so how high are these walls (from basement floor to first)? and how
thick is the CMU (cinder block wall) cause the crack sure sounds
like its the result of a bending failure in the wall.

From floor to 1st floor is almost 8 feet. The walls are standard 8"
cinder block.The soil is clay.

I agree, the horizontal crack was probably caused by hydrostatic
pressure or frozen ground swell above the frost line.

the contractor wanted to "install grip-tite style wall anchors." what are they?

Here is an example, except in my case there is no sign of buckling:

http://www.anchoredwalls.com/digout.html

I'm just wondering if I have to take this drastic action. Or if there
is
something less costly.