The 2012 American Presidential Election is less than six weeks away. Barring an October surprise, it looks like Barack Obama will win a second term as President of the United States. Also, Democrats, particularly Claire McCaskill of Missouri and Elizabeth Warren of Massachusetts, have a good chance of maintaining a majority in the Senate and perhaps regaining control of the House of Representatives. As an American, such a result will raise hopes for continued economic recovery and a return to the prosperity of the 1990s, the last time there was a Democratic Party sweep of the Executive and Legislative branches of government. However, as an expatriate American, I am apprehensive about what other laws Congress, in its sometimes misguided infinite wisdom, will conjure up under the mistaken notion that all American expats are criminals.
Everything changes for expats after each election season. You see, campaigns, particularly during the presidential elections every four years, have candidates and/or their surrogates host series of fundraising events around the world in order to raise much needed cash especially in this new era of billion dollar campaigns. The Obamas and Clintons did it in 2008, so did Rudolph Giuliani (during his ill-conceived race for the Republican nomination) and John McCain.
More recently, Mitt Romney was infamously in the news for his ill-timed $2 million dollar campaign event in London which came at the heels of his unwise statements about his host's missteps in preparing for the 2012 London Olympic Games. Instead of burnishing his foreign policy credentials as he had hoped, he gained the hatred of the British Press and was dismissed by the Buffon-like Mayor of London in front of a crowd of young Brits pumped up at the prospect of their home country hosting the Games. During his turn on the world stage, Romney got plenty of criticism literally every step of the way for his verbal diarrhoea of "disconcerting " and misplaced remarks on "culture ," whether it be British or Palestinian.
The Democratic Party has also held numerous events in cities like London and Paris in which folks as diverse as Obama Campaign General Counsel Bob Bauer and Vogue Editor Anna Wintour have served as surrogates for Obama at fundraising events.
During the 2008 election season, American expats around the world were all fired up and turned out in record numbers to vote during the November elections. But what did we get in return? We got FACTA. We got treated like tax dodging criminals by the IRS. And we are getting shunned by foreign institutions wary of having the US government peering into their books and dictating the way that they conduct their businesses simply because they have just one US citizen as a client or could have a US citizen indirectly as a client.
FACTA is the Foreign Account Tax Compliance Act of 2010, a way for the US government to increase revenue collection from foreign sources and combat those Americans who hide their wealth away in Switzerland protected by Swiss bank secrecy laws. It puts a burden on every non-US financial institution around the world to dig through their records and look for any indicia of US residence and/or citizenship among their clients and file reports with the IRS or else get penalized by having 30% of their US source income impounded by the IRS. The threat of having 30% of one's income withheld will make any financial institution dance to the beat of the US government's drum. But the consequence is that, in essence, what Congress, through FACTA, is telling American expats is that you are guilty until proven innocent and that one bad apple does indeed spoil the whole bunch. Reports abound about Americans being denied banking and financial services which has negative consequences for American businesses around the world and job creation in the US.
There is also the issue of taxation without representation. This is wrong and very un-American. One of the tenets underlying the founding of America is so blatantly violated when it comes to American expats. America is essentially the only country in the world in which taxes are based on citizenship rather than just residence. There is absolutely nothing wrong with a government trying to collect every penny that it is due, but what is wrong and abhorrent to the fabric of America is that American expats are so taxed and yet have no representation in Congress. The French on the other hand, a government that does not tax non-resident citizens, have allotted seats in parliament to their expats in order to take into account the interests of all French citizens far and wide whether within the territorial boundaries of France or beyond.
As this election season ramps up and then winds down towards conclusion, it is incumbent on both parties not just to seek out American expats when they need money, but show them that they truly do care about their well-being by not ignoring them once the elections are over. If that happens, America may have fewer opportunistic citizens like the Facebook co-founder who gave up his US citizenship ahead of Facebook's multi-billion dollar May 2012 IPO.
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