Unbelievable story from the Soviet Union I just learned about

Boris and Svetlana were simple farmers back in the old Soviet era.

They grew grapes on Russia’s bountiful Caspian coast, dried them in the sun, and sold raisins according to the quotas set by the committee.

Every year the Soviet Union’s Raisin Administrative Committee (RAC) would regulate production, often ordering farmers to destroy upwards of 40% of their crop in order to achieve some sort of bizarre, contrived equilibrium.

This adherence to the religion of central planning in the Soviet Union was so severe that even after the wall fell they couldn’t quite manage to divorce themselves from it.

In his book ‘The Company of Strangers,’ British economist Paul Seabright recounts a hilarious conversation he had just a few weeks after the breakup of the Soviet Union.

Seabright was speaking to the former director of bread production in St. Petersburg, who said:

“Please understand that we are keen to move towards a market system. But we need to understand the fundamental details of how such a system works. Tell me, for example: who is in charge of the supply of bread to the population of London?”

Seabright explained, of course, that no one is in charge of such things.

In the West we don’t have centrally planned committees to regulate the supply of bread, raisin, milk, etc.

One would think.

But guess again, comrades.

Because Boris and Svetlana are actually Marvin and Laura Horne of Kerman, California.

And yes, the Raisin Administrative Committee really, truly does exist in the Land of the Free. I am not making this up.

This happens year after year: RAC bureaucrats centrally plan precisely how many raisins will be sold in the market.

All raisins exceeding that quota are confiscated and stockpiled by RAC, which in some years has amounted to as much as 47% of US raisin production.

Amazing.

Aside from the unconscionable conclusion that this constitutes outright theft, it also means that American consumers are paying more for groceries than they should be.

Naturally, raisins aren’t the only crops targeted by bureaucrats.

There’s the Potato Administrative Committee, Citrus Administrative Committee, and oodles of other New Deal-era committees to set food production quotas.

Marvin and Laura Horne really did take a stand.

About a decade ago they bucked the quota and took the bold step of selling all the raisins that they had grown.

And they really have been punished severely for it. The US Department of Agriculture assessed a $695,226.92 fine against the Hornes, not counting penalties, interest, and legal fees.

The Hornes took the matter to court. And believe it or not, this case has actually reached the Supreme Court.

But even there at the Pantheon of American Justice, the issue is still hotly contested.

It’s incredible that even the nation’s most enlightened legal scholars can’t unanimously see the absurdity (and unconstitutionality) of this system.

But it only serves as further proof of how far things have fallen in the Land of the Free.

Congress is there to create the most absurd, destructive, and invasive laws imaginable.

Executive agencies are standing by to cram them down your throat at gunpoint.

And the courts can’t even recognize when theft is theft.

Under such a heavy yoke, I would respectfully submit to the Hornes that there are a lot of places in the world to grow raisins.

Or run a business. Raise your children in the way that you want. Choose what you can/cannot put in your own body.

Or just about anything else.

And do so with much more freedom and comfort, never again having to worry about Big Brother, the national debt, or the next destructive regulation to come your way.

Blacksmith Global Ltd.

Publisher of Sovereign Man
30 Cecil Street #19-08
Singapore, Singapore – No State 049712
Singapore

It begins: US government issues $700,000 fine against a digital currency

Well, it was bound to happen sooner or later.

Our beloved amigos at the US Financial Crimes Enforcement Network (FinCEN), have just issued the first-ever ‘civil enforcement action’ against a virtual currency.

The offending criminal mastermind in this case? Ripple Labs.

If you’re not familiar, Ripple is a virtual currency platform that was once the darling of Silicon Valley, attracting top VC firms like Google Ventures and Andreessen Horowitz.

Ripple’s technology allows users to conduct financial transactions with one another — sending and receiving payments in cryptocurrencies like Bitcoin, as well as fiat currency.

Imagine Bitcoin meets Paypal… and you have the basic idea.

As part of its technology, the parent company Ripple Labs also created a native virtual currency called ‘XRP’, which is the second largest in the world after Bitcoin when measured by market capitalization.

Because of all of these features, Ripple Labs qualifies as a ‘money service business (MSB)’ according to FinCEN… which makes them subject to all sorts of regulations.

At the top of the list is the Bank Secrecy Act (BSA), which, contrary to its name, requires banks and MSBs to betray their customers’ financial secrets to the US government.

Specifically, the BSA mandates that all banks and MSBs file ‘suspicious activity reports’ if they “know, suspect, or have reason to suspect” that a transaction of $2,000 or more is ‘suspicious’.

And in the age of the USA PATRIOT Act, suspicious transactions are BIG BUSINESS for Uncle Sam.

Last year a record 2.4 MILLION suspicious activity reports were filed. That’s a 40% increase from 2013’s record year of 1.7 million.

As you can imagine, Ripple Labs failed to register with FinCEN as an MSB, nor did it submit suspicious activity reports.

In its complaint, FinCEN describes several of the oooooh-so-nefarious violations.

According to FinCEN, “In January 2014, a Malaysian-based customer sought to purchase XRP from [Ripple Labs], indicating that he wanted to use a personal bank account for a business purpose.”

HOLY JIHAD BATMAN!!!! Someone wanted to use a personal bank account for business purposes?!?! NUKE THE SON OF A BITCH!

I mean, seriously. This is the complete nonsense that keeps financial bureaucrats up at night: some guy in Malaysia wants to buy digital currency with his personal funds.

Whoop-dee-doo.

But what’s really wild is that Ripple actually DENIED the transaction. They just didn’t file the SAR.

So… even though Ripple didn’t actually ENGAGE in said ‘suspicious activity’, failing to file the SAR (with the appropriate TPS report cover sheet) was enough to land them in hot water.

End result — Ripple was dinged with a $700,000 fine.

Now, $700k is a pittance compared to the $9 BILLION that BNP Paribas was slammed with last year for doing business with countries that were former enemies-turned-BFFs of the US government — namely Cuba and Iran.

But it’s still a ridiculous penalty for having done nothing wrong.

Of course, it’s never about right or wrong. It’s about sending a message. And that’s exactly what FinCEN is doing.

By going after Ripple (a major player in the industry), FinCEN is trying to scare all the smaller players into ratting out their customers.

This, after all, is what desperate, bankrupt governments have done for millennia —

Step 1: Track down where everyone’s money is.

Step 2: Take it.

You don’t see rich, stable countries doing this sort of thing. In fact, the exact opposite.

An official from Hong Kong’s Treasury recently stated that: “the Government does not consider it necessary to introduce at the moment new legislation to regulate trading in such virtual commodities or prohibit people from participating in such activities.”

Night and day difference.

We’ll continue to see these steps in the US and in Europe. Tracking down virtual currency transactions. Banning cash. Anything they can do to keep your money trapped in the system where they can keep their eyes on it.

It’s all the more reason to move a portion of your savings out of that system and into somewhere safe.

Blacksmith Global Ltd.
Publisher of Sovereign Man
30 Cecil Street #19-08
Singapore, Singapore – No State 049712
Singapore