I'll respond briefly here to the points both Sandy S. and Duncan F. make. Cypherpunks who are interested exclusively in RSA keylengths or in PGP Shells will not find this interesting. In my view, discussion of tax policies and the implications of crypto has a role on this list. Those who don't think so should hit "delete" now.
At 08:19 AM 7/15/94 -0700, Sandy Sandfort wrote:
Over the period I've been on this list, I've seen the optimism of various Cypherpunks wax and wane. Normally, I greatly respect Tim's opinions. Today, though, I think Tim is reflecting an emotional response more than a factual one.
Sandy, in his original post, went on to speculate that I am just ignorant of the methods used. I disagree. I've talked to legal folks, have strategized with friends who are also "persons of money" (to coin a euphemism) and there appear to be few options for me to avoid huge tax bites except via taking some pretty severe steps, like leaving the U.S. and not returning. I don't dispute that no schemes exist, I just claim that they're difficult to set up (not surprisingly, in my opinion) and that in my situation, with assets largely in the form of stock and real estate, there are no easy ways to convert them into tax-protected forms while remaining in the U.S. and while not being hit with a 35-45% tax bite. (Which I find unacceptable, for various reasons.) I have--don't forward this to the IRS!--toyed with the idea of simply moving to a tax haven. A problem is that the tax folks in the U.S. have a nifty idea that expatriates (ex-patriots?!) should still file U.S. tax returns for 10 years after departure. Enforcement may be tough right now, but I foresee advances in networks and border checkpoints leading to situations in which tax-haven residents are held at entries into the U.S. on charges of tax evasion. If this belief of mine is accurate, then leaving the U.S. could be a one-way ticket out. Maybe I'll go this route, ultimately, but it's certainly not an easy step to take...and not one I'm planning to take anytime soon, and not without a hell of a lot more thinking. (My friends in similar situations are investigating options. None look easy to take. Sure, Justin Dart can take his marbles and move to Belize, but his needs are different from mine. He doesn't need Computer Literacy Bookshop, Fry's Electronics, and a network of Bay Area friends, for example. And so on.) Duncan Frissell goes on to write:
Maybe Tim needs to leave the People's Republic of Kalifornia and go into "internal exile" in one of the United States which is less invasive.
Well, Kalifornia is not the main issue. It's max tax rate is 11%, compared to 39-41% (as I recall) for the Feds. So my _main_ concern is not Kalif. (I recall Duncan resides in New Jersey. An odd choice, I would think, given their tax rate and other peculiar laws. But I digress.) But I agree that the time may be coming for me to leave Kalifornia. I'd give some reasons, but many of you kind-hearted people would denounce me as racist, so I won't. (Suffice it to say I'm not a racist, I just believe every person and every business should be free to choose its customers and suppliers as it sees fit....Kalifornia is choosing to inject itself into nearly all business dealings under the guise of "fairness" and "antidiscrimination." I also see the social welfare system straining, with inner cities becoming cesspools of welfare and with unskilled immigrants being dropped directly onto the welfare rolls...a reason Kalifornia is deeply in debt and why businesses are seeking to expand elsewhere.) As a step short of leaving the U.S. (partly because I think that while the U.S. gets the Net attention for its Gorewellian plans, other countries are following suit or have already done so), I've been to Nevada to scout out property (no state income tax, lower real estate prices, fairly mild climate, little welfare) and plan to check out the coastal regions of Florida (also no state income tax). The Cypherpunks connection (if you've read this far, no one was forcing you to, so you must have found it interesting, eh?) is that I might even be involved someday in a true Caribbean node for a Net connection. (But don't expect me to move to the Turks and Caicos tomorrow!) --Tim May -- .......................................................................... Timothy C. May | Crypto Anarchy: encryption, digital money, tcmay@netcom.com | anonymous networks, digital pseudonyms, zero 408-688-5409 | knowledge, reputations, information markets, W.A.S.T.E.: Aptos, CA | black markets, collapse of governments. Higher Power: 2^859433 | Public Key: PGP and MailSafe available. "National borders are just speed bumps on the information superhighway."