It was pleasing to see the Cypriot people rise up against the government and reject the European Community's theft of a significant part of their bank savings. At the time of writing the Cypriot government has rejected the plan.
The European Community had proposed to bail out Cypriot banks to the tune of €10 billion in return for the Cypriot government seizing 6.75% of Cypriots' bank deposits up to €100,000 and 9.9% of deposits over €100,000. The Cypriot people rightly saw this as bank robbery and took to the streets in protest. Amusingly, the proposal has been listed on Wikipedia as one of the greatest bank robberies of all time.
The global reaction to this has been interesting. It is seen as a step too far in governments' looting of private property, although I am not sure why this should be the case given that governments all around the world have wealth taxes, some of which are far more rapacious than was being proposed here. I suppose it is the blatant nature of the theft that has provoked the reaction.
In some ways, we should have limited sympathy for the Cypriots. If you want the European Community to bail out your banks – in other words, if you want German taxpayers to stump up the money – you can hardly complain if they demand a contribution from you. The real issue here is not the pilfering of Cypriot bank accounts by the European Community but whether the EC should be bailing out banks at all. Governments around the world have been throwing money at banking sector since the global financial crisis hit in 2008 and it hasn't stemmed the rot. Private profits, public losses, seems to be the policy of governments towards the banking sector all over the world.
The Cypriot situation, if it has one benefit, has woken people around the world to the fact that governments can use force to do anything they want if they are not constrained. Once you accept the power of the government to take whatever it likes in taxes, then you shouldn't be surprised when it starts taking your bank account, your house and your business. As the millionaire said to the attractive young woman, "we've established the principle, now we're just arguing over the price."