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Monday, September 17, 2012

Citizenship - Name Your Price

Broadly defined, citizenship is membership in a political community.  Like any club it has benefits and it has duties and responsibilities.  But citizenship is perceived to be something much more than just a simple contact between an individual and a state - this is not supposed to be like signing up with Club Med.  With citizenship some of the membership rules are explicit (defined by law) but many more are implicit (an understanding or an unwritten social contract).  A citizen can be fully compliant with the rules and yet fall afoul of the social contract and be vilified or shunned by the other members.

Attempts to reduce citizenship to a simple cost/benefit analysis or to tie it to monetary terms is almost always regarded with disdain, if not downright hostility.  Most people would agree that this connection is not something that should be bought or sold or traded (but it can be inherited or earned through service).  To be an American or a Frenchman or a Japanese is supposed to be something a bit more than just a set of rights and a list of duties.  What that "something" is can be hotly debated but it seems to come down to a kind of emotional attachment plus a willingness to sacrifice on behalf of the nation.  It is a status fraught with meaning.

So a suggestion that we think of citizenship as just another membership in a club where each individual does a personal cost/benefit analysis of present and future benefits and then swaps memberships at will according to his/her interests tends to arouse very angry, very emotional, responses.  Most people agree that citizenship is not a membership to be traded in for something better for purely financial reasons.  Those who are perceived as trying to do just that (Eduardo Saverin and Bernard Arnault) are considered to be the worst sort of traitorous villains.

And yet the nation-states involved (and their citizens) seem entirely comfortable with the idea of offering very interesting incentives to draw rich and talented residents to their shores.  Remember that every immigrant is someone else's emigrant and one state's gain is another's loss.  To those who argue that citizenship has no price (or should not be priced),  one doesn't have to look far to find ways that states themselves put a sticker price on citizenship/residency and invite migrants to meet it for mutual advantage and profit.  The U.S. and France are not exceptions to this.  Don't believe me?  My French spouse didn't so I went and looked and this is what I found:

Carte résident - contribution économique exceptionnelle:  For the modest sum of 10 million Euros and/or a commitment to create (or save) 50 jobs, an investor will receive a French residency permit good for 10 years.  As a bonus, the immigrant investor is relieved of two requirements:  the "Visite medicale" and the "Contrat d'Accueil et d'Intégration."  Citizenship in this case is just a short step away since someone who is deemed to have "rendu (ou peut rendre) des services importants à la France" can apply for French citizenship after a mere two years of residency.

Hard to see this as much more than a purely commercial transaction and the French government website is not coy about the deal:
Le critère de délivrance de la carte de séjour pour les investisseurs étrangers en France est explicitement lié à la contribution économique qu'ils apportent au pays. Ce nouveau dispositif vise à faciliter et à encourager le séjour des ressortissants étrangers qui s’engagent à effectuer sur le territoire français un investissement d’au moins 10 millions d’euros et à créer ou sauvegarder au moins 50 emplois en France. Ils reçoivent en contrepartie une carte de séjour d’une durée de 10 ans.
(The criteria for delivery of a residency permit for foreign investors in France is explicitly linked to the economic contribution that they bring to the country.  This new program is meant to facilitate and encourage the residency of foreign citizens who agree to invest 10 million Euros and to create or save at least 50 jobs in France.  They receive in exchange a 10 year residency permit.)
EB-5 Immigrant Investor:  This has been described as a "Visa for Dollars" or "Swapping boat people for yacht people" program.  If you ignore the citizenship-based taxation part of US tax policy this is a steal compared to France.  For the very reasonable sum of 1 million U.S. dollars (500,000 in a poverty-stricken area) and the creation of a measly 10 jobs, an investor get an immigrant visa and a conditional Green Card.  Once the probation period is over he gets a regular Green Card and a path to U.S. citizenship after 5 years.  Other advantages are being able to the family over and the children can work or go to a U.S. school and benefit from in-state tuition rates.  Investors must reside in the U.S. but they only have to be physically present on U.S. soil for 180 days out of the year.  The only catch is that they have the same reporting and tax obligations as other Green Card holders:  they must report and pay taxes on their worldwide income and assets. Again, like the French program, this is a purely commercial arrangement - a genuine quid pro quo.

So for 10 million euros you can be French (EU) and for 500,000 USD you can be American.

A hell of a deal, don't you think?

A modest suggestion to the citizens of the two nations mentioned above:  if you don't want individuals shopping around for the best citizenship "deal" and you wish to vilify those who do,  your moral posturing would be much more credible if you weren't the ones putting it up for sale in the first place.

9 comments:

bubblebustin said...

Get a load of Canada's investor immigrant program. For an investment of $800G's you can purchase permanent residency in Canada, AND-get this-the government will give you the money BACK in five years and two months after payment!
http://www.cic.gc.ca/english/immigrate/business/investors/index.asp

Christophe said...

Hi Victoria.

I love your blog posts. What you say here is very true.
One comment to show that the governments (at least the US goverment) really pay attention about the numbers is this story about this French family who moved to the US under a similar E-2 visa, and who got their Visa renewal declined because the authorities thought they were not making enough money(they called it a "marginal enterprise"). Oddly enough, their sons, who go to college probably under student visas are allowed to stay. They really don't care about splitting families. Cold hearted and sad.
Here's a link to the local story:
http://www.kxan.com/dpp/news/local/austin/business-owners-trapped-in-france
Maybe more attention shoud have been put into granting them the visa in the first place if they thought a bakery did not qualify for that visa.

Take care

Tim said...

Interesting article on IPolitics.ca

http://www.ipolitics.ca/2012/09/17/permanent-residents-who-live-abroad-could-lose-status-kenney/

It is interesting the extent to which tax and immigration policy do not contact each other at all.

Victoria FERAUGE said...

@bubblebustin, That is a darn good deal. And you can even get your money back? Very nice. I looked for "exit terms" for both the French and US deals and there doesn't seem to be any. This site talks about the risks: http://www.whicheb5.com/money-back.php
Something to think about if you are a potential investor - can you get your money out one day if it all goes sour?

@Christophe, That is amazing. Yes, the E-2 appears to be a bigger risk than the EB-5. http://www.whicheb5.com/eb5-holders.php
I can't believe however that they are kicking this French family out. Sounds like their business was doing fine (OK it wasn't a factory employing 500 workers) and was much appreciated by the locals.

@Time, Interesting. So it's not just the US that has trouble with inter-agency communication and a coherent immigration/emigration strategy.

bubblebustin said...

Just a guess, but perhaps the Canadian government doesn't wish to be considered to be allowing immigrants to buy permanent residency by keeping the initial investment. The seed capital is not the 'return' that the government wishes to attain through the process, it's the jobs, etc. Therefore the investment capital should rightfully be returned to the investor?

bubblebustin said...

Good article, Tim. I was wondering when they'd get around to those things.

Anonymous said...

Hi Victoria
You might find the on-line class from Coursera/Emory University interesting.
https://www.coursera.org/course/immigration
No start date yet, but perhaps something to bookmark.

Immigration and U.S. Citizenship
Polly Price

What does it mean for an immigrant to become a U.S. citizen? Through a background of historical and policy perspectives, this course will examine U.S. law governing how citizenship is acquired, the constitutional and international law foundations underlying immigration regulation, the role of the federal government in regulating immigration, and immigration law reform.

Cheers

Victoria FERAUGE said...

@bubblebustin, I think you hit the nail on the head. The idea of selling citizenship is something that most people find morally questionable. In an ideal world it's a status that is not supposed to have anything to do with money or socioeconomic status. But it does. Even immigration laws favor the rich and talented. But there is just enough queasiness in most places to encourage governments to at least make it look like citizenship and money are not related.

And that's why I was very surprised at the French and US programs. In fact my French husband just didn't believe that France had something like that. No beating around the bush either - this is "write us a check and get your residency card."

Victoria FERAUGE said...

@polly, Thanks so much for the link. I will check it out and sign up for it. US immigration law is very complex and right now there are all kinds of unresolved issues. I get the Immigration Daily newsletter from ILW.com and that has been an eye-opener. What is going on with the DREAMers, for example, is just amazing. What a mess.