Open thread to discuss what happened to the land formerly known as the Western Shangri La.
- Delinked from gold in order to join the IMF and settle Nazi-era court cases.
- Caved to the IRS and the Germans on withholding tax information on expats.
- The SNB continues to sell gold in accordance to the Central Bank Gold Agreement.
- And now they are intentionally devaluing their currency.
What are they drinking over there? Got bored of eating cheese and chocolate on the Paradeplatz?
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There’s a nice book which deals with it – written by Ferdinand lips, a Swiss banker, former Rothschild executive. It’s “Gold Wars: The Battle for Sound Money as Seen from a Swiss Perspective”, and is available at Amazon.com
An interview with Lips:
http://www.financialsense.com/transcriptions/2003/Lips.html
Classical Liberalism Protection
Friday, March 13, 2009
Why Has Switzerland Given Up Its ‘Neutrality?’
‘Neutrality’ is just a facade in this era of monetary hegemony.
Will Switzerland – the people and the culture – allow their central bank (the central bank that is located there but which is in no way patriotic to Switzerland) to make them accomplices in the belligerence of the economic terrorists at the seat of power – the inner circle of the unConstitutional coup in the United States?
Return to your classical liberalism roots Switzerland by throwing away the indoctrination of moral relativity that has seeped into your culture since the time of the Protestant Reformation! And fight for the cause of liberty by rejecting the ego-driven intervention of the central bank in your country that licks the boots of the fascist ring leaders – the inner circle of the unConstitutional coup in the United States.
This is another example of the Exports=Wealth In, Imports=Wealth Out thinking of modern economics that goes to make people poorer. The fact is that an increase in the value of your currency vs others means that you can temporarily buy foreign stuff while the foreigners can’t buy your stuff. In the longer term like minutes in banking, days in software, months in electronics, and a year most other industries, the currency advantage is not so clear. There are two reasons for this:
1. Businesses can easily estimate the future value of the currency and get a more accurate picture of the future return on their investments. This produces more wealth than the advantage from exporting. Think Hong Kong, Singapore, etc.
2. Your producers can buy all that good foreign technology and labor from other countries. This makes your domestic productive capacity more efficient and cheaper. Think the US in 1980s and Pre 1960 Germany.
…not to mention the upcoming referendum on whether to move arms storage from the home, in the spirit of the civilian militia, to the barracks. a national gun register, and restriction on more powerful firearms form part of the agenda of the vote’s proponents.
Everything I’ve ever heard about them previously was positive, especially from a banking and economic perspective. Lately, that perception has changed a bit. In regards to their current banking issues, maybe they were threatened with some type of economic sanctions by other nations in private meetings? I can’t think of another reason outside of that. I also just recently found out about their gun referendum, which I find equally unexplainable.
I consider the Swiss a people that everybody should aspire to. Peaceful and neutral but well armed. Friendly in business and respects privacy. They have a high per capita income, there is little crime and the standard of living is high. I consider the steps they’ve taken to be a bad thing for them. With that said, it’s their country and they can do what they want with it.
Are there any Swiss that frequent this site that can educate us as to what the current climate is over there?
Yes, quite sad… but it seems the Swiss population has been contaminated with the general European political brainwashing, which this time wouldn’t stop at its natural geophysical barrier.
@Tim Swanson: The problem is, most people here (especially the politicians) regard these actions as extremely positive. Actually I have never seen an Austrian economist or some other libertarian speaking on TV or doing an interview with a leading newspaper. There’s basically only Keynesianism and statism.
@J Cortez: It’s getting worse and worse. There are a lot of bans and regulations just around the corner. Concerning the financial crisis, our politicians do what the German and American politicians are doing: Bailing out, “stimulating” the economy and just generally wasting our money.
And the climate, well it’s very hostile to free market and classic liberalism. There’s a huge trend towards bigger government.
And yes, Switzerland was threatened by the USA, the EU and the OECD. But I think’ what’s more important is the intense pressure coming from the Swiss themselves. They just don’t care about freedom anymore.
@Artisan: I’m afraid you hit the nail on the head.
You need theory to interpret history. The theory that explains exactly what is going on right now in Switzerland is: On the Impossibility of Limited Government by Hans-Hermann Hoppe.
Switzerland once had a limited government. It is getting bigger and more intrusive every day. This is inevitable.
As a Swiss resident, I can testify that, in the battle between the Swiss and their politicians, the politicians are winning hands down. They interpret the rules as they see fit. For example, the SVP won the last elections, and as a reward got kicked out of the government. A referendum on allowing free entry to Romanians and Bulgarians was bundled along with another one allowing free trade with Austria and France. Unsurprisingly, the bundle was approved, even though a clear majority of the Swiss did not want to be invaded by the Roma. I could go on forever…
The only solution is secession. After a terrorist campaign, the Swiss inhabitants of the Jura mountains managed to secede from the Canton of Bern to form their own canton. But this was all within the Swiss Confederation. Seceding from the Confederation itself is an untested proposition. So far.
Tim,
Check this out. It appears that the Swiss are a fickle lot.
Yet a wave of energy companies has in the last few months announced plans to move to Switzerland — mainly for its appeal as a low-tax corporate domicile that looks relatively likely to stay out of reach of Barack Obama’s tax-seeking administration.
——-
Over the past six months companies including offshore drilling contractors Noble Corp and Transocean, energy-focused engineering group Foster Wheeler and oilfield services company Weatherfield International have all announced plans to shift domicile to Switzerland.
http://www.reuters.com/article/rbssEnergyNews/idUSL312427120090312?feedType=RSS&feedName=rbssEnergyNews&rpc=22
thankful for mention of private banking. the mises followers discuss at length free banking, but rarely a mention of private banking. any discussion on this subject would be helpful
gary get in touch
@Ollie: The SVP themselves chose to kick their remaining delegates, Samuel Schmid and Eveline Widmer-Schlumpf, out of their party just because they weren’t their ideal candidates. They chose not to take part in the executive themselves – they were hardly ‘kicked out’. I fail to his how this matters though, or do you really think they are in any way better than any of the other politicians?
@Eric: The tradition in Switzerland is that every party has the right to designate their ministers themselves. The SVP designated one minister and it is Eveline Widmer-Schlumpf who got into the government instead of him – because she was chosen by the other parties.
Note that this was not reciprocated. The SVP did not get to choose the ministers from the other parties.
It’s as if the Democrats got to pick the winner in the Democratic primary, and also got to pick the winner in the Republican primary.
Given that every party is somewhat heterogenous, if your opponents get to pick somebody they like from within your ranks, they won’t pick somebody who represents your party line.
This matters in two ways. 1) The notion in Switzerland was that the voters would constrain the political Establishment, but clearly that’s not working. 2) Coincidentally (?), the SVP is the only party that opposes the 4 things that Tim Swanson deplored in his original post.
It’s not entirely fair to fault the Swiss people themselves – since they’ve been screwed all over by the politicians (a lot of pro-EU ones there), and it’s not as if most changes were done through the democratic process. If anything, they haven’t been vigilante in guarding their freedom and preserve their way of life – eternal vigilance is the price of freedom, as Jefferson said.
But this could be the end of Switzerland as we know it.
@Ollie: Yeah, but their long-time ideological leader Christoph Blocher also wants the Swiss government to forcefully take over the UBS and and split it up into several smaller banks… They may not support one form of government intervention, but they support a lot of other forms of it.
@Eric:
This is a good point. I think that there is no denying that the banking system, as it currently exists, is highly dependent on the State: money-laundering regulations, fractional reserve, bailouts by central banks printing money out of thin air… Without the State, banks and especially private banks (which UBS originally was – to take up a subject highlighted by gary c. stephenson) would be extremely different. And undoubtedly smaller. If only because there is an increasing return to scale to political lobbying.
So, within a general context where the State exists and is powerful, not every State action is bad: some of them may even bring us closer to what an industry would look like without the State. I believe this is the case with Blocher’s proposal.
Think of Blocher’s proposal as an anti-trust action. As Rothbard’s Power and Market (Chapter 3, Section 3) teaches us, the only meaningful form of monopoly is state-granted privilege. It is painfully obvious that UBS has, implicitly and explicitly, been the beneficiary of state-granted privilege. Therefore breaking it up is fully justified.
Speaking of the Swiss, I saw an article in the newspaper this morning: Apparently the residents of the Zug canton are deliberately overpaying taxes. Seems that the 2% interest paid on refundable amounts beats bank deposit returns hands down, besides being regarded as ‘safer’. Had to smile at that – and the official response:
‘Abusing the tax administation and ultimately the canton as a safe and interest-paying bank must be prevented’. No surprises there……..
As a Swiss Citizen I would not be so pessimistic about the future of Switzerland like many of the previous commentators who seem to be somewhat overly alarmed by recent events.
Here’s why.
Granted the US has been pressuring the country on many occasions starting in World War II by bombing it until more recently with the State Department and the IRS, so have the Germans and the EU and others including the Chinese, and, yes the Swiss political Elite has had the pet project of joining the Eurozone for more than 20 years and also giving up the currency in the process, and, most certainly the Swiss People’s Party (SVP) is a rather mixed blessing in its nationalistic and ostensibly ‘free and independent’ Switzerland policies while being statist nearly Mussolini style …
But guess what we’ve had German Reich sympathizers in the World War I era.
We’ve had even worse Reich sympathizers in the days leading up to World War II.
We have been invaded by Napoleonic armies, we’ve had a civil war, we’ve had starvation and overpopulation in the Alpine valleys, we’ve lost battles in Northern Italy, and weren’t exactly neutral as we often claimed. In short, there’s been a lot of trouble and many reasons why the place should fall apart but seven hundred years later – you might want to check about what the Afghans have been up to since Alexander the Great -we’re still here.
And it seems therefore far-fetched to claim that Bill Gates, Warren Buffett, the Soros’ and Kissingers of this world, CFR members, bankers and globalist minded heads of state that gather in Davos will really change this course.
Consider that the country has prepared – not perfect, but still to a degree that I have not seen anywhere around the world – to protect its population against nuclear war fare. Every house built since the fifties has a bomb shelter. How about that? Does that tell you how paranoid Swiss people through their historic experience are. And when is that going to change? Is that the response of a nation that really will cave in when truly threatened.
Anyway, this country has survived crises after crises for about seven hundred years through sometimes cunning, sometimes dishonest other times brave and honest actions and policies.
The Nation has not fallen apart and it is composed of a melange of three main language regions, many Cantons, Cities in other words it’s very nature is very decentralized. It is a micro Europe and in fact the EU would probably be better off joining Switzerland than the other way round. Sorry this is not likely to change. The country is now surrounded by the EU just like it was during Hitler Germany by the Axis powers, but so what. Why then is like that?
Very simple: the main opposition in Switzerland to counter all efforts by the elites (political, industrial, financial) to change the country are the Swiss people themselves. And the people are not happy with the IMF, the UN, the USA, the bankers, the politicians, the IRS, the European Agenda etc … They are not stupid and they are the ones who vote: NO. Thanks to the people we have not joined the Euro, and surprise it was perhaps a good decision and the people did not loose their jobs like the politicians told them they would That was very threatening propaganda by the way, just picture an American president telling you you will loose you jobs if you don’t join Canada, Mexico or say China. Thanks to the people’s popular referendum in the nineties the federal budget must by law be balanced – which of course, the politicians didn’t do, but at least it prevented them from goofing off badly and overspending in the known big ‘stimulus’ ways, so no big deficit – and despite being tricked into selling Gold and changing the constitution and all sorts of shenanigans in health care an other areas let me assure you the people know this. They will keep vetoing things especially now that the banking system, the European Union, the USA and a lot of this global world agenda has lost a lot of lustre being perceived as authoritarian, imperialistic and economic disasters, and last but not least now that all of the dire predictions regarding the Swiss economic survival have been proven wrong.
Is there a danger. Of course, no country is an island. The influence of bad policies en vogue internationally are being felt. The collectivist Zeitgeist has not yet expired. It probably will take a major world war for that to happen.
For now I’d say only if the Swiss people loose their communal, cantonal, and federal direct democracy through referendums (we are not talking about electing politicians here) or perhaps because of another Napoleon who promises to rid them of their useless elites … yeah then and only then the game of the old Switzerland would be over.
There is not exactly a fat chance for this, and this small porcupine as Hitler Germany used to call the country is far more likely to muddle through. Of course, it isn’t a libertarian’s model state but within the spectre of nations it will remain much closer to such an ideal than a lot of other places, again thanks to direct democracy which blocks a lot of “change”. Change we cannot!
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