The new PM of Cyprus, Nicos Anastasiades, who had been in power for only two weeks, was trying to negotiate a bail-out of £8.7 billion to pay the interest on his national debt. A modest sum and a reasonable request you might have thought, considering that so many other similar deals had been struck between the EU, the IMF and Italy, Spain, Ireland and Greece. The minor detail that such bail-outs are against the Lisbon Treaty was not even worth mentioning. But he had forgotten one factor - the imminent general election in Germany. Angela Merkel does not want to tell her voters, already irate about the costs of EU bail-outs, that they must find a few more billion euros out of their own earnings to prop up the single currency. So the EU invented a new sort of tax, a "deposit tax". Whatever money anybody has in a Cyprus bank account is simply being docked 10% to help pay for the bail-out, which is only needed because Cyprus entered the single currency.
Nobody told the people of Cyprus when they went into the euro that this was liable to happen. Deposit tax just amounts to bare-faced theft. It has been levied without mandate from the voters and the idea was not mentioned before the election. What does that remind you of?
Of course it is all part of the process of dismantling democracy that has been on the EU's agenda for so long. That is the EU's agenda.
People are shocked to discover that the banks, who run the EU anyway in cahoots with the handful of EU commissioners, can just deduct this amount electronically without your permission. As soon as word got around, queues of people formed at all the cash machines, trying to withdraw their savings, but only limited amounts can be taken out daily and the machines were soon empty. The banks blocked any attempt to transfer money via the internet, and they announcement was timed to coincide with a three-day holiday so nobody could turn up at the bank counter and demand their entire savings in cash.
Now the deductions have all been made and it's a done deal. Do you, dear reader, imagine that this couldn't happen here in England's green and pleasant land? Well wake up out of your torpor, the EU is not a democratic institution and it is not run by a nice bunch of people.
Sixty thousand British savers are affected and their total loss will amount to millions of pounds. One father commented, "I had just taken out a loan to pay for my daughter's university education. Now I have lost ten per cent of it, but I will still have to repay the whole lot and pay the interest on the original sum." The British Government will compensate members of the armed forces who are serving in Cyprus, thousands of whom are being affected. This means that the British tax-payer will end up footing a lot of the bill. Funny isn't it how often that happens? Luckily we're not short of money here and austerity is not our problem.
The Cypriot Archbishop Chrysostomos said in his Sunday sermon: ‘This is a villainy of Europeans. Cyprus must as soon as possible leave the Eurozone’. If only he had some real power!
This is not just an event that is going to hurt one small island. The repercussions for European banking in general will be major. Nobody will be able to trust a European bank and the logical thing to do is to put your money into a bank somewhere outside of European Union jurisdiction. Put it into a bank in Switzerland, the USA, Norway or China. A bank makes a contract with its customers, to store the money deposited and make it available whenever wanted. That contract is supposed to be binding and if it cannot be relied on, people will put their money elsewhere. Vladimir Putin, mindful of the interests of Russians who have considerable assets in Cypriot banks, has branded the deposit tax an "illegal forfeit".
Nigel Farage MEP, the UKIP leader, commented, "There is now a significant risk of capital flight from other Eurozone countries. George Osbourn needs to state immediately that we would never do that in this country. This would encourage money to come to London, as we should be a desperately needed safe haven in a very uncertain Europe.”
What will the EU do next? I would not be surprised if the whole of England were accused of "under-occupancy" and told we have to move to Scotland with 48 hours notice and no appeal. Our country would then be re-allocated to somebody else and the LibLabCon would all pretend it had nothing to do with the EU.