Legislative attacks upon the wealthiest 1% of Americans could soon wreck our economy.
by John Gaver
Fact: The top-earning 1% of US taxpayers pay more than one third (40.4%) of all federal individual income taxes collected. (Source: IRS)
Fact: The top-earning 1% of US taxpayers earn just over one fifth (22.8%) of all federally taxable individual income. (Source: IRS)
Fact: The top-earning 1% of US taxpayers pay more than half again (60.0%) more of the total individual income tax load than they did when President Reagan left office (1989 tax year). (Source: IRS)
Fact: The top-earning 1% of US taxpayers are facing frivolous lawsuits in phenomenal numbers, simply because our lax tort laws make them easy targets of opportunity.
Fact: The top-earning 1% of US taxpayers are in more danger of government seizure (forfeiture*) of their private property than ever before in our history, due in part, to the Patriot Act.
Fact: The top-earning 1% of US taxpayers are Leaving the USA at the highest rate in history. (Source: INS/Census Bureau estimates)
An insidious, creeping cancer is eating away at our economy. Not only the Income Tax, but other legislative and regulatory attacks on wealth are forcing many of the people who pay the lion’s share of taxes, to leave the United States and because of some of that legislation, they are now taking their wealth with them, thus very disproportionately reducing the tax and investment base in the United States.
The percentages cited above are not some bureaucrat’s pie-in-the-sky projections, but rather, they are the totals of actual IRS receipts, that are released every year, roughly 18 months after the close of each tax year. A link to the file on the IRS web site, containing the raw IRS data for this year (in Excel format) and an explanation of it can be found in the the companion article to this article, “1986-2007 IRS Collections Data by Income Category” (www.ActionAmerica.org/taxecon/irsdata.shtml).
Let’s start by looking closer at some of that IRS data and see how those numbers work out.
* There were roughly 141 million tax returns filed in 2007.
* The IRS collected $1.12 trillion in personal income tax in 2007.
* The IRS data shows that the top-earning one percentile of taxpayers (1.4 million taxpayers) earned 22.8% of the income earned in 2007.
* The IRS data shows that the top-earning one percentile of taxpayers (1.4 million taxpayers) accounted for $450.9 billion in income tax paid in 2007.
* Based upon that data, the top-earning one percentile of taxpayers (1.4 million taxpayers) paid over one third (40.42%) of the $1.12 trillion in total individual income tax collected by the IRS in 2007. We invite you to do the math for yourself ($450.9 billion / $1.12 trillion).
* Based upon that data, the top-earning one percentile of taxpayers (1.4 million taxpayers) paid almost double their share of taxes (1.7 times) in relation to their share of income earned. Do the math (40.42% of taxes / 22.8% of income).
* The top-earning one percentile of taxpayers (income over $410,096 in 2007) paid in excess of 60.0% more of the total tax burden than they did when President Reagan left office.
At that time their share of the tax burden was only 25.24%. Do the math (40.42% / 25.24%).
Since the original publication of “Tick-Tick-Tick – The Economy Bomb”, the earlier version of this article, in 2000, more oppressive legislation aimed squarely at the top-earning one percentile has made matters even worse. This of course, is creating a problem for the top-earning one percentile. But, before you start shedding crocodile tears for those poor top income earners, remember that these people are almost all problem solvers. To them, these new legislative attacks represent only a speed bump. To you and me, however, it’s quite a different issue.
You see, it is the wealthy’s legitimate and justified response to the problems being created for them, by lax US tort laws and a US tax structure that punishes wealth and virtually eliminates privacy, that represents a ticking time bomb that presents an even more serious threat to the remaining 99% of taxpayers. If you make less than $410,096 per year, then that’s you.
What’s wrong with making the wealthy pay more tax?
Many people who look at the above statistics will immediately say, “So, what’s wrong with making the people with the most money, pay more tax?” Some seem to think that the wealthy have, in some way, committed some horrible sin, just because they worked hard and sacrificed, in order to become wealthy and that such being the case, the wealthy should be forced to pay a larger proportional share of the tax burden, as penance for their perceived sin of success. Yet, others are suffering under the misconception (disproved by the IRS data) that the wealthy don’t pay tax.
Such absurd arguments are not only immaterial, but serve to show just how completely uninformed of the real problem now facing the United States, are many people, including many in the halls of government.
The problem to which I am referring, is a direct result of the position in which the wealthy now find themselves. The wealthy are being systematically backed into a corner by our government.
The wealthy are:
* paying almost double their share of taxes
* facing frivolous lawsuits by the greedy, in ever growing numbers (Yes, the poor can be greedy, too.)
* losing any semblance of privacy in their business transactions
* having their business dealings saddled with onerous Patriot Act and Sarbanes-Oxley Act requirements that often take so much time and cost so much money that otherwise profitable deals end up costing money, if they happen at all
* having their property confiscated (forfeited*) by the government, at an ever increasing rate
Everything for which those wealthy taxpayers have worked so hard, is now being threatened by the same government, whose job it is to protect citizens from just those types of abuses.
Don’t get me wrong. I’m not trying to make you feel sorry for all those “poor mistreated billionaires.” Frankly, I don’t care what you think of them. That’s because it doesn’t matter. I’m just trying to make you look at the situation from the point of view of the wealthy, so you will understand that what our government is doing, in this regard, can only make the situation worse.
So now that you are looking at it from the point of view of the wealthy, I ask you, should we then be surprised if the top-earning one percentile of taxpayers, facing an untenable situation, take the only legal route left open to them, even if such a response threatens the very fabric of the US economy? I’m not asking if you agree – only if we should be surprised at their response to these attacks.
Read on and then you decide. Their response is really quite simple.
The wealthy are leaving.
Since most of those who leave, are seeking privacy, they avoid leaving many trails. Therefore, factual data about expatriation is very difficult to come by. Due to that difficulty, in past versions of this annual article (prior to 2004), although we used a number of very reliable sources to come up with the best estimates available, at the time, we only presented the most conservative estimates. As it turns out, factual information that we uncovered in 2004, originating from the US Census Bureau, indicates that we should have been using the most generous estimates and even so, those numbers would have been well below reality.
According to the US Census Bureau, as reported in the “2000 Statistical Yearbook of the Immigration and Naturalization Service” (6.2 MB download), by the Bureau of Citizenship and Immigration Services (BCIS), formerly the Immigration and Naturalization Service (INS), the wealthy are leaving the United States in record numbers.
From that report: Approximately 300,000 are projected to emigrate annually in the 2000-2005 period. In the longer run, emigration is projected to increase steadily…
But, keep in mind that those estimates were made well before the 2001 terrorist attacks and the passage of the hugely anti-privacy Patriot Act, which indicators now show, caused even more wealthy Americans to leave. (And now we have TSA, Homeland Security, a national debt that will destroy America, and a Healthcare law forcing Americans to buy insurance under penalty of law. -Ed.)
It’s important to note that those numbers are only estimates. In fact, in that INS report report, they acknowledge that estimating emigration is very difficult, saying, “In some areas these deficiencies persist because of the inherent difficulty in estimating the numbers, as is the case for emigration and illegal immigration. As a result, no detailed tables on these two categories are included in the Statistical Yearbook.”
The reason why it’s so difficult to make such estimates is that it is known that the vast majority of expatriates (commonly referred to as “expats”) just quietly leave, without notifying any government agency of their leaving or of their destination. Expats often call this leaving “without notifying the jailer”. It should also be noted that, among expats, the popular term for expatriation is, “escape.” If expatriates feel that way about the US government, is it any wonder why they leave quietly?
So, although the Census Bureau numbers indicate that the number of US expats in 2007, may have been around 300,000, it is really quite likely that the number was really much higher. But, since there are no more authoritative numbers available, we’ll stick with the very conservative, 300,000, for our purpose. As you will see, even using that conservative number, a dire picture begins to emerge.
Granted, not all of those 300,000 expatriates were rich. But, think about it. How many do you really think were poor?…
How many do you think were even middle class?…
Personally, I think that it would be very conservative to expect that 80 to 90 percent were, at least, somewhat wealthy. But, don’t use my estimates. Use your own.
Just keep in mind that poor people come to the United States, mostly with their hand out and bypassing legal immigration channels, because of all the economic benefits that our government offers them, using our tax dollars. Why would the poor leave? In fact, for all of their protestations, even our middle class has it much better here than in any other country. The only class of people who can have it better in another country are those who are at least moderately wealthy – roughly, the top-earning ten percent (those who earned at least $113,018, in 2007).
Furthermore, that INS report indicates that we are now looking at the highest expatriation rate ever. Other data, such as records of citizenship and permanent residency applications at key foreign consulates, support these facts and some even indicate that the problem is much worse than suggested by the US Census Bureau.
But what’s worse, is that this exodus appears to have increased significantly since that 2000 report. Since then, we have had the 2001 terrorist attacks and a whole slew of oppressive measures, unrelated to fighting terrorism, that was inserted into terrorism related legislation.
The USA Patriot Act, two-thirds of which had absolutely nothing to do with fighting terrorism, created numerous privacy and financial problems for Americans – not just the wealthy. Other oppressive measures were hidden in the Homeland Security Act and other unrelated legislation since that time. In fact, before George W. Bush left office, he signed into law the first ever US “Exit Tax” (hidden in the Heroes Earnings Assistance and Relief Tax Act of 2008 – H.R.6081). Today, we are looking at the complete government takeover of healthcare, which will be paid for on the backs of the wealthy.
It cannot be denied. The wealthiest Americans see these measures as direct assaults on their wealth and they are leaving the USA for more wealth friendly climates, at the highest rate in history.
“So what? Let’em leave!”
One of the most absurd statements that I have heard, in response to the above facts is, “So what? Let’em leave! We don’t need’em! We don’t even want’em!” In fact, that attitude is not only contributing to the problem, but making it much worse.
You see, as a result of at least two of the laws, designed to punish the wealthy for leaving, the wealthy are now taking ALL of their investment capital with them, when they leave and therein, lies the true problem.
You see, when the wealthy leave and take their money with them, it creates severe problems for the rest of us, since we are the ones who have to make up the difference in lost taxes. What really surprises me is that even a few well-meaning conservatives, who realize that the real problem is Native Capital Flight, have fallen into the greed trap, right along with the liberals.
In fact, the most inane argument that I have heard on this issue has come uniformly from both ends of the political spectrum and goes something like, “Well, we just need to pass more laws to keep the wealthy from taking their money out of the country.”
It is precisely those laws that are some of the primary reasons why Native Capital Flight has become such a severe problem, in the first place. To the wealthy, each such law represents yet another brick in an economic Berlin Wall that they see being erected by our government and meant to limit their financial options.
Just remember that the wealthy are largely problem solvers. They are risk takers. They are the kind of people who manage to find opportunity, even in adversity. So, each time the government attempts to limit the financial options of the wealthy, the only effect that it has, is to make the wealthy take a closer look at options that they had not previously considered viable. In this case, they now have to consider the option of leaving and possibly never coming back. But to a problem solver and risk taker, that’s a small price to pay, to recover his lost economic freedom.
The result of these increasingly oppressive laws is that instead of forcing the wealthy to stay here, along with their money, they are actually forcing the wealthy to move more of their wealth out of the US, while they still can, in preparation for a time when a new round of such laws makes it impractical for them to stay. Although leaving is often far from their first choice, they are beginning to realize that their own government may soon leave them no other choice. In fact, many have already been forced to make that choice.
Some high profile expatriations
Here is a list of names that you might recognize. All of them have renounced their US citizenship, in favor of that of another less oppressive nation.
* John “Ippy” Dorrance (Campbells Soup) – Ireland
* Kenneth Dart (Dart Container) – Belize
* Sir John Templeton (Templeton Fund) – Bahamas
* Mark Mobius (Templeton Emerging Markets Fund) – Germany
* Fred Freible (Locktite) – Turks & Caicos
* Michael Dingman (Abex & Ford) – Bahamas
* Joseph Bogdanovich (Star-Kist & H.J. Heinz)
* 4 of the J. Paul Getty grandsons, Richard Minns, Ted Arison and more…
That’s just the short list and that list alone, represents billions in lost tax base. In fact, Templeton, who was born in Tennessee and who still pays a tremendous amount in foreign taxes, is on record, stating that he saved more than $100 million in taxes, in the first year after his expatriation. And, that’s just what he “saved”. Think about the total amount that he would have “paid” in US taxes, had he stayed.
Their flight creates serious problems for YOU.
To some, who have not achieved such wealth, the wealthy who are fleeing the US, for more wealth friendly jurisdictions, are “cowards”, “unpatriotic” and “quitters”, who we don’t want around, anyway. Be that as it may, I won’t argue those points here. That’s because what people think about them is completely immaterial to the problem at hand. Love them or hate them, when the wealthy leave, it creates serious problems for those who remain in the US.
To understand the threat that this represents, we must look at what this all means for the other 99% of taxpayers (those who make less than $410,096 per year)? Why is the fact that a handful of wealthy people are leaving and taking their money with them, such a problem for you? After all, wouldn’t it take a tremendous number of wealthy people leaving, to have a noticeable effect upon our economy?
Actually, no. You see, until you look at the actual numbers and do the math, it doesn’t appear to be a serious issue. But, it is. So lets look at the numbers again and this time, let’s do the math.
Without that 1% of the wealthiest Americans, every remaining taxpayer would have to pay two-thirds more in taxes just to equal what was lost. Can you afford that?
Those who argue that Americans with the most money should be taxed at a higher rate will find themselves being taxed at a much higher rate, instead. If you are paying $5,000 in income tax today, then imagine paying an additional $3392 in taxes. If you are paying $25,000, then imagine paying an additional $16,960. If you are paying $100,000 – well if you are paying $100,000 in income tax, there’s a good chance that you already have your bags packed and your second passport in hand, so you don’t need to imagine anything.
Although not all of any particular income group will leave, you must consider that the higher the income group, the greater the motivation.
There will always be those whose asset base is tied to the US. Bill Gates, for instance, would have a difficult time leaving, since Microsoft is such a US-centric company. But, who knows? After all, Microsoft has been significantly increasing its offshore programming staff, in recent years. Beyond the obvious cost savings and tax benefits, offshore outsourcing relieves companies of ties to any single country. So, who knows – maybe even Gates is preparing for the worst.
The point is that the higher the income, the greater the financial motivation for leaving. Then consider that as the most wealthy leave, the additional tax burden shifts to the next level down, so lets think about the fact that the top-earning 5% of income earners pay 60.63% of all taxes collected. While the majority of the wealthiest 1% are “escaping”, do you think that the top-earning 5% will just be sitting around waiting for a 68% tax increase? Of course not. And, when they leave, your tax bite will far more than double!
Then, of course, there is the top earning 10%. But, I wouldn’t worry about them. By that time, the government will have either taken the very unlikely measure of repealing all of the wealth punitive laws and abolishing the Income Tax, in lieu of a National Retail Sales Tax, to encourage the wealthy to return or they will have done what so many other repressive governments have done when faced with native capital flight, on a massive scale – they will have closed the borders to keep the remaining wealth in the country.
But then, as shown by every last case where that has happened in the past, ranging from Nazi Germany in the 30’s to South Africa in the 70’s and 80’s, to to the more recent case of Malaysia, even closing the borders to capital, only increases native capital flight, albeit on an illegal basis.
So, maybe you should worry about losing the top-earning 10% after all, because if they can manage to get out with their wealth in tact, your taxes would almost triple! Have I got your attention?
Although it’s interesting to think about, for other reasons that I will explain, I seriously doubt that it will ever get that far. The problem goes much deeper. But, staying with just the tax issue for now, let’s look at the actual numbers.
Here is the math for the top-earning 1%:
100% – 40.42% of taxes lost = 59.58% of taxes left
40.42% = 67.8% additional tax burden for those remaining
Here is the math for the top-earning 5%:
100% – 60.64% of taxes lost = 39.36% of taxes left
60.64% = 154% additional tax burden for those remaining
THAT’S FAR MORE THAN DOUBLE!
Here is the math for the top-earning 10%:
100% – 71.22% of taxes lost = 28.78% of taxes left
71.22% = 247% additional tax burden for those remaining
THAT’S MORE THAN TRIPLE!
Think about it. If only the top-earning one percentile of taxpayers leave the United States, the remaining taxpayers will find that they will have to pay an additional 68% more in taxes. 1% of taxpayers is not that much. Think about it.
Could you tell if there was just one aspirin missing out of a 100-count bottle, without counting them? That’s 1%. The point is that we could lose that critical one percentile without knowing that they were gone. Maybe we already have, which would explain a lot of the federal deficit.
In fact, I will clearly demonstrate later, just how quickly we could lose that 1%. Then, consider that if the top-earning five percentile of taxpayers leave the United States, the tax burden for those who remain, will far more than double. And yet, our government is making it more and more difficult for the wealthy to remain in the United States.
Legislative attacks upon people with any significant degree of wealth is a ticking time bomb for our economy and we haven’t even touched on the issues of frivolous litigation or government confiscation of private property.
It creeps like a virus.
The legislative issues contributing to this growing exodus have gone largely unnoticed, since the growth in expatriation of the wealthy has taken place over so many years. It really began back in 1968, shortly after the riots at the Democrat National Convention in Chicago. This is not to say that it was a problem at that time. Let’s just say that the trickle of expatriates that any country experiences became a barely noticeable flow at that time. If it had stayed at that level, it would not be a problem today. But, indications are that the flow increased slowly, but steadily until the 1980’s.
In 1981, the Reagan administration rolled back some of the wealth punitive, anti-privacy laws and tax rates that were contributing to this exodus and indications are that it did have a significant effect. In fact, officially, not a single US citizen renounced his US citizenship the next year. That fact alone, should tell you something.
But such is the nature of the income tax and the lust for ever more power, which often infects elective officeholders, that no sooner than President Reagan left office, his successor, George H. W. Bush, resumed the attacks on the wealthy and they have been increasing since. So has expatriation of the wealthy.
Evidence from key foreign consulates indicates that the number of US citizens requesting application forms for citizenship or permanent residence in those countries, jumped significantly in the months after the Democrats in Congress tricked George Bush (the elder) into a huge tax increase.
Granted, requesting citizenship forms or information on citizenship is not expatriation. But details on the number of citizenships actually granted is far more difficult to come by. It is however, reasonable to assume that as the number of forms requested increases, so does the number of forms submitted.
The point is that the timing of those requests tie back to the motivation.
Other jumps occurred just after the Clinton tax increase and again, after the HIPAA legislation (discussed below) was signed into law, in 1996.
Indications are that in the first year of the George W. Bush administration, expatriations increased much more slowly, as the wealthy seemed to think that maybe Bush (the junior) would relieve some of the pressure on them. But, shortly after the President signed the USA Patriot Act into law, all of the indicators show that expatriations quickly shifted into high gear again.
Just the timing of those increases point even further toward the fact that those who are leaving are wealthy, since each of those events represented an attack on wealth and no other group. The slower increases in the first year of the Bush administration indicate that the wealthy expected Bush to roll back some of the Clinton administration’s wealth punitive legislation. But, with the passage of the Patriot Act, the wealthy knew that they had figured Bush wrong and expatriation spiked once more.
The evidence is there, if you look for it.
Our government is becoming more and more oppressive to the wealthy and making it increasingly expensive for the wealthy to stay. Other than the US Census numbers and sparse data from foreign consulates, there is a lot of ancillary data that points to the fact that wealthy Americans are expatriating at phenomenal rates. This ancillary evidence ranges from tell-tale social indicators to more hard numbers.
For example, only a few short years ago, it was very difficult to find the single small bar or restaurant in most foreign countries, where American expats would gather. Today, they are more common than car dealerships in Houston (even, before Obama forced a lot of the car dealerships, owned by Republicans, to close). It seems that there are now quite a few such expat bars in every small country.
On the other end of the spectrum is the Forbes Magazine annual lists of “400 Wealthiest Americans” and the “Worlds Billionaires”. An analysis of those lists, in recent years, shows that in the ten years between 1999 and 2009, the number of billionaires in the US climbed by a mere 27%, with a 20% growth in wealth, while during that same time period, the number of billionaires worldwide climbed by a whopping 166%, with a 90% growth in wealth. This means that the number of worldwide billionaires grew at a rate six times faster than US billionaires and worldwide, billionaires’ net worth grew four and a half times faster.
In other words, while the growth in the number of billionaires in the US was just barely enough to account for inflation and their net worth was even less, the growth in the number of billionaires worldwide, along with their net worth, was moving ahead at a rapid pace. This is just one more indicator that US billionaires are moving offshore. Of course, if the billionaires are moving offshore, it’s likely that other wealthy Americans are doing the same.
Granted, the Forbes lists probably leave out some billionaires whose asset base is not easy to locate. But, since Forbes has been using the same criteria and methodology to build those lists for years, although the actual number of billionaires in each year’s list may not be accurate, the percentage of change, from year to year, should be a fairly close approximation of reality.
This is not anything new. Back in April of 2002, National Review reported on this exodus. In an article, titled, “Bermuda Straight – Government greed is causing corporate flight”, Veronique de Rugy wrote, “As taxes continue to soak up a larger percentage of the GDP, the number of U.S. citizens moving out of the country is increasing. Unfortunately for them, the United States is one of the few countries that taxes its citizens on global income, even when they are living abroad. As a consequence, some Americans living abroad have renounced their U.S. citizenship to protect their family’s interests.”
Of course, de Rugy was just talking about those who formally renounced. There are millions of others who simply take citizenship in some other country, stop paying US taxes and just never come back.
But there’s more evidence of how serious a threat this is. There is the annual Merrill Lynch/Cap Gemini Ernst & Young “2003 World Wealth Report”. The headline of the press release for the 2003 report announced “…Number of U.S. Wealthy Individuals Drops — Goes Against Global Trend”. Notice that they pointed out that this “Goes Against Global Trend.” According to the report, there were 100,000 fewer millionaires in the US at the end of 2003, than at the end of 2002, during a time when worldwide wealth was growing. There is no doubt about it. The wealthy are leaving in large and increasing numbers.
To be fair, the “2004 World Wealth Report” shows that the number of wealthy individuals in the US increased the next year (2004). But that was due largely to low interest rates and greater growth in world GDP than we have seen in more than 20 years. Everyone was making money then. So, this does not mean that the wealthy are not leaving. In fact, other indicators are just too solid on this point. It simply means that due to exceptional worldwide economic conditions, low interest rates in the US and helped along by rising oil prices and the continued effects of the Tax Relief Act of 2001, more Americans managed to “grow” their wealth here at home. 2004 was just an unusual year, across the entire spectrum.
The question that hangs ominously in the air is, “How long will these new millionaires be willing to take the abuse that our government increasingly heaps upon high net-worth individuals?”
Part Two is scheduled for 9-07.
Copyright 2009 John Gaver. All rights reserved.
All other considerations aside…leaving jealousy, envy, and suspicion behind…
Some of those leaving are people who studied and trained for years and decades to attain their level of expertise…
Think about that when you or a loved one needs a doctor that your GUNvernment has persecuted.
Think about that when you or a loved one needs a brain surgeon that your GUNvernment has persecuted.
Think about that when you or a loved one needs a cancer researcher that your GUNvernment has persecuted.
Think about what you do for a living now and what it would take for you personally to replace the doctor, surgeon, or researcher your GUNvernment persecuted and drove away.
So in the final analysis, EVERYTHING your GUNvernment has been doing in your name…the redistribution via the theft and robbery that is taxation…the global murderfest that is the Amerikan Empire…printing the dollar into oblivion…ALL of it is ultimately fatally destructive to you and your loved ones, neighbors, fellow parishioners, etc.
Then again…such is the Boobus Amerikanus Beast…
Enjoy the Mobocracy Looterfest for the short time longer that it exists!
Who will the looters loot when looters are all that are left to loot?
Maybe you can get ditch-digger Joe to dig that tumor out of your child’s brain…good luck with that…hahaha!
Fools…one and all…go figure…
Tending Wyatt’s Torch,
John and Dagny Galt
[…] Tick: The Economy Bomb Part One Posted on September 5, 2010 by Bill Miller This article by John Gaver on DumpDC.com. … An insidious, creeping cancer is eating away at our economy. Not only the Income Tax, but […]
This is the scam known as the federal income tax. The American people have never granted to the central govt. the authority to confiscate wealth from the earnings of workers in the private sector engaged in activities of common occupations; the 16th amendment notwithstanding. To think otherwise is to believe that our grandparents and great-grand parents were total morons, which, of course, they were not! Prior to WWII, approximately 6-9% of folks paid federal income taxes; after WWII, the % jumped to today’s levels and yet, no structural change has occurred to the tax law as it was first written and implemented by the Lincoln administration in 1862.
Today, as was the case before WWII, the law requires that anyone engaged in activities covered by federal privilege are required to pay tribute/tax to the govt. However, for those working in the private sector, no such legal requirement exists and their earnings fall outside the taxing authority of the central govt.
A deceived man doesn’t know he is deceived; this is the state of affairs for most working folks. The evidence of this truth and documentation confirming the truth about the federal income tax can be found at http://www.losthorizons.com, if you care to look and see for yourself.
Sad, interesting, intolerable, and that was LAST year, when conditions were “better.”
I’m not rich, but I considered seriously expatriating in 2004, after I was widowed. It made excellent sense monetarially and politically, but not in terms of moving to a country where I had no friends or contacts. Some of us just aren’t up to wandering around expat bars unaccompanied, which may be something men can do, but not Southern ladies. There was also the question of what I would DO with the rest of my life after becoming considerably more fluent in Spanish. I could have built a beach house near my brother’s place in Belize…and then what? Sure, I would have solved the problem of a basic social group, I love the ocean, and I could have read and painted endlessly at first, but I suspected my gilded cage would have palled fairly quickly.
Immigrating is still a pretty good choice for retired couples in good health IF they can handle having no meaningful work and IF they get up and do it fairly quickly before even more onerous penalties for taking capital out of the country are put in place. Rumors circulating around the hill are on the order of 40% appropriation by the government, and I have a feeling that provisions are being considered for sequestration of pension funds for those who renounce US citizenship. I can’t prove that one, at present, but it is a pretty obvious course for rapacious, punitive governments…and do pay attention to the Iron Curtain aspect and the simple fact that it is not possible to leave the country even now without a Passport, and those are issued at the good will of the government. Oddly enough, we seem to have no “right” to a passport, and I doubt many places will allow us to seek political asylum at their embassies.
Which sort of seems to mean that capital and personal flight are already quite difficult and likely to get far worse. Americans are funny; we have no objection to immigrants starting businesses and hiring locals for anything more complicated than house and lawn work. Foreign nations disagree, in large part. Belize, for example, would not allow me to hire locals to make handbags I design, and never mind that it would have improved their GDP slightly.
If you aren’t already rich and making plans, the chances are that seeking a new land is not for you.
Which leaves us two choices, both of which I advocate: continue working towards secession of at least three areas in CONUS, and…go limp on ’em. Ayn Rand told you to do that back in ’56. Don’t subject yourself to bracket creep. Consider carefully how much less of each additional dollar you would be allowed to keep before taking on a second job. Don’t buy anything you cannot eat or protect yourself with. Cut back every frivolous use of money–and yes, that includes cell ‘phones for every member of the family, cable and premium TV, movies, renting videos and games, gym memberships, and a lot of fripperies most Americans think are essential. They aren’t. Use the capital you free to buy physical silver and gold and survival supplies. Use it to increase the ways you are self-sufficient. Prepare physically, financially, and mentally for all of this to become a great deal worse with absolutely no guarantee matters will become better for any reason other than your own actions.
Dear Charles, who turned 73 last Saturday, gets a job offer about every six weeks, and if anyone ever headhunts him one at the right price in a foreign country we would enjoy with work he really thought interesting, we would consider it. Even I have rejected three job offers sweetly this year with, “If I made more money I would have to pay more taxes.”
I would rather sit here with an ashtray, a glass of wine, barefooted, watching the cattle and goats go by while I write. I don’t have to commute, “power” dress, or have lunches when I would rather be composing. I really would rather give my “work” away than pay the government to allow me to do it. Even when coaxed, “We’re not asking you to move or even keep office hours…” No, thank you.
The problem is those of you in your thirties and forties. Short of the heresy of suggesting that you not worry about how to send your children to college, what relief is possible? I don’t want your son to be a plumber any more than you do, although between the markups on parts and what plumbers make, that’s an excellent skill that will always be needed. For quite some time few of those being graduated from law school actually found jobs as lawyers! If the time you need to make a decision is ten years away, consider how else you could put the money to work and on-line schooling (which IS the wave of the future) and student loans. The books alone for one of my hands this semester were $1250! Check out CTU, where books are included, student loans guaranteed available.
Mr. Gaver’s article fascinated me because I love playing with numbers. The last stat I saw–at least a couple of months ago–indicated that revenue collection was down 20%. You may not be feeling richer by the minute, but we’re all looking “wealthier” to the government by the moment. It serves every person who ever thought the “rich” should be taxed more right.