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Blatter understands New World Order

Fifa boss understood very early that there’s a new world order in which westerners don’t matter much, writes Simon Kuper in the FT.

Blatter knows which of the soccer nations have money, and that is why he will be re-elected.

In the 19th century, it was the British, later Americans, then Russians and currently Gulf Arabs.

That’s why on Friday he will be re-elected to his fifth term as president of Fifa, the corrupt global football authority. Western countries rightly decry Blatter. However, we ought to recognise his genius. This 79-year-old understood very early that there’s a new world order in which westerners don’t matter much.

I only realised how deluded most of us westerners were on December 2 2010. That afternoon Fifa’s executive committee (Exco) chose Russia to host the 2018 World Cup and Qatar to stage the 2022 tournament. I had followed the bidding campaigns for years. I had had many off-the-record conversations with western bidders. A few had predicted Russia’s victory. Almost nobody foresaw Qatar’s.

Writing in the Financial Times before the vote, I chastised bookmakers William Hill for making Qatar runaway favourites. Hadn’t Fifa’s own evaluation report called Qatar’s extreme heat “a potential health risk for players, officials, the Fifa family and spectators”? I tipped Russia and the US to win. I was wrong. So were almost all other western observers. Theo van Seggelen, president of the international footballers’ trade union Fifpro, says: “For me — and I was reasonably close to the fire — the vote was a complete surprise.”

It turned out that Fifa cared only about naked power and money. In addition, more than a third of Exco’s 24 members were accused of corruption linked to the vote. Several resigned from football. Jérôme Valcke, Fifa’s secretary-general, wrote in a leaked memo that Qatar “bought” the World Cup. (He later said he’d been misinterpreted.) Last year The Sunday Times alleged that a Qatari, Mohamed bin Hammam, made payments totalling $5m to win support for Qatar’s bid.

Western countries, hopping mad to lose the World Cups, have cried “corruption!” But most non-western participants dismiss them (with some justification) as hypocritical, whining losers. Richard Attias, a French communications consultant who works with Qatar, told me: “Only a microcosm is interested in how World Cups are attributed — a very British microcosm.”

Fifa’s vote presciently recognised the geopolitical rise of Qatar and Russia. Fifteen days after the vote, a Tunisian fruit seller set himself on fire, and north Africans rose in revolt. Qatar, “flush with the success of winning the rights to host the . . . World Cup and with its international recognition soaring as a result,” then helped spark the Arab spring, writes Kristian Coates Ulrichsen, Baker Institute fellow for the Middle East. Qatar funded Islamists across north Africa, and helped unseat Libya’s Colonel Gaddafi. In 2014, Russia annexed Crimea. We live in a new world order.

It suits Blatter. Coming from a small country, he is skilled at accommodating big power brokers.

Moreover, he thinks like them: Blatter, too, likes legal immunity, motorcades on empty highways, and respectful underlings. The central American football officials who recently compared him with Jesus and Nelson Mandela presumably knew the comparisons were absurd. But the absurdity simply emphasised their loyalty.

Western countries are powerless to change Fifa. They could boycott the World Cup but, characteristically, they won’t make sacrifices for their principles.

Now some westerners are complaining about Blatter’s unfair advantages over any opponent in Friday’s vote. Many national football associations fear their supposedly secret ballots won’t stay secret.

Six top FIFA officials arrested for corruption in Zurich

Only hours before the start of Fifa’s Congress in Zurich, six senior Fifa officials have been arrested in early-morning raids by Swiss authorities – with 14 people understood to be facing corruption charges worldwide.

Officers carried out the dawn raid at the five star Baur au Lac hotel in Zurich, with the Fifa vice-president Jeffrey Webb understood to be among the six detained.

Sepp Blatter was not one of those arrested. Fifa’s spokesman Walter de Gregorio told the Associated Press: “He is not involved at all.”

The Swiss Federal Office of Justice said the officials were arrested pending extradition to the US on suspicion of receiving bribes totalling $100m.

The New York Times reported that the charges arising from an FBI inquiry include wire fraud, racketeering and money laundering, with the US Attorney General Loretta E. Lynch due to hold a news conference later on Wednesday.

NBC’s Bill Neely makes this observation after it emerged that the US charges relate to alleged offences connected to tournaments in the US and Latin America.

So far the names of four officials have been released: Eduardo Li, Jeffrey Webb, Jose Maria Marin and Eugenio Figueredo.

Webb and Figueredo are Fifa vice-presidents. Li was due to join the executive committee on Friday and Marin is a former member of the executive committee.

The New York Times says charges “were also expected against” sports marketing executives Alejandro Burzaco, Aaron Davidson, Hugo Jinkis and Mariano Jinkis.

It said José Margulies has also been charged for allegedly facilitating illegal payments.

Silent Circle moves to Switzerland to bypass US surveillance

As US mass surveillance continues to make headlines, one man has had enough. Philip Zimmermann, creator of one of the most widely-used encryption systems, has moved his company to Switzerland, claiming societies need to “roll back” surveillance tactics.

Expressing his concerns about mass surveillance, Zimmerman told the Guardian that “every dystopian society has excessive surveillance, but now we see even Western democracies like the US and England moving that way.”

Zimmerman is the inventor of the encryption program Pretty Good Privacy (PGP), as well as the co-founder of three-year-old encryption start-up Silent Circle.

“We have to roll this back. People who are not suspected of committing crimes should not have information collected and stored in a database. We don’t want to become like North Korea,” the Internet Hall of Fame inductee continued.

Silent Circle will now operate from Switzerland – a move prompted by the 2013 Lavabit incident. The founder of Lavabit – which provided email addresses for 410,000 people including NSA whistleblower Edward Snowden – was served with a court order in 2013, requiring him to install surveillance equipment. This prompted him to close the service.

Zimmerman paid close attention to the situation, realizing that Washington could also serve Silent Circle – which offered voice, text, and email services – with the same order. He shut down the email service, wiped its database and never looked back.

Now the company is setting up its headquarters in Switzerland – where, according to Zimmerman, he is “less likely to encounter legal pressures.”

On its blog, Silent Circle credits Switzerland with having the “world’s most robust privacy laws,” adding that the company will continue to grow its Washington and London offices, but that “most of our new growth will take place in our new headquarters.”

While the Snowden revelations have opened the world’s eyes to mass surveillance, Zimmerman knew the possibilities all along.

The user manual for PGP, written in 1991 and updated seven years later, warns: “Today, email can be routinely and automatically scanned for interesting keywords, on a vast scale, without detection. This is like driftnet fishing.”

Perhaps it is this insight that has led to such widespread support for Silent Circle. Earlier this year, the encryption system raised US$50 million in a second round of outside funding.

In addition to Silent Circle and PGP, Zimmerman also played a role in developing Blackphone, the world’s most spy-resistant phone. In addition to its sealed operating system largely preventing data leaks, Silent Circle is used on the phone to encode all calls, texts, and contacts.

The second generation of the phone, costing around $700, is expected to be released this year, and will be followed by an attempt at a tablet device.

‘US spies feel at home in Switzerland’

US spies operate in Switzerland without much fear of being unmasked, because Swiss intelligence, though knowledgeable and very professional, poses no threat to them, former NSA contributor Edward Snowden told Swiss TV.

“The reason that made Switzerland so interesting as the capital of espionage – particularly Geneva – has not changed,” Snowden said in an interview to Darius Rochebin on RTS, a Swiss broadcaster. The two spoke at the International Film Festival and Forum on Human Rights on March 5. The transcript of the interview waspublished in le Temps, a Swiss French-language newspaper, this Saturday.

“There have always been international headquarters, the United Nations, WTO, WHO, ICRC [in Geneva]. There are representations of foreign governments, embassies, international organizations, NGOs … A number of organizations, and all of them are in one city [Geneva]!”

According to Snowden, other Swiss cities have also been “affected” by US spies.

“You have exceptional flows of capital and money in Zurich. You have bilateral agreements and international trade in Bern,” he said.

The ex-NSA man recalled the time he was working in Geneva as an undercover US agent. He said the Americans weren’t afraid of Swiss intelligence.

“Swiss services were not considered as a threat. [They] are also very knowledgeable and very professional. But they are small in numbers.”

Snowden compared Swiss intelligence to spying agencies in France, saying they respected French spies who are known to be “sophisticated and aggressive.”

He drew examples of CIA operations concerning weapons of mass destruction, adding that people “involved in nuclear proliferation” were violating the law in Switzerland, Germany and neighboring countries.

And unfortunately, “political influence” was seen in these cases, which “rose to the highest level in the government.”

“That’s why representatives of the US government, even when they violate the Swiss laws, have a certain level of comfort, knowing that there will be no consequences,” Snowden concluded.

Swiss diplomat dissects diverging US, EU interests

It is important to understand that US interests are fundamentally different from those of Europeans, Lena Lio, a former Swiss politician and diplomat, expert on Russian studies, told the newspaper 24 Heures.

The instability in Eastern Europe is beneficial for Washington, as the ongoing conflict in Ukraine will lead to a weak Europe, implying also that mostly white nations will suffer the consequences.

The weak Europe, in turn, cannot pose an economic threat or political competition to the United States. That is one reason why Washington passionately hates “nationalists”, the real backbone of the EU.

If Europe manages to solve its internal problems, it will be a dangerous challenger for the US hegemony, Lio said.

Unable to remain the top dog in international politics, the United States deliberately destabilizes its potential competitors by creating conflicts and fueling existing disputes.

The United States is losing its dominance in the international arena and that is why Washington deliberately tries to destabilize and crush any potential competition.

Most Americans now see Russia – ahead of North Korea, China and Iran – as the US’s public enemy number one and the greatest threat to the US due to a relentless demonization campaign. Americans regard Europeans as “appeasers”.

But the EU has no energy security in the Middle East and North Africa, and without their reliable partner Russia, will have no energy security at all.

The United States can thus no longer remain the only hegemon in the world, the position it has become so used to since the fall of the Berlin Wall and the end of Cold War.

Therefore, unable to stay on the top, the United States uses aggressive style of conducting politics by deliberately damaging relations between other countries, such as fueling disputes between China and Japan, destabilizing Eastern Europe by supporting the conflict in Ukraine, artificially driving down global oil prices and damaging the Russian economy by imposing economic sanctions, said the former Swiss diplomat.

NATO in Europe embodies the ultimate geopolitical existential paradox; an alliance that exists to manage the chaos it perpetuates.

Snowden wants asylum in Switzerland

US National Security Agency (NSA) leaker Edward Snowden, who has been living in Russia since mid-2013, on Friday made a public appeal for asylum in Switzerland, where he said he once worked under diplomatic cover for the Central Intelligence Agency (CIA).

“I would love to return to Switzerland, some of my favourite memories are from Geneva. It’s a wonderful place,” he told a Moscow-Geneva videoconference. “I do think Switzerland would be a sort of great political option because it has a history of neutrality.”

US prosecutors accuse Snowden of leaking information on US National Security Agency (NSA) secret surveillance programs to mainstream media.

In 2013, he was granted a temporary asylum in Russia after spending more than a month in the transit zone of Moscow’s Sheremetyevo airport.

In August 2014, as the asylum expired, Snowden received a three-year residency permit.

Davos: Individual privacy is dead

Imagine a world where mosquito-sized robots fly around stealing samples of your DNA. Or where a department store knows from your buying habits that you’re pregnant even before your family does.

That is the terrifying dystopian world portrayed by a group of Harvard professors at the World Economic Forum in Davos on Thursday, where the assembled elite heard that the notion of individual privacy is effectively dead.

“Welcome to today. We’re already in that world,” said Margo Seltzer, a professor in computer science at Harvard University.

“Privacy as we knew it in the past is no longer feasible… How we conventionally think of privacy is dead,” she added.

Another Harvard researcher into genetics said it was “inevitable” that one’s personal genetic information would enter more and more into the public sphere.

Sophia Roosth said intelligence agents were already asked to collect genetic information on foreign leaders to determine things like susceptibility to disease and life expectancy.

“We are at the dawn of the age of genetic McCarthyism,” she said, referring to witch-hunts against Communists in 1950s America.

What’s more, Seltzer imagined a world in which tiny robot drones flew around, the size of mosquitoes, extracting a sample of your DNA for analysis by, say, the government or an insurance firm.

Invasions of privacy are “going to become more pervasive,” she predicted.

Political scientist Joseph Nye tackled the controversial subject of encrypted communications and the idea of regulating to ensure governments can always see even encrypted messages in the interests of national security.

“Governments are talking about putting in back doors for communication so that terrorists can’t communicate without being spied on. The problem is that if governments can do that, so can the bad guys,” Nye told the forum.

“Are you more worried about big brother or your nasty little cousin?”

“By and large, tech has done more good than harm,” she said, pointing to “tremendous” advances in healthcare in some rural areas of the developing world that have been made possible by technology.

And at a separate session on artificial intelligence, panellists appeared to accept the limit on privacy as part of modern life.

Rodney Brooks, chairman of Rethink Robotics, an American tech firm, took the example of Google Maps guessing — usually correctly — where you want to go.

“At first, I found that spooky and kind of scary. Then I realised, actually, it’s kind of useful,” he told the forum.

Anthony Goldbloom, a young tech entrepreneur, told the same panel that what he termed the “Google generation” placed far less weight on their privacy than previous generations.

“I trade my privacy for the convenience. Privacy is not something that worries me,” he said.

“Anyway, people often behave better when they have the sense that their actions are being watched.”

The World Economic Forum in the swanky Swiss ski resort of Davos brings together some 2,500 of the global business and political elite for a meeting that ends Saturday.

Source: AFP

Some 1700 jets land in Davos to ponder global warming

A squadron of 1,700 private jets are rumbling into Davos, Switzerland, this week to discuss global warming and other issues as the annual World Economic Forum gets underway.

The influx of private jets is so great, the Swiss Armed Forces has been forced to open up a military air base for the first time ever to absorb all the super rich flying their private jets into the event, reports Newsweek.

“Decision-makers meeting in Davos must focus on ways to reduce climate risk while building more efficient, cleaner, and lower-carbon economies,” former Mexican president Felipe Calderon told USA Today.

Davos, which has become a playground of sorts for the global elite, is expected to feature at least 40 heads of state and 2,500 top business executives. Former Vice President-turned-carbon billionaire Al Gore and rapper Pharrell Williams will be there as well; each plans to discuss global warming and recycling respectively.

Another big theme of the mega-rich confab will be combating “income inequality” and how the world’s rich can pay their fair share to reduce the gap between top earners and the lower class. Admission price for Davos: roughly $40,000 a ticket.

The World Economic Forum will also feature discussions on gender equality and opportunities for women. According to the World Economic Forum’s own statistics, just 17% of all 2015 participants are women.

The 45th World Economic Forum meeting begins on Wednesday and runs through Saturday.

Source: Breitbart

Switzerland stuns markets by giving up on currency peg

Bowing to the inevitable, Switzerland has ditched an increasingly expensive policy to limit the export-sapping rise of the Swiss franc — a decision that propelled the currency a whopping 30 percent higher against the euro within minutes.

Thursday’s decision by the Swiss National Bank, or SNB, to end its efforts to keep the euro from trading below 1.20 francs came amid mounting speculation that the European Central Bank will next week back a big stimulus program that will put more euros in circulation, which would further dilute their value.

That expectation has seen the euro face intense selling pressure in currency markets, particularly against the dollar. The euro has fallen to nine-year lows against the dollar and below its launch rate in 1999.

As the outlook for the euro has darkened, the cost for the Swiss central bank of defending the peg by buying euros or selling francs has risen. Though the timing of the Swiss decision proved a surprise, most foreign exchange experts thought the peg would have to be abandoned, just as previous such efforts had.

“Switzerland suddenly got a whole lot more expensive,” said Michael Hewson, senior market analyst at CMC Markets.

Many analysts thought the decision was inevitable in light of next week’s expected announcement by the ECB to break new ground in its efforts to inject life into the ailing 19-country eurozone economy. Its stimulus package is expected to be worth as much as 1 trillion euros ($1.17 trillion).

The peg, which was introduced in Sept. 2011, was an attempt to halt the rise of the franc — a traditional haven currency for investors — against the euro at a time when the eurozone debt crisis was at its height. The strong franc was then particularly problematic for Swiss exporters, who were forced to drastically cut prices to remain competitive.

Unsurprisingly, Thursday’s move prompted a painful 11 percent drop in Switzerland’s stock market as investors took fright at the worsening outlook for Switzerland’s traditional exporters, such as those selling chocolate or ski holidays.

Source: AP

Swiss reject gold reserve increase

Swiss voters rejected two closely watched referendums on Sunday that would have forced the central bank to buy up massive amounts of gold and introduced strict new limits on immigration, in a result that could bolster its economic ties to the European Union.

Proposed by the right-wing Swiss People’s Party out of concern that the Swiss National Bank has already sold too much gold, the measure would have compelled the SNB to boost its gold reserves to 20% from around 8% currently. Switzerland already holds the most gold per capita in the world.

An initial analysis of the voting trend from Swiss broadcaster SRF showed voters were likely to have turned down the “Save our Swiss gold” initiative.

A report from Bloomberg said the measure was voted down by a margin to 78-22.

If Swiss voters had approved the measures, it would have severely complicated policy at a time when the central bank is trying to defend a 1.20 euro cap on the Swiss franc imposed at the height of the euro crisis.

Earlier this month, gold futures went on a wild ride after polling data showed an advantage in favor of votes against measure. Previous polls had shown about an even split among voters.

Swiss were also set to reject a separate initiative that aimed to cut annual immigration by three-quarters from current levels in order to reduce the strain on Switzerland’s natural environment, and a third referendum aimed at scrapping a tax perk for wealthy foreigners was also set to be defeated.

Over the last several months, the price of gold has been declining sharply, with the precious metal currently near mu tli-year lows.

Source: Business Insider

As Dutch move gold out of US, French and Swiss call to follow

The financial crisis in Europe is prompting some nations to repatriate their gold reserves to national vaults. The Netherlands has moved $5 billion worth of gold from New York, and some are calling for similar action from France, Switzerland, and Germany.

An unmatched pace of money printing by major central banks has boosted concerns in European countries over the safety of their gold reserves abroad.

The Dutch central bank – De Nederlandsche Bank – was one of the latest to make the move. The bank announced last Friday that it moved a fifth of its total 612.5-metric-ton gold reserve from New York to Amsterdam earlier in November.

It was done in an effort to redistribute the gold stock in “a more balanced way,” and to boost public confidence, the bank explained.

“With this adjustment the Dutch Central Bank joins other banks that are keeping a larger share of their gold supply in their own country,” the bank said in a statement. “In addition to a more balanced division of the gold reserves…this may also contribute to a positive confidence effect with the public.”

Dutch gold reserves are now divided as follows: 31 percent in Amsterdam, 31 percent in New York, 20 percent in Ottawa, Canada and 18 percent in London.

Meanwhile, Switzerland has organized the ‘Save Our Swiss Gold’ referendum, which is taking place on November 30. If passed, it would force the Swiss National Bank to convert a fifth of its assets into gold and repatriate all of its reserves from vaults in the UK and Canada.

“The Swiss initiative is merely part of an increasing global scramble towards gold and away from the endless printing of money. Huge movements of gold are going on right now,” Koos Jansen, an Amsterdam-based gold analyst for the Singaporean precious metal dealer BullionStar, told the Guardian.

France has also recently joined in on the trend, with the leader of the far-right National Front party Marine Le Pen calling on the central bank to repatriate the country’s gold reserves.

In an open letter to the governor of the Banque de France, Christian Noyer, Le Pen also demanded an audit of 2,435 tons of physical gold inventory.

Germany tried and failed to adopt a similar path in early 2013 by announcing a plan to repatriate some of its gold reserves back from the US and France.

The efforts fizzled out this summer, when it was announced that Germany decided to leave $635 billion worth of gold in US vaults.

Germany only keeps about a third of its gold at home. Forty-five percent is held in New York, 13 percent in London, 11 percent in Paris, and only 31 percent in the Bundesbank in Frankfurt.

‘Save our Swiss gold’

‘Gold wars’ are intensifying ahead of the polling day in the Swiss Gold Initiative.

The Swiss National Bank (SNB) and establishment parties went “all in” during the week and intensified their campaign. They suggested that passing the Swiss Gold Initiative would be a ‘fatal’ for Switzerland and would be positive only for speculators.

The ‘yes’ side countered by saying the SNB’s assertions were alarmist and over the top. They say that it is not an invitation to speculators as there would be a five year transition to gold being 20% of Swiss reserves. They warned that there is a real risk of another debt crisis and a global currency crisis and that gold reserves would protect the Swiss franc and the Swiss economy.

Because if Germany failed miserably to obtain 674 tons of gold from the US Federal Reserve in 2013, it is assured that Switzerland will find absolutely nothing in its quest to obtain more than double, or 1,500 tons, of gold as a successful November 30 referendum outcome would require.

Then again, considering it was Obama’s action that destroyed the Swiss banking sector after the US crushed the centuries-long tradition of “Swiss banking anonymity”, this could be just the right action with which “neutral” Switzerland could finally take its revenge on the regime that cost it what was for centuries the primary source of capital inflow.

In 1992, after a concerted political campaign spearheaded by some of the country’s political parties, Switzerland joined the International Monetary Fund following a national referendum.

Under IMF rules, adopted in the latter part of the 1970s, IMF member countries cannot link their currencies to gold. After joining the IMF, Switzerland was therefore constrained in how it could subsequently revalue its gold reserves since IMF Articles of Association prohibited IMF member countries from linking their currencies to gold.

Well known Swiss banker, financial adviser and author of ‘Gold Wars’ Ferdinand Lips believed that Switzerland had been put under enormous foreign pressure and duress to sell half of its gold reserves, and he wrote in 2002 questioning “Is the SNB on New York’s leash?”, saying that “In my opinion, the once strong, proud and independent SNB has been degraded to an ‘Off-shore Branch’ of the U.S. central bank (the Federal Reserve) and reports directly to Alan Greenspan and his cohorts in New York.”

Lips added that “It is a given that the Swiss gold sales will help New York money center banks to survive a bit longer. It will help them manipulate the gold market. But, gold’s time is still to come. If the SNB does not stop its sales, Switzerland will have to buy back its gold one day but at a higher price. The question is: With what?”

With the SNB now in full media mode arguing against a 20% gold holding in the reserves however, perhaps some of the Swiss media might care to interview Dr. Jean-Pierre Roth who can now be found sitting on the boards of Nestlé, Swiss Re and Swatch.

The devious behaviour of the liberal mind

Another perfect example of the devious behaviour of the liberal mind.

For more than a hundred years the Swiss town of St Gallen carried the name of Krügerstrasse (Kruger Street), but because President Paul Kruger was evidently a “white racist”, the name had to change.

The Tagblatt actually went so far as to state that Paul Kruger was an “Apartheid pioneer”. It’s easy to make these outrages statements when the person has been dead for more than a hundred years. Who’s going to sue them?

Paul Kruger was the consumate anti-colonialist. He was also a brilliant military strategist against British marauders. He was loved by most black tribes in Southern Africa for these qualities, but Switzerland clearly does not care for historical fact.

From Reuters:

A street in the Swiss town of St Gallen, which for more than a hundred years bore the name of former South African president Paul Kruger, was renamed by local authorities yesterday.

Theo Buff, from the town’s planning department, said the name was being changed “because of racist associations”.

Kruger, who led the Boer resistance against the British during in the Second Boer War of 1899 to 1902, lived in St Gallen after fleeing Africa when the British advanced on Pretoria.

“In the context of the time, naming a street after Paul Kruger can be understood,” the St Gallen council said, “but today it can no longer be justified.”

The street will now be called Duerrenmatt Street, after Swiss author and dramatist Friedrich Duerrenmatt.

Will the Swiss vote to get their gold back?

On November 30th, voters in Switzerland will head to the polls to vote in a referendum on gold. On the ballot is a measure to prohibit the Swiss National Bank (SNB) from further gold sales, to repatriate Swiss-owned gold to Switzerland, and to mandate that gold make up at least 20 percent of the SNB’s assets. Arising from popular sentiment similar to movements in the United States, Germany, and the Netherlands, this referendum is an attempt to bring more oversight and accountability to the SNB, Switzerland’s central bank.

The Swiss referendum is driven by an undercurrent of dissatisfaction with the conduct not only of Swiss monetary policy, but also of Swiss banking policy. Switzerland may be a small nation, but it is a nation proud of its independence and its history of standing up to tyranny. The famous legend of William Tell embodies the essence of the Swiss national character. But no tyrannical regime in history has bullied Switzerland as much as the United States government has in recent years.

The Swiss tradition of bank secrecy is legendary. The reality, however, is that Swiss bank secrecy is dead. Countries such as the United States have been unwilling to keep government spending in check, but they are running out of ways to fund that spending. Further taxation of their populations is politically difficult, massive issuance of government debt has saturated bond markets, and so the easy target is smaller countries such as Switzerland which have gained the reputation of being “tax havens.” Remember that tax haven is just a term for a country that allows people to keep more of their own money than the US or EU does, and doesn’t attempt to plunder either its citizens or its foreign account-holders. But the past several years have seen a concerted attempt by the US and EU to crack down on these smaller countries, using their enormous financial clout to compel them to hand over account details so that they can extract more tax revenue.

The US has used its court system to extort money from Switzerland, fining the US subsidiaries of Swiss banks for allegedly sheltering US taxpayers and allowing them to keep their accounts and earnings hidden from US tax authorities. EU countries such as Germany have even gone so far as to purchase account information stolen from Swiss banks by unscrupulous bank employees. And with the recent implementation of the Foreign Account Tax Compliance Act (FATCA), Swiss banks will now be forced to divulge to the IRS all the information they have about customers liable to pay US taxes.

On the monetary policy front, the SNB sold about 60 percent of Switzerland’s gold reserves during the 2000s. The SNB has also in recent years established a currency peg, with 1.2 Swiss francs equal to one euro. The peg’s effects have already manifested themselves in the form of a growing real estate bubble, as housing prices have risen dangerously. Given the action by the European Central Bank (ECB) to engage in further quantitative easing, the SNB’s continuance of this dangerous and foolhardy policy means that it will continue tying its monetary policy to that of the EU and be forced to import more inflation into Switzerland.

Just like the US and the EU, Switzerland at the federal level is ruled by a group of elites who are more concerned with their own status, well-being, and international reputation than with the good of the country. The gold referendum, if it is successful, will be a slap in the face to those elites. The Swiss people appreciate the work their forefathers put into building up large gold reserves, a respected currency, and a strong, independent banking system. They do not want to see centuries of struggle squandered by a central bank. The results of the November referendum may be a bellwether, indicating just how strong popular movements can be in establishing central bank accountability and returning gold to a monetary role.

The Ron Paul Institute For Peace & Prosperity