Saturday, March 16, 2013

This isn't a 'tax' - it's theft, pure and simple

What do you do when your own government steals your money?

Cyprus is to receive a €10 billion (£8.7 billion) bail-out from the eurozone to recapitalise its ailing banking system in return for a series of drastic measures which will hit the country’s savers.

. . .

The emergency funding will be used to prop up the country’s banks which were hit by the financial restructuring of nearby Greece.

The Cypriot banking system had grown to be eight times the size of the country’s fledgling economy - which accounts for just 0.2pc of the eurozone’s gross domestic product.

But in a departure from previous bail-outs, the country’s savers are being asked to make sacrifices.

The terms of the deal mean that Cyprus’s savers will sacrifice up to 10pc of their deposits in a move which will raise as much as €6 billion.

The move, which is likely to prove unpopular with the country’s 1m citizens - and the Russian non-residents who reportedly account for half of deposits in Cyprus’s banks - will be enacted almost immediately.

Following a bank holiday in the country on Monday, March 18, the levy on bank deposits will come into force on Tuesday, March 19.

The Cypriot government will take steps to prevent electronic money transfers over the weekend, in order to stop depositors attempting to avoid the curbs.

“As it is a contribution to the financial stability of Cyprus, it seems just to ask for a contribution of all deposit holders," said Jeroen Dijsselbloem, the Dutch finance minister who chaired the meeting at which the bail-out was agreed in Brussels.

There's more at the link.  Bold, underlined text is my emphasis.

Let's be quite clear about this.  This is not a 'tax';  this is not a 'contribution'.  This is daylight robbery!

Cyprus' depositors are understandably outraged. They were given no warning that such a theft was being considered;  nor were they given any opportunity (as should be the case in a democracy) to have any say in the matter, whether by speaking with their representatives, or voting on it directly in a referendum or election.  The politicians who rule Cyprus were pressured by EU authorities (both politicians and bureaucrats) into making a contribution to the rescue package.  They arbitrarily decided to fund that contribution by stealing the money from depositors, without so much as a 'by your leave'.  They've even been so brazen as to shut down access to bank accounts, to prevent depositors withdrawing their money until the theft is complete!

Some readers may well say, "But that's Cyprus.  It could never happen here in the USA!"  Friends, it already has.  In 1933 President Roosevelt issued Executive Order 6102 (using - some, including myself, would say misusing - the authority of the Trading With The Enemy Act of 1917), in which he ordered Americans to surrender their gold bullion to the state at a fixed price of $20.67 per troy ounce.  Within months Congress passed the Gold Reserve Act of 1934, affirming this confiscation, and raising the official price of gold to $35 per troy ounce.  Everyone who'd just had their gold arbitrarily confiscated at the lower price was denied the benefit of the new, higher official price.  Can you say 'daylight robbery'?  I thought you could . . .

Another, even greater theft from Americans is currently being bruited about by left-wing and progressive elements:  namely, the so-called 'nationalization' (read:  confiscation or theft) of private pensions and retirement savings.  I referred to this a few days ago;  you can read more about it at the links provided there.  Suffice it to say that with our national debt situation as parlous as it is, I fully expect attempts to ram through such a plan on some or other 'legal' basis over the next few years, whether voters like it or not.

Those who conduct such confiscations - no, let's call them 'thefts', because that's what they are - argue that what they're doing is legal, because they make sure to apply existing laws in new ways, or pass new laws to cover what they're doing.  Well, it may be legal, but that doesn't make it right.  It's like a federal officer conducting an unconstitutional search of someone's property.  He - and the federal 'establishment' - will argue that you have no right to resist him;  you can only sue after the fact to establish that the search was illegal, and obtain what restitution the courts will allow.  If you try to stop an illegal, unconstitutional search before it starts, the 'establishment' will arrest you, or even use lethal force against you for 'obstructing an officer of the law in the execution of his duty' - and then grant so-called 'qualified immunity' to those who've killed you, because they were 'doing their job', irrespective of whether or not their actions were legal.  It's just another example of how the 'establishment' will use the law to protect itself and its minions while screwing you.

Friends, if you trust your government - whether it's under Republican Party or Democratic Party control - to look out for your best interests over its own, consider the example of Cyprus, and the others mentioned above, and wake up.  Government doesn't care about you at all, except as a resource from whom it can obtain what it wants and/or needs (the two are not necessarily one and the same thing).  This 'legalized', officially-sanctioned and -perpetrated daylight robbery on Cyprus should be a wake-up call to everyone who follows economic news and is concerned about what's coming down the pike at us.  It's already a reality in southern Europe (including Cyprus):  for example, in Italy a thousand companies are going bankrupt every day, according to the Telegraph.  The same reality has almost reached us here in the USA.  This legalized robbery in Cyprus is just another symptom of that reality.



Wraith said...

Funny thing...the infamous quote "We were just following orders," was never actually said at Nuremberg.

Their actual defense was, "It was legal for us to do so."

The more things change...

tweell said...

Another demonstration of our forefather's wisdom - don't keep money in banks! It's not as if you're collecting any interest on it, so why take the chance?

Anonymous said...

The unintended consequence will be all funds will now be withdrawn.
Oh boy what fun we have in store for us all as this action will happen here as well.

Anonymous said...

Those 1 million residents of Cyprus voted for union with Europe, right? They've supported their government as it spent and borrowed, right? They've agitated for their government to extort huge sums of money from their fellow Europeans to pay down their debt in order to avoid the consequences of their actions. Can't say my heart bleeds for them now that they have to cover a percentage of their own debts....

Toejam said...

Please don't let Obama see this story.

Anonymous said...

The truly pernicious effect is this-
ALL the theft is from those least to blame-the prudent, the savers, the frugal,the very backbone of stable society-when these people have lost everything, there will be hell to pay.

Anonymous said...

I have not yet read of Cypriot politicians being hanged from lamp posts. Expect other governments to say, "hmmm, they did it in Cyprus, why not here?"


Chris said...

My wife still does not believe that something like this can happen here. (She works for the federal court system.) She is blithely confident that *her* pension is secure, etc. I wish she would turn out to be right, but I don't see how.

Michael Z. Williamson said...

"Yeah, it's brutal. Right now, we're advising our clients to put everything they've got into canned goods and shotguns."

Gay_Cynic said...

As Michael was gracious enough to point out, somewhat subtly, things may just get a bit interesting in Cyprus. Folks get a bit tetchy about such things.

And yes, investing in tangibles seems like a wiser and wiser choice.