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Catching a Falling Financial Knife

Should Americans Emigrate or Defect?

Politics / US Politics Feb 12, 2013 - 11:18 AM GMT

By: Jeff_Berwick

Politics

Wendy McElroy writes: Anyone planning to permanently leave the US should give deep thought to whether they are emigrating or defecting.

The two concepts have so much in common that they tend to blur together. They may be best viewed as two extremes of the same axis upon which people can 'grade' themselves. But there is a significant difference between the attitude, motives, and actions of a straightforward emigrant versus a defector. And where you stand on the axis affects the most important aspect of who you are: How do you evaluate yourself?


Both emigrants and defectors physically leave a nation to relocate permanently elsewhere. But the key difference between emigration and defection is the motive. Emigrants usually relocate to be with family or for economic reasons. The motives can have political overtones; for example, some portion of the family may have left due to religious persecution or the homeland may have a disastrous tax rate. By contrast, defection is a political or moral act of renunciation aimed at the abandoned state. It is an active shunning of citizenship that is independent from family or economic concerns. Emigration focuses primarily on arriving to embrace something; defection focuses primarily on leaving in protest. They are not mutually exclusive, however.

Another key difference is that emigration is generally a lawful process. Or, at least, the emigration does not require an active challenge to the laws of the deserted nation. Defection is flatly illegal.

Typically, laws against migration are meant to discourage people from leaving, especially people who enrich the nation in which they reside through their wealth, productivity and skills. East Germany is an example. After WWII, the Soviet Union dominated the Eastern sector of Germany, with Western nations (mainly America) dominating the West; the city of Berlin was split in two. Emigration became an immediate problem for the Soviet sector. In his book Closed Borders: The Contemporary Assault on Freedom of Movement (Yale, 1989) Alan Dowty estimated that almost 20% of East Germany's population had left by 1950. The educated and the young, professionals and skilled workers formed a disproportionately large part of the migration. The words “brain drain” were spoken. In the early 1950s, a Soviet-style shutdown killed migration to the West. But Berlin remained a problem. The complex division and politics of the city served as a migration loophole. In 1961, East Germany began stretching the barbed-wire that would be extended to include the Berlin Wall.

From one day to the next, East Berliners who walked westward ceased to be covert emigrants and became defectors to be shot on sight. East Berlin was not merely determined to forcibly retain the best, the brightest, the most productive. It was tired of the political embarrassment of the best, the brightest, the most productive renouncing the communist state in a visible, tangible manner. Thus, the choice between emigration and defection was yanked from individuals and placed into the hands of the state. It is the tendency of totalitarian governments to slam shut the exit door. And it sometimes slams abruptly.

America still allows emigration; the door has not yet slammed. But America punishes the act and it is proposing legislation to punish it more. For example, a bill called the Ex-PATRIOT Act is in the Senate. Its full name is the Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act, and it would ban anyone who expatriates from ever setting foot again on American soil. As the law stands today, the “exit tax” for those who emigrate without renouncing citizenship is to be saddled with a US tax liability in perpetuity; in short, double taxation. The “exit tax” for those who renounce citizenship is the complexity of the process and a confiscation of wealth from those who have it. This is a fiscal Berlin Wall. Those who quietly leave and “stay gone” without notifying the U.S. state are similar to pre-wall East Berliners. They fall somewhat between emigrants and defectors, with their main reason for silence being to escape notice. Hopefully, the door for them to do so will remain open.

[Editor's Note: In order to renounce citizenship -- and we really can't blame you if the thought has crossed your mind -- requires you to have a citizenship someplace else. Sadly, you cannot be stateless in this world...yet. So as part of your own "permanent exit strategy", make sure to look into other citizenship and passport options, particularly if you are a US citizen. TDV has options in countries that will be much kinder to you and your capital than the US ever was. Click here to learn more.]

The two categories of escapees differ in another important manner: the attitude expressed toward them by the abandoned state. This is a key indicator of whether the door “out” is preparing to close. When emigration is considered to be an act of political rebuke and embarrassment, the emigrant is viewed as a defector.

Mexico does not care if its citizens go to California or Texas and send money back home to relatives. Mexico ignores these emigrants because they entail no political embarrassment or economic cost. America cares,  and for at least two reasons. First, those who emigrate – even without vocally defecting – are exploding the myth that America is the land of opportunity and freedom; they are a political rebuke. Second, the US is losing the best, the brightest, the most productive by losing businessmen, the wealthy, the skilled and the educated; the escapees are an economic and intellectual drain. Words like “traitor” and “unpatriotic” are being attached to high-profile emigrants like Facebook co-founder Eduardo Saverin, who fled for economic reasons. In the eyes of America, emigration is becoming defection. And totalitarian states do not tolerate defectors.

America has spent trillions of dollars to establish Homeland Security guards at entry and exit points, to build barriers across its borders, and to process anyone who wants in or out of its jurisdiction. This is not an accidental act. Any state powerful enough to shut people out is powerful enough to shut people in.

America is like the postwar city of Berlin. Borders are still open and they offer relatively free passage, officially or unofficially. But the wall is being built to close that porous border. Those who are planning to leave should decide if they are an emigrant or a defector. Otherwise the decision may be taken out of their hands and decided by the state. 

Wendy McElroy is a renowned individualist anarchist and individualist feminist. She was a co-founder along with Carl Watner and George H. Smith of The Voluntaryist in 1982, and is the author/editor of twelve books, the latest of which is "The Art of Being Free". Follow her work at http://www.wendymcelroy.com.

Anarcho-Capitalist.  Libertarian.  Freedom fighter against mankind’s two biggest enemies, the State and the Central Banks.  Jeff Berwick is the founder of The Dollar Vigilante, CEO of TDV Media & Services and host of the popular video podcast, Anarchast.  Jeff is a prominent speaker at many of the world’s freedom, investment and gold conferences as well as regularly in the media.

© 2013 Copyright Jeff Berwick - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Jeff Berwick Archive

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Catching a Falling Financial Knife