The “Summary Trial” hangover – Friday morning August 7/15
Yup my head hurts. I have a splitting headache. I don’t feel well. I can’ eat. I am not going to be able to work today. But, my “hangover” is not from too much alcohol. It’s from listening to and thinking about too much law. Too many statutes. Too many stupid arguments. Too much “splitting hairs”. Too many poorly written statutes. Too much uncertainty over what statue applies to who and when. It’s just too much. But, that’s what law is and what legal arguments are about.
This week I sat with about 20 people in a courtroom in Vancouver listening to a bunch of high priced lawyers and a judge (largely through written statements) talk about and try to apply law. I’m not even sure what I was doing there or what events in my life brought me there. After all, I was 1 of about 20. (There may be a reason there were only 20 people there.)
It begins in August 1977
So, in August 1977 I was just about to start law school. (It’s true. My classmates were Archimedes and Plato. Both passed law school.) I wanted to become a lawyer. I had respect for law. I clearly assumed that somehow law reflected standards of basic morality. During that time (like most law students) I was interested in ONLY what the law was and how it could be used. I didn’t care: how it was made, the values it reflected. I certainly didn’t appreciate how law (although in some cases a force of good) could be used to institutionalize evil. I had never thought about politics and how laws were made. It never occurred to me that in many cases, laws were made because people could help themselves by hurting others (the Canadian banks come to mind). Of course, I didn’t know anything about “place of birth taxation” and couldn’t have anticipated FATCA.
What law schools don’t teach …
A. The nature of the law making process
Government is by definition “force”. Political systems are NOT defined by WHETHER government is force. Rather they are defined by “WHO” exercises the force of government. In a democracy the coercive force of government is exercised (at least in theory) by democratically elected representatives. Of course (and we are seeing this today in Canada) a majority will use its majority to forcibly impose its will on a minority. (It’s the forcible imposition of the majority will on the minority that is the reason that we have a Charter of Rights.)
B. What law is
Law (at least statute) is a forceful legislative expression of the the objectives of governments. Once the law is made, the reasons for the law are no longer considered. The debate (if there ever was one) is over. What matters is:
“It’s the law.”
C. The effect of “It’s the law” or “There otta be a law”
Once a government makes a law the “issue is settled”. For example, lawyers will say: there’s no reason to discuss “citizenship taxation”. It’s the law. Canadian laws to facilitate FATCA have been made. FATCA is the law.
To put it another way, a way to stop discussion of a topic is often to pass a law. Once the law has been passed, what else is there to discuss? Furthermore, the framework of a law necessarily defines how any discussion of the law is to take place. The principles underlying the law are almost never discussed.
For example
Consider the following law:
“All U.S. persons in Canada must obey all U.S. laws.”
Prior to this law being enacted, there may be some discussion about whether the U.S. should have the right to control Canadian residents. People may or may not express their views on this issue. They may ask, “is this good policy”? If it is “good policy”, is it sufficiently important that “there otta be a law”.
Once, the law has been enacted, there is NO longer discussion about whether the law is a good idea. The terms of the law clarify that the only thing that matters is whether someone is a “U.S. person”.
Therefore, the passing of a law could be (and often is) a “diversionary tactic” to obscure the real issues. Laws operate to prescribe the terms of the discussion. Nowhere was this more apparent than in the “Summary Trial” on August 4 and 5, 2015.
What I witnessed on August 4 and 5 2015 would be described to a non-lawyer as follows …
What I saw (I think) was:
The Government of Canada, was spending money belonging to Canadian taxpayers to defend it’s “God Given” right to, to trade one million Canadian citizens into “U.S. Tax Slavery” in return for the United States to NOT attack Canada’s banks. Oh, and the Government of Canada is also agreeing to let the U.S. come back every year with new criteria for deciding which Canadian citizens they want to make U.S. taxpayers.
I have no doubt that this characterization will offend a certain “calibre of mind”, but I challenge you to identify a single word of this characterization that is incorrect.
The growing disconnect between law and morality …
The above tweet references an excellent post at the Isaac Brock Society.
We have entered a world where:
All laws have legal force, but only some laws have moral force.
What strikes me as I endure my “law induced” hangover is:
1. how the legal arguments at the Vancouver “Summary Trial” obscured an accurate characterization of what was really going on (see above); and
2. Obscured the truly evil intent of FATCA, CBT, FBAR, etc.
(To be clear, Justice Martineau – in a “breath of fresh judicial air” – did try to understand these issues. The Government lawyer did NOT want to discuss “what was really going on”. The Government lawyer’s main argument was” “It’s the law.”)*
But, hang in I maintain that we will win:
Today the Government of Canada is hiding behind “It’s the law” – but we will win because …
It’s very simple. At the end of the day, FATCA, CBT, FBAR, etc. are moral issues. They are just plain wrong. They trample the human spirit and impede human progress.
Don’t think about law and drive!
*Trish Moon in a comment to an earlier post, notes that:
I don’t think anyone should have the impression that anyone could possibly understand the issues as well as expats-so the OMG moment was more about the lawyers and the judge. Justice Martineau was truly impressive. He asked such relevant questions-and my impression was that he was not terribly thrilled with the defendants’ lawyer. I did not come away from this with any idea that J. Martineau fell for the idea that the IGA was a great deal for Canada. This would be hard to convey but he was affected by our presence in the courtroom. He got that this was about people – Canadians. I don’t mean he had a bias but more like he seemed to sense the big picture in spite of the nitpicking about whether the IGA was a treaty, how to read the Treaty, etc…
adcsovereignty
GwEvil
Patricia Moon
stephenkishadcs
trishmoon
Alliance for the Defence of Canadian Sovereignty 
Thank you for your observations. I wonder whether you might comment on extra-territorial application of national law. I can think of two situations in particular. (I am not a lawyer; correct me if I have it wrong.)
First, as I understand it, sex tourism is against the law in both the US and Canada. That is, a Canadian who goes to the Philippines for example and has sex with a child can be prosecuted in Canada upon their return to this country.
Second, in 1989 the US invaded Panama and arrested Manuel Noriega, who was removed to the US where he was tried and convicted for drug trafficking, racketeering and money laundering. He presumably violated US law while he was outside the US. This case of course is highly controversial. The UN General Assembly condemned the invasion as illegal under international law.
So, my question is whether these extraterritorial application of law are fundamentally different from the case at hand, namely enforcement of CBT on US persons living outside the US, and does it make a difference?
Many thanks!
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The Question posed by @NorthernShrike…
@NorthernShrike
Thanks for your comment. As you might expect, I am in the process of thinking these issues through.
I really don’t know. So, please consider my response to be a collection of somewhat random thoughts. In any case …
My thoughts …
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FATCA – Extraterritorial application today – Extraplanetary application tomorrow
The Tom Cruise movie Oblivion was a science fiction movie about what happened after the earth was invaded by an extra-terrestrial invader. The purpose of the invasion was to extract the “resources of planet earth” for the benefit of the invaders. The earth’s “capital and resources” were being extracted and transferred to the “extraterrestrials” (presumably for better use). The resources of the earth were being lost to “alien extra-territorial confiscation/taxation” policies.
“U.S. Extra-territorial Taxation” and international law
Interestingly the top three hits on the Google search “citizenship taxation and international law” are posts at the Isaac Brock Society.
What is international law?
First, international law exists primarily between countries and only to the extent that countries agree to be bound by it. International law (what there of it) is based on custom. A treaty is not really international law. It is simply a contractual agreement between two countries. In any event, I would define “international law” as something like an “expectation” based on custom that countries will behave in certain ways. That doesn’t mean that “international law” arguments aren’t relevant in court proceedings. As I write this I think of (for example) about the Geneva Conventions. What can be done if a country doesn’t abide by them?
https://www.icrc.org/en/war-and-law/treaties-customary-law/geneva-conventions
What about other aspects of the International law of war? What good is International law if a country chooses to not comply?
Does the United States recognize international law?
Well, yes. At least sometimes. On December 10, 1979 I woke up to hear President Carter’s Attorney General Benjamin Civilletti addressing the World Court. I remember it as being an extremely effective speech. He was arguing that the “hostages” should be released because their seizure was a violation of international law. Therefore, we know that, in some circumstance, the United States does recognize international law.
Considering your two specific examples …
Your examples are very different.
Prosecuting an individual in Canada
In the case of the “sex in the Philippines” we have a person prosecuted in Canada for conduct committed in another country.
Attacking/invading another country
In the case of the invasion that is a case of one country attacking another. I.e. the suggestion that the U.S. was in violation on international law was (if I am remembering this) that the U.S. had no right to invade another country because of conduct committed in that country. The reasoning would be that the lack of right to invade was what constituted the violation of international law.
These are quite different.
U.S. “citizenship taxation” and violations of international law
I believe that the issue should be considered in these terms because “citizenship taxation” affects both countries and individuals.
Now, let’s consider U.S. citizenship taxation. It has elements of both your examples.
First, there is no doubt that U.S. “citizenship taxation” imposes a direct tax on Canada itself and burdens Canada’s sovereignty (the extraction of Canadian capital). In that sense it is very much like the U.S. invasion of Panama. It is no different from one country going to another and “poaching” the natural resources of the country. For example, if the United States simply came to Canada and started cutting down trees, people would see that as an infringement of Canada’s sovereignty.
But, the forcible imposition of taxation on Canadian citizens is at least as bad and arguably worse. It is now beyond dispute that the United States extracts Canadian capital to the United States via “taxation of Canadians”. But, it’s worse than cutting down trees. Why? How could this be? The answer is that the U.S. is actually requiring Canada to pay the “compliance” (“cutting of the trees”) costs. So instead of:
The United States is coming to Canada and we are going to cut down your trees, we have:
The United States is forcing the Government of Canada to “cut down its trees” (absorbing the cost) and then shipping the trees to the United States.
All of this is an outright attack on Canada’s sovereignty.
But, a violation of international law????
If you agree that there is a doctrine in international law that one country can’t attack another, then U.S. citizenship taxation does violate international law. Frankly, I don’t understand why this argument has not been made. (I don’t think that many governments understand what U.S. “Extra-territorial Taxation” really is.)
The U.S. might respond by saying that it has the right to define who its citizens are and that U.S. citizens are U.S. property. Canada is harboring U.S. property. Therefore, Canada should pay a price for allowing U.S. property to “be habitually stored in Canada”. If you assume that U.S. citizens are “property” and not “persons” then this argument may have merit.
But, can the U.S. designate citizens of other nations as U.S. citizens/property?
I would agree that the U.S. can define who its citizens are in the U.S. I don’t agree that the U.S. can define who its citizens are when they are in other countries. The latter would be the acceptance of U.S. “extra-territorial jurisdiction” in an inappropriate way. (Obviously to allow the U.S. to come to Canada and specify who are U.S. citizens is to allow the U.S. to define what percent of Canada’s economy is under U.S. jurisdiction.)
The international community should NOT allow the U.S. to define who is a U.S. citizen when a person does not reside in the U.S.
Allowing the U.S. to people to be U.S. citizens, when they are citizens and residents of other countries should not be condoned by the international community. This is particularly true when the country prohibits dual citizenship and/or when the person is a citizen of his country of residence. Even the United States recognized this during the “Cook v. Tait” era. One of the almost unknown facts about “Cook v. Tait” was that the Treasury Regulation that allowed citizenship taxation actually did NOT allow U.S. citizenship taxation on those who had become nationals of the country they were residing in.
From a U.S. perspective – what if a “deemed U.S. person”, living in Canada fails to file forms? What can the U.S. do?
Is moving to Canada and failing to file U.S. forms the moral and legal equivalent of a Homelander going to the Philippines to engage in prohibited sexual activities?
No, I don’t think so. But, what they both have in common is:
1. The U.S. has made up a law and claims to apply it in an extra-territorial manner.
2. The person breaks that law. “It’s U.S. law!!”
What can or should the U.S. do?
I suppose that the U.S. could charge a U.S. citizen abroad in the United States for not filing U.S. taxes while in Canada. But, the idea of the U.S. coming to Canada and trying to “charge” a U.S. citizen for not filing U.S. taxes when he was in Canada strikes me as absurd. It is not a crime under Canadian law to NOT file U.S. taxes and forms. Could they try a private prosecution? Practically, I think that the worry of sanctions for not filing U.S. taxes and FBAR is a worry only if somebody returns to the U.S. But, that’s just my feeling.
But, the U.S. might force Canada to enact a Canadian law making the “failure to file U.S. forms a criminal offense”
At the moment, (I think) it’s not a crime in Canada to fail to file forms to the U.S. (I believe that the FATCA legislation imposed a legal requirement to answer the “Are you or have you ever been a U.S. citizen” question to the banks,
So, where does that leave the U.S. today?
So, IMNO the most the U.S. could do is execute a U.S. citizen abroad (probably for failure to file a form) when he returned to the United States. I expect that this question is going to become more and more relevant. I do NOT see people being enticed into U.S. tax compliance. The problem is that the “life restrictions” associated with U.S. tax compliance are so great that people will NOT see the benefits of attempting the impossible.
Theory aside, the practical reality is …
It is not good for any country to have U.S. citizens resident in that country. It’s really too bad that our “friends” at “Democrats Abroad” can’t see how these U.S. tax policies damage other nations. Oh well, they can think about this issue after the diplomatic problems become more apparent.
But, you ask very good questions …
The more these questions are understood, the more “pushback” there will be. The “understanding” is clearly increasing.
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