by Rick Levy
Another U.S. presidential election year is upon us, the second such event that has taken place since my wife Lydia and I relocated from America to the Philippines seven years ago. As I was completing my absentee ballot for the primary election in California where I’m a registered voter, I reflected on some of the issues about living outside the U.S.
American citizens who move abroad usually don’t do so arbitrarily. By uprooting themselves they give up the familiarity of life in the United States and often face many hurdles in adjusting to our new environment, one of which is the lack of meaningful political standing or voice that we had back home. For although we no longer reside in the United States, most of us expatriates do not severe our connections with America.Hence, we still have an interest in political and socio-economic events and issues in the U.S. which I for one have vigorously pursued. Yet, intentionally or otherwise, many of us have ended residential affiliation with the particular communities in which we lived before moving abroad. In doing so, we have effectively been cut off from legislative representation. In other words there is no member of the U.S Congress or Senate who is answerable to us in our status as expatriates even though we are still American citizens, voters, and taxpayers.
Now, it’s true that an overseas American can vote in presidential elections. And technically, by registering as an absentee voter from his or her most recent state of residence, we may thus take part in congressional and intra-state elections, and other political activity as well.
But let’s face it; if a voter has been away from his or her last Stateside address for a long period of time, holds no residential, property, or other interests there, and /or has no intention of returning in the foreseeable future (if ever), then how can he or she legitimately claim to have a stake in the affairs of that venue? Yet it is that locale which comprises the district from which we expats choose legislative and executive office holders. I still can’t wrap my head around having to furnish my last California address on various U.S. government forms such as voter registration, as though it were my current place of residence. If anyone is currently residing there, (s)he is also listing that same location for the same purpose. It all just seems so bizarre. However, an American living abroad has no choice but to furnish fictitious—or at least outdated—demographic data in order to participate in the U.S. election process.
To put it yet another way, there are approximately 4,000,000 American citizens living outside the United States. Most of them are of voting age, many of whom may have “participated” in the 2010 Mid-term congressional and previous elections, but not in terms of realistically expecting our own special issues as expatriates would be addressed.
One such concern of those Americans residing outside the country who are seniors is lack of access to reasonably priced health insurance (at least here in the Philippines). This is because U.S. Medicare is not available to Americans who live abroad. On a personal note Lydia and I were able to obtain private health insurance shortly after our arrival here, but the premiums are very expensive. As seniors, we recently we aged out of coverage for outpatient benefits on our policy, and Lydia is about to get a steep increase in her premiums for additional age-related reasons. So far we haven’t found any other insurers who will cover us let alone at more competitive rates.
A few years ago, in behalf of all health insurance-stranded Americans, both inside and outside the U.S., I wrote to three senators representing different states (and having what I thought were sympathetic political leanings) to enlist their support in addressing this issue by initiating or advocating legislation for universal health insurance including overseas portability for Medicare. However, none of them replied, perhaps because they saw no percentage in bothering with someone who is not only not a constituent but a non-U.S. resident as well. Without accountability, politicians apparently have no incentive to take up this cause.
More recently I wrote to two other Congresspersons who were purportedly friendly to Medicare portability. Again I received no reply. In short, American expatriates of all ages are on their own in securing health care coverage, which varies by country in accessibility to foreign residents.
Aside from health insurance issues, where can American expatriates turn for assistance regarding their other needs and interests as U.S. citizens? Our main contact with the U.S. government is usually the American Embassy in our respective countries of residence.
In the seven years that I’ve resided in the Philippines, the two consecutive U.S. ambassadors who have served here during this period have had ties with a blatantly pro-business and anti- consumer /anti-worker organization: (the local branch of) the American Chamber of Commerce. However, I’m unaware of these envoys’ concerns—if any—for the private citizen sector of the local American community, the 99% as it were.
One such problem that expatriates in the Philippines must contend with is the strengthening of the local currency against the U.S. dollar, which means that as time passes the value of the funds for those of us receiving social security or other income from the U.S. is shrinking. Further adding to the problem, there was no social security COLA increase as in 2010 and 2011. For Lydia and me, the worth of the dollar has decreased by about 22% since we originally relocated here. Also, in 2006, the Philippine began levying a 12% VAT (value added tax) on citizens and non-citizens alike for almost all purchases and services, even medical fees.
Don’t get me wrong. I very much want to see the Philippine economy prosper. Besides, there’s nothing the American ambassador can do about such matters as currency exchange rate changes and local taxes anyway. But just his acknowledgement to us regarding our concerns (including even the aforementioned Medicare issue) and his willingness to carry them to Washington would be welcome. However, that’s not likely to happen soon.
Moreover, it seems that the main focus of American embassies anywhere is the facilitation of travel for visitors or tourists from their respective countries of origin to and from the host countries. This is not to say that there are no embassy services for expatriates. But these functions are mainly technical in nature, such as civil status registration and passport renewals, veterans’ affairs, and social security matters.
And in a larger sense, whether or not we expats have a sympathetic ambassador or an embassy that looks after our interests is a consideration but not really the main point. Again, at the end of the day, what truly matters is our genuine political clout, and in this regard, Americans living abroad can contact lawmakers individually as I have done. We can also join local chapters of U.S. political parties in our respective countries of residence which many of us also do. In addition, there are also organizations such as ACA (American Citizens Abroad) which advocate in behalf of the U.S. expatriate populations.
However, recently, in an attempt to crack down on Americans hiding their wealth abroad, the IRS invoked onerous regulations via the FBAR (Foreign Bank and Financial Accounts) form and FACTA, both of which impact expats even of relatively limited means. FBAR is a lengthy document that is to required to be completed and filed by all Americans living abroad who individually have total assets of $10,000 on deposit with foreign financial institutions, whether or not these resources produce an income (such as a checking account). This amount is a ridiculously low minimum threshold for the IRS’s goal of catching tax evaders. I maintain that IRS should instead reset its sights to a much higher dollar figure in order to concentrate on nailing the big fish, not waste resources on vetting the non-affluent expatriates. After all, many overseas Americans are elderly pensioners who move abroad not to conceal their assets (such as they are) but for the very reason that their income is too meager to subsist on in the States but allows a decent standard of living elsewhere.
FACTA (Foreign Account Tax Compliance Act) on the other hand is a regulation imposed on foreign banks that have American account holders. It requires these institutions to report all American customers to the IRS lest they as well as their American clientele also are penalized. There’s more to this legislation than space permits to discuss here. Suffice to say, FACTA is an inconvenience to foreign financial institutions. So they will just as likely close the accounts of their American depositors rather than get tangled in IRS red tape. That in turn would pose a hardship for expats who need local banking services no less than do their counterparts within the U.S.
ACA is protesting these new requirements. Yet, doing so may be a just rear guard action that really won’t solve anything. After all, would these draconian tax reporting rules would have been implemented in the first place especially against low income expats if Americans living overseas had effective advocates in Congress to challenge or at least improve these codes before they were even passed? In short, without an elected representative who has the power to address and is truly responsive to our particular needs as expatriates, we are for all practical purposes disenfranchised.
It may be a long time before the American economy fully recovers, if it ever does. So the number of Americans living abroad is likely to continue increasing. I only hope that we expatriates can properly make the most of this demographic trend sooner than later so that we will finally be acknowledged as a political force to be reckoned with. As it now stands, in trying to make ourselves heard in Washington, we may just as well be talking to the wall.
About the author:
I was born in Chicago, raised in Indianapolis, and moved to California in where I spent my career in retail credit. My wife Lydia (to whom I've been married since 1970) and I retired to the Philippines, her home country, where we have resided since 2005.
My other works include another article for Expat Focus, "Moving To The Philippines, My Story". I have two blog sites: “Your Guide to Living In The Philippines” and “Towards a Rational America and an Enlightened Judaism”.