Episode Transcript
[00:00:00] Speaker A: Foreign.
Welcome back to Going Underground. Broadcasting all around the world from the uae Today is the day a town famous for bottled water hosts the Genocide 7, the G7 for a summit of leaders giving diplomatic and military cover to Israeli genocides in Lebanon and Gaza and the American war on Iran. The 20,000 were left without water in Iran after Trump bombed Iranian reservoirs. Hated at home in attendance in Evian will be the likes of Trump, Starmer, Macron, Merz and Ukraine dictator Zelenskyy. But also coming this year will be India's Modi, South Korea's Lee, Egypt's El Sisi and Brazil's Lula, who's been on this show after he was released from prison. That's all amidst warnings of a global economic catastrophe because of the Trump Netanyahu Epstein war on Iran. But while the so called mainstream media are telling you to worry about the filling your car and the price of your next foreign holiday, they seem not to know of an impending global famine that may starve 2 billion people on this planet. That's according to an economist known for correctly predicting the 2008 Western economic crisis. He's honorary professor at University College London, Steve Keane, author of the New Economics Manifesto. And he joins me again from Thailand's capital, Bangkok. Professor Keane, thanks so much for coming back on Going Underground. There's a bit of blurriness, I think a connection issue from this end, but you predicted the 2008 Western economic fight financial crisis. Now you're forecasting and we can ignore and lay to one side the repeated truth, socials from Trump, that the Strait of Hormuz is open and under the control of the United States. You're predicting the possibility of 2 billion people facing famine. How have Trump and Netanyahu got the world to its greatest catastrophe in history?
[00:01:51] Speaker B: Well, it's mainly because everybody who is not actually directly involved in production these days has really no idea of how production occurs. And that certainly applies in agriculture. So the extent to which we're relied upon chemical fertilizers derived from oil feedstock is extremely high. And if the absence of the Haber Bosch process and the process for producing both nitrogenous fertilizers and phosphate based fertilisers, without the oil, you can't produce them. And 30% of the world's fertilizer passes through the state of Hormuz, roughly speaking. Now, without the fertilizer in general, the carrying capacity of the planet falls from about 8.5 billion people, which is how many people we have right now, down to between 1 and 2 billion. That's the extent to which we're reliant upon chemical, upon petroleum based fertilisers for food output. If you lose 30% of the fertiliser that the planet relies upon at the extreme, that implies that something of the order of only 6 billion people can be supported by our food systems. From the current 8.5 to 9 billion people we're supporting is some buffer inside there in terms of 30% of food roughly is wasted.
But the extent to which we rely upon a continuous flow of petroleum based fertilizers cannot be overestimated. And if we have a disruption to the supply of those fertilizers anywhere from 10, 20 million people, true to the ludicrous scale, I have to admit, of 2 billion, that's the potential range of disaster. I hope it's down the low end, but there's certainly no way, I think we're going to avoid famines scattered all over the planet caused by this war. So people who are Buddhist, who are Taoist, Christian, they're all going to be exposed to a war which they have no part in and which there might be thousands or up to 10,000km away. So this is a war in which the collateral damage occurs outside the region of the war itself and to citizens who have absolutely no part in the war. Whereas collateral damage normally means civilians get killed in the combat zone, it's civilians outside the combat zone that are going to die because of this war.
[00:04:14] Speaker A: There are hints of it of course already, and we'll return to the economics. But I'm going to ask you then, what do you think are the profound structural reasons why so called mainstream media in the NATO nations giving the diplomatic and military cover for the Trump Netanyahu war? What are the reasons that they're hiding this from the public and their publics?
[00:04:36] Speaker B: I think partly they don't know. I mean, you always have specialists working in places like the CIA who research things like the military structure of Iran and would have known that it broke itself into a 31 headed Hydra to handle a decapitation attack. But you get to the top levels, people like Hegseth and Trump, who advises are surrounded by a bunch of yes men as advisors. The information that the intelligence workers at the lower levels of the system get does not get through at all. So they go and bomb Iran without realizing that 30% of the world's fertilizer passes through that strait. They bomb it without realizing that Iran was prepared to block the strait. And of course, since it's only 21 miles wide, it's extremely easy to block the flow of resources through that.
Now, people who make the decision to go to war lack the knowledge to know that the war shouldn't be fought in the first instance. And I think that that's partly why it happened. There's a cheer regionalist that these problems would resolve otherwise. I can only think that it's the whole Epstein argument that this, whether it's Epstein directly or it's Mossad through Epstein has got dirt on all these political figures and they're toeing the line to avoid having dirt published about them in the media, which would undermine and destroy their credibility and possibly get them arrested. That's about the only reason that I can think of where so many governments support the war while the public are opposed to the war. And of course the governments are supporting Israel when the public now seems to be majority in favor of Palestinians.
[00:06:12] Speaker A: Yeah, I might return to Jeffrey Epstein in a moment. But I mean, let's look at the timescales here.
You said at the beginning of April India would face famine within two to three months. I don't know whether that's why Modi might turn up at the EVRG7 summit to ask Trump what on earth he's doing.
Where are we at as regards the timescales? Because we've been covering on going underground how often the paper and physical prices of commodities are not correlating correctly at the moment. The market prices of things, the signals don't seem to be getting through to the markets. And I mean, would you revise that prediction that you gave in April of two to three months before you revised?
[00:06:58] Speaker B: I think we should revise our opinions of people in the finance markets because economic theory tells you that markets are efficient, that markets price and all potential opportunities. And this has become part of the aura we give for finance markets, that they've got some prescience, they can see what's coming. That is complete nonsense.
The people working in the finance markets are basically trying to guess what other speculators are likely to do. The extent to which they pay attention to the real world is quite minimal. And I was involved in a Twitter space not too long ago where about five other people who claim to be experts on finance were talking about the impact of the war. Not one of them had any awareness of the physical damage to the production system of the planet being done by the closure of the strait. They thought petrol would get or would get more expensive. They didn't realize that we're not going to get sulfuric acid for so many industrial processes that helium comes out of there. All these physical elements of production are issues that people working in the finance sector have no knowledge of. So they get caught up.
[00:08:00] Speaker A: Do you think it's a class issue?
No one wants to dirty their hands. They don't understand the productive process. Is it a class issue?
[00:08:06] Speaker B: They do not understand it. It is ridiculous. That is the again comes back to economic theory, which is based on a whole range of myths about how production occurs. So conventional economic theory argues that if you combine what they call technology or total factor productivity with labor and capital, you get output out the other side. They have no inputs from the natural world in terms of their production theory. Now I pointed out the floor on that about eight years ago with a little quip of saying that labor with that energy is a corpse, while capital with that energy is a sculpture. So if you don't have energy as an input, you can't produce.
Now you'd think that would be something which is common knowledge to economists. But in fact, their mental model of how the economy operates leaves out the need for physical inputs from the natural world at all, especially energy. So they're completely ignorant about how the system functions. And therefore they're not pre warned about the dangers of cutting off the supply of physical goods through the Strait of Hormuz.
[00:09:05] Speaker A: And the central bankers and politicians are those who would have criticized you when you forecast the 2008 economic crisis, presumably based on similar core principles. Of course they still think that because, I mean, the reverberations of that crisis are still ongoing. They think that printing money will sort things out. And price controls, I suppose, embattled if by the time this program is broadcast, Keir Starmer is still Prime Minister of Britain has already announced possible price controls of bread, milk and eggs. So they presumably believe that they can borrow the money, print the money, and somehow cope with the escalating price increases due to the closure of the Strait of Hormuz.
[00:09:55] Speaker B: Well, the government can create money. This is one element again that mainstream economics is wrong about. The government has capacity to create money and to do that it has to spend more than it brings back in taxation. Now, even there, they think that's a bad thing. But in fact that's how the government creates money. But creating money doesn't create goods and services.
And this is where this crisis differs from what happens back in 2008, because in the global financial crisis, you had financial credit, the growth in private debt every year, which adds to aggregate demand and income, hitting extremely high levels of America's case, 15% of GDP, additional demand came out of credit and then when the credit negative, when people stopped borrowing money, were trying to repay their debt or were going bankrupt, it went from plus 15% to minus 5. That's what caused the CR.
GDP itself was affected after the event. This time around you don't have the same level of credit based demand anymore. We're still carrying a large amount of private debt as an aftermath of the global financial crisis. So America peaked at about 170%.
It's a ratio of private debt to GDP. Now it's about 140%.
Now that's sustainable with the current level of economic demand coming through. So people are servicing their interest payments out of the turnover of goods and services. But what's going to happen this time is up to 10% of that turnover could be crushed by the reduction in oil supplies, the reduction in sulfur dioxide, helium, all these things. The inability to produce goods and services will mean that people can no longer service their debt levels out of the cash flow of their businesses because the cash flow will dry up, because the goods won't even be there. So I do expect a financial crisis coming out of this, but not caused by the financial sector. Instead this time it's the destruction of the capacity to produce output that'll mean people can't service their debts anymore and therefore they'll fall for that reason rather because of excessive credit going from positive to negative.
[00:12:00] Speaker A: And so what? The countries that will survive will be the ones that are most independent? I don't know, Cuba, Iran itself, Eritrea, North Korea. Are the countries that are most going to survive this kind of shock, the ones that are most self sufficient?
[00:12:18] Speaker B: Yes. And this is a complete change, the focus on globalization. Everything in mainstream economics is about how you should specialize in what you're good at and not produce things which can be made more cheaply by other countries. So globalization, comparative advantage, that's been the dominant theme for the last 50 years. But what that assumes is that you're going to continue having the flow of those goods and services to enable you to produce output. Now what we're showing here is that that is no longer a given.
People used to say when you had people arguing against renewable energy, they'd say, well, the sun doesn't always shine and the wind doesn't always blow. Well now we can also say the Strait of Hormoz doesn't always flow. So suddenly when that supply is cut out, you no longer have the capacity to produce goods and services anymore. The countries which are more self sufficient, more likely to surv and the ultimate example there, of course, is China, because if we do have a famine coming out of, and we will have famines coming out of this process, the only way you can survive those famines is to have buffer stocks. Now, most of the west has almost no buffer stocks of food. China apparently has one and a half years of grain in reserve.
So they can go for one and a half years without getting grain supplies from the rest of the world and still feed their population. The UK at the other extreme imports at least 40% of its food, possibly 70% because they describe some so called domestic production is made with English ingredients and foreign ingredients as well. The England is going to be massively unable to feed itself, which is why and actually I'm quite pleased that Starmer's talking about price controls, because if you don't have price controls, then it means the poor starve. And if that happens, then your social system breaks down.
[00:14:05] Speaker A: Professor Steve Keen, I'll stop you there. More from the author of the New Economics and Manifesto after this break.
Welcome back to Going Underground. I'm still here with the author of the New Economics and Manifesto, an honorary professor at ucl, Steve Keen. Professor Keen, in part one, we did briefly mention the dreaded name Jeffrey Epstein, given what we were talking about as regards global famine and 2 billion possible possibly facing it because of what Trump and Netanyahu have done. I mean, we now know from the New York Times of all places, that Mossad has apparently been bugging Witkoff, Elbridge Colby, the top Pentagon policy official, and Michael Dimino. How to blame is Jeffrey Epstein's ghost, as it were, and Netanyahu for what the entire world is now facing?
[00:15:00] Speaker B: Well, definitely Netanyahu is, I think, peak blame because this is a war that he talked Trump into. And there have been 30 years of prime ministers, of presidents before Trump who heard that same pitch and turned it down. Now Trump, who claims to be the great negotiator, fell for that pitch. Whether that's because it's dirt that Moss had and that Netanyahu have on Trump. And of course we know he's in the Epstein files more than virtually anybody else. Whether it's the blackmail that led to it happening or his own sense of grandiosity believing that he could start a war and end it in a few days, it's hard to say. But I think both factors are there. I'm almost certain blackmail is involved in the decisions of top political leaders, including Trump. And it's almost certain that his stupidity, his ridiculous belief that he can end wars after Starting him in the first place and get a Nobel Peace Prize for it.
Combination of stupidity and blackmail, I think, are the only way we can explain how this war came about.
[00:16:00] Speaker A: Yeah, people can watch our interview with former Israeli intelligence official Arabell Menashe, who talked of the blackmail as regards Epstein. But you've been talking about even before the Strait of Hormuz situation, about the enrichment, personal enrichment of the oligarchs that run the United States.
It's your contention that Trump himself is using every moment to buy and sell on the markets to enrich himself, his family and the oligarchs that run the U.S.
[00:16:33] Speaker B: i don't know that it's Trump doing the buying and selling, but you'd see the work done by Ed Conway trying to identify volumes of sales, particularly on petroleum markets, before and after announcements and 15 minutes before most of the announcements that Trump has made. Whether there's, you know, war is back on again or best about to sign peace agreements, there are huge volumes of sales or purchases, people taking advantage, knowing which way the market is likely to be moved by the next announcement by Trump 15 minutes beforehand.
That's documented. It's in Ed Conway's work on Sky News.
This implies that there is insider trading going on in some sense, knowing what the announcements are going to be, knowing when they're going to occur, and 15 minutes before positioning themselves to make a personal profit out of it. We'll only find out in the aftermath of this whole catastrophe just how extreme that was. But I think it's almost certainly this is an elaborate pump and dump scheme designed to look like it's a foreign. Foreign policy.
[00:17:36] Speaker A: And I suppose he has a bunker and. Yeah, Ed Conway on Sky News, I suppose so called mainstream media in NATO countries often hates Trump for being Trump and often can be quite good sometimes, despite its support. Arguable. Sky News's arguable support during the genocide. For the genocide. So given this picture that we're painting in this episode of Going Underground, I mean, it seems like an odd question to ask, but do you think Iran is being irresponsible in not having developed nuclear weapons to have a deterrent?
[00:18:10] Speaker B: Yes, yes, yes. I mean, there's a great, you'll see great memes around the world about why are you attacking Iran? That's because they might develop nuclear weapons. Why don't you attack North Korea? Because they have nuclear weapons.
In some ways, the insurance against being invaded by America is the potential for nuclear retaliation. That was the whole idea of mutually assured destruction in the old Cold War days. And I do think that without mutually assured destruction, we might well have had localized wars on a grander scale after World War II than we actually did have. So I think MAD worked. And then with the argument that we have a post confrontation world between the Soviet Union and America, America, the Soviet Union, Ukraine dismantled their nuclear defense, deterrence and bam, we get war again in Ukraine. So in some ways, as awful as it appears, countries have the capacity to threaten nuclear retaliation. They're likely to be attacked by America. So the fact that the previous leader had a fatwa against developing nuclear weapons might be why Iran got invaded this time around or got attacked.
[00:19:24] Speaker A: And that feeds into your five scenarios of how this war will end. Maybe you can just very briefly go through those quick five scenarios.
[00:19:33] Speaker B: Well, the worst would be if Israel decides is losing categorically and it executes what's called the Samson Directive, that they decide to hit the rest of the world with nuclear weapons. That is the absolute worst outcome. My hope is that the level of preparedness that Iran had for this conflict has taken virtually everybody by surprise. The fact that they have broken themselves into a state based, province based military structure rather than a national based one, meaning they've got 31 separate control centers, they have 31 different groups producing weapons, having them stored in very, very hard to hit bunkers, using their mountain terrain extremely effectively as well to hide where their bases are.
It appears that they may also, if they're at that level of intelligence, to fight back a conventional attack. I simply hope they've got the capacity to use weapons that can take out Israel's nuclear weapons. I just hope that they do, because I don't. The last thing we want to see is the Samson Directive and the best prevention of that may be the Iranians already having developed a strategy to take out those weapons.
[00:20:43] Speaker A: Yeah, the Samson doctrine exposed by a friend of the show, Cy Hirsch. Famously, I should just quickly say the five scenarios. You said the US could use nuclear weapons. Iran destroys the Gulf, the Samson doctrine, Iran disables Dimona and the Israeli nuclear program and Iran gets nuclear weapons, which is what we just said.
What do you think is the most likely at the moment? At the time of this interview, I
[00:21:12] Speaker B: don't think America's going to use nuclear weapons. And this comes down to Trump's personality again, because being a severe case of narcissistic personality disorder, the last thing they can cope with is public humiliation.
So if he actually thought about using nuclear weapons, what would stop him is the thought of the humiliation that he would then be regarded as the greatest mass murderer in human history.
I think that will stop him actually using nuclear weapons.
If Iran continues fighting back as effectively as it is right now, and Israel fears that it's going to be wiped out by the Iranians having far more defensive capability and far more aggressive capability than apparently the top American commands or the Israeli commands thought they had.
That's what worries me. Is Israel going for the Samson Directive? I really can't say which way it's going to go. The classic story about the first victim of war being truth is amplified a hundredfold now by social media and by the extent to which there are blackouts and attempts to control what we see coming through as coverage of the conflict. So I simply can't. No. But I'm hoping that the outcome is that Israel's nuclear weapons get destroyed. Because the whole cause of the catastrophes in the Middle east in the last 50 or 60 years has been the asymmetric power of Israel versus its Arab and Persian opponents in that region. If that asymmetry is removed, then we might get some form of stability in the Middle East. What I really hope is that the Arab nations, the Muslim nations that are all part of this conflict, decide to do what the Christians did several hundred years ago, and that's cease fighting each other.
It's been, you know, we go back 300 years or 400 years. You have these forms of conflicts occurring in Europe between so called Christian nations, Catholic versus Protestant. I know there's much more to it than Shiite versus Sunni, but the fact that the Sunni side of the Muslim religion sided with America supposedly is a defense against the power of the Shiite Persian country, and that's failed. I hope that makes those countries realize they really should come together with the people that they're closer to, which would mean that would become a Muslim part of the world in general and keep the Americans out. Because the true troublemakers in the Middle east have always been the Americans and the Israelis.
[00:23:44] Speaker A: Well, let's turn to Europe. Since the G7, or Genocide 7, as I call them, are meeting in Evian this week. For all the criticisms we've been making about Trump, at least he seems to have understood that Russia has more nuclear weapons than any other country on Earth. What have you made of EU powers in my country, Britain doubling down against Russia, let alone the context of what you were talking about, the 2 billion facing famine and the war in West Asia, what possible strategic direction is Western Europe heading?
[00:24:21] Speaker B: It's extremely hard to understand the behavior because we're trying to work out some way in which what the leaders are doing is a strategic reaction to the circumstance they're in. I just don't think that cuts the mustard. I'm not a conspiracy theorist by any stretch of imagination that the extent to which Israel has tried to control the political attitudes towards itself from countries in the rest of the world. I expect there's dirt on all of these major political leaders and that's why they're making the decisions. They are. It's not based on a sensible assumption
[00:24:53] Speaker A: even vis a vis Russia.
[00:24:56] Speaker B: Yeah, I know Russia it is. So I mean people, we're trying to make sense of a senseless world.
And if you were going to be strategic about this, you would say, well, Russia has specialized in being a producer of raw materials. Europe doesn't have the raw material inputs. It needs them. It should be cooperating with Russia. Instead they're expending the conflict. And of course, the whole Ukrainian conflict goes well before the invasion, the Russia's own invasion, which I saw as a mistake on the scale it made the invasion. I expected Putin to take over Donbass, not to try to wipe out Kiev in the first few weeks of the conflict.
But NATO is provoking that behavior all the way through. NATO promised Ukraine, it's promised so many countries that it would not expand its range eastward. And it has done that expansion of the range. So Russia's response was, they've had European invasions before. They're saying, don't tread any further. You're NATO consider doing it. That's what leads to the Ukraine war.
But you would hope that that ancient sense of military based conflict would finally be removed from our political system by the interdependencies that now exist between countries like Russia with a large energy supply, Europe with a large need for energy. Instead, these conflicts occur and I just shake my head again. I said I can't make sense of it unless I imagine that people have got some metaphorical gun at their heads. That means that that's why they're making the decisions they do. Not that those decisions make any sense.
[00:26:36] Speaker A: Yeah, I mean, critics of Putin include those who say that he should have gone in 2014 after the coup, of course. Well, very briefly and finally, do you think then the rising inequality that will continue in these Western European nations will give rise to fascism and G7 nations will see that rise in fascism as they become more unequal and their oligarch classes continue to drive them into war?
[00:27:02] Speaker B: I'm afraid I do.
And of course these decisions is turning people against the outsider, blaming the outsider for the situation that's going wrong inside the country.
This is a common element again that was the original of Nazism. You blame the Jews for the problems of Germany.
This tendency back to fascism seems to occur when we have massive economic inequality and the economic system functioning badly for the people at the bottom of the the social totem pole.
The response of the A leaders to say it's all the fault of the foreigner and that then seems to lead to the growth of fascist type behavior. So yes, I'm afraid I see a continuing tendency towards fascism.
[00:27:48] Speaker A: Professor Keane, thank you.
[00:27:51] Speaker B: You're welcome.
[00:27:52] Speaker A: That's it for the show. Our continued condolences to all those of you bereaved or affected by today's NATO nation wars of aggression. We'll be back on Saturday with a brand new show. Until then, you can keep in touch via all our social media if it's not censored in your country. And head to our channel, going underground TV on rumble.com to watch new and old episodes of Going Underground. See you Saturday.
