The US sequester, to keep the super rich and corporations from paying their fair share, is just a beginning. Cyprus hints at our future - bailing out a country by stealing from all bank deposits (but not stocks or bonds).
In Cyprus, money deposited safely in banks has been seized and used to “bail out” the country.
... depositors went to sleep on Friday night and woke up Saturday to find that their money, deposited safely in Cypriot banks, had been seized and used to “bail out” the country.
... Cypriot bank account holders with funds over 100,000 euros will have 9.9% of their account holdings deducted from their accounts when banks open on Tuesday. However, importantly, an additional 6.75% levy is going to hit deposits below that 100,000 euro level.
Well that's certainly scary!!!
Relax in the face of the inevitable*; we the people will pay the money via income taxes before we bank it, or from our accounts after we bank it**.
While Reagan was president, the Repubs announced that because they didn't have the numbers in Congress to cut the social programs, they would cut them by borrowing the government into bankruptcy.
Reagan and the two Bushes borrowed (from our offspring) and we the people (some of us) benefited from the increased government spending.
And get this, while the Repubs borrowed, their attack machine called Dems "taxers and spenders".
Did the Dems return the favor and call Repubs "borrowers and spenders"?
Would gentle liberal liberals stoop that low?
We less gentle progressives would, but we didn't.
*Old Chinese proverb: Relax in the face of the inevitable.
New American Proverb: How do I know it's inevitable unless I poke at it a few times?
**...from our accounts after we bank it. Unless we were so poor that we had none left over to bank. So it's a "tax the rich" policy after all.
In one sense it only taxes those wealthy enough to have any money in a bank. But in the US, the FDIC insurance for bank deposits rests on the backs of federal government. You know that programs for the poorest are the first to be cut here when government money is imagined to be tight. The powers-that-be don't ask corporations or the super wealthy to pay their fair share, they target "freeloaders" such as teachers, firefighters, government employees, social security recipients, meals for the elderly, etc. In sum, the US finance sector stands to make a tidy short term profit and the lowly folk here stand to pay the price when the shit hits the fan.
... ultimately it is Uncle Sam – meaning you and me – who are on the hook when the FDIC needs backstopping. So our too-big-to-fail banks look set to profit from the federal government they love to denounce, as anxious depositors around the world move money into insured US banks. [emphasis mine]
Therefore, Tom, I am not relaxed in the face of this shitstorm.
I don't envy the people who, during America's early decades, died of starvation.
What are your thoughts on what we-the-relaxed-people will do if we see such conditions returning?
I'm guessing we will make some noise about how governments--federal, state, and local--are spending money.
We might make enough noise to persuade the feds to close overseas military bases, stop bribing other nation's rulers, raise taxes on the wealthy we have subsidized for decades, etc, etc, etc.
Let's make a list, with the amounts saved if possible.
I read and see even more chaos ahead. The bad news, the probability of worsening financial conditions will create even more turmoil. The good news, we see it coming and can prepare. If banks failures do not follow, then we have prepared for nothing. However, if we don't get our affairs in order and worsening conditions do arrive, we sink with those who have no clue.
Chaos and stress caused by economic instability can result in an error of judgment.
A type I error is a false positive; it causes one to think the banks will fail, when in reality they will not.
A tupe II error is a false negative; it causes one to think the banks will not fail, when in reality they will.
This article summarizes the Cyprus crisis more clearly.
Ruth, I enjoyed my AlterNet experience, until I tired of reading lists of things I needed to know.
It is clear to me why USA banks and world banks want to be bailed out, and governments acquiesce to banks' demands because government legislators are beholden to bankers for their funding, especially now that USA perceives a bank as a person. Cyprus is only a symptom of a larger picture.
My quandary is why the public does not revolt. People have more power because they have more people. Yes, government has armies to resist revolt. Every economic issue between owners of wealth and owners of labor have always had to fight for a share of profits that both are required in order to make those profits. We now have the ancient class war and with so much joblessness, some kind of adjustment has to be made.
Too many people, too few jobs. Pay for wage-labor too low to support families, interest paid on investments go to wealthy without consideration of growing income gap. Health care costs beyond the ability for wage-earners and small business to pay. Education beyond the reach of working class people and fewer dollars for grants and tuitions.
All of this is evidence of a need to make fundamental changes in our economic principles and practices.
We live in interesting times.
"My quandary is why the public does not revolt."
Joan, your quandary was mine too in 1974 when I was running in the party primary for the Arizona legislature. The reasons a few people told me for not voting all but floored me and I saw a strikingly different meaning for TJ's words in the Declaration: all experience has shown that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.
I was too new to the game, too idealistic, to tell myself those people were a minority small enough to ignore.
My fling into politics persuaded me that idealists, who want the world to be better than it is, know unhappiness well.
I now describe my move away from idealism as the swing of a pendulum: on my travels between idealism and cynicism, I'm finding it easier to pause at realism.
I first heard your interesting times phrase as an ancient Chinese curse: May you live in a time of change." Whoever first said that knew how to lay curses.
Idealists have to persuade people that evils are not sufferable. Cynics need only to lie.
BTW, I did well in the primary but not well enough to defeat the incumbent. It was exciting.
Tom, Your swing from idealism to cynicism to realism feels familiar. Much of my childhood was spent listening to my uncle, a superior court judge, who spoke so glowingly of our Declaration and Constitution and Bill of Rights. I soaked it up as if I were a sponge. It all made such sense to me, and seemed to be right, and overflowed with justice and fairness. Life presented me with a few knocks and reality had to be addressed. Early on I discovered our treasured ancestor who signed the Declaration of Independence was a ship captain who made his fortune kidnapping Africans, chaining them together and shipping them to the Americas as slaves. Another early reality was my uncle believed niggers and women should not be citizens because of being African and for being lesbians. At the time, I did not understand what either meant. A few more shocks to the reality of life in the good old USA, and I went from 100% gullible to various stages of angry, hurt, sad, embarrassed ashamed, and guilty.
Well, that was then and now I just want to see what is real and deal with reality. No perfume to cover the stench; no bandage to hide the wound. Just good old fashioned tell it like it is, like it could be, like it probably will be and like I prefer it to be.
If "Idealists have to persuade people that evils are not sufferable. Cynics need only to lie", then perhaps balance for me is to live my life not wanting to persuade or to lie, but to be.