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Bookmark[The following post is by TDV editor-in-chief, Jeff Berwick.]
As I write this, the European Union has just announced a possible $15b aid package to the Ukraine (including 8 billion euros in fresh credit). Everybody has read the headlines about Europe: record unemployment, no end in sight, and so on. So you might be wondering just where the European Union, and its’ constituent nations, scrapped together the money to propose aid for the Ukraine. Well, wonder no more, because the following eight events might give you an idea of where governments go to get a little extra cash.
1. In March, 2009, Ireland seized €4bn from its Pension Reserve fund in order to rescue its banks. In November 2010, the remaining savings of €2.5bn was seized to support the bailout of the rest of the country.
2. In December, 2010, Hungary told its citizens that they could either remit their private pension money to the state or lose their state pension funds (but still have to pay for it nonetheless)
3. In November, 2010, the French parliament decided to earmark €33bn from the national reserve pension fund FRR to reduce the short-term pension scheme deficit.
4. In early January 2011, $60 million in private retirement funds were transferred to the state’s pension scheme in Bulgaria. They wanted to transfer $300 million, but were denied on their first attempt
5. In the Spring of 2013 Cyprus took it a step further and outright confiscated up to 50% of the funds from bank account holders in that country.
6. In the Fall of 2013 the Polish government announced it would transfer to the state (aka. confiscate) the bulk of assets owned by the country’s private pension funds (many of them owned by such foreign firms as PIMCO parent Allianz, AXA, Generali, ING and Aviva), without offering any compensation.
7. In February 2014, Italian banks were ordered by the Italian government to withhold a 20% tax on all inbound wire transfers. Il Sole reported, “the deductions will be automatic (unless prior request for exclusion), and then it will be up to the taxpayer to prove that the money is not in the nature of compensation “income.’”
8. The savings of all 500 million Europeans can be stolen by the European Union. Why? Because the financial crisis is not over, according to an EU document. The Commission is looking to ask the bloc’s insurance watchdog in the second half of 2014 for advice on how to draft a law “to mobilize more personal pension savings for long-term financing,” the document said.
So you see, european governments and institutions have already begun seizing private pension funds, slapping 20% taxes on all incoming wire transfers, confiscating up to 50% from private bank accounts and even stating all the savings of Europe are fair game. As we’ve said before, this phenomenom of wealth confiscation won’t stay confined to Europe
