In March 2010, President Obama signed into law one of the most arrogant, unfeasible bills ever to hit the books.
Known as FATCA [Foreign Account Tax Compliance Act], it was enacted as part of the inappropriately titled HIRE Act; the law requires that foreign banks must disclose personal account details for their US clients, essentially agreeing to get in bed with the US government.
If a foreign bank does not agree to disclose information on all of its US customers, then the law further requires that noncompliant banks withhold a 30% tax on all payments that may have originated from the United States.
The arrogance of this law is overwhelming. It would be as if the Saudi King issued a decree forbidding US grocery store chains to sell pork to Saudi citizens while on US soil. Crazy, right? Americans would be up in arms-- who do those Saudi's think they are, trying to control a US company on US soil?
But that's exactly what FACTA does. Needless to say, the international banking scene has been up in arms since March 2010 when the law was passed. Those cries have largely fallen on deaf ears... until late last week when the US government granted a brief extension for the law to take effect.
This is important, and I'll explain why.
We're in the early stages of what I call the Age of Turmoil-- a tumultuous time in which governments turn to increasingly desperate, authoritarian measures in order to maintain the status quo.
The drive their economies into the ground, generate painful inflation, and destroy the livelihoods of millions, even hundreds of millions... and when you don't like it, they turn their police forces after you to ensure they still get to live a life of power and privilege on your dime.
We've already seen these people in action-- they've seized pension accounts, turned the nation into a police state, ruined the economy with corrupt, reckless spending programs, inflated the currency to dangerous levels, and made it extremely difficult to do basic things like establish a business or even open a bank account.
There are a few things you can try to do about it. The default option for most people is to do nothing. They'll stick their heads in the sand as things continue to get worse and their families' livelihoods get eaten away by public policy.
Others think they can 'vote the bums out,' only later to realize that the brand new crop of politicians is just as bad as the old batch.
I've long been an advocate of the internationalization approach-- diversifying your assets and interests overseas to reduce the control that one single government has over you.
If you live, work, bank, invest, own property, store gold, operate a business, etc. in the same country of your citizenship, you are truly putting all of your eggs in one basket.
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This blog has concentrated on finance and government issues facing America. This blog was formed to include some personal items, but has grown mostly as a political machine.
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We're Liberty and Freedom-minded, professional fellows; with a plethora of things to say and no fear in expressing them. One of our favorite sayings is:
"Oderint dum metuant" which translates, roughly, as "Let them hate as long as they fear." It was a favorite saying of the Roman emperor Caligula. He wasn't a particularly nice guy, but he had the world at his bidding and history will never forget him or his notoriety. That's power.