You probably know the story of the boiling frog.
The premise is simple. If a frog is placed in a pot of water that is already boiling, it will immediately sense danger and jump out, relatively unscathed. If it is placed in a pot of cool water, the frog will happily stay in the pot while it is slowly heated to a boil. By the time the frog realizes the danger, it is too late.
The metaphor is used to describe how society is allowing itself to be slowly boiled– small changes that go unchallenged will lead to imminent danger.
History has seen plenty of examples– everyone always cites Nazi Germany or Rwanda, but there are countless others that don’t involve fascism or genocide. I think today’s Argentina illustrates this point clearly.
After that country’s 2002 economic collapse, Argentina’s legislative assembly granted extraordinary power to the president on the grounds that unprecedented times call for unprecedented measures.
Seven years later, the president is still holding on to those powers, and usurping even more. The federal government completely dominates Argentina’s economy, either directly through shareholder control, or indirectly through regulation. Government sponsored thugs execute a mafia-like grassroots agenda, and now the government is seeking to limit the voice of what little free press remains.
The moral of Argentina’s story is simple: the greater the power given to the government, the less likely they will ever relinquish it.
In the United States, the growing tide of government power over the last decade has been equally disturbing. Each passing bill– the USA PATRIOT Act, the Emergency Economic Stabilization Act, etc. raises the temperature in our collective pot of water by a few degrees.
One by one, some frogs are wising up and are starting to jump out
I find the recent morass to be especially boiling. The CFTC, under the spurious motive of protecting the people, has announced hearings to discuss limiting oil speculation… this is the first step in price controls, and methinks corn and wheat cannot be that far behind.
Further regulatory developments include a proposal coming from the FDIC to limit the size and scope of commercial banks. Comrade Bernanke has endorsed the idea, indicating that it is ‘legitimate’ to artificially restrict the growth and profitability of a private enterprise.
And now we have, within the last few days, the economic luminaries on Capitol Hill unveiling a special tax on the nation’s top earners to pay for the 1,000+ page health care bill… that no one has actually read.
Without even a cursory understanding of the bill, Congress is proposing to legislate the majority of Americans into health care by legislating a minority of Americans out of their wealth. Perhaps the ’stimulus surtax’ will follow close behind.
Is it getting warm yet?
As a casual outsider who has checked out of the nation-state system, I find myself curiously peering inside from time to time wondering about that boiling point… what will it take for people to finally realize the peril that they are in?
It’s clear to me that subscribers to this letter are a cut above. You are a thinker who will keep working to improve your personal lot in life despite the foolish behavior of politicians. But each of us has a breaking point… a point where we, like Howard Beale in the film Network (clip below), decide that we’re just not going to take it anymore.
What’s your breaking point? I’d like to know. Make your voice heard by commenting below.
{ 41 comments… read them below or add one }
Agree. But, for many of us, jumping is — or appears to be — very risky and difficult. You should write about the how, the cost and the place to, jump.
I’m a retired farmer with, of course, no pension and precious little in the way of funds from, of course, having to sell the farm. No farmer–unless he/she is a doctor or a CEO–can escape that eventual forced sale. Why should I give a tinker’s dam about whether some rich guy can keep his millions? Reducing the gap between workers’ and management’s incomes seems to me imperative from any standpoint. The sooner the better. Say 95% tax on incomes over $250,000?
HGHdoges retardedly said this: Why should I give a tinker’s dam about whether some rich guy can keep his millions?
Because in relation to me YOU are a rich guy and the gov’t should tax you at 95%.
How in the he11 do people get this way?
Full of envy and hate filled bitterness from their own failures in life.
Simon,
Was that you with family in Uruguay or was that Fitz?
It’s much easier to be an international man when single, footloose and fancy free.
Regards,
Roger.
Mr. Black,
I believe I hit my breaking point about a half a dozen years ago. I was already quite aware of the massive corruption in both the executive and legislative branches of the FedGov. But then I read about some poor person (in Houston I believe) who was shafted by the courts. The case was completely winnable but because the opposition was a drug dealer of sorts backed by the Feds, this person couldn’t get a lawyer to touch it and had more than one judge reverse himself to toe the line. For some reason, the realization that there is not even any reason to have faith in justice in the U.S. pushed me into thinking of leaving.
I’ve been slowly gathering information to make such a break someday (like when I retire or after my parents die). I’ve got the country picked out (originally it was Costa Rica (now too expensive), then Belize (too humid and hurricane bait), and now Panama) and I’ve had Mark Nestmann in mind as my first source to help me facilitate this move for several years (I hope your promotion of him doesn’t make it tougher for me to see him when the time comes!).
Given Joel Skousen’s high probability that Russia will nuke us in the near future, or that martial law is not as unthinkable as it once was, or merely the even greater steps in removing my freedoms that are imminent (such as greater restrictions on getting my money out of the U.S.), I think my timeframe needs to slide to the left.
Actually pulling the trigger, I can imagine, is a huge psychological/emotional hurdle that remains to be seen whether I can pull it off.
Hello Simon,
Thank you for your letter and the chance to share my thoughts.
Currently in my 26th year as a Financial Advisor, I have clients in nearly every state, in many different walks of life. I can tell you that I have never received the overwhelmingly unsolicited negativity from clients regarding both social/political trends, as well as the financial mismanagement coming from Government as I have been recently. Generally, the older clients are more disgusted, concerned and afraid. Atlas Shrugged is often cited. Very few have spoken about possibly leaving.
I see my ’slice of America’ at an intellectual breaking point, but they (nor I) know what to do. Many have attended tea parties, are active forwarders of emails, yet if by breaking point you mean a call to arms (or protests/marches on the state), they are not (yet) there, possibly because they do not have a leader/organization to join. The time to lead such a movement seems right to me for the right person.
As a student of financial history, my nose is in the air for the telltale whiffs.
Meanwhile, the overwhelming public opinion is that it won’t happen here, and that everything will be ok.
Personally, I cry on the inside everytime I reflect on the new powers of government in the USA and the control by those (bankers/Rothschilds) at the top of the food chain [realizing of course that someone will always be at the top]. But one must live, and if you are to enjoy this life, for me at least, don’t dwell on the dark powers.
Thank you again for your work, and you do have permission to share comment.
Best Regards,
Lawrence Scharf, AAMS
Senior Vice President, Investments
UBS
My breaking point will be when they try and brand me and my kids like cattle with a digital implant / debit card, which I expect will eventually be legislated globally, because it will be the only way to bail out all the global failing fiat currencies with a “pure” fiat currency — digital credits that expire after a few weeks of issuance, stripping away everyone’s ability to save. To me that’s the natural extension of the central banker’s current agenda of neo-feudalism, and they are only approaching the height of their powers. I expect them to “sell it” in conjunction with the abolition of the income tax, since it will become intrinsic or inherent in the new system, while they can pretend it is being abolished.
I said as much to Peter Schiff recently. I probably made him “mad as hell”, because he thinks honest money can win in the end, whereas I think Doug Casey is closer to correct by explaining that the deck is stacked with “the pathocracy”, and it is in their nature to kill the host, because they just cannot see any further than that, due to their mental handicap.
So, while my sister writes a letter to the UN to request the repeal of property taxes, I invest in self-sufficiency, and encourage others to do the same: a biodynamic farm, and fortified concrete walls for a nice hidden residence, so that you can live in peace while the cycle plays out.
I recently read “Atlas Shrugged”, and there was such a place in that book as well. Not surprising… it is a necessary thing for people who have no place in the system, and who are currently severing their last ties with it, and who are about to take a little break from it until it is safe to return to normal life, as soon as the human and monetary capital is once again welcomed by the market and society, once the sharks are no longer circling in the parasite-infested waters.
Simon, what do you mean by your comment “as a casual observer who has checked out of the nation-state system”? Because, as long as we’re still “citizens” of the US, then we’re still “slaves/chattel/serfs” (call it what you wish, but we’re mere property). And, as you likely know, if one simply “leaves the plantation”, then one is simply considered a “slave off the plantation” and can be returned to the plantation at any time they wish to bring the slave back. That’s because, if one is someone’s property, then one doesn’t have standing upon which to state a claim for which relief can be granted. So, one cannot simply run away from the problem and expect the problem to go away. A US citizen will continue to be responsible for the debt and taxes and the irresponsibility of their elected con-gress, as long as one continues to be a US citizen. So the solution is to throw the yoke of citizenship off of one’s back. But then, you can’t be an island without “belonging” to something, somewhere, otherwise you’ll be subject to whatever jurisdiction in which you’re found. So we too are fishing for the “solution to our citizenship”. Which takes me back to my original question, what do you mean by your comment describing yourself as “a casual observer who has checked out of the nation-state system”?
This same question comes before me very often. My belief is that the people reading Simon Black are not the ones that will break first. We will be required to defend against out of control people who have not been Producers but just consumers. I am not speaking of the men and women of the working poor. I am referring to those who don’t make plans or preparations for anything. When they lack what they need they look around to take it from someone who has it.
We are coming into the danger zone quickly. It is like the fog, traveling on little cat’s feet.
I really appreciate your good and actionable information from many corners of this world. Keep it up.
I think what Simon is referring to is that you may have a revenue stream coming to you that could just as easily go to a foreign corporation in several legal ways. One thing you must remember is that most of the taxes the government refers to are INCOME taxes. “Rich” people, especially the self employed, can take less income and push more revenue into either expenses paid to foreign corporations for services or goods or to assets for future growth. Perhaps your revenue stream is coming from capital or intellectual property rights that can be transfered to an offshore entity so it no longer comes to you. The entity now has the income and is responsible for taxes in the foreign country, if they have a tax (see UAE and others). The enitiy holds, invests and grows the accumulating revenue and at some future date, the entity can pay you but until that time you no longer have the income, so you no longer have the tax. Think of it like an unlimited IRA. You can also start a defined benefit pension plan if you have few or no employees that will allow you to legally push a ton of income into the plan to provide retirement benefits later in life. The older you are, the more money is needed to be able to provide the benefits. Sometimes, you can legally contribute to the plan more than half of your income.
Any of these can reduce your INCOME, thus your tax. Perhaps your business should be stockpiling gold offshore for future use. Talk to your CPA or attorney to see what can work best for you, but start jumping soon!
Hi,
i live in Germany since 2001, and things do not look that good anymore. But the funny thing is no one seams to react … little by little it is getting worse …
I would be intrested in knowing where to go, if you could comment please.
To me it seams that all ? countries is in to QE, if you belive the news…
So, you have to take care of your own lot best as you can. i once heard that one of the riches men in France pays only 1 Franc in taxes, as he has his accounters and lawyer do the trick for him … but i guess that you have to have some pocket money or connections to pull that of.
Anyway, thank you for your view points and tips, you have a realy great publication
NOW! I have been in contact with the lawyers I met at the Casey Conf in LV in March. They are standing by for my directions. I have ordered Nestman’s book, and am waiting to receive & review it before executing a planned move to Panama, as I don’t want to make any mistakes or have to do anything over.
We have already been down and found where we want to live. Moving business entities and money is more of a concern.
Simon, I enjoy every missive you send and have to react to this one because it strikes a chord in me and I’m in full resonance.
My boiling point? I reached it at age ten. No kidding. When my family members think of me, they remember the little boy who wanted to break free and become a world citizen, on board his plane, circumventing the globe. I have done just that and being married did not hold me back. But it all isn’t very surprising: after all as a European I was born in the boiling water…
Comments such as those of HGHdoges above call for a strong reminder and as a European I am well-positioned to deliver one: if the inhabitants of the US&A (not really Americans for most of them) don’t get it and what the implications are of what is currently happening, then maybe they should look at Europe and ask themselves if this is really the kind of bullshit they want to swim in. And if it is, they should just as well get it good and hard. If 5000 years of history and the repeated disasters it is made of could not teach them, nothing will. Unless…we get more Simons out there.
ron paul needs to find and tutor a younger version of himself, (if there is one) and start to promote his ideas via this person, besides himself, unfortunately ron cannot be elected, but this “new” person will.
Ron Paul has a son, named Rand Paul. (Interesting name, I think, considering Ayn Rand and all!)
I am broken, but not broke. My feelings of brokenness come from the slow realization over the last few years that almost everything I was taught is good about this country is either demonstrably false or has been corrupted beyond recognition. I am thoroughly disgusted at the incompetence of our leaders and the apathy of the sheeple. The situation makes one want to believe the conspiracy theories that abound. Rather than march against, I think I will march away. I have lived abroad and have many places and friends I am comfortable with, especially in Asia. Given the new prominence and power of the region I think I might like to be there again. Panama is definitely a good second in my view and I will be checking it out soon, but it seems more geared to retirees and folks who want to be near the US. Frankly, I have business to conduct yet, and I want to be in a dynamic region with many opportunities. No matter what, I want to be happy and in a position to fix my heart; broken from watching my beloved country self destruct under the weight of its own idiocy and hubris.
Simon thank you for your work. I owe you many beers…
ZG
Simon,
I’ve reached my boiling point. That is why I currently own a building lot in Costa Rica. I plan to go there in the near future and rent a place to stay. If the current health care bill passes congress, then I’m out of here. I have had lots of surgery. The problem is that you are always a U.S. citizen. Ducking citizenship requires you to give up a lot (I don’t know if it is half of your net worth or $500,000.00, but it is very expensive). I am retired and most of my assets are in an IRA. My wife and I are very conservative, and are disgusted with most of what is happening on the congressional front.
Harry Schutz showed the way many years ago:
1. leave the country were you were born and live in another suitable country.
2. residence in another country.
3. money in a third country.
The advise seemed obvious, so I took it many years ago and never looked back. I enjoyed it even if it is not easy. Most difficulties are in the organization of the thing, that is much more complicated than what may appear at the beginning. There are however many advantages: you’ll know the world and enjoy it and you’ll survive personally and economically. You have a full right to fight for your survival. It is a jungle! But it is ok. There is fun in this total freedom. There are no lions around anymore, but the bloods and crips are an interesting animal. In Panama we have the “ninos asasinos” variety. But the bigger beasts are the various governments, like huge dinosauros devour everything they can touch. Is that bad? Not really. Just keep yourself far from them. After all the jungle is changing very fast lately. And I suspect our dinosaurs will find it harder to get enough food to keep themselves alive.
Wow! I see just about all the usual excuses trotted out in these 13 comments! Why make it so complicated? If you are happy where you are fine. If not, do something about it!!!
- Kids can move a lot more easily than adults because they don’t have so many preconceptions.
- If you have farming skills you are better positioned than most of us to survive anywhere on the planet.
- If you don’t have money, you can probably find somewhere much cheaper to live than where you are now, with much greater opportunity, so you will then have money!
I don’t see any need at all to wait until you reach breaking point to do something. But I think the point Simon is trying to make is that it’s all about perception. Simon can and will empower individuals with tools and practical information. But I think what he is saying in this article is that it really has to come from inside YOU the individual.
But then, maybe I’m biased as I checked out of the nation state system when I was a teenager…
If any of you have read Doug and now his younger disciple Simon you should already know what to do — act. I’m in my 40’s with a family and not of great wealth however I’m convinced “this is it.” There’s no turning back for the US to a day where freedom reigns — won’t happen. Einstein apparently said: Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.” Actually I see a third thing and it is self-delusion. In this case it is the delusion that we’ll muddle through, that somehow it won’t be as bad as the Great Depression. Well, stop lying to yourselves because when you step back and take a look at the unbridled debaucery (The other night, Fox news was discussing Michael Jackson’s multi-colored pecker on prime-time news for crying out loud!), corruption and gluttony at all levels of society the US needs to collapse and be recreated to something else. Take the steps now to protect yourselves so you at least have options. All US-based everything means you have none.
I would suggest everyone read this book the answer lies within one self.
How I Found Freedom
in an Unfree World
Harry Browne
i
Boiled over last year. Visited Panama in Oct. moved here with 3 teenagers in Nov. It is getting close to Now or Never Time. Jump in the water is fine.
Great comments today, everyone. I’d like to interview some of you who’ve actually taken the step of internationalizing yourself whether that be full expatriation or even just a relocation of assets and/or time.
Real stories of real people would be quite inspirational to our readers.
Let me know if you’re interested by posting a comment on the contact us page:
Matt and Simon
My personal breaking point? We’re almost there. What would get me heading for the exits are:
1. Significantly more onerous capital controls such as currency restrictions, heavy investment regulation or outright bans.
2. The mass registration, control or confiscation of guns. There is only one reason to do that and it demonstrably is not to protect the public.
I’m sixty and retired. If I were younger, I’d already be in another country where business is encouraged, wherever that might be. If I were younger I’d have little to lose by renouncing US citizenship. Now, I have too much to lose. I won’t start another business in this country because of the government risk. Though I have the energy, capital, contacts and more than enough experience to begin another enterprise, it’s far easier to be retired and live off my investments.
Hello, Simon,
I am not certain that many of your “subscribers to this letter are a cut above”, as you say. I will tell you why I say that…
Judging from today’s (Thursday) comments, some are too bitter to be able to see what is going on around them. They want revenge rather than salvation of their own thinking and doing.
Others want everything done for them, i.e., that YOU should write everything for them to do. How can you possibly do that when everyone is different in most ways?
Still other makes excuses of various kinds. I give you that each of them has valid points of conscience, but somewhere along the way you have to make a break. That is to say, if you are concerned about leaving relatives behind, take them with you. You will actually be saving them from misery in due course.
I did not wait to find my boiling point. I found my disgust point first; disgust with ALL government antics at ALL levels; the lying and cheating of politicians and banks; the misrepresentation of themselves by politicians; government borrowing to pay off debt…(there is no limit to stupidity); the obvious foolhardiness of the people in their attitude toward personal debt; and the list goes on.
Regarding debt, most people could not move because of their mountain of debt.
My first realization of how things in government and with Man work came to me as I stood in a sheep yard in 1962, watching a large flock of sheep eat and drink. From then on I’ve always looked behind the curtain. Or at least as much as I can.
A friend of mine has a good collection of guns and he uses them to hunt with. I asked him when he going to use his guns to protect himself. He said he will use them when the government comes to take them. My reply was that by then it will be too late. The same is true with every other aspect of American life when the government decides to move against the people in earnest.
So I vacated the premises not when I found my boiling point but when my disgust point got too much for me to want subject myself to it any more. It was a considerable project, but it was doable and has been worth it because I am freer in a beautiful country, I feel unburdened, I am absolutely happy, and I live for half the money without changing my lifestyle one iota.
I suggest that your readers do their own reading and research, not to rely on you, Simon. I do not suggest tourist-type books. They are not what you are really looking for if you are searching for a place to live. The library is full of books.
Make a complete list of things desirable and undesirable to you that will give you the things that you want to make your lives happy and useful in your new country. Write down absolutely everything you can think of.
The Internet can deliver to you all kinds of information on almost any country. Most countries have official information just waiting for you. But in all of your searching you must dig deep to find the specific things you want to know. There are all kinds of online pictures of many countries.
With proper research you should be able to narrow down to one or two countries that seem most suitable to you.
In the end you should make an exploratory trip to countries that interest you, just to be sure. You aren’t there as a tourist, you want to learn things that will immediately be useful and beneficial to you. You can visit art galleries, museums, and cathedrals later if you decide to move there.
There are many other do’s and don’ts and must do’s that I wont take the space to go into here.
I urge all of you not to give up on escaping. At some point in the future it will be too late.
I have been self employed my entire life. I live in Iowa and watch all the favored classes, farmers, unions and teachers, receive benefits at the expenses of everyone else. We have a high income tax rate (9%) and very high property taxes. yet we have no jobs and miserable weather. Our governor wants to import more immigrants so he can expand his voting base.
My breaking point will come when the government wants to take my 401K and IRAs so that the non-producers on this world will have a retirement income. While I complain about living in this high tax state, making the break is still difficult due to family and the uncertainty of change. Leaving the US is nice to talk about, but it is difficult for most of us in the middle. Not enough money to feel secure and making to much money to get any benefits from the give away government we have now. It appears the non-producers of the US are winning the battle. Eventually the producers will just give up.
Rick, I’m an Iowa boy myself and have never been a member of the ‘favored’ class. In fact, I still have a home there although I’m hardly ever there and certainly don’t claim residency in that unforgiving jurisdiction. Making the break is hard, but perhaps not as hard as you might suppose. Being a “self-employed” man, you’ve already done the heavy lifting by being self reliant. Simon and I will endeavor to provide you with more examples of people who have internationalized their lives. Many of our subscribers have. It doesn’t, by the way, mean you have to permanently leave the US. Baby steps.
Attn Subscribers: if you want to share your story of internationalization fill out the comment form here. We’ll get back to you and schedule a phone interview.
Mmm. Interesting comments here.
I grew up in South Africa. Spent most of my childhood running around the streets without a care in the world. No high walls, no guard dogs, alarms etc. I remember moving to a house that had a burglar gate over the front door. This when I was 15. By the time I finished school at 18, just 3 years later, we lived in a gated compound with six foot high walls topped with electric wire, 24 hr patrolling guards with shotguns, panic alarms etc etc. We boiled slowly.
Not until I left the country (immediately after completing school) did I come to realise exactly that I was being boiled. The decision was then made instantaneously. Black and white.
The thing is that everyone (friends and family) talked about it, and much like all the comments above, everyone came up with the “when xyz happens then thats it” scenario. You know what? That in itself is self delusion.
If you see a great big wall of water coming at you across the bay do you say “when that thing gets too the dock then thats it!!”?. Well that’s exactly what most people do and many are doing on this forum. Don’t delude yourself, there is no perfect time to do anything. You can always make as many excuses as you like but at the end of the day you either decide or you don’t. To decide means there are no if’s or but’s, you cut off all options. Once you decide thats it. I have found this personally to be something that one needs to keep working at. Never to be complacent. It runs through business, investing and all other life choices including marriage children etc. For those of you with children think of it like this. Once you had your child or children was there ever a time that you would have considered letting them get in harms way? It’s simply not an option. You would sooner die. That is deciding.
For those that think that opting out of citizenship is too expensive, ask yourself this question. Which is better. 50% of something or 100% of nothing. There is absolutely no way that it is going to get easier to renounce. The wall of water can’t recede but only gather strength. At some point its power will be vanquished but not before those in its path are decimated.
Incidentally I now have 3 passports, live where I want to and am always vigilant. Nothing is linear, certainly not the future. How do you do it? You decide to.
Dear Sir Me,
Bravo–and would you mind saying which if any other African nations you hold passports from?
VisitedJohannesburg not too long ago and chafed at the “security” situation–a situation that was half created, half allowed to develop. Nevertheless, I think there could be places in Africa with a world of potential, and your candid assessment would be much appreciated.
hello Simon Black,
Your message is right on the mark.
This is goes right along with the forced vaccine ambush which is upon the world and the USA.
I heard this on the Alex Jones show today, 7/16/2009
Demand Protection from Mandatory Vaccination, Drugging or Sanctions, Including Internment and Support for the Right to Self-Shield In the Event of a Pandemic. We must get the third option passed into a bill where people can refuse vaccination and internment, and choose self-quarantine in their own houses.
Hello Simon,
I’ve been a rebel most of my life to some degree but 911 was the breaking point for me especially after watching a memorial service performed in Washington DC while the camera was paning the audience of mostly people in officialdom I could see clearly through the facade of facial expressions. The message was very clear that we all have been screwed once again. Up to that point I had at least some hope that consciousness would prevail. That hope was finally put to rest as the stark reality of the event was undoubtedly in my face. Three years later I was living in Australia. My International Man learning curve is expanding. My next exploration will be in various parts of South America. I’am a young senior with plenty of zest for life and would like to get involved with sustainable and creative endeavors that expand awareness and have a damn good time doing the rest of my life in as much freedom as possible. Look forward to learning more. Thanks for your spirit of freedom.
Roberto
Dear Simon:
I feel the same frustration you seem to. I too Served my country in a war or 2, as did my father and brother. I have spent my life trying to work and provide for my family. Then I ran a foul of the system and was screwed beyond belief. I have in fact reached my breaking point and am reviewing options. Sadly, I only see one that has any hope of doing some good for my fellow citizens, and waking the average man. I would love to see more of your comments. we have much in common.
I am 29 years old and I have lived in 6 countries so far. I lived in the US for the last 9 years and when I saw the imminent collapse of the American empire, I decided it was time to go. I like the US when I was living there…but there sure were a lot of frogs…no one was shouting from the rooftops when the WMDs were not found or when the IRAQ war started without declaration of war from Congress. You also lied to yourself about 9/11, but I guess it is just the nature of empires. All must come to an end when overextended and it’s currency debased. Those are all clear signs that people chose to ignore which is why they have to suffer the consequences, which is also why I was happy to get rid of my green card and leave the US for good. If you think I sound anti-American, then you still have your heads in the sand. As for the where, when and how to move out of the US…take some responsibility for yourself for once in your life and do your own damn homework. Don’t always look to someone to point out to you where liberty is…
Confessions of a Economic Hitman
http://www.youtube.com/watch?v=oARBdBtGenM
Simon,
This is my final post in Dr. Gary North’s forum, in reply to my question in which I asked for banking ideas for becoming an Expat family to either New Zealand, Panama or Costa Rica. In my opinion, getting out of the US yesterday can’t be too soon. . . Here is my final comment after hearing back from several people saying that I would be making a tragic mistake, though there were a few good answers giving me a little support, but no real ideas on how to bank or move physical bullion. . .
“After digesting and mulling over all of the replies, and considering our own research, we are still going to expatriate. Most likely via Panama which has a very generous expat pension visa (with built-in safeguards), a great cost of living, an excellent health care system and a bright economic outlook for business and investing. From our research and talking to other expats (there are about 25,000 Americans there already), we will be able to live quite comfortably on my husband’s pension and not dip into our savings–maybe even be able to put some away. (We certainly can’t do that here in California!)
If we find Panama is not for us, then our next move would be to New Zealand and get our residency via investing in a small business. We’ve since found out that we would most likely be granted residency if we do so and can show a profit. We also have some friends from New Zealand (living here in CA) who have said they will help once they go back next year.
Our main goal is to get a second residency/citizenship, and stay gone until America works out its “issues”. As a former Air Force member, and my husband being a firefighter–this does sadden us to leave all we know and the America we once knew. Although this is something we wish we would have never had to consider, we are willing to take the chance to be able to give our kids a decent future without billions in debt tied to their SSAN, a broken health-care system, a broken education system, and tainted, chemical-ized, genetically engineered food and water supplies. In addition, we get to leave behind an ever growing big-brother and police state, an anti-parental rights state, ever increasing costs of living and taxes, and unchecked illegal immigration. Yes, there are still a lot of great things about America, and we know there will be potential problems of similar nature or others that we are not even aware of yet in another country. However, it seems that many other countries do not have the myriad or scale of problems the US does at this time, and hopefully in 10 years, when our kids are of age, it will have gotten better again. (Unfortunately, I do think it will take at least that long to fix all our problems. . .) After carefully weighing everything out and doing a pro and con list, we believe that what we will temporarily lose will be worth the potential gain, or at least the potential peace of mind.
P.S. This must also be in our blood–I remember all the stories my grandmother told me about her and my grandfather leaving Germany in 1920. She said her family ended up throwing their German Marcs into the fireplace for warmth because they were worth literally nothing, and how some people plastered them on their wall as wallpaper. They came to America after they lived in France for a couple of years (and decided it wasn’t for them), in their early 30s, with four children (one born on the boat just as they arrived at Ellis Island), and not knowing a lick of English. However, they already knew German, Polish and French, and learned English as soon as they arrived. They ended up investing in a bakery, bought some real estate and, in the end, left the earth with 102 grandchildren and great-grandchildren as a result of their decisions. Some of their relatives and friends in Germany were not so lucky. They also helped many less fortunate people through the depression with left-over food from their bakery, and when someone couldn’t pay their rent, they didn’t kick them out. I don’t know if they were naturalized citizens yet at that point, but they embraced America whole-heartedly and immediately got to work by learning the language and then worked very hard and made good investment decisions. My husband’s family is the same story–they settled in New York from Ireland to find a better life and to avoid starvation in the 1800s. So, I believe we can do this and I believe it is the right decision. Our grandparents were smart enough to see the handwriting on the wall, and I think most people here are also–they just don’t want to. Does that mean I think everyone should do this? Of course not, but I do think everyone needs to prepare according to their situation. If we did not have kids, we would stay and fight to get back the America we know will be one day again, but when you have kids, (as those of us who have been blessed with children know), everything changes. This is for our children and for our economic survival.
Guys,
My Breaking point was in Kindergarten. I may not have realized the finer details of what it was that I disliked, but I new that this State run organization was not for me. It nurtured the weak, and shackled any real free thinking.
Over time I became numb to it. I got into less trouble and got good marks and excelled athletically and socially so…whatever…I was part of the problem…just going along and getting along.
In University I met my wife, a Japanese woman educated from an early age in Canada – very international up bringing compared to mine. Here parents had recognized the down falls in that country and wanted to expose their children to something else. We met, I graduated and moved there for a couple of years. Going in, I didn’t feel like frog soup…coming out I was ready to fix bayonets. We returned to Canada and that is when it really hit me. I saw this nanny states down falls clearly
I have bank accounts there and a home base and some gold under the mattress, friends and family. As a white foreigner who speaks the language badly…it’s not my first choice if the shit really hits the fan and we get WW3…but it is a Choice other than my “Home and Native Land”. I want more choices.
In my twisted view, Canada has a very high quality of life due to HUGE amounts of natural resources per capita. The Country has 33 million people or so. It is easy to run a dumbed down welfare state when you have what this land mass has. But, when the UN holds Canada up high and plugs the virtues of its programs, I fear for the world. Brave New World. Here’s your check, go get your booze and pills and your MSG, watch your porn, sports and video games and shut the hell up!
Many things have happened here over the decades and nobody kicks up a real fuss. We had our War Measures Act long before the Patriot act (Trudeau used it) and nobody really cares. The official Secrets Act is as heavy as it gets if you get in its way. George Radwanski was the privacy commissioner under Chretien and he began to alert the people of some of the V for Vendetta-like protocols Canada had on the drawing board and he was pushed out in days – over night scandal, Media Falls into line and pumps a story of him “OVER SPENDING ON HIS EXPENSE ACCOUNT” (talk about the pot and kettle). The people bought it and he was out – no more resistance to video surveillance, bio metrics, ID cards, national Data Base, the works.
Anyway guys, I’m starting to breath heavily and sweat here so I’ll wrap this one up.
I must take this opportunity to thank you both for the invite to Stompernet. I can;t make this one, but just receiving the Ad copy letter was helpful (great ad copy) and I now have more resources for my Internet Business research. Anything else you guys have is always appreciated. I am impressed with you service.
Travis
I’m a bit skeptical about people claiming they’re going to renounce. Less than a thousand people a year do it, and if you look at the fed web site that displays their names, most are obviously not USA natives. Who is actually going to be part of that (say) 300 gringos a year that are legally cutting the cord? And slim chance any consular officer will grant you a visa after doing it…once you leave, it may be decades before you can return again.
If you don’t renounce, and just physically leave as most expats do, you’ll no doubt eventually be compelled by circumstance to stop paying US taxes. Then you’re a felon who is a citizen of the world’s most powerful government, one which is desperate for revenue, in an ever more computerized world. Legally expatriating is easy to talk about, quite another thing to actually do.
Where did that fifty percent exit tax rumor get started? There has never been any exit tax, until a year ago.
http://www.govtrack.us/congress/billtext.xpd?bill=h110-6081
Prior to that, renouncers were liable for normal income tax (not an exit tax) for ten years, but it only applied to US-source income.
The exit tax that was passed last year is 33%, and it’s only_on_unrealized_gains, not on net worth. The first $600k in unrealized gains is exempt. How many readers of International Man have more than $600k in unrealized gains? Even for those who do, one can just sell part of one’s assets–enough to get the unrealized portion below that threshold–and pay capital gain rates on it, which are of course less than 33%.
I agree with the tidal wave analogy of commenter “Me” above; the number of people renouncing will remain miniscule until it becomes obviously necessary, at which time the law will very quickly change. It’s only viable if it’s done before the rush, which means very few people will do it successfully.
Anyway, some tips:
Know the law, which is all on the internet on .gov websites. You won’t be taken seriously if you don’t know which sections of legal code are applicable. For example, there’s an IRS form that has to be filed, though you aren’t required to present it at the embassy.
Consult a US lawyer regarding the law as it applies to expatriating…or at least have the name of a US law firm that you can claim to have consulted with. You aren’t required to have counsel, but you don’t want to give the consular officer any pretext to treat you like a nincompoop.
Make the appointment by couriering a calm, thoughtful letter to the head of the American Citizens Services Section (you can get the person’s name from the embassy website). Do not do it by phone, or, worse yet, as a drop-in visitor.
When you phone to make the appointment, ask for the secretary of the person you wrote to. If the operator tries to get you to talk about what it’s in reference to, say you need to discuss a matter which you have already explained in detail in [courier company letter #] which was received on [date] and signed by [signer]. Emphasize that you are a US citizen and that you have already initiated contact.
Some consulates won’t perform the paperwork on your first visit; they’ll treat you like a loon and insist that you reflect on it for a few weeks. Be cool and businesslike. They can’t refuse to do it, but they can do it on their own schedule. They personally don’t give a rat’s derriere about your renouncing, but they can’t let Washington think they’re processing it without at least token resistance.
You need not only your second passport, but also your naturalization paperwork. Bring everything. (“Instant” citizenships [aka "banking passports"] are useless. Vince Cate pulled it off in ‘98, but that won’t work anymore.)
Some embassies have a long queue for expatriation (wait a few years to begin your expatriation, and maybe the queue will be years rather than months), so you may want to go to a different country to renounce…but wherever you go, they’ll give priority to people who are legal residents there. Also, they’ll want to hear that you’re going to be there for at least a year, because part of the process is to courier your CLN (Certificate of Loss of Nationality) and canceled US passport to a local address; they won’t send them outside the country. “I’ll be leaving for short periods of time, but mostly I’ll be here for 18 months” would be a good thing to say. In reality, once the CLN is generated, you’re home free, whether you have it in hand or not.
The law doesn’t require you to give a reason as to why you’re leaving, but they probably won’t process the paperwork unless you do. Rather than fruitlessly argue, have a brief, emotionally-neutral statement prepared as to why you’re leaving. If they ask you to expound, just keep calmly and slowly repeating it in different ways, like a politician. Do not allow yourself to be put in a position where you’re justifying yourself. Expatriation is a right. It’s not at the discretion of the consular officer
Have extensive chitchat well-memorized so you can talk at length. Remember that the staff may feel obligated to pad the interview time-wise.
Take a strong stance that you’ll never enter the States again. Don’t give them any pretext to say that your words demonstrate your lack of commitment, or that you’re at risk of slipping back in illegally. Any mention of the possibility of returning on a tourist or business visa gives them argument material.
Think what you like beforehand, but this is going to be an emotionally intense experience. Unless you can honestly say you’re tough, bring an imposing-looking lawyer or paralegal as a witness. He won’t be there as legal counsel (this is going to be a local, non-US person…a US lawyer would charge you a fortune to attend an expatriation). The embassy staff will treat you with much more respect–and is much less likely to try to get dramatic to try to make you tremble and back down–if you have someone on your side of the table.
Keep the tone relaxed and pleasant. The embassy staff has enough annoyance in their lives already…they’re fed employees! Shake hands at the end. Wish them well.
The embassy will forward the paperwork to Washington. After many months, Washington will tell the embassy it’s approved (Washington will have checked with IRS to make sure you’re current on tax returns, do not owe money, are not in the process of being audited, and of course they’ll also check with FBI to ensure you’re not a fugitive, on parole, in arrears on any court-ordered payments, etc.), and the embassy will create your CLN and return your US passport (it’ll have holes punched in the cover, a “canceled” stamp inside, and of course will be flagged in the databases as canceled.)
You may want to FedEx the form to IRS just before you go to the (second) embassy appointment. Showing the FedEx receipt to the consular officer will satisfy him that the IRS paperwork has been taken care of. This is easier than trying to convince an ignorant consular officer that you have no legal obligation to show him the IRS form (which shows the breakdown of your net worth).
The legal expatriation date is retroactive to the day you signed the oath of renunciation, or the date Fed Ex shows IRS received your expatriation tax form, whichever is later. Your renunciation is virtually assured of being approved. Rejections involve foolish behavior, like the man in Puerto Rico who claimed the right to continue living there despite its being a US territory. Of course, there’s always that small chance expatriation gets banned while paperwork is in the pipeline. But, good news, you’ll get your US passport back, non-canceled! Maybe with a gratis IRS audit as a bonus. Barring that, income after you renounce is non-taxable, even if it occurs before the CLN is generated.
But, really, who is actually going to renounce? Nestmann (presumably) hasn’t, probably nobody at Casey Research has, Messrs. Smith and Black (I assume) haven’t. Big, scary step.
When? About high school, in the 60’s, I thought the US was going to the dogs and probably wouldn’t turn around. Active action really started as soon as I could get an early retirement in 1997 (at the age of 51). We shifted to New Zealand in 1999. And it’s been a good decision. But here’s a turn your other readers may not expect. We’re now working on setting up a crib in Panama, because NZ has many of the same problems fundamentally as the US does. No, it’s not bought into the bubble government finances mania, and has much going for it, but it’s derived from the same culture. Debt (personal and corporate) is out of control, as are unfunded future promises for welfare by government. And it’s already got gun control and socialised medicine, and is run by a much less-limited central government.
And in truth, I won’t be surprised to feel a need to look for another place sometime after that as things continue to change in the world.
Oh. As for kids. Our ancestors came to the US with very little or nothing, and brought the kids. And I understand archeologists believe our species has been doing that for millennia. So it’s presumably still in our genes. The kids don’t seem to me to be the ones who have trouble adjusting to a new language or culture.
As for finances, combined, my wife’s and my pensions are around $35k/yr gross–and we pay one very large part of that for health insurance, so far at least. My wife went back to work teaching in NZ at about half the salary she got in the US, and paid a higher proportion in income taxes. Yet we rebuilt our cheap and dilapidated house, had a lot of fun with new friends and exploring. We’ve also done well enough on investments (mostly staked by what we made on selling our house) to now afford this multi-country lifestyle. We pay income taxes to BOTH US and NZ. And there are a lot of folks living in NZ, Panama, and other places we’ve been on less income and living happy lives. If you choose what toys and hobbies you can afford, life is a lot easier. Life’s far too short to do all the inexpensive fun stuff alone, anyway.
Relatives? Like most folks, our relatives are scattered across the country. It’s not much more expensive to fly from NZ to a smallish city in the US–let alone several of them–than it is to fly from one smallish city to another. Besides, when was the last time we saw some of them? Years. But we didn’t travel all that often visiting each other when we lived in the US, either. And Skype really shrinks distance.
Finally, the rules are tightening on immigration in NZ, and I’ll bet most places. You may think you can wait until the last minute, but so are a lot of others, no? From decision to arrival at our place in NZ took us a full 6 months, and the house was already sold. It took, literally, 6 months before that to get permanent residence visas, which we got before we even visited NZ the first time. (No point checking it out if we couldn’t live there, no?)
For me, moving away was partly for adventure and the lifestyle. But a part was I am too risk averse to want to stay in the US. Every time we come here, it’s feeling like we’re climbing on board the Titanic. So we enjoy ourselves and the parties and champagne on offer here–but keep our personal lifeboat (home offshore, some currency, and return tickets in hand) well in sight. So I guess you could say we are willing to put up with the risk to see the grandkids.
Do you love liberty, or not? This is the basic decision it came down to for me. We may not live in an ideal country, but a multi-country option is a lot more free than being stuck in one. And that’s true whichever country you’re in of the sorry lot of alternatives out there these days.
“Bob in NZ” (but temporarily now in NM).
Regarding shorting Swedish banks, what about shorting the ETF ISHARES MSCI SWEDEN INDEX (EWD)? I realize it’s not just comprised of bank stocks, but Swedish companies in general.
Regarding the US health plan, most people don’t realize that it will seek to reduce expenses (2 trillion dollars) by having non-medical administrative personal determine if a patient has sufficient worth as a human being to warrant the cost of care. The cost/benefit ratio may be negative for the elderly, chronically ill, etc. The focus will be on cutting costs, not treating people. The Nazis had a similar policy.
The Declaration of Independence does not share the same ideals as the Constitution. Patrick Henry was right in saying that it would lead to large tyrannic central government. Another jerk by the name of Lincoln took care of the concept of States Rights. The 1960’s really showed the tyranny of government. This was promulgated by allowing the uneducated to vote themselves benefits from the treasury as promised by their representatives in Washington, DC to keep getting elected. I had enough in the Carter years, as soon as I could get off the floor from laughing. I unfortunately am not independently wealthy, and need employment or a business of my own. I am seriously looking at Ecuador and Brazil. It is ironic, my grandfather left Lithuania in 1909 and now a hundred years later it may be time to return. In my case the gun is in the process of being aimed at a target. Once that target is found, pulling the trigger will not be a problem.
I’ve been searching the previous posts for something I recall reading about second passports and being adopted, even if you’re an adult, by a Spanish citizen.
If anyone recalls which post, please let me know.
We crossed our Rubicon some fifty years ago. When the nest was empty, Atlas shrugged. It is an up hill battle, but the wagons are circled. We choose to weather the storm. We the people will prevail.