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Guest Post: 500 Million Debt-Serfs: The European Union Is A Neo-Feudal Kleptocracy
From Charles Hugh Smith from Of Two Minds
500 Million Debt-Serfs: The European Union Is a Neo-Feudal Kleptocracy
The banks of Europe are the new Feudal Manors and Masters. All Europeans now serve them as debt-serfs in one way or another.
If we knock down all the flimsy screens of artifice and obscuring complexity, what we see in Europe is a continent of debt-serfs, indentured to the banks under the whip of the European Union and its secular religion, the euro.
I know this isn't the pretty picture presented by the EU Overlords, of a prosperity built not just on debt, but on resolving the problem of debt with more debt, but it is the reality behind the eurozone's phony facade of economic "freedom."
What else can we call the stark domination of the big banks other than Neo-Feudalism? In one way or another, every one of the 27-member nations' citizens are indentured to the big international banks at risk in Europe, most of which are based in Europe.
Amidst the confusing overlay of voices and agendas, there is really only one agenda item: save the big European banks. Everything else is just mechanics. The banks are the new feudal manor houses, the bankers are the new feudal lords, and the politicians of the EU and its influential member nations are the servile vassals who enforce the "rule of law" on the serfs.
Here is the fundamental fact: there are trillions of euros of debt which can never be paid back. In a non-feudal system, one in which the banks were not the Masters, then this fact would be recognized and acted upon: something like 50% of the debt would be written off in one fell swoop, all the banks whose assets had just been wiped out would be declared insolvent and liquidated, the remaining debt would be sized to the economic surplus of each debtor nation, and a new, decentralized banking sector of dozens of strictly limited, smaller banks would be established.
To the degree that is "impossible," Europe is nothing but a Neo-Feudal Kleptocracy serving its Banker Lords.
The Greek worker whose pay has been slashed in the "austerity" demanded by the banks serves the Banker Lords, as does the German worker who will be paying higher taxes to bail out Germany and France's Banker Lords. Though the German is constantly told he is bailing out Greece, the truth is Greece is just the conduit: he's actually bailing out the EU's Banker Lords.
We can clear up much of the purposeful obfuscation by asking: exactly what tragedy befalls Europe if all the sovereign debt in the EU was wiped off the books? The one and only "tragedy" would be the destruction of the "too big to fail" banks, not just in Europe but around the world. As the big European banks imploded, then their inability to service their counterparty obligations on various derivatives to other big banks would topple those lenders.
While the political vassals call that possibility a catastrophe, it would actually spell freedom for Europe's 500 million debt serfs. From the lofty heights of the Manor House, then the loss of enormously concentrated power and wealth is indeed a catastrophe for the Lords and their political lackeys. But for the debt-serfs facing generations of servitude for nothing, then the destruction of the banks would be the glorious lifting of tyranny.
Just as a refresher, here is a definition of kleptocracy:
Kleptocracy, alternatively cleptocracy or kleptarchy, from the Ancient Greek for "thief" and "rule," is a term applied to a government subject to control fraud that takes advantage of governmental corruption to extend the personal wealth and political power of government officials and the ruling class (collectively, kleptocrats), via the embezzlement of state funds at the expense of the wider population, sometimes without even the pretense of honest service. The term means "rule by thieves".
Extracting the wealth of 500 million people via the EU's central governance machinery to serve a handful of big banks is definitely a form of systemic embezzlement. As for corruption: where are the politicians who speak to the enormous benefits of writing off these debts and destroying the power of the big banks, utterly and completely, as the only way to free the people from debt-serfdom?
While the European Central Bank (ECB) and the vassals' favorite form of oppression, the European Financial Stability Facility (EFSF), print or borrow more euros into existence to fund the illusion of solvency, the cold reality is that the only way to service these trillions in impaired debt is to skim the surplus from the labor of the debt-serfs.
Since the political vassals control the means of taxation, then it is their job to squeeze hundreds of billions of euros out of the labor of their nation's debt-serfs.
There is a fatal weakness in the Grand Scheme of European Neo-Feudalism, and the lackeys in the EU are desperately trying to fix it under the banner of "integration." The fatal flaw is that the political union of the EU vassal states did not include fiscal union in which the EU could impose and control taxation within all member states.
This flaw means that the Banker Lords lack the necessary means to impose serfdom directly through the "laws" of the EU itself; instead, they must coerce the vassal political class within each member state to impose debt-serfdom on its citizenry.
This has proven cumbersome, as some nation's debt-serfs are threatening to refuse to submit to serfdom. Such a rebellion would of course bring down the entire house of cards that is Neo-Feudal Europe, and so the lackeys in Brussels and elsewhere are frantically trying to sell "fiscal integration" as the "necessary step" to centralizing the power of the banker Lords over the citizenry of all 27 EU member states.
The euro was intended to be the enforcement mechanism, but alas, voluntary agreement is not a solid foundation for neo-feudalism. At its heart, the euro currency was ultimately a Grand Arbitrage for the big European banks: they could loan essentially unlimited sums to citizens and sovereign member-states in a stable currency, and be guaranteed that they would be repaid in that same currency regardless of the weaknesses of the debtors.
That was a very sweet deal, an essentially risk-free license to generate monumental profits, all backstopped/guaranteed by the EU and ECB.
In the old, horribly risky system of independent states and currencies, any bank foolish enough to loan vast sums to weak states and its citizenry would soon find the currency in which their loans were paid would weaken to the point that even if the loans were repaid in full, their losses would be crushing.
For example, say a bank loaned Greece 1 billion drachma when the drachma was equal in value to the U.S. dollar. The loan would thus be worth $1 billion. But let's say that by the time the loan was repaid, the drachma had fallen to 50 cents. Measured in dollars, the bank suffered a loss of 50%, even when the loan was paid in full.
The euro removed all that nasty risk, and created a massive vassal class of EU bureaucrats to enforce the rules and make good any defaulted debt via the European Central Bank (ECB), the supra-national lender that served the big banks as guarantor. Ultimately, the ECB was funded by the member states' taxpayers, which spread the costs of the arbitrage over such a large number of citizens that it seemed impossible that the guarantee could be broken.
But the Banker Lords got greedy, and they overshot the carrying capacity of the EU's economy by a trillion euros; the debt loads are now so enormous that the surplus skimmed from the debt-serfs isn't enough.
That is the core dilemma of the Banker Lords and their political vassals. Since the Banker Lords lack the legal mechanism to impose new taxes via the EU itself, they must rely on the cumbersome processes of illusion and propaganda, of "extend and pretend" extensions of debt and harsh "austerity" to skim as much cream as possible.
The cloak has been removed, and the bloodied whip is now visibly in hand. In a household analogy: your mortgage has been rolled over into a new form of servitude, and your wages have been cut even as your taxes have been raised to service your debt to the Banker Lords. The vassals are bowing and scraping before their Lords, promising deeper cuts and higher taxes; yes, Master, we will obey.
But this isn't enough, of course; the Lords are demanding the rings off the fingers of the debt-serfs, and the rights to sovereign assets; they are casting a covetous eye on the comely daughter as well, and we can fully expect a discreet demand to exercise droit du seigneur, a right befitting the Lords of the new Feudalism.
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This is only half accurate and missing a big player.
The free spending gov'ts have a BIG role in this disaster as well. Sure they are supported by the banks and they in turn protect the banks, but they are at least equal partners. Don't be so naive.
Syrin,
You have identified the second player in the axis of evil. The third in the axis of evil are the political parties that have enabled the other two.
If we think of the banks and the government as two large leeches that suck the life from humanity, the political parties are the leech that sucks from the other two leeches.
I'm not a debt surf.
I have NO debt.
And I pay NO taxes. Well no income taxes at least.
How does that property tax work out for you , or payment on a car, or anything that makes you go to work , you are in debt, deal with it you are not free
I have NO debt. No car payments.
I work but pay no income tax. I know I'lm lucky to be able to work it that way
(UK citizen, not working in UK and hardly ever in UK)
Local property tax ? Whatever.
I'm definitely far more free than most.
Think bigger.
You are still enslaved by the debt-based system, and all the debts of a corrupt society, with its debt-paid wars, debt fueled environmental destruction, and debt-caused miseries.
You may think the price you pay now is small compared to (and thanks to) the misery of others. But that is changing, as evermore liberties are eroded, global destruction proceeds, and economic well-being is undermined.
Its always been the way. Serving our masters. Hey, you gotta serve someone, God or the Devil... Our Lords certainly serve the Devil, though, with their buying of his offer of riches and power. But Another cometh in wrath for them, and in meekness and love for we who believe.
Jacob 2 5 Hearken my beloved brethren [for jewish believers and not for unbelievers]
Has not God chosen the poor of this world/rich in faith,
and heirs of the kingdom [1000 yr peaceable reign of Messiah coming soon] which he has promised to them that love him?
I'm no debt surf.
I have NO debt.
And I pay NO taxes. Well no income tax.
We all pay the INFLATION tax. That one is unavoidable.
True.
Best I can think of is property & PM's
Don't keep cash for longer than necessary.
It is a bitch and a disgrace that the people should have to spend all their time protecting what they have from the inflationary incompetence of their own government. Assuming it's incompetence and not part of the plan.
I agree. Unfotunately, property they also tax and some argue they manipulate PMs - so is there really a 'safe' haven?
No.
I believe TPTB are capable of nearly anything. Tax. Confiscation.
Land & PM's not safe. Just the best I can think of.
I do have property in different countries. So diversity may help.
No.
I believe TPTB are capable of nearly anything. Tax. Confiscation.
Land & PM's not safe. Just the best I can think of.
I do have property in different countries. So diversity may help.
Yep, and better than a systemic crash, Glass-Steagall will with a scalpel rid the odius, fraudulent debt from the books, and a much more managable crash will happen, in a much more directed way.
Then gov'ts can be free to utter credit for useful, tangible, value adding projects. Nope, golden toilet roll makers need not apply.
But this was a good article and pretty spot on imo of what the Euro is, it's thankful flaws, the true nature of the 'bailouts', etc.
To believe they built the euro house of cards on something like this, shows how out of touch these oligarchs were at the time they created the euro. They thought this would work! Then went full steam ahead, even though the only way it 'works' is as stated above all the nations slit their own wrists and throw all their citizens to the debt-slave wolves. If anyone objects, everything else comes crashing down.
Tell them they can have their fiat, fraudulent debt money. We deem what money is, what it is worth, and what are lawful debt obligations. We also don't need to pay THEM for creating it out of thin air (always for their fraud, and very little for anything tangible..unless it is fraud riddled..see MERS)
Boehner is an idiot, Obama is an idiot, they're all idiots. Cut and tax for our fraudulent filled national debt, just like the euros need all these countries to do the same.
ALL OF IT, to serve the oligarchy, the bankster overlords, who think they have a right to defraud you for their gain.
Glass-Steagall
Once the kleptocrats tighten the vise another few turns, I am just going to load up the car with some pm's, necessities, defense tools, board on the roof and embark on my own Road to Surfdom.
On the Road to Serfdom- Starring Hope and Crosby.
Join our friends as they take a mad-cap journey to 70%+ taxes and Soylent Green to support those Famous International Banker Cartels!
Coming to a theatre near you soon....very, very soon!
Bear with me here, I'm no banker.
Premise: Banks create money via credit based on capital (fractional reserve), right? What is capital? Equity? Deposits? Collateral? Or, all three?
Suggestion in article: Write off the debt.
Question: What happens to capital? Is it all preserved? Deposits whole? Collateral intact? Equity a wash?
If I don't get answers, then I might be up all night thinking about it. Don't be sadistic. Thanks.
Euroskeptic
http://www.youtube.com/watch?v=YTBbcaNLccM
Seneca related a story in his essays about the Spartan child who would not be a slave and crashed his head violently into a stone wall to end his life rather than be a slave.
As dusk settles around us do not go gently into this terrible night that has LIBERTY in its crosshairs. Make your life count. Do not submit.
"500 Million Debt-Serfs: The European Union Is A Neo-Feudal Kleptocracy."
well, don't forget who AMPLIFIED the 1980s "DEREGULATION" of the SAVINGS & LOANS... that led directly to the late 1980s-early 1990s Bush-1 Recession.... into the 1999 Gramm-Leach-Bliley Act DEMOLITION of 1930s Glass-Steagall (allowing the big NY & London banksters to use neighborhood banks as GAMBLING CHIPS for the CASINO GULAG) and Commodity Futures 'Modernization' Act (2000) - complete with "ENRON LOOPHOLE" allowing "DERIVATIVES" to put TRILLIONS of dollars of casino gambling DEBTS OFF THE BOOK, and BEYOND regulation...
all of which is LICENSE TO FRAUD, the LEGALIZED DEFRAUDING of consumers and (via "Disaster Capitalism" Too Big Too Fail "bailouts") and TITANIC DEFRAUDING of taxpayers worldwide
http://jessescrossroadscafe.blogspot.com/2010/06/sp-500-september-futures-and-gold-daily.html
So everyone can join a locally owned credit union and the problem is solved. Next task: Cure cancer. Burzynski did it....Next task:...
the " rescue " is just a transference of wealth
from the future of everyone into the current hands
of the craven few. it isn't the first of its kind and
that doesn't excuse it, now that we know it, it
will/must/should end.
I AM SO INCREDIBLY ANGRY RIGHT NOW. GRRRRR
http://www.telegraaf.nl/dft/10247251/___Duitse_banken_wilden_verder_gaan...
Rough translation:
German banks were prepared to take a 50% haircut, but the french banks persuaded everyone to only do 21% (and kick the can once more)
including that sad little fucker Rutte (PM Netherlands) who backtracked already on his descision (probably because he realised his HUGE mistake) source: FD.nl
that sad little clown lived with his mother before he became PM, he should be infected with parasites to be consumed slowly
what a little incompetent bitch owwwwwhhh
GRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRRR