Why protecting the Homeland is destroying the economy

January 13, 2011
Santiago, Chile

Yesterday evening I was walking around the beautiful tree lined streets of Providencia, one of Santiago’s central upscale districts.

I might as well have been walking around Berlin or Strasbourg– Providencia is a clean, highly civilized area with plenty of parks, cafes, and boutique shops that adjoin the neighborhoods of manicured homes and quiet mid-rise condominium buildings.

On the streets its common to see a host of walkers, runners and bikers– Santiago is a very ‘outdoors’ city, much like Austin or Vancouver, and with such beautiful mountain vistas and great weather, it’s easy to understand why.

What’s interesting is the number of languages that you can hear being spoken while walking around town– the varied nationalities that have made Santiago their home is staggering for a country of this size (17 million).

It’s common to see the token French, German, British, and American expats… but in addition you come across people from all over the world– Africans, Taiwanese, Thai, Russians, and even Iraqis.

Chile has become one of the countries in a growing list that welcomes foreigners with open arms– people who are willing to work hard, add value, or bring in capital are respected and treated well.

This is the same approach that has worked in places like Hong Kong and Singapore; these are two countries where just about every nationality on the planet can enter without a visa.

Propping the door wide open for foreigners provides significant economic benefits; people are more likely to visit (and spend their money) in a place where they are treated well, and they’re more likely to do business in a place where they feel comfortable.

The exact opposite end of the spectrum is the United States… and to a growing degree, the UK. Foreigners who arrive to the US are subjected to discourteous, disrespectful measures and made to feel like lowlife criminal terrorists.

For many, it’s an absolutely horrific experience.  Maria C., the Chilean lady who owns the apartment I’m renting in Providencia told me yesterday about her most recent– and last– trip to the United States.

The Department of Homeland Security decided that, instead of being a well-respected Chilean national attending her Harvard reunion, she was a suspected Colombian drug trafficker. DHS detained her for over 12-hours, confiscating her purse, her passport… even her shoes.

She was continually interrogated by DHS officials who played good cop/bad cop mind games, and when she was given ‘permission’ to use the bathroom, it was under close-up video surveillance. They finally released her without so much as an explanation, let alone an apology.

Maria’s story is unfortunately common; Homeland Security’s Customs and Border Patrol division takes itself way too seriously, and its uniformed chimpanzees are convinced of their own righteousness… that their actions are actually defending the homeland.

One recent story makes this attitude abundantly clear. It involves a Canadian woman, Lind Bird, who was stopped, searched, and relieved of her $2 Kinder Surprise egg by US border patrol agents.

Kinder Surprise eggs are a type of European chocolate candy, and they’re considered illegal in the United States because the FDA has deemed them a choking hazard for children.

The eggs are perfectly legal in Canada, and Bird had one in her vehicle as she was crossing the border. After a stern talking-to by agents, Bird’s egg was confiscated by the United States government, who subsequently sent her a 7-page letter demanding that she authorize the ‘destruction’ of the egg.

Stories like this are so ridiculous that they border on satire… and yet they’re entirely true.

Rather than wasting taxpayer dollars such nonsense, the US government should be rolling out the red carpet for all nationalities with welcome signs saying “Thank you for spending your hard earned savings in our economy… and while you’re at it, please consider mopping up our excess housing inventory!”

I mention housing because it’s such a massive problem; the latest census data shows that there are 19 million vacant homes in the US… and climbing. There are only a handful of ways to clear out this surplus.

First, the country can wait it out until a new generation of Americans comes of age, moves away from mom, and establishes a new household.  Given the country’s anemic growth rate over the last decade, this option will take years. And years.

Second, the excess inventory could be consumed by a sudden surge in Americans’ wealth that sends them on a shopping spree for second and third homes.

Considering that the government has spent a few trillion dollars to create a few hundred thousand temporary and low-paying jobs, however, this seems unlikely.

Third, foreigners could provide the much-needed influx of people and capital that are required to purchase and fill the surplus of homes. Given the way that the government has so distastefully mistreated foreigners over the last several years, however, those cries would likely fall on deaf ears.

Just ten to fifteen years ago, if the US housing market had been in a similar situation, foreigners from all over the world would have been lining up to buy cheap property in the states; there was no greater status symbol than having a home in New York, San Francisco, or Florida.

Today, foreigners understand that the world is a big place, and that there are dozens of other countries that will treat them like human beings, and offer attractive incentives to boot.

Latvia is one country already taking this step, offering EU residence to anyone that purchases real estate subject to minimum criteria (I’ll have a lot more actionable information about this in our upcoming edition of Sovereign Man: Confidential, due out this weekend).

Meanwhile, the US government will continue to treat visitors like criminals, scare citizens about terrorist threats, and wrap itself up in a blanket of righteousness… all while failing to realize that instead of protecting the homeland, these policies take an active role in the destruction of the economy.