Last year, a total of 3,415 Americans renounced their citizenship. That’s a record number. But that is likely to be toppled when 2015 figures are announced, as early numbers revealed that 1,335 American citizens already expatriated during the first quarter alone. If the trend continues at that rate, we can estimate that 5,000 individuals will have renounced their American citizenship by the end of this year.
Because a lot of people dream of obtaining a green card, this piece of news is counterintuitive. But the recent upward trend is actually driven by new tax laws that make it more of a hassle than a privilege to be an American citizen, especially if you’re a decent earner who lives outside of the U.S. The United States is one of only two countries in the world that require their citizens to pay income taxes no matter where they earn their money. They also have a complex tax code which, along with their many business regulations and high tax rates, make it difficult for individuals to file income tax returns and for businesses to hire more people.
If you’re a young American citizen, you effectively inherit a portion of the massive $18 trillion national debt as well as a whopping $200 trillion in unfunded payment obligations (students loan guarantees by the government, pensions, etc.) — products of the U.S. government’s erratic decisions made over the last several decades. As a productive member of society, it’s your obligation to pay part of those liabilities, whether in taxes, inflation or a sudden devaluation of your assets.
Such enormous amounts are quite obviously impossible to repay. America is only buying time by printing huge amounts of paper money and taxing the corporations and its citizens to the hilt. The whole thing is Finance 101 fail. You’re not supposed to spend more than you make, otherwise you’re going to go broke. But that’s exactly what America did, and it’s been overdoing it with reckless abandon.
The U.S.A. is broke. It cannot afford to wage another war, let alone a war of Chinese proportions. Just consider how much one round of ammunition costs, or how much fuel and supplies the U.S. government spent on its military operations in Afghanistan and maintaining hundreds of its military bases around the world. All of those expenses go against future taxpayers. In the Iraq war alone, the U.S. government spent $2 trillion and now it owes $490 billion in benefits to war veterans as a result. If you have no idea how big those numbers are, compare them to the Philippines’ national debt, which stood at $78 billion in 2014.
Wars, welfare giveaways that they can’t afford and anti-business policies are taking their toll on the American economy. Their days of over-consuming other nations’ goods and serving as the policemen of the world are numbered. Sooner or later a big economic trigger will be pulled and it’s going to finally bring them to their senses.
When Jessica Soho interviewed American ambassador Harry Thomas in 2013, she argued with the ambassador (regarding China’s aggression), “But sir, we fought your wars, why won’t you fight ours?” It was like telling a friend, “Hey, I made you breakfast, why wouldn’t you pay for my college tuition?” — all while being unaware that the friend is broke. Apparently it’s not only Jessica Soho who thinks this way. 99.9% of Filipinos are too naive and too “free-lunch”-minded to recognize that the friend is broke.
“Pahinging free lunch” is catered to in the U.S. only because politicians are willing to give in to the popular socialistic demands. But it wouldn’t last long. Reality would eventually set in when money stops being loaned and the debtors finally realize that they couldn’t afford all the heavy spending.
In the Philippines there is a good potential for the same thing to happen because the demand is even greater — it traverses national boundaries. “Penge” is addressed in all its selfish and ungrateful glory not only to the government but also to the people in other countries. All it takes to gratify this attitude like it’s a positive thing is some shrewd and wicked politicians to gain power.
The thing is, there’s no such thing as a free lunch. Someone’s always paying for it — the people who are productive — mainly through taxation. Their resources are not unlimited. But America has been on a spending spree as if the resources are unlimited. When reality sets in, expect the balance of power to shift to the east. I’m not talking about the Philippines, which is only going to be the next one to realize that there’s no such thing as a free lunch, if it’s smart enough to.