Cyprus makes a Decision

According to many news reports, Cyprus will be making an important decision about their bailout today. Whatever happens, the decision will have far reaching implications across the entire world. If The Cyprus government chooses to tax deposits, the Russians will not be very happy.   If they choose not to tax deposits, will they be kicked out of the European Union and how will that effect the Cypriotic economy?   There are many questions still to be answered about this situation, so stay tuned.   I’m still hoping to get D13’s article published, but I cannot do it from the pending section.   Feel free to bring forward any discussions as we wait for the Cyprus situation to play out.


  1. gmanfortruth says:

    Good Morning SUFA 🙂

    @D13, If you can go to the dashboard and publish your article, please do. We can have to threads running at once. If you need my email address, let me know.

    @Charlie, I’d like you and JAC to continue your chat on how to fix the corruption/income problem. Let me know if I can help.

    More snow at my place today. 3-5 inches as winter just won’t go away. Locals have offered a bounty for the groundhog named Phil. Reports say that it was really Obama in disguise on Groundhog Day 😆 Par for the course if the latter is true 🙂

  2. gmanfortruth says:
  3. gmanfortruth says:

    @D13, Colonel, there are some quiet reports that a vial of Hemmoragic fever, a very deadly viral infection and possibly weaponized, being missing from the Bio-lab on Galveston Island. Any info from your end?

  4. gmanfortruth says:

    As expected, Cyprus and the EU reached a new late-night bailout deal last night that will reduce the chance that Cyprus’s financial system and economy will completely implode.

    The new deal is better than the last deal in one key respect:

    Deposits under 100,000 euros will be protected

    That’s very important. Those deposits were ostensibly “insured.” To seize them, the way the last bailout deal would have, would have been grossly unfair and would have set a truly alarming precedent.

    Now, small depositors in European banks can breathe more easily. At least in this case of gross malpractice on the part of reckless bank managers, their life savings have been preserved.

    Alas, the good news ends there.

    Although deposits under 100,000 euros will be spared, deposits over 100,000 euros will be seized and subjected to an as-yet undetermined haircut–with the confiscated money going to bail out the gambling losses of the aforementioned reckless idiots who run some of Cyprus’s banks.

    More info to come. I would have to say that this is not good for the EU overall. Any comments?

  5. gmanfortruth says:

    Then there are the rediculous words of Michael Moore 🙄 I would like him to prove just one of his lies with some basis of fact. Oh, He can’t because nothing he say’s has any fact in it. Target practice for lonely elephant hunters?

  6. If you remember,some time ago….both BF and I predicted that the Euro is an albatross…and that is coming true Last year, I tried to start a discussion on the European Common Market and people thought I was nuts. I guess I am still nuts even though it is coming true. If anyone has any money anywhere in Europe….you better get it out. It is in serious trouble. Let us start with Cyprus. An economic war is about to happen and despite what Charlie thinks, it will be devastating not only for the large depositors (which no one cares about) but it will be be ten fold on the small folk. Consider this.

    “at least some depositors are going to lose a substantial amount of money. Personally, I never dreamed that they would go after private bank accounts in Europe, but now that this precedent has been set it should be apparent to everyone that no bank account will ever be considered 100% safe in Europe ever again.”

    This statement is just the beginning. It is the general opinion of the top investment firms throughout the world. The EU started the war by confiscation and it is not going to stop with the large depositors. The EU has demanded and will get the entire depositor accounts with the large depositors having 40% of their deposits happening and the little guy at 25%. Cypress will fall… bailout is going to help it. The big boys are leaving as soon as they can.

    “Without trust, a banking system simply cannot function, and right now there are prominent voices on both sides of the Atlantic that are loudly warning that trust in the European banking system has been shattered and that people need to get their money out of those banks as rapidly as they can. Even if you don’t end up losing a significant chunk of your money, you could still end up dealing with very serious capital controls that greatly restrict what you are able to do with your money. Just look at what is already happening in Cyprus. Cash withdrawals through ATMs have now been limited to 100 euros per day, and when the banks finally do reopen there will be strict limits on financial transactions in order to prevent a full-blown bank run.”

    The above sentiment is what the “other side of the world” thinks and it does NOT include the United States in this meeting, This is the Asian Pacific Investors thoughts.

    “And of course anyone with half a brain will be trying to get as much of their money as they can out of those banks once they do reopen. So the truth is that the problems for Cyprus banks are just beginning. The size of the “bailout” that will be needed to keep those banks afloat will just keep getting larger and larger the more money that is withdrawn. Cyprus is heading for a complete and total banking meltdown, and because the economy of the island is so dependent on banking that means that the economy of the entire nation is going to collapse. Sadly, similar scenarios will soon start playing out all over Europe.”

    This belief is common among the gurus of the financial world. The house of cards is about to tumble. The United States will go through its…..but it is still the most stable in the world and will survive. There is an economic axiom that is prevalent and that is called the Law of Diminishing Returns. It not only applies to the economics of the world but to the banking system as well. It will happen in Cyprus and it is inevitable. When the big money is gone….there is nothing left except the starving 800,000 left on Cyprus. It is over.

    ” The revised terms under discussion would assess a one-time tax of 40 percent on deposits above 100,000 euros at the Bank of Cyprus, which has the largest number of savings accounts on the island. Because the Bank of Cyprus suffered huge losses on bets that it took on Greek bonds, the government appears to be taking depositors’ money to help plug the hole. A separate tax of 4 percent would be assessed on uninsured deposits at all other banks, including the 26 foreign banks that operate in Cyprus.”

    Think about this carefully…..even foreign banks are not immune……so as a foreign bank….I am outta Cyprus as soon as feasibly possible.

    ” The main question surrounds the future of the island’s largest lender, Bank of Cyprus. If unsecured deposits (above 100,000 euros) at all Cypriot banks are taxed then large savings at Bank of Cyprus are likely to be taxed between 20 and 25 percent. If the levy is not imposed on deposits at other lenders, the haircut for Bank of Cyprus customers will be much larger.

    The option of a full bail in of Bank of Cyprus depositors is still on the table. As with the Popular Bank of Cyprus (Laiki), which is to go through a resolution process, the full bail in option could lead to deposits above 100,000 euros being lost. The only compensation for unsecured depositors will be shares in the “good” bank that will be created by a possible merger between the “healthy” Laiki and Bank of Cyprus entities.

    When asked by Kathimerini how the Cypriot economy will survive if all company and personal deposits above 100,000 euros disappear from the country’s two biggest lenders, the EU official said: “Unfortunately, Cyprus’s choices are between a bad scenario and a very bad scenario.”

    The above speaks for itself.

    “So what percentage of the deposits in Cyprus are uninsured deposits? Well, nobody knows for sure, but according to JPMorgan close to half of the total amount of money on deposit in EU banks as a whole is uninsured.Do you think that some of those people will start moving their money to safer locations after watching how things are going down in Cyprus? They would be crazy if they didn’t. And if you think that “deposit insurance” will keep you safe, you are just being delusional. According to CNBC, very strict capital controls are coming to Cyprus. These rules will apply even to accounts that contain less than 100,000 euros…Financial controls are coming. Depositors with less than 100,000 euros may not lose their money outright, but they won’t like the restrictions–no matter how much they have in the bank. Limits on withdrawals, limits on check cashing, and perhaps even outright conversion of checking accounts into fixed term deposits are coming (translation: you don’t have a checking account, you have a bond from the bank).”

    ” However, with Russian investors having an estimated €30bn (£26bn) deposited in banks on the island, the growing optimism about a deal was accompanied by fears of retaliation from Moscow. Alexander Nekrassov, a former Kremlin adviser, said: “If it is the case that there will be a 25% levy on deposits greater than €100,000 then some Russians will suffer very badly.Then, of course, Moscow will be looking for ways to punish the EU. There are a number of large German companies operating in Russia. You could possibly look at freezing assets or taxing assets. The Kremlin is adopting a wait and see policy.”

    This is how economic warfare starts.

    Then you have this problem….”Retailers, facing cash-on-delivery demands from suppliers, warned stocks were running low. “At the moment, supplies will last another two or three days,” said Adamos Hadijadamou, head of Cyprus’s Association of Supermarkets. “We’ll have a problem if this is not resolved by next week.”

    “Well, at this point it does not take a genius to figure out what to do about any money that you may have in European banks. The following is from a recent Forbes article by economist Laurence Kotlikoff… Whatever happens, no one is going to trust or use Cypriot banks. This will shut down the country’s financial highway and flip Cyprus’ economy to a truly awful equilibrium in a replay of our own country’s Great Depression, which was kicked off by the failure of one-in-three U.S. banks. Cyprus is a small country. Still, the failure of its banks could trigger massive bank runs in Greece. After all, if the European Central Bank is abandoning Cypriot depositors, they may abandon Greek depositors next. A run on Greek banks could then spread to Portugal, Ireland, Spain, and Italy and from there to Belgium and France and, you get the picture, to other countries around the globe, including, drum roll, the U.S. Every bank in each of these countries has made promises they can’t keep were push come to shove, i.e., if all depositors demand their money back immediately.”

    “Others are being even more blunt with their warnings. For example, Nigel Farage, a member of the European Parliament, is warning everyone to get their money out of southern European banks while they still can…The appalling events in Cyprus over the course of the past week have surpassed even my direst of predictions. Even I didn’t think that they would stoop to stealing money from people’s bank accounts. I find that astonishing.There are 750,000 British people who own properties, or who live, many of them in retirement down in Spain. Our message to expats now that the EU has crossed this line, must be: Get your money out of there while you’ve still got a chance.”

    And finally….”And Martin Sibileau is proclaiming that if you still have an unsecured deposit in a eurozone bank that you should have your head examined…

    What are depositors of Euros faced with today? Anything but a clean bet! They don’t know what the expected loss on their capital will be, because it will be decided over a weekend by politicians who don’t even represent them. They don’t really know where their deposits went to and they also ignore what jurisdiction they really belong to. Finally, depositors are paid mere basis points for their trust in the system vs. the 20% p.a. Argentina offered in 2001 (thanks to the zero-interest rate policies of the 21stcentury). In light of all this, I can only conclude that anyone still having an unsecured deposit in a Euro zone bank should get his/her head examined!”

    D13’s position…….as I told some of you long ago, as a family we got out of all investments in the EU and that included selling off stocks and bonds in companies locally that have investments over there. Now that it has been shown that “secured” or “deposit insurance” means nothing… better look locally and get away from the Feds.

    Good luck Cyprus.

    • gmanfortruth says:

      Colonel, Do you think all of this has anything to do with European socialism? I am under the impression that it was socialism that played a huge part in the debts of many of the countries now in trouble. Any thoughts?

      • I dont know if you want to call it Socialism, per se….but it does have to do with the same entitlement issues we have here. Most of the countries that I have been in over there are very dependent upon government. The more dependent upon government, the more it creates elitism. Spain, France, Belgium, Portugal…etc….all have government programs that are dependent upon the wealthy to fund. Without the wealthy the government itself will fold…..governments do not make money. One of the interesting aspects of the Cyprus bailout is the privatization of State assets…..if I understand it correctly, they have recognized that privatization of assets is better run than state owned…however, it almost always means that the taxes are going to be greater.

        It is no secret that once the great Ponzi scheme comes home to roost……entitlement programs fail…..costs keep going up but there are not enough wealthy to keep it going. So, call it Socialism if you want but governments are to the point that they cannot afford it any longer.

  7. gmanfortruth says:
  8. CHARLES KRAUTHAMMER: The real news is that the Senate offered a budget for the first time since 2009. The iPad didn’t even exist the last time the Senate had a budget. And that is completely dead on arrival. It is the most appalling document you have ever seen. It doesn’t look at any entitlements. It doesn’t have any cuts. It marches us off a cliff into Greece and perhaps into Cyprus.

    Read more:

  9. Howard Kurtz Defends Leno from Provincial Media Elites

    by John Nolte 25 Mar 2013, 6:12 AM PDT 8 post a comment View Discussion

    Big Journalism regularly criticizes media writer Howard Kurtz, but he’s 100% correct on this one.

    It’s the way that television critics despise Leno, and how that colors the coverage of the late-night wars.

    When The New York Times’ Bill Carter broke the story last week that NBC is ready to hand “The Tonight Show” to Jimmy Fallon in 2014, there was this line buried deep in the piece: “Another complicating factor has been Mr. Leno’s success in the ratings.” …

    Time’s James Poniewozik writes that “Jay ‘It’s just a business’ Leno deserves no man’s pity however this plays out.” The Atlantic complains about his “groan-worthy jokes.”

    But here’s the thing: Leno doesn’t appeal to anyone but the viewers. At least those who live west of the Hudson River and east of the Santa Monica Mountains. He does broad comedy and hardly wields the kind of cutting-edge style favored by the bicoastal elites. But much of America likes him.

    Does the 62-year-old comic skew old? Well, he’s been beating Kimmel and David Letterman even in the coveted 18-to-49 demo.

    This same elitism colors more than the media’s coverage of Jay Leno.

    It colors everything.

    This seems like a small thing-Leno looses the Tonight show-But it says volumes.

  10. Colonel,

    Could you hold a banking for SUFA dummies class please? I have a couple random (stupid)questions:

    You’ve said to get money out of federal banks and into state banks. Aren’t the state banks the ones that have been failing? I used this link to find that my bank is regulated by the federal reserve, now don’t laugh, that means it is a federal bank, right? So I should consider changing banks, but the state banks are failing. What’s a dummy to do? Someone has also buried a list of state banks deep in the bowels of the internet. Can anyone help me with a link? Here is a link to find out if your bank is a federal bank:

    • gmanfortruth says:

      Maybe I can help some 🙂 The Federal Reserve is not govt. It is a private central bank entity that regulates smaller banks. Many of us would like to get rid of the FR, for many reasons.

      I go here to look at banks and their relative health.
      D13 can help more than I 🙂

      • Thanks G, but I don’t think you answered my questions 🙂 Problem is I don’t even know what I don’t know. I’ll see if the Colonel can answer in a way I can understand. Got one for you below, though.

    • Anita…I am FAR from being a financial expert but, as a family, we have done fairly well. State Banks are a risk, to be sure… depends upon several things. A State Bank is the official depository institution for all State collections and fees. It’s very beneficial to local economies. Such a controlled source of funds is called a ‘captive deposit base’. The State Bank pays the State Treasurer a competitive rate of deposit interest that can be used to reduce local tax burdens. In states that are part of the federal system, funds collected by the State leave the State. When a State owns a State Bank, loan policies are determined by the State, not the federal government or the banking cartel known as the Federal Reserve System.

      There is no real true sovereign State Bank….(meaning being able to print and manage its own currency.)…..

      What we have done is move our money out of large institutions into locally owned State banks….but when we did, we looked a the charter and the reserve that the banks put up. Reserve meaning, can they back their loans that they have out. Are there assets to cover depositors. No bank is fail safe. The FDIC is an insurance corporation that will insure deposits up to a certain amount….today it is $150,000. So, if a bank fails totally….you have lost anything over that amount. We have decided that the bigger banks are to unwieldy. We think that they do not manage their assets well enough for if they did, you would not have had bailouts. We have gone to locally owned banks within the Fed system. We feel that our assets are a lot safer there because locally owned banks support local areas and State areas. Local banks typically do not loan to other banks or outside the State and certainly typically do not get involved with the international trade or monetary policies outside the State. So, when I say State bank….think locally owned….not a bank “run” by the State.

      All banks are governed in part by the Fed (Federal Reserve System)….The Fed is not run by the government but is a private organization that sets monetary policy.

      So, our decision is to drop out of banks that are involved in International issues and large National transactions…….loaning money to New York, for example. We have put our trust into locally owned banks that do not have a huge appetite and that are financially sound with a reserve large enough to handle all deposits. But, therein, lies a risk as well….and any bank is only as good as its board of Directors and its monetary policies and loan. We used to have money in Bank of America, Wells Fargo, Chase, etc……we do not anymore because they get to involved in transactions that re questionable. So…we have moved locally (within the State) that supports local issues. These banks are very tight on their loan policies and, therefore, are more reliable…in our opinion. In the last banking crises, not one of the local banks failed and none took bailout money and all have ample reserves to protect investors.

      I hope this helps….when you get into banking and economics… is difficult to understand at times.

    • By the way, I still believe that the unasked question is the stupid question….so ask away.

      • Thanks, Colonel. Now I know where to direct my research. But that brings a couple more questions up, please;) What is your opinion of credit unions? They are owned by the depositors and insured by the FDIC, making them sound like a safer bet… you have any knowledge about what Ann Barnhardt has said..that The FDIC is underfunded big time and can not back up it’s 100,000 claim?..which also means that you can’t bet on credit unions any better than local banks.

        • Nothing wrong with credit unions…..if properly backed the same as banks. I have some personal funds in a credit union belonging to USAA. USAA has a very good rep and is very selective. I do not put much faith in the FDIC at all since Dodd/Frank was passed. That is something that Bush did that I believe was not a good bill……but it is there never the less. So…..just look at the balance sheet and reserve funding….if you do not know how to read a balance sheet…..I would suggest that you have your accountant look at one.

    • gmanfortruth says:

      Fully aware my Dear 🙂 I do follow health news closely, with several subscriptions to pay4 sites and I’m a distributor for some of the best health supplements on the market ( Isotnix), as well as a user of the product. I’m going to start a new regiment of minerals as soon as they arrive. Just a few things about GMO foods that I am concerned with:

      1. Insecticides are in the plant, therefore in the food.

      2. Nutrients like needed vitamins and minerals are missing from many GMO foods. This has been known be a cause of obesity, because the foods leave people hungry for more (a natural reaction to the need for vitamins and minerals). People eat more to try and get what their bodies need, only to eat themselves to the fat farm.

      3. The supplements in the stores in pill form do NOT give you what your body needs. Only 30% of the pills get into system before being flushed out.

      Maybe a future article is in order, too much to cover here 🙂

  11. Bottom Line says:

    The system we use to organize our planet is gone.

    It is based upon force, …forced behavior, morality, economics, territory, etc.

    Anything developed from a faulty premise will also be faulty.

    When will it implode?

    Then what?

    • gmanfortruth says:

      If you survive, you live on! Most who survive will do so because they understand what led to the downfall. That should be enough to make sure that future generations who think about governments understand how to severely limit it’s power. The survivors will write the history that leads the future.

      Let’s get past the implosion first, then start writing 🙂

      • Bottom Line says:

        ” If you survive, you live on! Most who survive will do so because they understand what led to the downfall. ”

        I am in a standby ready position, bug-out gear, tools, transportation, arms, etc. In minutes I can be ready to go and survive almost anywhere to either assist, flight or fight.

        ‘ Minute Man Status: Standby Ready ‘, to speak.

        If/when SHTF, how many people can say the same?

        ” That should be enough to make sure that future generations who think about governments understand how to severely limit it’s power. The survivors will write the history that leads the future. ”

        Future generations are liable to either be cleaning up a big mess, out-smarting previous generations, …or dead. Let’s try to leave them something to work with besides enslavement or a mess to fix.

  12. We are just so screwed. The ability to intertwine a persons activities, behaviors, finances, leads to nothing but total control.

    • gmanfortruth says:

      Kathy, I hope today finds you and yours healthy and happy (and free of snow, we have plenty here for everyone, 🙂 ) 🙂

      Voting in the Federal elections is totally useless. The two parties are completely corrupt. I won’t waste my time with them, but, I will be active locally.

      Yes, we are screwed!

  13. gmanfortruth says:

    More hollow point ammo for DHS , who are they prepping to fight?

    While the Department of Homeland Security continues to ignore members of Congress demanding to know why the federal agency is engaged in an apparent arms build-up, the DHS has just announced it plans to purchase another 360,000 rounds of hollow point ammunition to add to the roughly 2 billion bullets already bought over the past year.

  14. gmanfortruth says:

    There should be a “STOP PROTECTING RAPIST’S” campaign started as an answer to this. Isn’t it time to start calling Democrat’s who support gun control what they are? Rapist loving Liberal’s!

  15. Wow, just listened to Jim Carrey’s new song-he’s really a sick little jerk -and he didn’t even manage to be funny in the process.

  16. Regulatory pressure moves battery recycling south of the border
    posted at 2:01 pm on March 25, 2013 by Ed Morrissey

    Among the many problems with the headlong rush to subsidize the entire electric-car distribution channel is the environmental impact of the battery life cycle. Electric vehicles
    require large battery arrays to have any kind of practical range, and the process of manufacturing batteries requires rare-earth elements that require extensive mining — and have to be imported to the US, primarily from China and South America, which negates the effect of transitioning from dependence on foreign oil. China reminded everyone of that reality almost two years ago, in fact. Plus, the need to build massive amounts of batteries will create even more environmental hazards, as battery manufacturing is hardly the cleanest of industries.

    What happens when those batteries get exhausted? Supporters of electric-vehicle subsidies claim that most of the material can be recycled to reduce the impact on the environment and the need to keep mining for the elements required. However, that opens up yet another channel of foreign dependence, as McClatchy reports today. The EPA has tightened regulations on disposal in the battery-recycling process, and so American firms are moving those jobs outside of the US:

    When an American replaces the battery in a car, likely as not the old battery will be shipped to Mexico rather than trucked to a modern U.S. recycling plant.

    U.S. recyclers have some of the world’s top technology for safely breaking apart batteries to smelt the lead for reuse. But U.S. recycling plants are closing down or standing idle.

    Plants in Mexico are not.

    Mexico has won a leg up for a reason: Its lead emissions standards are 10 times less stringent than U.S. standards. Mexican factories can ignore strict U.S. regulations that cap harmful lead emissions onto factory floors and into the air.

    The result has been an ever-increasing surge in the trade of used batteries across the border. One watchdog group estimated that in 2011, the dead batteries headed to Mexico would have filled 17,952 tractor-trailers. And the trade keeps growing, the result of a stark regulatory gap that has left Mexico at risk of becoming a “pollution haven,” according to a Montreal-based commission that investigates environmental issues under the North American Free Trade Agreement, the economic accord between the U.S., Mexico and Canada.

    Many of the same disposal problems can be found in the manufacture of solar panels, as we have discovered in the collapse of Solyndra and other manufacturers. There are two key differences between the two, however. First, solar panels actually generate the electricity, although they also require batteries if storage is required; batteries only store power generated by other means. Second, the shift from gasoline to electricity will require a commensurate increase in power generation for all of these batteries, and solar and wind can’t even come close to meeting that increase in demand. The power will have to come from oil, coal, and natural gas, which means we’re not only not decreasing arguable environmental damage, we’re actually making it worse — all while forcing the US to become even more dependent on foreign resources for our energy use.

    This project from the Obama administration has been an utter failure from its inception. Congress needs to cut off the flow of government funds to a program that will make us weaker, more dependent, and create even more joblessness than now.

  17. gmanfortruth says:

    Trust in banks is shot. It’s only a matter of time before the EU goes down. The domino effect has begun.

  18. Just A Citizen says:

    Sorry guys but won’t be able to participate much this week.


    Maybe even a little spring fly fishing.

    Right now I am back in the land of the almost sane. That would be the State that passed a law allowing in state manufacture and sale of guns.

  19. gmanfortruth says:
  20. I find some of this true and a lot of it nuts-but it seems to be a pretty good explanation of the reasoning of the left. If not-the people on the left can tell me what they disagree with if any of them are still going to comment. Found it really odd to use China as an argument against capitalism.

    Marx’s Revenge: How Class Struggle Is Shaping the World
    By Michael SchumanMarch 25, 2013204 Comments

    Karl Marx was supposed to be dead and buried. With the collapse of the Soviet Union and China’s Great Leap Forward into capitalism, communism faded into the quaint backdrop of James Bond movies or the deviant mantra of Kim Jong Un. The class conflict that Marx believed determined the course of history seemed to melt away in a prosperous era of free trade and free enterprise. The far-reaching power of globalization, linking the most remote corners of the planet in lucrative bonds of finance, outsourcing and “borderless” manufacturing, offered everybody from Silicon Valley tech gurus to Chinese farm girls ample opportunities to get rich. Asia in the latter decades of the 20th century witnessed perhaps the most remarkable record of poverty alleviation in human history — all thanks to the very capitalist tools of trade, entrepreneurship and foreign investment. Capitalism appeared to be fulfilling its promise — to uplift everyone to new heights of wealth and welfare.

    Or so we thought. With the global economy in a protracted crisis, and workers around the world burdened by joblessness, debt and stagnant incomes, Marx’s biting critique of capitalism — that the system is inherently unjust and self-destructive — cannot be so easily dismissed. Marx theorized that the capitalist system would inevitably impoverish the masses as the world’s wealth became concentrated in the hands of a greedy few, causing economic crises and heightened conflict between the rich and working classes. “Accumulation of wealth at one pole is at the same time accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation, at the opposite pole,” Marx wrote.

    A growing dossier of evidence suggests that he may have been right. It is sadly all too easy to find statistics that show the rich are getting richer while the middle class and poor are not. A September study from the Economic Policy Institute (EPI) in Washington noted that the median annual earnings of a full-time, male worker in the U.S. in 2011, at $48,202, were smaller than in 1973. Between 1983 and 2010, 74% of the gains in wealth in the U.S. went to the richest 5%, while the bottom 60% suffered a decline, the EPI calculated. No wonder some have given the 19th century German philosopher a second look. In China, the Marxist country that turned its back on Marx, Yu Rongjun was inspired by world events to pen a musical based on Marx’s classic Das Kapital. “You can find reality matches what is described in the book,” says the playwright.

    (MORE: Can China Escape the Middle-Income Trap?)

    That’s not to say Marx was entirely correct. His “dictatorship of the proletariat” didn’t quite work out as planned. But the consequence of this widening inequality is just what Marx had predicted: class struggle is back. Workers of the world are growing angrier and demanding their fair share of the global economy. From the floor of the U.S. Congress to the streets of Athens to the assembly lines of southern China, political and economic events are being shaped by escalating tensions between capital and labor to a degree unseen since the communist revolutions of the 20th century. How this struggle plays out will influence the direction of global economic policy, the future of the welfare state, political stability in China, and who governs from Washington to Rome. What would Marx say today? “Some variation of: ‘I told you so,’” says Richard Wolff, a Marxist economist at the New School in New York. “The income gap is producing a level of tension that I have not seen in my lifetime.”

    Tensions between economic classes in the U.S. are clearly on the rise. Society has been perceived as split between the “99%” (the regular folk, struggling to get by) and the “1%” (the connected and privileged superrich getting richer every day). In a Pew Research Center poll released last year, two-thirds of the respondents believed the U.S. suffered from “strong” or “very strong” conflict between rich and poor, a significant 19-percentage-point increase from 2009, ranking it as the No. 1 division in society.

    The heightened conflict has dominated American politics. The partisan battle over how to fix the nation’s budget deficit has been, to a great degree, a class struggle. Whenever President Barack Obama talks of raising taxes on the wealthiest Americans to close the budget gap, conservatives scream he is launching a “class war” against the affluent. Yet the Republicans are engaged in some class struggle of their own. The GOP’s plan for fiscal health effectively hoists the burden of adjustment onto the middle and poorer economic classes through cuts to social services. Obama based a big part of his re-election campaign on characterizing the Republicans as insensitive to the working classes. GOP nominee Mitt Romney, the President charged, had only a “one-point plan” for the U.S. economy — “to make sure that folks at the top play by a different set of rules.”

    Amid the rhetoric, though, there are signs that this new American classism has shifted the debate over the nation’s economic policy. Trickle-down economics, which insists that the success of the 1% will benefit the 99%, has come under heavy scrutiny. David Madland, a director at the Center for American Progress, a Washington-based think tank, believes that the 2012 presidential campaign has brought about a renewed focus on rebuilding the middle class, and a search for a different economic agenda to achieve that goal. “The whole way of thinking about the economy is being turned on its head,” he says. “I sense a fundamental shift taking place.”

    (MORE: Viewpoint: Why Capping Bankers’ Pay Is a Bad Idea)

    The ferocity of the new class struggle is even more pronounced in France. Last May, as the pain of the financial crisis and budget cuts made the rich-poor divide starker to many ordinary citizens, they voted in the Socialist Party’s François Hollande, who had once proclaimed: “I don’t like the rich.” He has proved true to his word. Key to his victory was a campaign pledge to extract more from the wealthy to maintain France’s welfare state. To avoid the drastic spending cuts other policymakers in Europe have instituted to close yawning budget deficits, Hollande planned to hike the income tax rate to as high as 75%. Though that idea got shot down by the country’s Constitutional Council, Hollande is scheming ways to introduce a similar measure. At the same time, Hollande has tilted government back toward the common man. He reversed an unpopular decision by his predecessor to increase France’s retirement age by lowering it back down to the original 60 for some workers. Many in France want Hollande to go even further. “Hollande’s tax proposal has to be the first step in the government acknowledging capitalism in its current form has become so unfair and dysfunctional it risks imploding without deep reform,” says Charlotte Boulanger, a development official for NGOs.

    His tactics, however, are sparking a backlash from the capitalist class. Mao Zedong might have insisted that “political power grows out of the barrel of a gun,” but in a world where das kapital is more and more mobile, the weapons of class struggle have changed. Rather than paying out to Hollande, some of France’s wealthy are moving out — taking badly needed jobs and investment with them. Jean-Émile Rosenblum, founder of online retailer, is setting up both his life and new venture in the U.S., where he feels the climate is far more hospitable for businessmen. “Increased class conflict is a normal consequence of any economic crisis, but the political exploitation of that has been demagogic and discriminatory,” Rosenblum says. “Rather than relying on (entrepreneurs) to create the companies and jobs we need, France is hounding them away.”

    The rich-poor divide is perhaps most volatile in China. Ironically, Obama and the newly installed President of Communist China, Xi Jinping, face the same challenge. Intensifying class struggle is not just a phenomenon of the slow-growth, debt-ridden industrialized world. Even in rapidly expanding emerging markets, tension between rich and poor is becoming a primary concern for policymakers. Contrary to what many disgruntled Americans and Europeans believe, China has not been a workers’ paradise. The “iron rice bowl” — the Mao-era practice of guaranteeing workers jobs for life — faded with Maoism, and during the reform era, workers have had few rights. Even though wage income in China’s cities is growing substantially, the rich-poor gap is extremely wide. Another Pew study revealed that nearly half of the Chinese surveyed consider the rich-poor divide a very big problem, while 8 out of 10 agreed with the proposition that the “rich just get richer while the poor get poorer” in China.

    (MORE: Is Asia Heading for a Debt Crisis?)

    Resentment is reaching a boiling point in China’s factory towns. “People from the outside see our lives as very bountiful, but the real life in the factory is very different,” says factory worker Peng Ming in the southern industrial enclave of Shenzhen. Facing long hours, rising costs, indifferent managers and often late pay, workers are beginning to sound like true proletariat. “The way the rich get money is through exploiting the workers,” says Guan Guohau, another Shenzhen factory employee. “Communism is what we are looking forward to.” Unless the government takes greater action to improve their welfare, they say, the laborers will become more and more willing to take action themselves. “Workers will organize more,” Peng predicts. “All the workers should be united.”

    That may already be happening. Tracking the level of labor unrest in China is difficult, but experts believe it has been on the rise. A new generation of factory workers — better informed than their parents, thanks to the Internet — has become more outspoken in its demands for better wages and working conditions. So far, the government’s response has been mixed. Policymakers have raised minimum wages to boost incomes, toughened up labor laws to give workers more protection, and in some cases, allowed them to strike. But the government still discourages independent worker activism, often with force. Such tactics have left China’s proletariat distrustful of their proletarian dictatorship. “The government thinks more about the companies than us,” says Guan. If Xi doesn’t reform the economy so the ordinary Chinese benefit more from the nation’s growth, he runs the risk of fueling social unrest.

    Marx would have predicted just such an outcome. As the proletariat woke to their common class interests, they’d overthrow the unjust capitalist system and replace it with a new, socialist wonderland. Communists “openly declare that their ends can be attained only by the forcible overthrow of all existing social conditions,” Marx wrote. “The proletarians have nothing to lose but their chains.” There are signs that the world’s laborers are increasingly impatient with their feeble prospects. Tens of thousands have taken to the streets of cities like Madrid and Athens, protesting stratospheric unemployment and the austerity measures that are making matters even worse.

    So far, though, Marx’s revolution has yet to materialize. Workers may have common problems, but they aren’t banding together to resolve them. Union membership in the U.S., for example, has continued to decline through the economic crisis, while the Occupy Wall Street movement fizzled. Protesters, says Jacques Rancière, an expert in Marxism at the University of Paris, aren’t aiming to replace capitalism, as Marx had forecast, but merely to reform it. “We’re not seeing protesting classes call for an overthrow or destruction of socioeconomic systems in place,” he explains. “What class conflict is producing today are calls to fix systems so they become more viable and sustainable for the long run by redistributing the wealth created.”

    (MORE: Is It Time to Stop Green-Lighting Red-Light Cameras?)

    Despite such calls, however, current economic policy continues to fuel class tensions. In China, senior officials have paid lip service to narrowing the income gap but in practice have dodged the reforms (fighting corruption, liberalizing the finance sector) that could make that happen. Debt-burdened governments in Europe have slashed welfare programs even as joblessness has risen and growth sagged. In most cases, the solution chosen to repair capitalism has been more capitalism. Policymakers in Rome, Madrid and Athens are being pressured by bondholders to dismantle protection for workers and further deregulate domestic markets. Owen Jones, the British author of Chavs: The Demonization of the Working Class, calls this “a class war from above.”

    There are few to stand in the way. The emergence of a global labor market has defanged unions throughout the developed world. The political left, dragged rightward since the free-market onslaught of Margaret Thatcher and Ronald Reagan, has not devised a credible alternative course. “Virtually all progressive or leftist parties contributed at some point to the rise and reach of financial markets, and rolling back of welfare systems in order to prove they were capable of reform,” Rancière notes. “I’d say the prospects of Labor or Socialists parties or governments anywhere significantly reconfiguring — much less turning over — current economic systems to be pretty faint.”

    That leaves open a scary possibility: that Marx not only diagnosed capitalism’s flaws but also the outcome of those flaws. If policymakers don’t discover new methods of ensuring fair economic opportunity, the workers of the world may just unite. Marx may yet have his revenge.

    Read more:

  21. gmanfortruth says:

    In response to the stupid event in New Jersey with the boy and his new gun picture on Facebook, then the ensuing attack by Child Protective Services, here are some pics of more kids with guns.

    • While I commend the concept of posting these photos, there is an awful lot of unsafe things going on there and one or two shots of male teens especially the one with the Flak jacket and gonad protector (which he labeled) whom I wouldn’t let any closer to a firearm than I would let Adam Lanza.

      Below is the latest in stupid where the two cardinal rules have been ignored, “treat every firearm as if it were loaded” and “don’t point your gun at anything you don’t intend to shoot”. Daddy in this story is at the very least guilty of involuntary manslaughter.

      • gmanfortruth says:

        Granted, a very stupid mistake and a sad one. I will be the first to agree that many gun owners should have some good, quality safety training. I was lucky, I started hunting at an early age and safety was drilled into me constantly. Not everyone is that fortunate. Then I went on to be a weapons safety/marksmanship instructor for the USAF. Been training my young cousins that last two years. I’m proud of how they have become so safety minded (pointing out bad things on TV) 🙂

  22. LEMON: Ryan you said you don’t believe gay marriage should be legal and especially you took issue with what’s happening at the Supreme Court. Why did you take issue with that, and you took issue with a Pediatric study that was — that came out this week saying that gay parents — that children were well off even with gay parents and it made them to be better kids even if they had been with single heterosexual parents.

    RYAN T. ANDERSON, The Heritage Foundation: Sure. Just to clarify, the issue here is not legality. So in all 50 states, there’s nothing illegal about same-sex marriage. Two people of the same-sex can live together and love each other. They can go to their church and their church can perform a same-sex wedding ceremony. They can work at a place of employment that will give them same-sex benefits. What’s at issue right now is whether or not the Supreme Court will redefine marriage for everyone. And whether or not the Supreme will then —


    LEMON: Wait, wait, wait — hang on. You said same-sex marriage is not illegal?

    ANDERSON: It’s not illegal. There are no laws against it. When something’s illegal, it’s criminal to engage in that activity.

    LEMON: That’s just not true. That’s not true. I know it’s a matter of semantics that you’re saying but that’s just not true. It is illegal. They can’t be married. Gays –


    LEMON: Hang on, let me finish. Gay people don’t have the same benefits —

    ANDERSON: Well, you interrupted me, just to be clear.

    LEMON: Well, I’m the anchor of this show, so I can interrupt as much as I want. So let me interrupt and then I’ll let you talk. But it’s a matter of semantics what you’re saying, because it is illegal. Gay people don’t have the same rights —

    ANDERSON: No, no, it’s not illegal. When something is illegal, you can go to jail for doing it.

    LEMON: Did you hear what I said? I said let me finish, Ryan. Let me finish and I will let you talk. Ok? It’s a matter of semantics what you’re saying, because it is illegal. They don’t have the same rights. People don’t have the same rights. You can’t see in many places people in the hospital, people who are sick. You don’t have the same rights under tax laws. You don’t have the same benefits. It’s not legal to marry — to be a married person in many states. Now go ahead.

    ANDERSON: All right. So again, I disagree with you, because when something is illegal, you can go to jail for doing it. It’s illegal to kill, it’s illegal to rape, it’s illegal to steal. Being in a same-sex relationship is not illegal. So I think it’s not a matter of semantics. Actually I think you’re just using the wrong terminology.

    LEMON: No. You’re using the wrong terminology. You’re saying being in a same-sex relationship is not illegal. No it’s not. But being married in certain states is illegal.

    ANDERSON: No. Again, you can’t go to jail for committing a same-sex marriage. The question is what is marriage?


    LEMON: Go ahead, Ryan. Finish your point. As absurd as it is. Go ahead.

    ANDERSON: I don’t really think it’s absurd. I think you’re being a little rude. I think a lot of Americans –


    LEMON: I don’t appreciate you coming on –

    ANDERSON: – think marriage is a relationship between a man and a woman. They want laws to reflect that. And it’s not a matter of legality. It’s a matter of what is marriage.

    LEMON: If it wasn’t illegal, it would not be going to court to be legalized.

    ANDERSON: Again, I think you’re using the wrong terms. The question right now is redefinition. It’s not going to legalize something. It’s going to redefine something. It’s going to redefine what marriage is.

    LEMON: It’s not going to the Supreme Court to be redefined. It’s going to the Supreme Court so that it can be legal across the country. It’s not going to be redefined. That’s not why it’s going to the Supreme Court.

    ANDERSON: It is. Right now the definition of marriage for the federal government and for 41 states is the union of a man and a woman, a husband and a wife —

    LEMON: That is the legal —

    ANDERSON: – a mother and a father.

    LEMON: What is the legal definition of marriage?

    ANDERSON: Right now marriage is defined in 41 states and by the federal government as a union of a man and a woman, a husband and wife. And the case before the Supreme Court is asking the Court to strike down those laws and redefine marriage, and then use the coercive power of the government to force everyone to accept a new definition of marriage.

    LEMON: Okay. If each of you had 30 seconds before the Supreme Court to make your case right now, let’s hear it. Ryan, what would your best argument be?

    ANDERSON: The reason that the government’s in the marriage business is not because of my romantic life or because of the desires of adults. The government’s in the marriage business because men and women produce children. Children need mothers and fathers, and marriage is the institution that unites a man and woman as husband and wife, to then be mother and father to the children that they produce. Mothers and fathers are different and distinct. Children do best when raised by their married mother and father. And that’s why government’s in the marriage business. All Americans are free to live and to love as they choose. But no one has the right to redefine marriage for everyone.

    Read more:

    • Gives me a headache trying to listen to stuff like this. Spinning our wheels and getting no where fast. We’re doomed.

      • Stephen K. Trynosky says:

        Anita, all you can say to these folks is that man-man or a woman-woman contract is not a MARRIAGE, it cannot be, it is impossible to stand that word on its head that far!. Maybe the solution is for the government to just grant a license to contract and drop the term “marriage”. So the “marriage” bureau would go out of business and be replaced by the domestic contract bureau. I have, as I have said time and time again, no problem with domestic contracts or civil unions of any type but calling the unconventional ones “marriage” is akin to calling day night and night day. From the true Marxist-Leninist perspective as outlined by Orwell in “1984” doing this damage to language may in fact be the ultimate goal here.

        • gmanfortruth says:

          I think I’m just plain tired of hearing about it. I really don’t care if they get the same financial benefits, which is what this should be about. Homosexuals will never be totally accepted in our society. Maybe that’s just a fact that everyone needs to realize and learn to live with. No different with people of different colored skin. It will never happen that there is no racism. Prejudice is just a part of today’s world. Those who think they can end it are fool’s.

  23. gmanfortruth says:

    Just some random thoughts 🙂

    Jim Carry will go by the way of Dixie Chicks! Bye Bye, Asshole!
    Cypriot govt made a deal with the devil, shame on them. Now good people will suffer.
    When things go bad, most people will not know why. They will be hungry and frightened. They will beg for the govt to finish enslaving them. Idiots!

  24. So it begins… the Euro Chief suggests that bankrupt countries confiscate whatever money they need from all depositors. This is the head man from the European Union. The top dog. The big kahuna…..just steal what you need.

    • gmanfortruth says:

      D13, Not a shock here. This was inevitable in my mind. Our retirement accounts are next here in the States.

      I have emailed USW about your article, no reply as of yet. If you would like to email it to me, we can do it that way. Let me know one way or the other.

      Peace 🙂

    • Well, we were first to do this in a way. The GM bailout had the President set aside (ignore) established law and decide who got shafted (stockholders) and who was rewarded (unions). And it is the same narrative, elect us & since a majority approves, we will steal from the “rich”. This is moral & right because the majority has said so and incidentally, has the might.

      What’s behind the Stockton, CA bankruptcy?
      Rick Moran

      Last July, Stockton, CA became the largest US city ever to file for bankruptcy. It was being choked to death by pension and health care costs after a series of bad investments in mortgage backed securities blew up during the housing meltdown.

      But some bond insurers are saying, “Not so fast.” These companies stand to lose a bundle in any restructing and are accusing Stockton of misusing the municipal bankruptcy laws.


      “The agenda is clear,” lawyer Jeffrey Bjork wrote on behalf of the Assured Guaranty Ltd. bond insurer, one of the largest creditors that helped the city refinance pension debt.

      “The city hopes to use the Chapter 9 plan process to impose permanent impairment, and to cram down a non-consensual plan, on capital-market creditors,” he wrote.

      Bjork called Stockton’s July 2012 declaration of Chapter 9 bankruptcy an improper use of the U.S. Bankruptcy Code and asked U.S. Bankruptcy Judge Christopher M. Klein in Sacramento to throw out Stockton’s case, arguing the city of 300,000 is solvent.

      Other creditors making similar arguments include two mutual funds managed by Franklin Advisers Inc., bond trustee Wells Fargo Bank NA and bond insurer National Public Finance Guarantee Corp.

      Chapter 9 lets municipalities restructure their debts, the way Chapter 11 does for businesses.

      Stockton became the largest U.S. city to file for the protection after suffering one of the nation’s biggest hits when the mortgage bubble burst five years ago.

      It has since slashed tens of millions of dollars in city services — including firefighters and programs for at-risk children — and said it would cut its municipal bond repayments to a level The New York Times said was never seen before in a municipal bankruptcy.

      But it has refused to touch current workers’ pension accruals or cut benefits retirees now receive.

      Read more:

  25. Newt wants to help us find God? I kinda wonder what the adultery section says…maybe Bill Clinton wrote the pre-face?

    • Stephen K. Trynosky says:

      One has to hope, during this Easter season that the spirits of repentance and forgiveness are alive and well.

      • gmanfortruth says:

        I find it very important that people get their religious beliefs in order soon. The relationship with God is very important, and may prove to be vital in the future. Peace!

  26. gmanfortruth says:

    I have a question for any current or ex LEO’s. Is there any reason why an inner city police dept would need a 50 cal sniper rifle?

  27. Always doing their very best for the 1% …

%d bloggers like this: