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Should you Stay Onshore to Protect Your Assets

By John Dietz - Email Editor - Editor Bio

Date : 04-Dec-2007

Dear Subscriber:

Today’s discussion is set forth to enlighten you on the realities of why linear thinking will not work to protect your assets. I refer to linear thinking as a thought process of moving from point A to point B, taking the same route repeatedly and in some ways, I am speaking metaphorically of thinking “in the box” as opposed to “out of the box.”

Everyday I get questions about whether someone should go offshore to protect their assets or use domestic tools. I generally respond with a question. What is the biggest offshore tax haven jurisdiction is the world? The answer may surprise you. You were most likely thinking of some small island nation, unless you were considering the island of Manhattan. The fact is the US holds almost 30 percent of its deposits from non-US citizens. This money is not taxed by the US as long as the beneficial owner of the account is not a US citizen.

So why would a US person go outside the US to look for asset protection? One does not need to look further than the Full Faith and Credit Clause of the US constitution. Please click here to review

The framers of the constitution, along with others, probably knew all to well that conflicts and strife were some of main building blocks of a strong nation. Benjamin Franklin, Thomas Jefferson, Alexander Hamilton, George Washington and James Madison understood what people can inflict upon each other.

It should be no surprise that the Constitution of the United States implies that there was a great possibly that the US would be litigious and that there are many clues as to how the forefathers would have handled their wealth preservation today.

It would seem that they understood the delicate balance between freedom and protection by intentionally omitting a bill for The Right to Privacy (click here to learn more about your Right to Privacy). Yet the Constitution defends the right to protection as in the Second Amendment (The Right to Bear Arms), Fourth (Right to be protected from unwarranted Search and Seizure) and the Fifth (Right to Due Process), Amendments, just to name a few. They clearly understood that there is a difference between privacy and protection.

Do you think that they would have made efforts at protecting their assets and reducing their taxes? Would they have taken their money offshore or left it onshore given the choice? How would they react to the over litigious society that we live in today (click here to find out more).

This may sound far-fetched, but the forefathers and drafters of the Constitution and The Bill of Rights were no strangers to fighting, both civically and physically (as in war). They even planned that people in the United States would be responsible for all consequences to others in the Full Faith and Credit Clause.

If we are intelligent enough to learn from the past and diligent enough to study the outcomes, we may have some of the answers that we need to make good decisions for making investments, protecting our assets, preserving our wealth and planning our estates. We are granted the legal right to this control, the proactive. When you play chess or checkers, you control your move; you do not control the moves of the other player, until Checkmate!

A lawsuit is a fight. If you have ever been involved in a trial, you would understand the punches being thrown back and forth in the courtroom. After a day of trial, the defeated attorney will certainly feel the beating, while the winning attorney goes home hyped on the advantages he will have the next day.

Law was the common denominator of our founding fathers and the founding fathers of all countries. All law men were engaged in the fascination of man’s role and place in society in both peaceful times and times of disagreement and war.

Thomas Fuller, a British Oxford Physician and philosopher who is often quoted today (1645-1734), said “Law cannot persuade where it cannot punish” and Benjamin Franklin (1706-1790) said, “Laws too gentle are seldom obeyed and laws to severe are seldom executed.”

Thomas Jefferson (1743-1826) said “The care of every man’s soul belongs to himself. But what if he neglects the care of it? What if he neglects the care of his health…or his estate? Will the magistrate make a law that he shall not be poor or sick?”

You might ask, “How did they know?” They knew because the fight has been going on for centuries. The law of the paradigm is that the shift always returns or cycles back. There were times when society went topsy-turvy, such as the industrial revolution. The names Andrew Carnegie, Henry Ford and John D. Rockefeller are thrown around today in the name of capitalism…and protection. (All took advantage of offshore banking and trusts.)

In the cycle, so many of our ancestors realized that with growth comes the need for protection. This is because capitalism is a virus that spreads. Once the “haves” are exposed, it is human nature for the “have not’s” to want.

Mohandas K. Ghandi (1869-1948) said “As in law so in war.”

When we speak of the higher minds that have engaged us with politics, literature and government, it is certain that they had a wisdom that enabled them as visionaries. James Madison (1751-1836) said, “So strong is this propensity of mankind to fall into mutual animosities, that where no substantial occasion presents itself, the most frivolous and fanciful distinctions have been sufficient to kindle their unfriendly passions and excite their most violent conflicts”

These leaders have all esoterically created documents and left a legacy of philosophy that understood and predicted what was to come. They predicted war, men trying to escape their debts, litigation, narcissism, trends and swings, violence…and they protected themselves from it.

I quote W.L. Saunders, Member of New Jersey election, in his 1911 article defending the Alexander Hamilton position on tariffs against the Payne-Aldrich Prohibition System (concerning the taxes on sugar imports)…claiming that Hamilton’s policy of a 10 to 15% tariff had been distorted by the interest of the government…

This is not the present American system (referring to Alexander Hamilton as an example). It began right and in all considerations would have continued on reasonable lines if the prolonged use of power had not fallen into the hands of special interest groups and it became the wheedling handmaiden of wealth.

The forefathers who designed the guide for our society knew all to well because they experienced similar conditions just maybe not the same magnitude, but then again, maybe they felt the pain of these issues just a extensively as we feel today.

Here is George (Washington) who needs no introduction…on taxation,

“There is no such thing as a tax that can be devised without inconvenience and unpleasantness.”

Would these great men have looked for alternatives? What is your vote?

“Should you go onshore or offshore?” what would their answers have been? Though we think the path is clear, we do not see a straight line. The commonalities of human nature creates the thread of protection that all people need.

Until next time,

John

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