End of the Banking System – Frederic Sautet

Mine is not about to become another cut and paste blog, however, given our banking laws are to be the same as Cyprus as regards the ultimate destruction of a depositor’s property, and remembering many of my New Zealand taxation and legal blog entries have been precisely about how the state has usurped the rule of law in New Zealand, following the lead of the Western police-states growing under Big Brother Surveillance State Keynesian socialism, with irresponsible, profligate politicians incompetently bumbling us all down the road to our serfdom by not understanding the (unintended)consequences of destroying the free market mechanism and imposing their foolish, petty selves oafishly between the needs and desires of the individuals in society, and the voluntary resolution of those needs – the current Tiwai Point fiasco another case in point of National’s bumbling – this becomes an important statement of truth by Sautet. This is what destruction of the free in free markets leads to; this is the implosion; read the full article here, with this short quotation to whet your curiosity:

I cannot think of a faster way to completely destroy a banking system than to expropriate its depositors. This is the kind of policies one would expect from a banana republic, not from a political system that rests on the rule of law. But this is the point: the EU does not respect the principles upon which a free society is based. The more a government uses the tools of expropriation, the more it creates the conditions of its future demise. Big depositors will not come back to Cyprus once all this is over. And restricting capital flows, as it is the case now, worsens the situation in the long run. 

As many commentators have said, the Cyprus problem, like that of Italy, France, Greece, Portugal, and Spain is one of public finance. As the EU moved from a free trade zone to a political system after the ratification of the Maastricht Treaty in 1992, it also (among many other things) progressively collectivized the risks associated with public spending …

And before I'm accused of backing the crony capitalist fiat money system (that is, current banking), note Sautet's final sentence:

Ultimately, of course, governments should get out of money production, but that’s maybe for another century.

(Every place EU is used in this quotation, replace with New Zealand: unfortunately the sense still works.)