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The US rich are getting second passports, citing risk of instability
- miningape 3y agoMost rich people are already citizens of multiple countries, on top of tax and travel benefits it's easy (and relatively cheap) to buy passports from Caribbean island nations
- fastaguy88 3y agoIt would be good to define "rich" here. Probably not most of the top 5% (50% of 15 million people). Perhaps "most" of the top 0.1%? Any data?
- deleted 3y ago[deleted]
- throw1234651234 3y agoTop 10% is basically a frugal tech-bro in a flyover. FAANG is top 5%. Assuming "over the course of at least 5-10 years" for both to get there. I doubt these are the people being discussed. These are basically millenials/zoomers that can actually afford the "American dream middle class lifestyle" - house, kids, savings, etc without an inheritance, but not much more. Article is probably focusing on 10mil+ net worths at least, but likely "UHNWI" which are 30 mil+ who have time to think about this stuff.
- Forge36 3y agoI suspect it's better PR to say "instability” than "avoid paying taxes"
- anovikov 3y agoYou can only avoid US taxes if you drop citizenship altogether. US has citizenship based taxation and you are stuck paying US taxes regardless of where you reside and what other passports you have. So getting another passport (as opposed to residence permit into your US passport) does not help you at all there. Almost all countries have double taxation treaties with US so you can credit your US taxes paid against your tax obligation in your country of residence, but if their taxes are lower than US taxes, you just pay US taxes. Again, no difference if you have that other country's citizenship, or just legal residence as an American. Difference happens only if you actually renounce your US citizenship and thus cease to be a U.S. person for tax purposes. People are getting second passports as a fancy object, and to avoid discrimination in countries where anti-Americanism is popular.
- Aspos 3y agoHaving a second passport provides an option to ditch US passport and stop paying US taxes at any moment. One basically pays to buy an option to stop being subject to US taxation at a moment of their choosing.
- rdl 3y agoIt's a (virtually) necessary but not sufficient step in the process. The big blockers are exit tax over $2mm (basically, unrealized capital gains get taxed), and doing the actual appointment with an embassy overseas to document loss of nationality (if relinquished) or renounce (if renouncing; same effect, but much worse option IMO). If your assets are under 2mm, or if super liquid and thus easy to pay the exit tax, you have a pretty decent option. Otherwise, the exit tax can be addressed on a scale of multiple years (Puerto Rico has 0% capital gains under act 60, exemption from federal under irc 933, so move to PR first, realize capital gains, have no unrealized capital gains subject to exit tax when relinquishing...) I'm not a lawyer; not legal advice, or financial advice, entertainment purposes only.
- devoutsalsa 3y agoFor those who want one & don’t already know, the Caribbean countries are doubling the the price of passports on June 30. The minimum price will be 200,000 USD for the cheaper countries. It takes time to apply, so best to get started if you want the old price.
- balderdash 3y agoThe tax benefits of a second passport for us citizens are pretty close to zero unless you give up your us passport, and the exit tax is no joke (basically assumes you sold all of your assets including real estate, private shares, stock/bond portfolios, etc on expatriation and charges cap gains on all the gains)
- llm_trw 3y agoDon't forget that the US will lowkey fuck you every chance they get if you give up your passport. You need to come back? Better be ready for your visa to get lost five times and a random 6 hour interrogation at the border. It's easier to get into the US on an Iranian passport than on a UK passport when you've given up American citizenship.
- ghaff 3y agoI'm very skeptical of the claim that most rich people have a second passport, especially for any reasonably inclusive definition of rich. If it's cheap and easy based on recent ancestry? Sure. But, as you say, it's just not that useful outside of narrow circumstances and doesn't provide any tax advantages if you keep your US passport as well.
- balderdash 3y agoI think the people that get second passports are mostly doing it for residency reasons e.g. you own a home in another country/spend a lot of time there and want guaranteed travel rights/it’s not much more work/can be easier (through investment) than getting a permanent visa
- ghaff 3y agoThat's probably true. If you actually have ties to another country, having a passport (or other residency permit) could make sense. But it's not a case of just getting an arbitrary second passport.
- resource_waste 3y agoWell its CNBC, so its just buzzfeed-clickbait that isnt grounded in reality. Anyway, since we are here, where should I get a passport too?
- balderdash 3y agoI think if you have grandparent or great grandparent that was a citizen of some EU countries you can apply for citizenship
- lionkor 3y agoNot usually no
- 082349872349872 3y agoitaly does it and I've heard germany as well; some ≠ all
- balderdash 3y agoAlso Ireland, Greece, Italy, Poland, Czech Republic as well (I think) it’s not guaranteed and the details may mater (was it you grand father or stand mother, were they born there, etc)
- 082349872349872 3y agoYou don't get "bank account in Cyprus" ads while surfing? (I'm pretty sure this is submarine advertising for Henley)
- lastofthemojito 3y ago> Anyway, since we are here, where should I get a passport too? A lot of it has to do with your personal background. I know one friend going through the process of obtaining German citizenship which is available to her due to her ancestors fleeing Nazi Germany. There's a subreddit dedicated to obtaining German citizenship here: https://old.reddit.com/r/GermanCitizenship/ https://old.reddit.com/r/GermanCitizenship/ Also know someone who obtained Irish citizenship due to their background, there's a subreddit for that too: https://old.reddit.com/r/IrishCitizenship/ https://old.reddit.com/r/IrishCitizenship/
- vrodipo 3y ago[flagged]
- surfingdino 3y agoThe last time the US rich bolted to Europe we got The Great Gatsby. Those hoping that we'll get something of cultural value out the current exodus need not bother waiting. The next great American novel will be compiled by AI...
- moritonal 3y agoA good parallel would be that when Brexit was occurring almost everyone with the opportunity was renewing their second passport. The only friend I knew who outwardly supported England leaving, was of course, renewing his duel-Irish one.
- throw1234651234 3y agoWhoah, your friend is a badass! I also didn't know Ireland still allowed duels. Do you know if it's just short swords or what? Cool benefit for his dual citizenship. (sorry, sorry, had to).
- ccppurcell 3y agoSadly members of my own family openly voted Brexit, despite my grandma, my sister and myself all being EU immigrants at the time.
- shrubble 3y agoMillionaire is not "rich" or wealthy however. I think conflating billionaires like Thiel or Schmidt with a Californian couple who sold their house plus another they bought 30 years ago as a rental property doesn't help the article.
- Rinzler89 3y agoMillionäre in USD is still rich by European standards when your average neth worth is in the five figure to low six figure range. Hence why a lot of them like moving to Southern Europe where they can live like kings getting the Californian weather on a budget once they made their wealth in the US.
- willcipriano 3y agoAverage global income is about 12k per year, a million dollars is 80+ years of the average person working. I'd call that wealthy.
- taylodl 3y agoI'll counter that the American having a million dollars USD also has a lot more in expenses than the average global citizen. The cost of living in the US is quite high. From a certain vantage point, we should encourage those Americans to leave and take their money and distribute it elsewhere in the world.
- etrautmann 3y agoYep - The cost of housing, education, health care, and retirement require a different calculus than living in most other countries.
- etrautmann 3y agoI think it’s more reasonable to think about it in relative terms to the cost of living in an area. Yes, it’s healthy to have perspective, but a 2BR in NY can cost well over 1.5M, and the cost of just existing in a city makes a world-definition of wealthy somewhat less relevant for many.
- jhbadger 3y agoThe key problem is I don't see a scenario where the US economy collapses and the rest of the world is fine to escape to. The 1929 Wall Street crash led to a global economic depression, likewise the 2008 US subprime mortgage crash led to the global "great recession".
- deleted 3y ago[deleted]
- 082349872349872 3y ago(having voted with my feet decades ago) I'd bet people in the Old Country are not worried about economic, but rather political, instability. Other people in the thread have mentioned tax issues, but really, as far as tax havens go Montana is right up there.
- hollerith 3y agoEconomic depression or recession is not the worry: the worry is political extremists on the left or on the right taking control of the government a la Russia in 1917, Germany in 1932 or China in 1949. Even though the probability of such an outcome is very low, it makes sense for rich people to protect against it because of how deadly and full of long bouts of suffering and trauma such outcomes are.
- barryrandall 3y agoI think you're getting at the root of the issue. The problem isn't that the perceived probability of a revolution is high, it's that people are accustomed to that being effectively zero, and it's not perceived to be effectively zero any more.
- Milton6 3y agoAnd if such a thing happens there will still be an economic crisis
- archagon 3y agoWhich political extremists on the left are at risk of taking control of the government…?
- rdl 3y agoIt's about $100-150k to get, you don't need to be super rich.
- _heimdall 3y agoIn many peoples eyes having around 2 years worth of average household income to throw at a single passport is rich. I don't know where the line for super rich would be, but the article just talks about the US rich.
- silverquiet 3y agoYeah, you could probably just sell one of your planes and pick one up.
- blitzar 3y agoYou could probably just fly commercial for one flight rather than on your private plane and pick one up instead.
- archagon 3y agoNot for EU. Portugal was around 250k for specific types of property investments but they closed that one off. Now IIRC it’s around 500k up.
- ItCouldBeWorse 3y agoI'm against them becoming citizens of the EU - they ruined the us, they will do the same here.
- brodouevencode 3y agoThe EU did a pretty good job of tanking itself
- redserk 3y agoCould you elaborate on how the EU is “tanking itself”?
- RestlessMind 3y agoBrexit - a key member left. Ukraine and energy crisis - EU's biggest member(s) depended on Russia for their energy in spite of warnings. Rise of far right in Germany, Netherlands, Hungary, Poland, Italy, France, .. Which is itself in response to the bungled handling of the Syrian refugee crisis.
- CuriouslyC 3y agoTo be fair, the wealthy didn't ruin the US, I think the tea party movement and the involvement of near-retarded anti-vax flat-earth paranoid conspiracy nuts in politics is ruining things.
- mcbuilder 3y agoThose people help vote in bad politicians, but their propaganda is fed by opportunistic and wealthy. It's a cycle, but it's definitely "top-down" at least if you want to ascribe actual malice.
- 082349872349872 3y agoAccording to Goldstein, The Theory and Practice of Oligarchical Collectivism (appearing in [Orwell49]), there are two possible governing coalitions in any society: Low+High (vs Middle) or Low+Middle (vs High). If both Low and Middle were to agree the High ought be taxed, it would be to the High's advantage to stoke culture wars between Low and Middle in an effort to ensure the first coalition. (posted before at https://news.ycombinator.com/item?id=39826408 https://news.ycombinator.com/item?id=39826408 )
- armchairhacker 3y agoI feel like if the US isn't safe, nowhere is safe. Whose going to stop Russia and China from invading EU countries and Japan if the US won't defend them? Their populations and militaries are comparably tiny. I know some EU countries have nukes, but I'm not fully aware how much that protects them. Do they have enough to cause MAD?
- 082349872349872 3y agoWhen MAD happens, it's pretty much D for everyone; if you're worried about that scenario then maybe look to Oz/NZ/a mineshaft with 10 women for each man.
- lionkor 3y agoThe US' enemies aren't everyone else's enemies ;) We all just go along with it because our governments are insanely pro-US
- spacecadet 3y agoSure, but if your enemies are super powers and you succeed, whats left? Would Europe stand ideally by? Probs not... even in a post-war rebel state situation, would not be stable.
- jvanderbot 3y agoIt's very likely not true that those countries want to invade Europe in the traditional sense.
- failuser 3y agoRussia is invading a European country as we speak and openly claims ambitions to control all of the Eastern Europe at least (see Putin’s ultimatum of 2021).
- spacecadet 3y agoI was going to say this too, but Russia is delusional.
- brodouevencode 3y ago> The top destinations for supplemental passports among Americans are Portugal, Malta, Greece and Italy Something tells me instability is not the real issue.
- okasaki 3y agoGives you access to the EU and those are easy to get I guess (schemes like invest some $x00k and get a passport)
- brodouevencode 3y agoYes, but (especially) Greece and Italy aren't known for their stability in recent years.
- tylersmith 3y agoThey don't have to live in Greece. The passport gets you access to the EU.
- yohannparis 3y agoAs mentioned above, those are EU passport. If Italy becomes unstable you can still go to Germany or Austria for example.
- mrsalt 3y agoIf the situation in Italy actually got bad, the EU would suspend Italy's membership or at least many EU rights (such as freedom of movement) very quickly. As usual, everyone likes their neighbors until they don't.
- okasaki 3y agoIf you're rich you're leaving Italy way before that, and member states wouldn't suspend rights of Italians already in their country.
- TheNewsIsHere 3y agoOrthogonal point: I know of an LGBT couple who keep their (only, US) passports valid for escaping civil instability, or in other words “when they finally make The Handmaid’s Tale a reality.”
- 082349872349872 3y agoPassports are revocable; these days probably even electronically. If Handmaid's Tale became reality at least many countries' asylum laws would then apply, so if you were able to get there physically the legal documents might not matter so much. (I understand there are a few fringe Mormon communities which straddle the Canadian and Mexican borders; they might have further ideas)
- TheNewsIsHere 3y agoYes; in fact they use a PKI. But by that same token you can simply close the borders irrespective of what passport a person holds. You can also leave when the writing is on the wall but before such events.
- 082349872349872 3y ago(Even if borders are closed to transit, I'd hope a valid passport would still be useful for transit through or a few months' stay in other countries?) > the writing is on the wall It's an older* code sir, but it checks out. Two useful sayings from my childhood were "run down the hawser line before the other rats", and "skate to where the puck is going to be". In business, it's easy to find a new position when everyone else thinks your current company is hot stuff. In sport, better to let the play come to you than always be chasing the play. Anticipation helps in many cases: allowing one to act, not to react. * https://www.chabad.org/library/bible_cdo/aid/16488/jewish/Chapter-5.htm#v5 https://www.chabad.org/library/bible_cdo/aid/16488/jewish/Ch...
- TheNewsIsHere 3y agoI like the cut of your jib.
- jmclnx 3y agoThe US Rich are the once who brought the US to the state it is in. Their 50+ year support of the GOP and tax cutting for the rich did more harm to US then anything else. With things looking like the GOP and a certifiable nut case about to take over the US, they want to have the option to flee before the people scammed by the GOP realized they were taken to the cleaners. With that said, China is already on the edge, and should the US economy crash, it will take China with it then the world will follow. But I doubt any crash will happen as long as the Fed can remain fully independent of politics.
- matthewdgreen 3y agoThe previous administration brought an enormous amount of pressure down on the Fed, and a new version of that administration will likely be much more focused. Combine that with major tax cuts in our current fiscal environment, the result is not likely to be pretty.
- inglor_cz 3y agoI don't think that stability of a country is a simple function of tax rates. France has the highest taxation in OECD and it is internally very messy. Switzerland much less so.
- bestouff 3y agoI don't think France is so messy. It looks like it because the French really enjoy criticizing everything.
- JPLeRouzic 3y agoWe only had a quasi-state of insurrection for a month or two each year since 2005 and even before 2005 it was not that quiet: https://fr.wikipedia.org/wiki/%C3%89meutes_dans_les_banlieues_fran%C3%A7aises_depuis_les_ann%C3%A9es_1970 https://fr.wikipedia.org/wiki/%C3%89meutes_dans_les_banlieue...
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- paxys 3y agoI'd be surprised if there was any rich person (say, $10M+ in liquid assets) in the US who wasn't planning an exit strategy. Like...open your eyes and look around you. If you'd spend money preparing for an earthquake why not the fall of democracy? What are you going to do if you or your spouse/daughter needs emergency medical care and the procedure is outlawed nationwide? What will you do if an authoritarian government and the mob that powers it turns its eyes towards your political views, race, religion, sexual orientation, place of residence, economic class, hobbies? By the time it starts happening it'll be too late to act. The US economic engine will keep chugging, and people in that position can still take advantage of it while enjoying the political stability and social freedoms elsewhere.
- _heimdall 3y agoIf you have the means, it does effectively fall under the self insurance banner. If I had the money, and was willing to abandon my country, I'd do the same.
- rdl 3y agoThe cheap way to do this is (if you're from any kind of immigrant background over the past few generations, or in some cases far longer, especially if Jewish) -- "ancestry/descent based". Doing the research to find parents/grandparents who were citizens of e.g. Poland, then applying on the basis of descent, is relatively inexpensive (thousands of dollars in research). Ireland is super popular for this; lots of European-Americans are part Irish. Caribbean Citizenship-by-Investment is about $100-250k but can include spouse/children. Various permanent residency on the path to citizenships are also relatively expensive (thousands of dollars, some paperwork); if you move there and establish presence, you go through the naturalization process, in some cases fast-tracked. Spain has some great programs if you're from a Spanish colonial country (including Puerto Rico, apparently...); the citizenship process gets fast-tracked. Netherlands has a special deal dating from WW2 for US citizens to get fast-tracked to NL. Turkey has a really cheap (in fees) program -- $5k or so on top of buying real estate at market prices. I personally am not super excited about owning $400k in Turkish real estate, but it has been a good investment in even USD terms (2-3x) over the past few years, from friends who did it. The program used to be $250K buy-in; now it's $400K and potentially moving up.
- mrpound 3y agoWhat a bunch of cowards
- MuffinFlavored 3y ago> citing risk of instability The election is coming up in ~200 days Depending on who you ask, this is either a huge deal, or not that big of a deal at all What's the truth? Somewhere in between? What's actually unstable about the country? It depends on who you ask, right? Monetary debasement? Economic inequality? Political polarization? Immigration challenges? National debt?
- skeledrew 3y agoIt's near harvest time for all those wonderful policies that they helped to sow, and now they're trying to escape the consequences of the reaping. How typical.
- glimshe 3y agoSo much doom and gloom... I'll bet most Americans here who think that the US is on the "brink" of whatever man-made economic or cultural disaster you can think of have never lived elsewhere. Things are still remarkably stable here compared with pretty much everywhere else. The US will always be a kind of a mess given our relatively (to other large countries) decentralized government and the enormous cultural diversity, but I believe this is what gives us resiliency in the long run.
- hackeraccount 3y agoThis is a variation on "If X is elected I'm moving to Canada!" I just don't see it happening to any degree.
- matthewdgreen 3y agoNo, it is a "I am thrilled to vote for X but I no longer have confidence that the country will survive it, so I'm preparing my backup plan." That's a very different thing.
- ultrasaurus 3y agoIt's worth noting that this isn't unique to Europe. There's a garden industry of minimizing the $s needed to get an EB-5 greencard. It originally required a "Plan to create or preserve 10 permanent full-time jobs for qualified U.S. workers" but you can usually get by with a $500k investment in a winery. [0] https://www.uscis.gov/working-in-the-united-states/permanent-workers/eb-5-immigrant-investor-program https://www.uscis.gov/working-in-the-united-states/permanent... [1] https://abcnews.go.com/Nightline/fullpage/500000-green-card-eb-visa-program-28662457 https://abcnews.go.com/Nightline/fullpage/500000-green-card-...