A Cypriot Lesson: Glass-Steagall or Suicide

As this is being written, on Monday night, the eurozone finance ministers are holding an urgent teleconference on the Cypriot crisis. They had, of course, caused the crisis themselves, by deciding after a ten hour meeting in Brussels on Friday, to bring off , what Irish bloggers are calling, “the Cypress Bank Heist.” What in the world will they decide next, since  Cypriot President Anastasiades, after having delayed the parliamentary vote on the bailout from Monday to Tuesday, has now announced that he doesn’t have the votes to OK the robbery.

Friday’s EU Council meeting, was shamefully presided over by Ireland, which holds the rotating presidency of the EU Council, took austerity to a new depth, when it decided that Cypriots would pay for the troika’s bailout by seizing a hefty proportion of all depositors accounts. Knowing that most banks were closed over the weekend and on Monday, the first day of Orthodox Christian Lent, the Troika proceeded with its robbery as depositors tried to get their money out of ATMs that ran out of money in the first couple of hours.

What did the euromaniacs expect? Did they think that people would take this robbery of their life’s savings lying down? Did they think that flinging phrases insinuating that most depositors were “non- resident Russians” would cushion the blow? No, the other nations, which had already been fleeced by the troika, began to think that this “once off, unprecedented” could be taken against them as well. Anyone who now believes a word uttered by the coalition of liars in the Irish government needs their head examined and their soul exorcised.

What Anastasiades claimed would happen without the deal sounds all too familiar to Ireland, as well as to our fellow sufferers in Greece, Spain, Portugal and Italy:

“1. One bank would instantly cease operation. Following that the other major bank would suspend operations and we would finally be led to the collapse of the banking sector.

2. As a result, depositors would lose direct access to their deposits, while a large number of depositors would be subject to significant losses.

3. Thousands of SMEs and other businesses would risk bankruptcy.

4. Equally important, however, would be the direct loss of thousands of jobs in the banking sector. I cannot also ignore the consequent loss of thousands of other jobs related to banking activities.

5. The culmination of disorderly bankruptcy would be our potential coercion to exit the eurozone. A similar development would doubtless lead to a significant devaluation of our currency and our national wealth, with all that that would entail.”

The pictures of Cypriot Finance Minister Michael Sarris, looking worn out and grizzled,  like every other finance minister who has prostrated himself at the feet of his troika, But there is a bit of difference between him and the stories of some of the other finance ministers we know about. Sarris was only in office for a month before he was agreed to the highway robbery known as the bailout. He was educated at the London School of Economics and then received his doctorate from Wayne State University in the United States .From September 2005 to March 2008, Mr. Sarris served as the Minister of Finance of the Republic of Cyprus ushering in the Euro as the national currency. Before his first position as finance minister he’s worked with the Central Bank of Cyprus and the World Bank. In 2008 he left his position of Finance Minister, when his right wing Democratic Rally (DISY) party lost the election to the Progressive Party of Working People (AKEL), which is Cyprus’ Communist Party. When the DISY/DIKO coalition government was formed in February 2013, Sarris was again names Finance Minister.

The other interesting fact about Sarris, which is totally swept under the rug in all biographical accounts, is that he was arrested on 15 October 2011, along with a 15 year old boy, in a homosexual orgy in the Turkish part of Cyprus. The important thing about this fact is that it makes Michael Sarris wide open to blackmail. Those who think that the Troika would not stoop to blackmail are hopelessly naïve.


The ruling party has a very slim majority,. If they lose one or two votes they are finished. That’s why as of now the vote has been put off until Tuesday and the banks are closed until Thursday. The parliament will try to “rejig” the levies, to make the bank robbery by the Troika go down a bit easier in the parliament. No doubt the EU finance ministers are dancing their own little jig in their teleconference tonight (Monday) , hoping against a crash of the markets and runs on banks all over Europe.

Here is the breakdown of the Cypriot parliament. Note that President Nicos Anastasiades does not actually hold a parliamentary majority. His coalition controls 28 of the 56 seats in the Nicosia parliament, and coalition partner DIKO had previously been in coalition with AKEL, which is totally against the deal, and the social democratic party EDEK has also come out against the deal.

Anastasiades party ΔΗΣΥ: 20 seats

ΔΗΚΟ (DIKO) (coalition party): 8



Greens: 1


Independent: 1


Precisely because Ireland holds the chairmanship of the EU Council, the suffering Irish should get off their knees and back their Cypriot brothers and sisters in solidarity in defiance of the Troika. We must choose Glass-Steagall (burn the bondholders not the depositors) rather than suicide.

This entry was posted in Austerity & Bank Bailouts, Glass Steagall and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

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