Robbing Peter

Tyler Durden's picture

Submitted by Jeff Thomas via Doug Casey's International Man,

“A government that robs Peter to pay Paul can always depend on the support of Paul.” – George Bernard Shaw


“Since the beginning of recorded history, the business of government has been wealth confiscation.” – Ron Holland


The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.” – Vladimir Lenin

On 16th March 2013, the banks of Cyprus, with the approval of the Cyprus Government, the European Commission, the European Central Bank, and the International Monetary Fund, confiscated private savings of accounts exceeding €100,000.

At the time, there were two readings of the unanimous approval by four bodies. As the confiscation was presented to the public, the unanimous approval implied that the confiscation was above board. To those who looked a bit deeper, however, the unanimous approval meant that, not only had the four bodies clearly been working on the plan for some time, behind closed doors, but it also demonstrated that all four bodies colluded to steal a significant amount of privately owned money.

For those of us who took the latter view, the confiscation meant that there would be more to come—that Cyprus was being used as a test case. If successful—that is, if the world did not immediately express outrage over the theft—a precedent would be set whereby the EU, the IMF, and presumably any of the banks and governments of the world could assume that it was alright to confiscate private funds, so long as there was an “emergency.”

As it turned out, they got away with it. There was no great outrage—very possibly because so few people in the world were directly impacted, so they were not especially bothered.

However, the precedent had been set, and at the time, I predicted that this was a test case and that the Cyprus model would spread.

I subsequently wrote a follow-up article, when Canada wrote into its 2013 budget that the Canadian banks could perform their own bail-in, should they find themselves in a state of “emergency.”

But, in fact, this did not begin with Cyprus. It began in November of 2010 in a meeting of the G20 countries, all of whom agreed to the concept of a bail-in. Since then, under the UK Banking Act 2009, legislation allowing bail-ins was passed in the UK. The US followed with the Dodd Frank Act of 2010. Switzerland followed in 2013 with a revision of the 1934 Banking Act. Other countries followed—some having completed legislation, some still in the works.

Now, on 4th July, Spain announced that it would impose a blanket taxation on all bank accounts at the rate of 0.03% for the purpose of “Harmonizing tax regimes and generating revenues.”

Spain may defend its decision by pointing out that it has one of the lowest tax takes in the European Union, which is true. However, what should be the issue here is not the amount of tax being imposed, but the principle upon which the tax is being taken. Let there be no doubt about this bail-in or any other—it is pure theft.

There will be those who are shortsighted, who may point to the tax rate of 0.03% being low. But history shows us that, over time, once a taxation concept is accepted by those being taxed, the rate tends to be increased over time. (All taxes start out small.)

The measure in Spain is also an advance on the concept that, as long as an emergency is perceived to exist, confiscation is justified. In Spain, no emergency situation is being pretended; they simply want the money and have decided to take it.

There are a number of points that the reader may wish to consider, even if he does not reside in Spain:

  • Since the initial confiscation in Cyprus attracted the approval of the EU and the IMF, it should not come as a surprise if the EU passes bail-in legislation. (Indeed such legislation is now in the works.)
  • It is unlikely that people who bank in any G20 country are safe, even if they do not as yet have bail-in legislation, as they may be next.
  • Should the US and /or the EU replace their paper currencies with plastic debit cards, as has been suggested, those who live in those jurisdictions will have no choice but to rely on banks as the clearing houses for all monetary transactions, once paper currency is eliminated. This, coupled with bail-in legislation would render all personal and corporate funds open to confiscation.

It does appear as though the table is being set for the citizens of all the G20 countries to be subject to legalised theft by their banks and/or governments. The question then to be asked would be, “How can I steer clear of this outrage, either in whole or in part?”

First, it might be wise to establish banking in another jurisdiction where, at the very least, confiscation legislation does not appear to be under discussion.


Second, it might be wise to establish a home base of some sort in another jurisdiction, in order to further diversify your risk.


Third, should you choose to remain in your present jurisdiction either full or part time, it might be wise to retain only three months expense money in banks in that jurisdiction, to minimise the possible loss-level.


Fourth, it might be wise to move a significant portion of your cash into investments that would be difficult, if not impossible, to confiscate. (Those who advise on internationalisation tend to recommend real property and precious metals as the two safest choices. Such investments should be outside of the endangered jurisdictions.)


Fifth, other types of confiscation are planned by some jurisdictions—notably with regard to retirement funds, through the demand that retirement funds be invested in government treasuries and/or bank debt. (It might be wise to move these funds elsewhere internationally as well.)


Sixth, it might be wise to resolve all of the above issues as soon as possible. Once legislation is in place, exiting from confiscatory laws may become impossible. Certainly, as in Spain, there will be no warning offered by governments. One day, you will own your deposit, the next day you may not.

One last note: In robbing Peter, the individuals performing the robbery will not be dressed like the individual in the photo below.

They will be wearing suits, and they will present themselves as legitimate authorities, carrying out the law. Unlike a customary robbery, there will be no authority to complain to; there will be no means of recourse. Your wealth, however large or small, will be lost.

Editor’s Note: This story is not surprising. In fact, we predicted it here. And don’t expect this to be the end of bank deposit “taxes” (i.e. confiscations) either. This is only the very beginning. As governments in the EU and throughout the world sink deeper into bankruptcy expect measures like this to increase in frequency and intensity. This is yet another great illustration why you need to have a bank account in a jurisdiction with sound finances. More on that here.

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fonzannoon's picture

 Hershey (NYSE:HSY) announces a weighted average price boost of about 8% across its packaged candy and grocery lines, effective today. The increase is intended to help offset the significant jumps in input costs, including raw materials, packaging, fuel, utilities, and transportation.

Dr. Engali's picture

First of all, any currency in any system is subject to confiscation and secondly as we have seen in Kelo v.The City of New London that 'private property (ahem..... You pay property taxes so it's all rented) can be confiscated for any oligarch's personal pet project. No my friends if you want to protect yourself in this world you're going to have to fight for it. There is no safe "jurisdiction" sounds like 21 to me.

logicalman's picture

If you own nothing, which is, in truth, the case for all but the elites who can defend their stuff with hired thugs, nothing can be taken from you.

You don't own stuff, stuff owns you - if you let it.


nmewn's picture

The trick is to not let them KNOW YOU own anything, at OUR level.

They do it with their trust funds & "foundations" all the time...its for "the children" dontcha know, they just don't tell you its for THEIR children & cronies.

Oh look...they're being COOOMPASSSSINATE!

Fuckers, adopt some Barry Border Babies and show the "compassion".


shovelhead's picture

It's really much worse than that.

Notice the increase in stories that the cops kick in doors, shoot someone and say sorry when it's a bad search?

Basically it's a "Fuck you. We're the cops. Be thankful it wasn't you we shot."

Compared to this, pickpocketing looks like light-hearted fun.

nmewn's picture

Kelo v.The City of New London...don't even get me started..."for the greater good"..."From each according to his ability, to each according to his needs".

If it were within my power I would burn everyone of them alive and toast marshmellows in the eye sockets of their skulls.

Thats how bad I hate them.

kchrisc's picture

Governments NEVER rob Peter to pay Paul.

Government robs them both and rebates a bit back to Paul as cover of their theft.

Quentin Daniels's picture

Robbing Peter to give to Paul to lend to Peter.  Thus ensuring that Paul is bought and in the their pockets (or the other way around more likely), and Peter is so indebted that he can be crushed at a moments notice if he steps out of line.

Peter, if you're listening, no matter how much they take form you, just don't borrow money from Paul  Freedom is worth more than fiat.  Hell, anything is worth more than fiat in the long run.

Tracking the accumulation and movement of private wealth is almost certainly the primary objective of the increasingly pervasive surveillence dragnet, and not the wealth of billionaires, but ordinary folks.  It's getting harder to keep private wealth private.

Heavy metals and careless operation of watercraft still stand out as the best option.

Clamdigger's picture

My old man always said that robbing Peter to pay Paul just makes for a sore Peter.

Cliff Claven Cheers's picture

The way I am starting to see it is there is no such thing as a free lunch.  In reality there would not be as much "savings" to confiscate had the savers been paying adequate taxes to cover the spending they authorized via democratically elected representatives all along .  If it all gets taken I am all for it, better those that benefited from it than taxing future generations that got no benefit.  Screw the baby booming theives who think they can steal from my kids through all this Financial Fuckery TM.

The Most Interesting Frog in the World's picture

Exactly! Who knows I might actually start voting again if somebody came up with a platform to make this situation right.

Buster Cherry's picture

Where is this safe jurisdiction located so I can money there?

I have some PM on the bottom of a lake, but I still need to write checks to pay the bills.

Dublinmick's picture

Only problem is that Peter was first issued fiat money and Paul didn't realize it was inflationary and he was in fact stealing nothing but an illusion.

The Most Interesting Frog in the World's picture

As I have commented on ZH before, and quite unpopular, I am all for bail ins and wealth taxes of nearly any kind. After all, who is stealing from who?

Let's take the US. Has US "wealth" in the last 40+ years been earned? Or has it been borrowed? I am not suggesting that the precious few workers we have remaining are not working hard and not earning their paycheck, but would their paycheck even exist without massive government deficit spending financed by everyone from the Fed to China, etc. The answer is no! Collectively, US wealth on a net basis has been borrowed.

Now, who exactly is going to pay off the government debt? Well, under our current structure, the debt will have to be paid by those that are working. And, more and more, those workers have nothing left at the end of year to save for themselves, not to mention the fact that the younger generations were not responsible for, nor have they directly benefitted, from the debt in the first place.

So, who is robbing from who? I would suggest that the generations, individuals and families that benefitted the most from the debt, have stolen from the younger and future generations. I am no fan of government and banks, but are they not filling the role of Robin Hood when they collect from the rich and pay down the debts accumulated by the government that helped make them rich?

Harbanger's picture

The entire West has gotten a free ride from this ponzi scheme since WWII.  The Euros like to complain about the US having military bases on their land but that security after the war allowed them to not spend money on their own military defense and instead put that money into growing their socialist welfare state.  I know in a perfect world everyone gets along but in the real world countries look out for their own self interest and will soon be at each other throats again.

Judge Smales's picture

“A government that robs Peter to pay Shaniqua, Tyrone and LaShonda can always depend on the support of Shaniqua, Tyrone and LaShonda."



Sandy15's picture

“A government that robs Peter to pay Paul can always depend on the support of Paul.” – George Bernard Shaw


Why would you start an Article here on ZH quoting a communist?

shovelhead's picture

Why not?

If it's true.

Commies always wanted to destroy the US. They told us how they would do it and they were right.

It's working like gangbusters.

You better brush up on learning the words to the Internationale.

manich's picture

Robbing Peter to pay Peter's boss.

LibertarianMenace's picture

Seventh, head off to Mars.