Tuesday, April 27, 2010

Renouncing American Citizenship

Let's be clear about something. A person who decides to give up his US citizenship is not guilty of disloyalty to America; quite the opposite. He could very well be more loyal to American principles than the regime is willing to tolerate.

It also does not mean that he is giving up hope for liberty; he may have great hope for liberty, in a different way and in a different place.

In any case, the rise of emigration, expatriation, and citizenship renunciation is a trend that is not going away. It is rising and will get more significant. In some ways, it is completely expected. When regimes over-control, over-tax, over-regulate, they gnaw at the innate sense of the right to be free. When this gets worse and worse, people tend to look around for better environments.

We've all known people who talk about it openly. It is becoming cocktail conversation, the once-unthinkable now standard fare. It's not just an impression. State Department records show that 502 people gave up citizenship in just the last quarter of 2009. That is more than twice the total for 2008. That might not seem like a lot but what stands out here is the trend line, which is soaring. I also hear reports of year-long bureaucratic delays in approval, and, of course, plenty of people leave without permission.

The driving factors here are not cultural or social; they are economic. The US government is making it ever more difficult for Americans living abroad, taxing them wherever the bureaucrats can find them. The government makes it very difficult even to hold a bank account in the US unless the account holder can point to a US residency (thanks to the Patriot Act). And when the government finds a reporting error on income earned overseas, it can charge a 50% penalty.