Friday, August 17, 2012

Presidential Commission on U.S. Expats?

White House
Hello, anyone home?
Photo by Chris Christner
The New York Times writes about a possible Presidential Commission on U.S. Expatriates. I welcome this, but I'm concerned when we consider Obama's campaign promises to expatriates in 2008. He promises to address expat concerns in several areas:
  • Strengthen Economic Security for Americans Abroad
  • Responding to Social Security Concerns
  • Citizenship Transmission
  • Voting Procedures
  • Census of Americans Abroad
  • Concerns of Americans Living Abroad
  • Other Governmental Services and Benefits
He has addressed none of these issues. Not only has he not followed up on this, Obama signed FATCA into law, making our lives much worse.

If you've not been following along with the FATCA debacle, here's a brief and somewhat misleading description of what's going on:
  • The US passes a law demanding all Foreign Financial Institutions (FFIs) turn over American account information to the IRS or suffer massive penalties.
  • As an incentive to comply, the US offers nothing.
  • FFIs discover it will cost them millions to change their computer systems to comply and that such compliance can break local laws.
  • Many countries object, so US offers many of them "reciprocal" treatment: give the US the data on our citizens, and the US will return the favor.
  • US banks start objecting en masse because it will cost them millions to change their computer systems to comply.
  • US considers not honoring reciprocity agreement. Germany politely responds "f**k you".
If nothing else, you have to ask how arrogant the US must be if it feels they can demand that every FFI on the planet submit to IRS authority. At this point, it's very much up in the air regarding whether or not FATCA is going to go anywhere, but that's a story for another time.

From the NY Times article cited above:
“Right now, there’s no systemic focus on issues dealing with Americans abroad, and their numbers just keep growing,” said Representative Carolyn B. Maloney, the New York Democrat co-sponsoring the legislation. 
Ms. Maloney, chairwoman of the Americans Abroad Caucus in Congress, said the level of concern she had been hearing from expatriates was “the worst I’ve ever seen it.”
It's getting bad enough for some expats that the number of Americans renouncing their citizenship are hitting historical highs. What's more, these aren't anti-Americans. These are not hippy/political protester types that many Americans back home think they are, nor are they a bunch of rich tax dodgers. They're ordinary Americans who are angry that they're giving up their citizenship, but they feel like they're forced into it due to the increasingly punitive set of laws coming out of Washington.

So I welcome a Presidential commission aimed at trying to sort through the mess and trying to make things right for the estimated 2% of the US population that lives abroad, but there's no way this will happen before the upcoming election. If it happens after the election, I doubt anything will change. Neither Romney nor Obama have done anything to convince me that they care about Americans overseas. But then, why would they? We're hardly enough votes to sway the election.


  1. This Presidential commission is a kind thought, but it's not really needed since the problem is clear and visible. We need actions not more talk. It simply can't be that US policy results in Americans abroad having difficult refinancing their mortgages simply because they are US persons.

  2. One of the comments to your post of 2nd March 2012 said, "Once a person has residency [in another country] a passport becomes unnecessary unless a person wants to travel. Traveling puts a person back on the radar screen so staying in your chosen home country is best until you have citizenship and a second passport." I can't improve on that advice. The main problem US expats have is their exaggerated patriotism. Get rid of it! Nobody owes his birth-country anything.

  3. I know this is a "duh", but the rights of a faction of the populace shouldn't be determined based on their voting prowess. As far as I remember, Democracy isn't intended to be tyranny of the popular. Of course, in practice, I know that isn't the case. And I'm reminded of that every time gay marriage is assaulted in this nation.

  4. @Gordon: Thank you for the lexicon entry: "Exaggerated patriotism". I hope to use it soon, as it exemplifies one of my biggest pet peeves about tribalists.

  5. Paul Ryan co-sponsored a bill to eliminate the cap on the Foreign Earned Income Exclusion (FEIE) for ex-pats.

    At least someone running for the top positions seems to understand a little about ex-pat issues.