The Great Fiction


Most of our readers are familiar with this famous quote of Frederic Bastiat, excerpted from his Essay on Government:

“Government is the great fiction through which everybody endeavors to live at the expense of everybody else.”

Bastiat was charitable in his definition – but even this statement from the mid-1800’s recognizes the basic parasitic nature of government. Amended and amplified for our world in complex modern times, Bastiat’s definition becomes:

“Government is the great pain that man chooses to inflict upon himself, the agony of which he seeks to relieve by incurring even more pain.”

When I saw what was happening in Cyprus as a result of the Eurozone “rescue”, I thought of the old story of the Byzantine Emperor Alexius III who would gain temporary relief from gout by applying a red-hot poker his feet – because the pain of the searing skin was less than the pain from the gout:

European finance ministers have agreed an £8.7bn bailout for Cyprus which includes all Cypriot bank customers handing over up to 10% of their savings.

Cyprus becomes the fifth country after Greece, Ireland, Portugal and Spain to turn to the Eurozone for financial help amid the region’s debt crisis, but also faces a possible run on its banks as depositors try to avoid losing up to 10% of their savings.

The savers, half of whom are thought to be Russian, will raise almost €6bn. It is the first time a bailout has included such a measure.

“I wish I was not the minister to do this,” the Cypriot finance minister, Michael Sarris, said after 10 hours of late-night talks in which Eurozone finance ministers agreed the package. “Much more money could have been lost in a bankruptcy of the banking system or indeed of the country.”

So what Sarris is saying is that they better steal the money now before they can’t and the hot-poker is going to hurt less than the gout – which none of this will cure because apparently only the Second Coming can save the EU.

Without a rescue, Cyprus would default and threaten to unravel investor confidence in the Eurozone, a renewed confidence fostered by the European Central Bank’s promise last year to do whatever it takes to support the euro.

However, on Cyprus, initial incredulity at the decision gave way to anger. Co-op credit societies, normally open on Saturdays, were shut for business in the coastal city of Larnaca as depositors started queuing early in the morning to withdraw their cash.

“I’m extremely angry. I worked years and years to get it together and now I am losing it on the say-so of the Dutch and the Germans,” said British-Cypriot Andy Georgiou, 54, who returned to Cyprus in mid-2012 with his savings.

“They call Sicily the island of the mafia. It’s not Sicily, its Cyprus. This is theft, pure and simple,” said a pensioner.

The bailout was smaller than initially expected and is mainly needed to recapitalise Cypriot banks hit by sovereign debt restructuring in Greece.

Cypriots with savings of under €100,000 will pay a one-off levy of 6.75%, which rises to 9.9% for those with larger deposits.

The levy on bank deposits will come into force on Tuesday, after a bank holiday on Monday. Cyprus will take immediate steps to prevent electronic money transfers over the weekend.

“As it is a contribution to the financial stability of Cyprus, it seems just to ask for a contribution of all deposit holders,” the Dutch finance minister, Jeroen Dijsselbloem, who chaired the meeting in Brussels, told reporters.

This is theft, nothing but out and out theft, by the very organizations that caused the problems in the first place. People who were prudent and actually saved money are going to be punished only because they chose to save money.

From the “It can’t happen here file”, we have written about the concept of “negative interest” in the UK here, and the fact that our own US government is covetous of your 401K here.

Unbelievably craven, isn’t it? Unfortunately, it is par for the course with the elitist political classes on both sides of the pond. Obama’s quotes during the debates on taxes, the fiscal cliff and the sequestration battle betray this fact:

On taxes:

“A simple premise of my campaign for president was to change the tax code that was too skewed toward the wealthy at the expense of working middle-class Americans. Tonight, we’ve done that,” Obama said, standing beside Vice President Biden in the White House briefing room just before 11:30 p.m.

Once again, many have noted that our tax codes are the most progressive in the western world and the top 10% of taxpayers (a bracket that begins at $112,124 – hardly rich for a family of 4) paid 70.5% of all income tax. The evil 1% paid 36.7% with an average tax rate of 24.01%. This data is from 2009 IRS numbers and is posted for all to see at the Tax Foundation.

This is “too skewed toward the wealthy at the expense of working middle-class Americans”? He also forgot to mention that the 2% increase in payroll taxes hit every worker, not “the rich”, the bulk of income of which doesn’t come from hourly wages or a salary.

On the fiscal cliff:

While I will negotiate over many things, I will not have another debate with this Congress over whether or not they should pay the bills that they’ve already racked up through the laws that they passed,” he said. “Let me repeat: We can’t not pay bills that we’ve already incurred. If Congress refuses to give the United States government the ability to pay these bills on time, the consequences for the entire global economy would be catastrophic — far worse than the impact of a fiscal cliff.”

On Sequestermageddon:

“What I’m asking them is are there ways, for example, for us to accommodate school groups … who may have traveled here with some bake sales,” Obama told ABC News’ George Stephanopoulos in an interview on “Good Morning America.” “Can we make sure that kids, potentially, can still come to tour?”

Obama’s comments suggested, contrary to previous statements by the administration, that the decision to scrap the tours fell solely to the Secret Service.

“I have to say this was not a decision that went up to the White House,” Obama said in the interview. “But what the Secret Service explained to us was that they’re going to have to furlough some folks.

“The question for them is, you know, how deeply do they have to furlough their staff and is it worth it to make sure that we’ve got White House tours that means that you got a whole bunch of families who are depending on a paycheck, who suddenly are seeing a 5 percent or 10 percent reduction in their pay,” he said.

Hypengyophobic? Perhaps – but constantly creating problems, disavowing responsibility and then punishing people who weren’t responsible in the first place is commonplace with despots, autocrats and tyrannical governments. When it is this common in a global setting, it is hard to argue that it is incompetence and not intentional. Call it Cloward-Piven, call it socialism, call it what you will – but in each case, albeit to different degrees, it indicates a worldwide effort for elites in governments to subjugate people to their rule. People have lost faith in themselves and have ceded control for “the mundane things” to a political elite that is as dumb as a box of hammers and as clueless as a deer in the headlights.

The people created government, government did not create the people – the people can change it. The answer isn’t more government, it is less. Governments are made of men, men are corruptible – ergo government is corruptible.

‎Bad men need nothing more to compass their ends, than that good men should look on and do nothing.

– Edmund Burke

You don’t have to sit next to fat, naked men. If the people of Europe don’t stand up and be counted – if we don’t – Marx’s vision of a worldwide communist state is just over the horizon. A corrupt individual is an isolation of corruption; a corrupt government is the institutionalization of it.

Government is the great pain that man chooses to inflict upon himself, the agony of which he seeks to relieve by incurring even more pain.

We have to end the pain.

6 thoughts on “The Great Fiction

  1. The odd thing about all this isn’t that we have run out of resources (yet, anyway) or that the populations around the globe are unwilling to work; what we do have are a parasitic bunch of elitists who have perfected the art of convincing everyone else that we could no longer survive without their monetary system. Imagine, all these resources and willing people ……… and by some quirk of fate, every monetary entity on the planet is surprisingly going broke ….. all at the same time, except for them. Must be FM.

    • You would think that most people with active brain cells would notice that the danger and pain of economic collapse came AFTER governments around the world had been increasing their share of the economies as a percent of GDP. Europe is at the post WWII height of government participation in their respective economies, so if government spending insulates people from downturns and grows the economy, then why aren’t Cyprus, Italy, Portugal, Spain and Greece growing by leaps and bounds? Why is it that the quasi-capitalist economies of the UK, France (before Comrade Hollande) and Germany – and even Latvia (the PM of which just econo-bitch slapped Paul Krugman) are struggling but surviving?

      Leftists have a confirmation bias and a cognitive dissonance and about economics to the point that they can’t even process data that refutes their “reality”. The EU is a real world laboratory for the US to watch.

      I tried to explain why centralization begets more risk, not less, when I wrote this post: Distributed Systems – How Free Enterprise And Democracies Prevent System Failure.

  2. I will remember to take Cyprus off my “wish to visit” list My wife and I just returned from a wonderful trip to Rome, Italy. A few things we noticed there:
    1. Young people are unemployed in amazing numbers. We spoke to several 20 something year olds who all said that they will have to leave Italy to find work, if they can find any other country where businesses are hiring.
    2. On a train ride from Rome to Nettuno (where my uncle is buried at the US WWII graveyard), at least half of the apparent factories we passed were shut down. Nearly all had broken windows, missing parts and were in really bad shape. About half of the ones still obviosly open, had parking areas that I assume were for workers that were only about a third full.
    3. The tourist industry seemed fine, mostly because nearly all the people we shared tours with and spoke to were from USA or the orient. I will also say that the Italians were still a great bunch of folks to intermix with. They told us about watching out in certain areas for pick-pockets and crooks.

    • We were there for two weeks in July of 2010 and saw exactly the same thing. The only part of the economy that was working was the tourist trade and when we passed through Naples on way to Sorrento, the scumbags in Naples were doing everything they could to destroy that – the garbage people were on strike and there were mounds of garbage piled up in the streets.

    • Sawdust,
      In the three states I’ve lived in over the last five years, they have all tended to be looking to carve an existence from the gravy of the tourist business. They pushed agriculture out, and the bedroom communities developed a disdain for small industry. As the actual “manufacturing”, “production” and “design” work has been intentionally farmed out overseas by the NAFTA and globalist supporters, the dregs of many smaller communities’ technical industries has shifted down to a proliferation of computer or auto repair shops, restaurants, and the dreaded tourist industry. Of course, we can’t forget the gambling industry and WalMart; two of the largest parasitic blights on the festering carcass of what once was the fastest growing economy in the world.

  3. We went to Naples to take a boat ride to Capri and it hasn’t changed in Naples from what you described. We had enough time to tour the Castel Nuovo adjacent to the port before our boat left for Capri, but nobody went because the pickpockets were said to be rampant there. They were supposedly young gypsy children, some say as young as 10, that can take your wallet before you have a clue it’s even in jeopardy.
    Rome had way more homeless people sleeping in the streets than I expected to see. One morning there was one sleeping in the entrance doorway to the building we stayed in, when we tried to leave for a tour at 7.

Talk Amongst Yourselves:

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.