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WHERE CAN YOU AFFORD TO RETIRE TAX FREE?           WHY ARE SO MANY OF THE MIDDLE CLASS LEAVING THE US & EUROPE?

Our October 2003 Newsletter:
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News Items: Divide and Rule in the Caribbean, US Dollar declines versus the Euro, Hispanic Soldiers in Iraq.  Panama News and Information....
John Schroder - Author of The Ascot Advisory News Letter Bulletin and Numerous Expatriate  Articles
IN THE NEWS:
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U.S. DOLLAR POSTS SEVENTH WEEK OF DECLINES AGAINST THE EURO
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Oct. 11 (Bloomberg) -- The dollar had its seventh week of losses against the euro and fell versus
the yen on speculation finance ministers from the world’s largest economies will let the U.S. currency continue its decline.  Declines for the dollar accelerated to 3.7 percent against the euro and 4.7 percent versus the yen since Sept. 20, when the Group of Seven industrialized nations called for more flexible exchange rates. President George W. Bush during a trip to Japan next week may lobby the country to stop selling yen, which pushes the dollar higher. European policy makers said this week they aren't concerned by the euro's rise.  The sheer magnitude of the decline suggests further dollar losses are likely in the weeks ahead, with the euro surpassing its record high of $1.1933 reached May 27, said Christopher Rupkey, senior economist for the Bank of Tokyo-Mitsubishi in New York.

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http://quote.bloomberg.com/apps/news?pid=10000006&sid=
acJ6yohAoUn4&refer=home
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EDITORS NOTE: As of October 25, the Euro hit an all time high of US$1.17 as other major currencies also hit long-term highs versus the US Dollar.
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THINGS ARE LOOKING UP (Unless You Want a Job): This economic recovery really is different—and that has a lot of people worried. Should they be?  FORTUNE - Monday, September 15, 2003 - By Justin Fox and Anna Bernasek
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The economic news has been almost all good lately. Manufacturing is on the rebound. Corporate profits are up. So are retail sales. In the U.S., third-quarter economic growth is expected to clock in at a close to 5% annual clip. Other major economies - even Japan's! - - - Are finally showing signs of economic life.  It's almost enough to make you believe that after three years of economic coughs, fits, starts, and disappointment, we're finally in the clear. That's certainly the consensus on Wall Street.  I'm highly confident about the economy, says Jim Glassman, senior economist at J.P. Morgan Chase.  There's been a distinct change in mood. And whenever confidence in the outlook changes, the economy takes off.  But there's one statistic that keeps getting in the way of such positive thinking.
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http://www.fortune.com/fortune/articles/0,15114,485656,00.html
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THE US IS FALLING ASLEEP ON THE JOB: Jobs have left before, but this time America's place in the global economy is at stake.  FORTUNE Magazine - Tuesday, August 12, 2003 - By Geoffrey Colvin
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The issue du-jour is being framed as jobs, which is a shame because that sounds like a movie we've seen before, and it isn't. Yes, American companies are firing U.S. workers in rising numbers while hiring more foreign workers, and unions are yelping about heartless bosses, and politicians are solemnizing—all that does sound familiar. But the surprising fact is that while CEOs are happy to be saving money by hiring good accountants for $6,000 a year in New Delhi, those CEOs are actually as worried.
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http://www.fortune.com/fortune/valuedriven/0,15704,475047,00.html
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JOBS GROWTH STILL LAGGING US ECONOMY:  Corporations seen cautious on hiring despite surging profits - By Martin Wolk, MSNBC
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Oct. 10 — Despite last week’s encouraging news that the economy added jobs in September for the first time since February, few forecasters expect any significant growth in employment over the next six months. That may be distressing to job seekers and current workers concerned about their prospects, but economists believe the latest wave of economic growth is sustainable even without the long-awaited surge in employment.
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http://www.msnbc.com/news/978749.asp?0si=-
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LET THEM EAT CAKE: A Taxing Proposal For Expat Americans?
By William P. Barrett, May 13, 2003

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U.S. citizens and resident aliens living abroad likely will panic over a new proposal by a Senate committee to eliminate tax-free status for $80,000 of earned income plus certain housing costs. But even if enacted, the impact could be less on many workers than feared.  The elimination is part of a plan by Senate Republicans to bring down the net cost of $350 billion to $417 billion in general income tax reduction, using selective loophole closers and tax hikes. The Joint Committee on Taxation estimates that eliminating the $80,000 exclusion will raise an extra $35 billion in taxes through 2013.  The income tax exclusion for U.S. citizens and resident aliens abroad was put into law about a quarter-century ago partly to encourage U.S. companies to send U.S. workers overseas. As recently as 1997 the exclusion was $70,000. Then legislation raised it in yearly increments of $2,000 to $80,000 for 2002 and later, or $160,000 for the somewhat unusual case of a husband and wife where each has sufficient earned income. Complicated rules allow housing costs exceeding a formula to be excluded from income if reimbursed by an employer, or deducted if not.  The exclusion has never applied to unearned U.S. source income of expatriates, mainly dividends and interest, although the exclusion frequently allowed these sources to be taxed at a lower marginal rate.
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The U.S. is one of the very few industrialized countries in the world that taxes the income of its citizens and resident aliens no matter where they live and where the income comes from. Most nations do not attempt to tax nationals who live and work abroad, if for no other reason than the difficulty of monitoring and compliance.
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http://www.forbes.com/2003/05/13/cz_wb_0513tax.html
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EDITORS NOTE:  Sort of makes you want to become a European, or in the least a dual citizen from somewhere else (that does not tax you if you are not living in your country of citizenship).  With that said, it is quite telling that the US Government is one of the very few governments in the world that attempts to tax citizens living and working outside of their home country of citizenship, and of course now they want to eliminate what very few tax advantages that do exist.  Of course, in the continued hunt for new tax money to pay off the ballooning deficit, it is not so surprising.
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NURSING A MARKET – By Heidi Brown, September 1, 2003 - More Europeans are willing to pay for private health insurance for better service and shorter waits. A patchwork of regulations still makes that difficult.
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Europeans may sneer at the health care system in the U.S., with its cost woes and coverage gaps, but they are pushing fitfully in the same direction. Although experts agree that health care in Europe will likely never be privatized completely, between 5% and 10% of residents are paying for some kind of private health insurance, whether to supplement the state system or to replace inefficient medical care that suffers from a lack of emphasis on service. Still, the market is tiny compared with the U.S.': European revenues last year totaled just $46 billion, versus $438 billion in the U.S.  In some ways Europe's health care troubles are remarkably similar to those of the U.S. Health care costs are spiking as an increasingly affluent population demands access to the new tests, drugs and procedures that are coming onto the market nearly every day. And a growing population of older people, living longer, is putting pressure on providers.  One difference is that Europeans remain far less litigious, and so malpractice insurance has not yet hit the astronomical levels seen in the U.S. Pharmaceuticals cost far less in Europe as well. Most important, governments foot most of the bill for medical care in Europe, through payroll taxes and subsidies from their budgets. In developed Asia--Japan and South Korea, most prominently--the situation is much the same. So Europe's course on medical care offers lessons elsewhere.
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Paul Wolf is an insurance consultant based in New York who helps people find expatriate plans in Europe. He says he has lived through three national health plans in the U.K., Canada and France. In the U.K., where the chorus of complaint grows ever louder, Wolf says the government probably sees private health insurance as a relief:  National health systems will run out of money before they run out of patients. He expects Britain's system to gravitate toward that of the U.S., where the indigent get government-paid care and wait longer for it, while the more affluent pay for private insurance out of pocket and get immediate care.
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http://www.forbes.com/global/2003/0901/032.html
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EDITORS NOTE:  Regardless of whether we are discussing North America, Europe or anywhere else – government run social insurance programs do NOT work (be it health insurance, be it retirement pension programs, whatever).  They all end up going broke, are poorly managed, and provide some of the worst levels of service to the public they are meant to serve.  There is a lesson in this for any up and coming or emerging market country that looks to emulate such programs currently in existence – let’s hope they study the idea well and think better of it (less they squander all that new found wealth and affluence quicker than they have attained it).
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COVERING THE TRAVELER’S ELECTRONIC TRAIL:  Practical Nomad author Edward Hasbrouck lays out the case that these enormously intimate records are too important not to protect
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To travelers around the world, Edward Hasbrouck is the Practical Nomad, the go-to authority on international travel, an expert on airfares, and how to get the best deals on the Internet. A few years ago, when the author of the Practical Nomad travel books started to worry about the privacy of travel data, few people paid much mind. Who cared if buying airline tickets or renting cars online would make it easier than ever for corporations and the government to know where you go, when, and with whom? Travelers were more concerned about tracing the best path to far-flung destinations than about being tracked them-selves.
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All that changed on September 11, 2001. The massacres at New York City's World Trade Center and the Pentagon put travel data in the spotlight. Within months, the newly formed Homeland Security Dept. had proposed creating a government database, dubbed CAPPS-II (Computer Assisted Passenger Prescreening System), that would combine names, addresses, phone numbers, and dates of birth, plus law-enforcement and intelligence files.  It's an effort to alert airlines and law-enforcement officials if someone fitting the profile of a terrorist tries to board a flight. Admiral James M. Loy, head of the Transportation Security Administration (TSA), has said his privacy amens, but he's vague about just how he plans to protect the personal information that will be collected and analyzed for CAPPS-II.
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So, Hasbrouck is leading a charge to persuade policymakers and citizens that travel data should be protected from prying eyes -- just as financial or health data are. Business Week Online reporter Jane Black caught up with Hasbrouck as he was on the road in Argentina. (Along with Uruguay, he believes Argentina is one of the world's best travel values.) Here are edited excerpts of their e-mail exchange:
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http://www.businessweek.com/technology/content/jul2003/
tc20030722_1438_tc125.htm
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WASHINGTON IS ACCUSED OF DIVIDE AND RULE IN THE CARIBBEAN - By Peter Richards - Updated Oct 5, 2003
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PORT OF SPAIN (IPS/GIN) - President George W. Bush’s recent invitation to meet some Caribbean leaders for a working breakfast is being viewed as another of Washington’s attempts to divide and rule the region, as the administration seeks more bilateral agreements to counter opposition to its global policies.  At least six Caribbean leaders were not at the meeting, leading to suggestions in the region’s media that their exclusion follows from their refusal to sign bilateral agreements with Washington to exempt U.S. nationals from the jurisdiction of the International Criminal Court (ICC).
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http://www.finalcall.com/artman/publish/article_1043.shtml
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HISPANIC SOLDIERS PAY A BLODDY TOLL IN IRAQ - By Miriam Kagan
Updated Oct 5, 2003

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WASHINGTON (IPS/GIN) - One of the first U.S. soldiers to die in Iraq, Jose Gutierrez, was an orphaned Guatemalan who at the time of his death was not even an American citizen.  As U.S. casualties in Iraq continue to mount, so does the worry in the country’s Latino community that its children are dying in unusually high numbers and are being lured into dangerous service with targeted recruiting by the Armed Forces.  Many in the community worry that Hispanic men and women are being disproportionately exposed to risk and sent to the front lines.  According to the Pew Hispanic Center, while Latinos make up 9.5 percent of the actively enlisted forces, they are over-represented in the categories that get the most dangerous assignments—infantry, gun crews and seamanship—and make up over 17.5 percent of the front lines.
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http://www.finalcall.com/artman/publish/article_1049.shtml
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As a follow up to our coverage of the West Nile Virus in the USA: WEST NILE CONCERNS
October 11, 2002 By Mark Tyler
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PORT REPUBLIC - This small town offers the perfect getaway for those who want country living just close enough to the big-city employment dollars offered by Atlantic City's 24-hour gaming.  But in late summer and early fall, there's trouble in paradise. Mosquitoes are so bad it's hard to enjoy even a few hours outside in the sunshine. Bordered to the North by the Mullica River and split by Nacote Creek, this historic town has a historic problem - mosquitoes.   I have a 60-acre farm," Clarence Hanselman said this week.  You couldn't even go over by the woods. If you took a deep breath, you'd have a mouthful of mosquitoes.  The Hanselman spread overlooks Nacote Creek and is close enough for him to fish from his back yard.  Hanselman, a longtime resident, said this year the mosquito problem has been worse than it's been in a long time.  I had on long sleeves, spray all over the place, and it wasn't fit to work outside, Hanselman said.  You don't even have to be by the water.  In addition to being a local Christmas tree farmer, Hanselman is a city councilman and heads the town's Public Works Department. Both he and Mayor Gary Giberson are worried about the threat of West Nile Virus.  Just like the 1950s, we have an epidemic of mosquitoes now, Giberson said.  Then it was encephalitis. Now it's West Nile.
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http://www.pressofatlanticcity.com/news/atlantic/101103MOSQUITO_O11.html
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READERS WRITE IN:
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Hi John:  You may find the attached article interesting. My thought is that there are mixed motives for the US declaration that they are now going to help the Caribbean stay safe from terrorists! My own viewpoint is that it is a clever way to drill into these countries and take more control of them. I guess I have become extremely cynical in my middle age years!  I have to say that we feel much, much safer in your home country (DR) that we do in the US.
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http://www.jamaicaobserver.com/news/html/20030928T040000-
0500_49585_OBS_AMERICA_WANTS_
TO_KEEP_THE_CARIBBEAN_SAFE.asp

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EDITORS REPLY:  Well, to tell the truth, many people do feel that things are being done or put into place all under the umbrella of fighting terrorism, but with the true intent or the real agenda as being something else.  Also, to touch upon your other comment, you are not alone in that a large number of our clients have chosen to expatriate to the Dominican Republic, and a host of other countries as well, with the goal of improving their quality of life.  
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Another Reader Writes:
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I got your information last year about the DR.  I was wondering how the peso to dollar changes (i.e.. exchange rate) has affected things there? Do you think it makes more sense to put dollars in the bank or take advantage of the exchange rate and cash them into pesos before putting them in the bank? I plan to buy land to retire there for six months a year when I retire in about thirty years. I traveled there in 1999 and drove almost the whole coast scouting the land for a place to buy. Samana Peninsula and South of Barahona are where I think I will end up buying do you have any thoughts about my two choices? Thanks for your time.
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EDITORS REPLY:  To be sure, devaluation has been felt most by the middle-class, as it has certainly made imported goods more expensive.  In addition, I would say that many stores have increased prices to some extent even though they may not be importing anything, in reality trying to use this as an excuse to charge more.  However, obviously most foreigners are not effected too much if they are exchanging dollars for pesos as of course they are simply receiving more pesos for their dollars (so it comes out even or better for them).  Although, again for foreigners, certain fixed costs such as rent, utilities, etc. have actually become cheaper when translated back into dollar terms, so for anyone with dollars, it has made some things that much less expensive also.
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With that said, the real answer is that anyone with the bulk of their savings in US Dollars has not been hurt at all.  So, to try and answer your question, it has always been true that we have suggested that clients do not place ALL of their funds into pesos or peso denominated investments for this very reason.  On the other hand, peso investments will offer yields of up to 24 percent whereas dollar investments no more than 10 percent.  The trick or issue is whether or not the exchange rates will remain somewhat stable (which they seem to be for the moment) going forward, or at least return to a sort of reliable devaluation of no more than 5 percent per year (which was the case previously). 
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In regards to Samana and Barahona, I would say both are very beautiful areas to consider buying real estate, although I would have to say that Barahona will still be a less expensive area to buy in relative to Samana (Samana has become discovered over the last few years and many Europeans especially have settled in there, whereas Barahona remains to be less developed, and less expensive as a result).
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Another Reader Writes:
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Hello Mr. Schroeder:  For a long time now I have been reading about all the benefits that the Dominican Republic has to offer. I have no doubt that this is all true because I have seen it for myself and have established some contacts there regarding the banking system, lifestyle, etc.  My concern is that what if the U.S. at some point decides to go after U.S. citizens that relocate with their U.S. dollar or starts to lean on the Dominican Government to report financial activity of any U.S. citizen. This lovely cash cow government of ours does have a long arm and what is to keep that from happening?
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EDITORS REPLY:  Well, this is an excellent question, but it really also applies to any country outside of the US.  In other words, it applies to Americans living and banking in Austria, Thailand, Ecuador, etc., etc.  I would say the real answer lies with the politicians of any country and how foolish they may or may not be.  Meaning, if you read the news article link above, many smaller nations in the Caribbean are not exactly in agreement with the US on many issues.  This does not mean they are belligerent, but it does mean that they (these smaller countries) want to maintain their rights as a sovereign and independent nation to respectfully disagree and act in their own best interest.  Such applies to taxation issues, import-export tariffs or duties, banking issues, etc., etc.  Personally, I would like to believe that the leaders of the Dominican Republic would never be that foolish, to do something that would be in contrary to their own best interest and long-term well being, and so far I do not see anything negative on the horizon in this regard with respect to foreign investment and related issues.
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Another Reader Writes:
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Dear John - Thanks for the newsletter - and thanks especially for the roundup section on the Dominican Republic as a place for escape.  Though it was illuminating as usual, I do have some reservations or questions about some of your contentions.
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EDITORS REPLY: Since you had quite a few questions going off in different tangents, please see my reprint or your questions and comments below, with my reply after each one as well.  I could not address all of your comments or questions, but I have addressed a few.
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READER COMMENTS:  A second passport won't necessarily save you from the IRS scrutiny.  Part of the Qualified Intermediary Program (QI) that our beloved Mr. Clinton – aka Slickodemus, the man who won election on the pledge of a tax cut  – wrote for us requires participating banks – more than a 1,000 worldwide, including all of the major private banks – to look at the place of birth on even a non-U.S. passport. If it says you were born in the good old USA – the William Jefferson Clinton Minimum Security Federal Prison to you and me – the Tax Exile Act of 1998 & 1999 kicks in – and if you're adjudged a tax exile, you owe tax for the next 10 years on all US-sourced income. Furthermore, you're not ever again allowed to return to the US. The constitutionality of this law is in question. As a result, clearance by the IRS can be pretty much pro forma - but you gotta ask - and they can say, no - string him up! It helps to have a job there or a Dominican lovely as a better half. Yum-yum! Did you catch Miss World on the tube?  Thus, changing citizenship won't necessarily break you out of Slickville Prison. The guy in your last e-letter said owing child support had locked him in. Well, smile maw-faws - we're ALL locked in to some level. As you pointed out, 1% of us now pick up nearly 40% of the cost of the Democrats' welfare state - what's in effect political patronage for the party of the American Left. And their propaganda mill is the American press - who spin us escape artists as unpatriotic tax cheats. Do you really think they're going to let us go willingly? - Only if we'll pay up for 10 years after substituting Splitsville for Slickville.
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EDITORS REPLY:  On the first issue, you are correct in that having a second citizenship in and of it-self will not cause you to become exempt from any tax obligations that the US Government thinks you might have or owe (of course your new country of citizenship might possibly disagree with this idea or concept, which makes for something interesting).  If I left an impression that was any different, then please accept my apologies.  In addition, you are quite correct in that even if you properly relinquish or renounce US Citizenship, assuming this is something you would consider doing,  (there is a difference between relinquishment and renouncement, but I tend to think not much in the case of the IRS, even though there is a suppose difference technically) that the US tax authorities say it is within their right to tax you for up for up to ten years afterwards (good luck to them if you happen to be living in Finland, or where ever).
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However, that is not really the point.  Which is to say, the politicians can pass a new law requiring you to wear red pants on Tuesday, and if you do not, they will incarcerate you.  What do you do in such a case?  Some people will lie down and accept it.  Some people will want to fight the government either by force or by legal political means (both somewhat worthless in my opinion).  Some people will think it better to just go and live somewhere else, somewhere less insane, somewhere more in line with their own thinking and philosophy.  So, in terms of the later, having a second citizenship (all quite legal, by the way) does allow you to travel and conduct business as a non-US Citizen, which can be a handy thing both economically speaking and otherwise (personal safety being just one other point).  It is like an insurance policy or legitimate escape hatch.  Does it really matter what any government thinks, says or does – if that government is abusive of it’s own authority and abusive of its citizens and you decide you want to get away from it? 
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Do I think the US Government will let the current otherwise law-abiding middle-class citizens who are expatriating go willingly?  Considering the amount of public debt, economic problems and insolvency of the public welfare systems – probably not as a general policy going forward.  But then again, the real question is – what do YOU want to do about it and does it really matter in the long run if you decide to do something as simple and peaceful as to go live somewhere else?  It is somewhat insane, in my opinion, for any government to claim a master – serf relationship over any citizen that has decided to move somewhere else.  Kind of life being in the Mafia, the only way out is through death.  Of course, unlike the Mafia, the US Government still looks to tax your estate, which means that even after you die, they are still taxing you. 
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READERS COMMENTS: The Dominican passport is a lousy travel document – esp. if you want to go back to the US for business.  Even if the Attorney General – at the behest of the IRS – hasn't adjudged you a tax exile – you still must get a visa to return to the US. The same is true for most E.U. nations, etc. The list of visa-free travel for a DR passport reads like Graham Greene's AK-47 Tour of the Third World.
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EDITORS REPLY:  Well, while it is true that the Dominican Passport does not allow for as much visa free travel as does say a European Union Passport, I tend to disagree with you on some of the countries you can travel to visa free in regards to being third world.  I tend to think that Japan, Taiwan, Chile and Argentina are not third world countries (although I must admit I am not familiar with Graham Greene’s AK-47 Tour of the Third World and perhaps he thinks Japan fits the category), but of course for many Americans, I also realize that there are still many who think electricity has not yet arrived in Europe either – so it certainly a matter of one’s definition or perception.  However, you would still now need a visa to visit the US with a European Union member country passport.  Meaning that considering the Irish, the French, the Dutch, etc., etc. all need a visa these days to just change planes in the US (visiting is another story altogether), it sounds like a passport from a European country would not suit you either.      
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READERS COMMENTS:  Can kidnapping of Americans make the DR more dangerous than the US?  I understand that this is a growth industry in the region.  Is there any truth to that? I know it's happening next door in Horror Show Haiti - but you're right - they share an island, but that's about all.
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EDITORS REPLY:  I honestly do not know where some people get their information (perhaps Graham Greene’s AK-47 Tour of the Third World), but I have never seen or heard of any such problems in the Dominican Republic.  In fact, most of our clients find the country to be very accommodating and peaceful.  If you have some legitimate news sources for these claims, please send them to me.  If this is something you overheard in the men’s toilet at the shopping mall – then that is another matter altogether.   
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Another Reader Writes:
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I want to know why our government (US) thinks it has to provide for our welfare.  Why doesn't it let us be self-sufficient?   Those who don't provide for themselves - - - tough cookie.   I don't want to depend on government for my well - being.   Why can't we just take care of ourselves?   I think we would be better off.
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EDITORS REPLY:  Well, this certainly is the Libertarian point of view and mine as well.  It is a good question, but with socialism being the order of business for most so-called developed countries, it is probably something you will not get a sensible answer to.  However, the real issue is that we have had socialism as a domestic policy for Canada, USA, and most of Europe for the past fifty years.  Are we really any better off?  Do we have a better society as a result, or are we merely producing wards of the state – and wards who just now are finding out the state is going bankrupt (and the state cutting back on the social – economic promises as a result)?  Is it still worthwhile to continue paying into a system that is bankrupt – A system that probably will not deliver on the promises for a retirement or pension check when you re ready to collect it (due to lack of funds)?  Some will say, such as US Congressman Charles Rangel, that not to do so is unpatriotic.  However, the converse argument is that you cannot pay your bills and send your children to college on an emotion (patriotism).  Why is it that we do not have freedom of choice (if we want to participate in a government entitlement or insurance program, or not)?  Most people interested in expatriating would probably rather move somewhere else to some country that does not tax them to death, with the understanding that yes – they are on their own (and prefer it that way), but at least the new government is not picking their pocket to the tune of 50 percent or more.      
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Another Reader Writes:
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Hi John - I always read your letter with great interest, and also agree with the concerns of many of your contributing writers. Recently there were some banking problems, which of course is not unique to the Dominican Republic.  If I were to move there, what kind of health insurance would I, as a retiree, be able to get? Is opening a bank account as impossible as in Panama, where according to a law firm you must have 2 bank references and 1 accountant or lawyer reference, or 1 bank reference, 1 accountant and 1 lawyer's reference? From the sounds of it, I'm surprised they don't require an alibi as to why you were born. It seems that 'laundering mania' has reached the absurd. I look forward to your reply.
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EDITORS REPLY:  Most of clients are very surprised to find out that private health insurance from local insurance companies is very, very affordable.  The last time I looked into monthly premiums for some of the very best plans in terms of coverage (at very modern private clinics or hospitals), the rates were about US$150 per month - which covers the family (meaning you, your spouse, your children).  Some plans even offer health coverage that includes a university hospital in Miami for something not available in the DR (although they have been and are doing open heart surgery in the DR, so let that guide you to some extent).  However, I always suggest that clients find a private hospital and or doctor that they like first – and then find out which insurance plans they are affiliated with (in other words, work backwards instead of choosing an insurance plan first only to find out the hospital you prefer is not on the list).
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In regards to banking, you are correct in that is probably has become more and more difficult to do something as simple as establishing a bank account, and this does include Panama.  However, the bankers in the Dominican Republic are not so ridiculous with the exception of two or three banks I would prefer not to mention.
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Another Reader Writes:
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I am starting a new business with a new product in Oregon.  I have been warned by friends - (whom have been down the road of self-employment before)  -  that the taxman will undoubtedly consume vast amounts of my profits with ridiculous rules and regulations.  In fact, a huge corporation, Louisiana Pacific announced yesterday that they were pulling up stakes in Portland and moving out.  One reason stated was due to Oregon's high income tax.  I have worked for years developing my product to perfection with no government assistance or blessing, and I know deep inside that soon as a few buck-skins begin to role in, the taxman will stick his finger out at me shamming me for my industriousness.  The tax and regulation onslaught in Oregon is growing worse.  The county in which Portland is a domain has recently voted in a social tax for schools, police etc.  The County is telling its citizens to estimate how much money they will earn in the coming six months, and pay that tax upfront as well as paying it retroactively.  This is the end of the line for me.  I want out.  I have heard very interesting comments about small manufacturing incentives offered by the government of The Bahamas.  I have done some background research about The Bahamas, but have found little detailed information of how to actually make the transition from the USA to this fine country.  If you can help me in any way to be better informed on how a real establishment of my business to The Bahamas can occur, or point me in the right direction, my serious consideration will soon follow
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EDITORS REPLY:  This is one of the reasons larger US corporations have or are in the process of domiciling to another country.  Of course the rub is that the small businessman is finding out just how inexpensive and easy it is for him (or her) to do the same.   I wish I could offer some extensive information about the Bahamas, but I cannot.  However, my advice is to contact the Bahamas Consulate in the US as I sure they have some information for you (or could direct you).  Aside from the Bahamas though, which tends to be a bit pricey both for labor and real estate, also keep in mind that many other countries have very attractive tax and other kinds of regulations for business to relocate.  So, while you are investigating the Bahamas, take a look at some other jurisdictions as well.
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Another Reader Writes:
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I wanted to tell you a little story about how much worse things are getting in the U.S.  The state of Nevada, the last bastion of Libertarianism in the U.S., was just taken over by socialists this summer.  The Governor with help from a legislating State Supreme Court railroaded the Nevada State Constitution.  The article below is a good one, but it doesn't mention that the State Legislature passed on their own with a 2/3 majority many bills that raised taxes through franchise fees, business licenses, liquor, tobacco etc.
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http://www.cfif.org/htdocs/legislative_issues/state_issues/nevada_judicial_activism.htm
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EDITORS REPLY: The vast majority of state governments in the US are facing serious cash flow problems and income short falls.  So, as a result, expect to see this across the board in terms of higher state taxes.  Ironically, one of the major reasons for this has been the US Federal Government reduction in aid to the states, which has been a result of so-called tax rebates, etc.  In addition, the US Federal Government is facing an unbelievable deficit; so do not expect to see this trend change anytime soon.
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Another Reader Writes:
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I HAVE RECENTLY VISITED THE DOMONICAN REPUBLIC AND FOUND THAT PROPERTY WAS VERY CHEAP. I LIKE THE OLD SECTION COLONIAL ARE WHERE YOU CAN GET GOOD DEALS FOR 35000.00   HOWEVER WOULD NEED TO BE RENOVATED.  I KNOW YOU ALSO HAVE AN OFFICE IN PANAMA.  APPLES FOR APPLES WHAT IS THE DIFFERENCE FOR THE COST OF RESIDENTIAL PROPERTY, CONDOS, HOUSES, ETC IN SANTO DOMING0---PANAMA CITY.
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EDITORS REPLY:  Clients often ask which country is better, less expensive, offers a more attractive life-style, etc.  These kind of questions can often be difficult to answer because everyone is different and everyone sees value differently as well.  However, speaking about real estate prices alone, I would have to say that overall Apartment prices tend to be lower in Panama, where as single family homes tend to less expensive in the Dominican Republic.  Why is that?  Well, there had been some over building in Panama in years past, so there still is somewhat of an excess of luxury apartments to be had.  In Santo Domingo however, there is more of a demand for luxury apartments than for single-family homes (everyone wants a luxury apartment in the city), so that is one factor or difference driving the real estate markets in each.  Farmland costs about the same in both countries, and I would tend to say I have seen more reasonably priced upper middle class homes in the Dominican Republic than in Panama.  In other words, you can find a slew of lower end new residential developments heading out towards the airport in Panama City, and then a large gap        
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This information has been compiled and presented by John Schroder of Ascot Advisory Services, for the benefit of clients and readers. Ascot Advisory Services provides assistance with such matters as offshore company formation, Panama Foundations, offshore banking, and special services in the Dominican Republic regarding residency, free zone applications, etc. For more information:  Use Reply Form