Rule Of Law: Markets tumbled after Cyprus and the EU said they might tax private bank accounts to pay for a bailout. Arbitrary property grabs are a new low and a bad precedent in this crisis. Worse still, it can happen here.As bad as tumbling markets around the world are, they seem to be the only signal strong enough to catch the attention of Europe's otherwise unaccountable bureaucrats who have long since learned to ignore street riots.As stocks fell from Tokyo to New York, Europe's leaders are scrambling to say they had nothing to do with the cause — the shutdown of all Cyprus banks and ATMs for at least three days and the expropriation of a large chunk of each now-captive account, as a "tax" to pay for Cyprus' $13 billion EU bailout, Europe's fifth.
It appears that Cypriot banks made very bad investment decisions costing them billions. Without a bailout they will go bankrupt. So the EU demands that the Cypriot government confiscate a large part of every saver's account in return for enough money to bail out the banks.
Which teaches everyone a valuable lesson. The government can do anything to you if you can't defend yourself. Banks accounts are not safe from government confiscation. Neither are any other accounts held by any other financial institution and not held by you personally.
Suddenly the Second Amendment and stuff under your mattress become increasingly important.
Already Congressional Democrats are plotting the expropriation of Americans' private 401(k) and IRA retirement savings accounts in favor of "a guaranteed income." If bank accounts can be casually expropriated in Cyprus to pay for big-spending governments and bailouts, there is no reason a nice slice of the $19 trillion in retirement accounts can't get the same treatment.If it happens, it will signal the end of individual freedom and the return of feudalism.Frederick Hayek had a phrase for this: "The Road To Serfdom." Let's hope there will be more than just markets to make this state theft of private property stop.
From Glenn Reynolds:
Like I said, an enterprising GOP member of the House or Senate would introduce a bill immediately to make such shenanigans illegal — and dare the Dems to oppose it.
This is a golden opportunity for Rand Paul or Ted Cruz.
1 comment:
There is a precedent for this kind of action.
After WWII Germany lost about 1/3rd of its territory and millions of Germans wer expelled. Most moved to West Germany where they arrived pennyless. They lost all property through no fault ofm their own while those who were lucky enough to live ion West Germany kept theirs.
In 1961 the German Parliament passed a law that assessed all real estate with 50% of its value. Those who owned real estate had to pay their share into a fund but were given 30 years to do so. The last payements were made in 1991, shortly after reunification. The money thus collected was given to those who had lost property in 1945.
That action helped to integrate the refugees into West German society.
So, why not ask those who have monet =y in Cyrus banks to give up a small percentage to prevent the country to go bancrupt?
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