At the start of a holiday weekend, the Eurogroup finance ministers and the government of Cyprus announced a surprise 10% "tax" on all bank deposits in the country as part of a secretly negotiated bank rescue agreement. Banks immediately froze depositor accounts to prevent people from withdrawing their funds.

"Bank depositors will lose up to nearly 10 percent of their money and authorities have prohibited withdrawals for now, setting off furious reaction as depositors lined up outside the institutions demanding their cash... The decision came late in the night of March 15 and by the next morning customers were trying to make a too-late run on the bank, lining up outside major and cooperative banks..."

-- Greek Reporter

Some reactionaries say that "taxation" is just a euphemism for organized theft and the forced transfer of wealth from producers to parasites. But the central committee has met and decided that everyone must pay his "fair share". Who can argue with the will of the collective, comrades? It's the socialist way!

Whoever "deposits" money in a bank account is actually loaning the bank the use of that money in exchange for the service of processing transactions. The bank pays little or no interest on that loan, and there is also a risk that it won't even return the principal. To offset that risk, most governments provide "deposit insurance" up to a certain amount. The feckless Eurocrats have now pressured Cyprus to default on the promised coverage in a flagrant breach of contract. Who will be next?

UPDATE: Someone finally realized that this insane proposal would scare the sheep in other countries and cause a panic run on the entire European banking system. The current agreement avoids hitting depositors below the €100K insurance limit, and will not be called a "tax". Larger depositors stand to lose at least 60% of their money. I'm sure the Russians will think of their own names for it.