Being in a Drudge Report

I never thought I'd see my name in The Drudge Report

However, http://news.yahoo.com/more-renounce-us-citizenship-deny-stereotype-162509477.html that appeared Saturday night there I was. The article appeared elsewhere because it was an AP story called More rennounce US Citizenship but deny stereotype.

I'd talked with the writer Adam Geller as did many others. He quoted me accurately. There was a photo. I do wish he'd mentioned FATCA.

FATCA is the Foreign Accounts Tax Compliance Act. It requires banks, pension funds, insurance companies, investment houses all over the world to report on Americans who have accounts with them. If they don't there are huge penalties payable to the US government.

Many countries have had to change their laws to comply. (I don't want to go into the arrogance of one country demanding another change their laws. I can't imagine the US changing its laws to report on French citizens at the demand of France.) 

As a result banks all over the world simply close the accounts of Americans which means no bank account, no credit card, no car loan, no debit car, no P2P, no mortgage. Some mortgages have been called in for full payment. Technically US expats are not allowed to have a bank account from a foreign address so that means absolutely no way to do ordinary banking transactions.

As of this writing 7:39 Monday morning there were 10,362 responses.

Many missed the point of the story.

Some went off on their own agendas. It wasn't about gays, abortion, Obama, socialists, liberals, etc. It was about people who need to protect themselves and their families.

The responses fell into a few categories.

Why not?
A few said let people make up their own minds with little condemnation. They were in the minority.

Millions want to be American
Respondents cited illegals who want to be in America. Well yes.

People from Latin America do come to the US for a better life. Just like Africans flock to Europe for the same reason. Most want to feed their families. No one looks into increased immigration numbers after NAFTA when the dumping of American products caused untold numbers of farmers to lose their livelihood.When you're looking to escape poverty you go to the closest better country.

They did not consider when a person lives in another country for an extended period of time and plan to stay in that country they want to become a full part of that country with voting rights, etc.

Many expats were transferred for work reasons and found they liked where they were living. Some married locals and have raised families there. The ties to the US become weaker. Sometimes the only tie was the annual tax filing.

Accidental Americans
The accidental Americans are those that were born in the US when their non-US parents were visiting, working or studying there temporarily.

Some never lived in the US more than a few days, yet every cent of their earnings are the subject of the US taxes forever and ever and ever and they are losing their right to bank accounts all over the world. 

Imagine if you were born in England when your parents were on holiday. You never set foot on English shores again. How happy would you be if every cent you ever made or would make would be subject to English taxes and your American bank accounts were being closed because the English government was too threatening to the US banks? Sounds pretty ridiculous doesn't it?

There's no place as good as America
Hmmm. What is better in other industrialized countries? Health care, cost of higher education, quality of education, roads, bridges, safety legislation (products such as US makeup are banned in Europe because the chemicals are not deemed safe) food safety, violence or lack there of, holiday leave (4-6 weeks), maternity leave. All the countries do NOT offer a perfect life. These items were gathered from a number of international reports by reputable researchers that show the above list are better in most industrialized countries than in the US.

America is really good with income inequality, child poverty and number of prisoners. We make the top of those lists.

Does this mean America is horrible? No, it means people have chosen to live else where for many reasons.

American Expats get a $96,000 deduction

True on salaries. Unemployment, investments, pensions, SS are double taxed.

Everyone should pay taxes
Yup they should. Where they live. It is the price of living in civilized society. Taxes should mean we have good schools, a reasonable safety net for the weakest, safe food, safe water, safe roads, safe bridges, etc.

Think if you were born in MA and moved to NH? How willing would you be to continue to pay MA income taxes on everything you earned? What if you couldn't bank in either state? How loyal would you be to MA then?

Renouncers are tax dodgers
Not really. We pay taxes where we live. Most resent paying taxes twice. Many resent having to spend thousands to stay in compliance to learn no taxes are owed. My accountant's bill was three times what I owed but I had the assurance that I wouldn't be hit with fines anywhere from $10,000-50,000 if I messed up in the filing.

Renouncers hate the US
No, but many of us are sad at the state of the US today not because we are liberals or socialists. We see the boarded up houses, the crumbling roads, the ignorance of people about what is going on in the world. Many still have family and roots there. It's just our lives have taken other turns.

Renouncers should be forbidden to ever enter the US again
Actually a law was proposed on just that but it died in Congress. Other "Punishments" were suggested such as confiscation of property, SS, pensions. Hmmm. I wonder if these people think those who take American citizenship should have England, Holland, South Africa confiscate whatever they have left in their birth countries? Admittedly many people who did go to America sacrificed everything but in this global society changing countries isn't all the unusual.

Renouncers won't be protected by the embassy in time of trouble.
No, the US embassy won't. But the embassies of their other country will. Maybe even better.

If you don't like the government you have the right to vote out the government
Not really. US choice of candidates is limited. Had I been able to bank I would have continued to as a US citizen because I was politically active calling Congress regularly on proposed legislation. 

Different country elections vary but in Switzerland we've voted on whether the air force can buy planes, whether to join the UN and EU, the retirement age and many, many, many other topics that I couldn't vote on in the US.

Soon we will be voting on whether to grant every citizen a minimum income.

We vote many times a year on legislation proposed by the citizens or that enacted by the parliament on which we disagree. Sometimes the vote is stupid, but at least it is decided by the citizens.

Renouncers want to escape payments to the US
If you have under $2 million in assets (and they can be all outside the US) the cost of giving up US citizenship is $450. Over $2 million it's now up to 23% of all your assets (and they can all be outside the US) Any American heirs will pay a much higher rate on whatever their renounced parents leave. So when they talk about the Facebook guy who was a naturalized citizen giving up his US citizenship to escape US taxes and what a traitor he was, it was his second country, he did not plan to live in the US again and he didn't like being double taxed, but he still paid a small fortune for giving up the passport.