the nominal economy greatly overreaches the real economy, an unavoidable economic crisis ensues. His basic points about the unavoidability of the current US economic crisis are: the production of real goods is constantly dropping, but the credit supplies are steadily increasing, the real and nominal economies form two curves with one going up, and another one going down, which creates a great contrast. When the nominal economy greatly overreaches the real economy, the world will fall into an economic crisis.
Since 2000, the LaRouche movement has: Called for a moratorium on Third World debt. Opposed deregulation. According to LaRouche's publications, "LaRouche has consistently called for reregulation of utilities, transportation, health care (under the "Hill-Burton" standard), the financial (especially the speculative markets) and other sectors ..." They support the renewal of Glass–Steagall Act regulations on banks. In 2007, LaRouche proposed a "Homeowners and Bank Protection Act". This called for the establishment of a federal agency that would "place federal- and state-chartered banks under protection, freeze all existing home mortgages for a period of time, adjust mortgage values to fair prices, restructure existing mortgages at appropriate interest rates, and write off speculative debt obligations of mortgage-backed securities". The bill envisioned a foreclosure moratorium, allowing homeowners to make the equivalent of rental payments for an interim period, and an end to bank bail-outs, forcing banks to reorganize under bankruptcy laws. A LaRouche spokesman said that bank bail-outs "reward corrupt swindlers with taxpayer money". The proposal attracted support from Democrats at city council and state legislature level. Pennsylvania Democrat Paul Kanjorski opposed the bill, stating it would involve government seizure of "every American bank". Mike Colpitts of Housing Predictor stated that LaRouche's economic forecasts had been correct, and that he might have received more mainstream credibility had it not been for his controversial history."Former candidate returns to Illinois" , saukvalley.com, November 2, 2007.
Neoplatonism
LaRouche's philosophy references an old dispute between Plato and Aristotle. Aristotle believed in knowledge through empirical observation and experience. Plato believed in The Forms.