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governance

What Do I Get Out of It?

Jan 31st, 2007
by jas.
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Every day, the American leadership asks Sunnis and Shiites: isn’t it time to forego your petty loyalties and forge a new and powerful Iraqi nation? The benefits seem clear enough: personal safety and security; the possibility of economic reconstruction; an independent nation without meddling from Iran and Saudi Arabia, much less the US. In many regions of the world, the emergence of nationalism and meaningful governance are one and the same.

Now, step-it-up one level, and ask the same question of Germans, French, and Greeks: Doesn’t it make sense to invest the European Union with more power, not less? The Euro has been a great success; why not ask for the same result in a unified code for legal systems and contracts, the regulation of monopolies like Microsoft, and trade negotiations with China? Does it really make sense to balkanize food and drug regulation, passports and immigration, anti-terrorism police work, or government oversight of financial markets?

Historically, we have seen many nations that were sustainable on a higher level of federation – e.g., the US after the Civil War – and many that were only sustainable on a lower level – e.g., the Czech Republic or Bosnia. There has been a great deal of political science devoted to understanding the difference. At some level, it comes down to millions of people deciding that “they will get more out of it” by affiliating at a higher level.

Globalism is really just the next level of aggregation. It makes sense because globalization is already well underway; what lags is governance. Not UN-style bureaucratic sluggishness, but governance in the same sense that we support national governments for domestic issues. Imagine if political disputes between two [United] States were resolved in the same manner that Britain and Argentina resolved the Falklands dispute. Or, that the FDA was a state-level function, and required drug approval in all 50 states before a drug could come to market. We have no trouble supporting government within a nation that has sufficient coherence, power, and authority to govern effectively. With globalization a fait accompli, we need more than a Wild West form of governance to achieve a civil world.

The question is, what should citizens do? You could send a check to Doctors Without Borders, or UNICEF, or Amnesty International. You could join one of the many interest groups with a global perspective on human rights, the environment, or worker safety. These are all worthwhile causes; eventually the global commons could metamorphose into something more civilized. However, I wouldn’t hold your breath.

Expat Nation is potentially a novel and viral way for non-governmental forms of benign authority to emerge. First and foremost, it is not the UN, which as a descendent of nation-state politics is constrained to a very limited sphere of activity. Expat Nation is based on a different organizing principle: people with common needs and values voluntarily adopting a new, super-national allegiance. It is grassroots and self-selected; you don’t have to be born into it but you do have to choose to “immigrate.” As guests in host countries, expats have a unique position in the commerce of nations – if we don’t add more value than we cost, nations simply boot us out. As itinerant, unrepresented residents in host countries, we need more than our embassies and Chambers of Commerce to lobby for our interests.

What are our interests?

  • No taxation without representation
    • Focus tax revenues from expats on protecting the global commonwealth
  • The free movement of labor and capital, backed by . . .
  • Global institutions of law
    • Adoption of simplified means of conflict resolution that are scaled to the size of the problem, but backed by Expat Nation members
  • Uniform practices and policies to:
    • mitigate exploitation of the unprotected
    • rein in corruption
    • counter terrorism, the drug trade, and multi-national mafias
  • Encourage transparency in governance through the free flow of information
  • Give up anonymity (in tax reporting, [secure] internet usage, and most public roles) in exchange for accountability, security, and the protection of individual human rights
  • Enhance systems of trust and reputation to enable cooperation among unrelated parties
  • Democratic, but constrained by constitutional agreements to maintain a . . .
  • Globalist perspective over nationalist interests

The devil is in the details. As a work in progress, most of the details are still up for discussion. After all, this grassroots movement needs democracy and participation! There is no question that these general principles are rife with potential conflicts and internal inconsistencies. Where does legitimate national interest end and the global commonwealth begin? When is personal privacy protected and where does public accountability become more important? These questions are not easy to resolve with Expat Nation any more than they were without it.

I am optimistic that Expat Nation members can resolve these issues and move forward to establish more powerful and effective means of governance. We have a greater stake in successful globalization than most of our national brethren. Because we will aggregate based on shared interests and values instead of birth location, we can overcome the greatest barriers to collective action.

Equally important, globalism has been around the world of big ideas for quite some time, and it does not have a lot to show for it. We need to reconnoiter, learn from history, and start fresh. Today, I have no trouble identifying dozens of policies that could be adopted by Expat Nation “members” that would directly benefit me. Would others benefit the same way? Would these be enough to push potential members over the tipping point, from pure-nationalists to Expat Nation dual citizens? Without critical mass, Expat Nation will surely die.

Expat Nation is compelling precisely because there is “something in it for you.” It is not purely philanthropic; it is potentially a win-win for expats and host nations. To paraphrase Alfred Sloan (former president of General Motors), “what’s good for expats is good for the world.” Or, a little less arrogantly, expats are uniquely positioned to create and adopt civic governance that will benefit globalization and host countries alike. The challenge ahead is to build “Governance 2.0” from scratch; gathering a critical mass of participants to be powerful, while staying true to the principles that make it effective.

To borrow from Robert Frost:

He only says, “Good fences make good neighbors.”
Spring is the mischief in me, and I wonder
If I could put a notion in his head:
“Why do they make good neighbors? Isn’t it
Where there are cows? But here there are no cows.
Before I built a wall I’d ask to know
What I was walling in or walling out,
And to whom I was like to give offence.
Something there is that doesn’t love a wall,
That wants it down!”

[from Mending Wall]

Death and Taxes?

Jan 25th, 2007
by jas.
2 comments

Death, maybe. Taxes — in the era of global tax havens, widespread fraud, and code complexity that even the enforcers can’t figure out – are anything but certain. As an American who is taxed on all his income, because of citizenship, I was surprised to find the vast array and variation of expat taxation. It feels a lot like going to an expensive bar and finding out that everyone is getting free drinks except you. While I cannot believe that I am the only expat in the world paying taxes according to what all the governments say they are due, it certainly feels that way.

One of my most profound realizations about taxation came when we moved to China. Here, it is hard to find anyone who would pay any tax that was self-reported. Income tax filings? Hah! Most Chinese laugh at the suggestion that such an honor-based practice could ever work here. This led me to wonder where the American habit of voluntarily paying taxes originated. More important, it led me to realize that much of the strength and power of the American government derives directly from the willingness of Americans to be taxed according to a system that they believe (on some level) to be fairly legislated and executed.

I believe that global civil society is at an important juncture: either go down the path of narrow self-interest and paying minimal taxes, or recognize that governance and civility ultimately depend on a fair system of tax codes, enforcement, and compliance. As the “only paying customer at the bar,” sooner or later it makes sense to make sure others are pulling their weight. As a founding principle of Expat Nation, it makes sense to represent the paying customers instead of the free riders.

Let’s face it: taxes are broken. I could spend hours listing all of the random exceptions and perverse incentives, the overhead of collection and enforcement, the inability to corral free riders, and the huge inequities among peers not to mention “progressive” transfer payments between different groups. The question is, what can expats and Expat Nation do about it?

To begin with, it would make sense to focus on information, research, and representation. The “paying customers” benefit by knowing how much everyone at the bar is paying, even if the “comps” [complimentary customers] do not. It is easy to research tax codes for various jurisdictions to determine how compliant taxpayers in different countries fare in each. It would be even better to understand what the real payments are, much like looking over the tax returns of candidates for public office. Obviously the IRS has access to much more information than we do – is any of this available from the Freedom of Information Act? It would be very interesting to drive through some of the ritzier neighborhoods in the world, identify the occupants of the numerous mansions, and compare their tax burden.

The next step would be active representation of expat interests, to all host nations. For example in China, where real estate taxes and regulations were recently established for foreigners, no one represented expat interests except some real estate agents. I have read rumors that China plans to tax residents on all income, not just China-sourced, under a new income tax policy. What would happen if an organization representing the million or so expats in China, collaborating with Chambers of Commerce and embassies, coordinated a response?

In the realm of “poli-fi,” there are many opportunities for Expat Nation. Imagine an existing nation, such as Costa Rica or Panama, actively soliciting expats to become citizens without domicile. The expats would be taxed and managed in a different way than host-nation residents and citizens: their tax revenue would be earmarked for separate spending on Expat Nation priorities, less a small service percentage for the host country. The Expat Nation taxes would therefore be a tax credit against other countries’ taxes, such as the US’. Then, US expats could choose to allocate their taxes to solve global infrastructure problems, instead of paying to police Baghdad. How to spend this money would be, in my opinion, a “nice problem to have.”

I would certainly “emigrate” (or adopt dual-citizen status) if this were available. . .would you?

Governance

Jan 23rd, 2007
by jas.
No comments yet

There is a research group at the London School of Economics called The Centre for the Study of Global Governance (see http://www.lse.ac.uk/Depts/global/researchgcswhatis.htm ):

Global Civil Society is about understanding globalisation ‘from below,’ from the perspective of ordinary people.

It is a highly contested concept, for which many meanings have been proposed but no agreed definition reached. Far from an obstacle, this ambiguity is an opportunity. Debate about its meaning is part of what global civil society is all about.

We defined global civil society, for operational descriptive purposes only, as a sphere of people, events, organisations, networks – and the values and ideas they represent – that exist between the family, the state and the market, and which operate beyond the confines of national societies in a transnational arena. The concept describes an emerging reality of global civic action and connectedness.

Expat Nation is a subset of global civil society; it is a subset of the population that has chosen (or, in many cases, has at least adapted) to live away from their homeland. For many expats, of course, their identity is completely nationalist. For another large fraction of expats, they are clearly in transition from one national citizenship to another. But for a large and growing group, their citizenship is as much in global civil society as it is to any national state. When expats cross this line, they become citizens of Expat Nation.

This definition, of course, begs the question: “What is citizenship”? At a pragmatic level, it is as basic as the country that issues our passports. For many reasons, this definition is inadequate – dual citizenship, exile, and landed immigrants all defy categorization in this way. But more important, as an accident of birth instead of choice, and as a characterization of loyalty, national citizenship is no longer adequate.

Beyond representation overseas – i.e., passports and embassies – expats experience the ties of citizenship in many ways. Most of us still pay taxes to our homeland; we have family members who are subject to real or potential military conscription; and we are often discriminated against by host nations according to our nationality.

Similarly, representation of expats is already performed by many organizations other than national governments. For example: the chambers of commerce, the International Baccalaureate Organization overseeing international schools, and professional certification organizations are global institutions with some measure of membership and professional control. Charitable organizations like the Gates Foundation and the Clinton Foundation are international in scope and governed solely by their donors, however subject to public and international approval for their legitimacy. In the financial realm, stock exchanges and GAAP define the parameters of disclosure for public and multinational corporations. In addition, internationalist organizations such as the WTO, the WHO, and the UN peacekeepers around the world demonstrate the increasing reach of nationally-controlled international institutions and conventions. The emerging governance of global civil society is already well underway.

The key political question regarding governance of global civil society is “Who controls it”? There is a big difference between institutions under national government control – such as the UN, the WTO, and the IMF – and “bottom-up” organizations with specific missions and constituencies. Trying to satisfy the disparate and conflicting interests of national governments is like herding cats. Membership-driven institutions “from below” are likely to be much more effective in representing the interests of Expat Nation.

Expat Nation members have legitimacy in representing global civil society that nationals do not. As invited guests in host countries, subject to a clear “balance-of-payments” that always favors the host nation, expats are limited to win-win policy formulation. The days of colonization and imperialism are over – expats know that their social value must exceed their social cost within each host country.

Because of this legitimacy, the exercise of collective power by expats could be profoundly effective. We have already seen the power of NGOs such as Doctors Without Borders or the Clinton Foundation. Expat Nation could potentially exceed the membership of a large NGO (e.g., the Chambers of Commerce) but with a truly global constituency. With funding (a subject for later. . .), Expat Nation could become the major representative of expat interests.

Equally important, Expat Nation should be different from NGOs and organizations like the Centre for the Study of Global Governance in that it will be interest-driven rather than purely philanthropic. Expats are clearly beneficiaries of globalization, even if they are employed by NGOs whose primary function is to mitigate the adverse consequences of globalization. Finding a balance between narrow self-interest and advocating for global constituencies will be difficult, but hardly impossible. These somewhat-conflicting interests are at the heart of so many global issues today. By addressing these conflicts first within the purview of expats, it is highly likely that a reasonable balance can be struck, and hopefully, one that is transitively win-win for the global commonwealth.

The Governance section of the Expat Nation blog will explore the nature and potential of grass-roots initiatives for global governance. I hope that readers will submit ideas and suggestions that are prescriptive and normative. One reader coined the term “poli-fi” with its allusions to science fiction, political science, and Semper Fi – I think this pretty much captures the ideal spirit of Expat Nation.