When Angela Merkel – to cut out the middlemen – feels entitled to arrest the bank accounts of individuals and institutions in another country and help herself to 10 per cent of their deposits, then the rule of law has become a folk memory in German-occupied Europe. Is this what was meant by negative interest rates? The sheer irresponsibility of risking a bank run, not just in Cyprus but potentially in Greece, Spain, Portugal, Italy and everywhere else the dominoes might topple, betrays the stupidity of those shoring-up the deluded euro project.
Even though the Cypriot parliament has voted for the EU’s ludicrous good bank/bad bank “solution”, with Draconian capital controls, as those controls imprison depositors’ money and hobble the economy, the Russian option may eventually become more appealing. Behind the capering pantaloons centre-stage – Barroso, Van Rompuy, et al – this is a proxy war between two enduring enemies: Russia and Germany. When Russian leaders look at Chancellor Merkel they do not see a dowdy housewife but a Panzer tank commander: old antipathies die hard. Yet it is Germany, via the ECB, that has demonstrated gross financial irresponsibility in raiding depositors, risking a bank run and imposing capital controls on Cyprus that effectively make it a separate currency from the euro. And all to defend the fools’ gold that is the euro.Western politicians who struggle to understand Vladimir Putin should bin intelligence reports and buy some good biographies of Peter the Great, Catherine the Great and Nicholas I. Putin is a classical Russian nationalist; his rule is autocratic (to the gratification of the majority of his subjects) and he has re-forged the historical alliance between the government and the Orthodox Church by imposing socially conservative laws and repressing the homosexual-rights intifada. Like Catherine the Great and Tsar Paul he has Mediterranean ambitions. Unlike them, he faces negligible opposition from a bankrupt European Union and a geopolitical illiterate in the Oval Office who makes Jimmy Carter resemble Bismarck. We should not be surprised if, by the time the EU collapses, the Mediterranean has become a Russian lake.
Full article: Gerald Warner: Cyprus caught in proxy war between old enemies (Scotsman)