A Private Tech City Opens for Business in Honduras
bloomberg.com
bloomberg.com
There are several pain points for people who want a remote, independent and flexible setup.
1- Residency: Visas and residency are a big headache. Almost every country makes it difficult to move there, and also unpredictable.
2- Passports: People moving from disadvantaged countries (poor) are often for the look out for an alternative passport.
3- Low taxation: Preferably close to 0 with direct taxation for infrastructure.
4- Online Infrastructure: Can you make a company online? Is English available? Are there services that make companies, take care of accounting online?
5- Banking: Can I open a bank account? A merchant account? Online options for banking.
As it stands, this program (or private city) provides nooone of that. It is just a 3.560 pages[+] of Spanish (or Portuguese?) that probably have nothing to do with your business or professional/life situation.
[+]: http://pac.hn/wp-content/uploads/2020/10/Prospera-Legal-Code...
On basically all the other points I agree, I really wish they were solving for residency/passports which are a nontrivial component of choosing where to live (especially for a long time). I pinged them about residency and citizenship options for people in Prospera some days ago and the answer was essentially that they're looking into it. Other countries have citizenship by investment programs (which I know have some ethical implications but at least provide clarity on legal pathways to becoming enfranchised in domestic politics).
I would think that would be far easier than a VISA / RESIDENCY rule change. Those things are usually deeply interwebed with the bureaucracy, and there's bound to be someone dissatisfied with a "special people" not subjected to the red tape everyone else is subject to.
My wife and I considered several years ago moving to a low cost tropical area and decided not to because the US government makes it very difficult to do banking while living elsewhere, and we decided to not be so far away from family and friends.
As a fellow American I agree it's a bit of a pain to move and do taxes in several places (and potentially be liable for taxes in multiple jurisdictions depending on income) but with a good accountant it's not that bad and getting bank checking (not savings) accounts abroad isn't too hard.
I would not like to live there.
[1] https://www.aljazeera.com/news/2021/1/26/the-spiralling-cris...
[2] https://www.hrw.org/world-report/2020/country-chapters/hondu...
[3] https://freedomhouse.org/country/honduras/freedom-world/2020
I’ve been stopped plenty of times by cops in US and have never had to pay a spot fine in cash
I've actually traveled internationally and worked in tough areas. US police / customs etc are not corrupt (relative to developing countries I've traveled in). This really makes me lose confidence in Amnesty unfortunately.
The US is relatively violent compared to developed peers and has some insane pockets of violence (east st louis etc). No question about that. This is stark when traveling to Asia or Western Europe - even "bad" areas in places like Germany are ridiculously safe relative to "bad" areas in the US. And that includes interactions with police (often unarmed overseas vs jumping on your back with a gun in the US).
I would be interested in some of the examples of tourists and visitors being killed by police - I pay somewhat close attention to that. There are issues of violence that really shock visitors to the US, including killings, but I hadn't realized the police were playing such a big role. Could you give some examples of visitors being killed by police (ie, the issue Amnesty is warning people over?).
A few paper reports doesn’t even begin to describe the real risks in Honduras. By comparison, US is a regional heaven.
There is a reason people are paying everything they own and more to get smuggled into the US.
In the US , you are not exposed at all to petty corruption, and the judicial system is mostly fair and works at a decent pace for all. However you are more likely to end up dead and or without recourse when the police turn hostile for whatever reason. The police is a guild that suceeds in protecting its members.
Elsewhere, down south, everyone is exposed to petty corruption, and generally, justice is far from fair and slow. However, you can pretty much get things done quickly ...with cash.
On the positive side, police don't go crazy on the avg person. They do seem to have some kind of respect to life. This is not because people are nicer, but because incentives are aligned : arresting or abusing the wrong person very quickly lands you in hot water, fired, with no income (lack of jobs) or even worse. Police mostly can't tell if a person is the son/daughter of some person with connections, and that is a positive externality.
The police is a profit-driven bureaucracy to protects its riches. Cross a "contract", or fail to abide by the rules, you are cut loose.
Police as a profit-driven bureaucracy can turn very nasty however when certain illegal industries use their money to leverage their power (drugs, etc). That's when you end up in situation's like Mexico's.
As people "pop" like popcorn all over the world (becoming worth vast sums of money), they are going to become rapidly disincentivized from living in high tax jurisdictions.
They will ask why they pay so much in taxes when they could join a commune with other ultra high net worth individuals and buy better services than they would ever receive in a big city.
Once you can get to anywhere on the globe in under 3 hours for a reasonable sum of money, this will likely become the norm.
The wealthy will just take their stuff and go somewhere else.
No individual owes anything to the bigger group. That's the principle. In practice you see a lot of abuse, sadly.
Do you have a family?
Do you work for a company?
Do you live in a neighborhood?
Do you hold money in a bank? Do you buy goods and services from corporations? You realize that you are not contracting with an individual when you do this, and the bank or corporation will continue to have your account in their (computer) systems long after any specific individual has left the company, because it doesn’t belong to any specific individual?
Everywhere you go, you enter into agreements with the people who are affected by your actions.
Money is just a paper or digital asset representing how much other people or organizations owed you and cleared by sending this asset.
Even property ownership itself is just a result of laws passed by certain jurisdictions. They vary from place to place and are balanced against other rights. Property rights make sense for small amounts of property but as you come to “own” larger and larger amounts of capital, you simply expect the system to scale indefinitely, without changing, but that is not necessarily a reasonable expectation. Just like you can’t just scale up an ancient ship and expect everything to work.
What you’re really saying is that someone owes you the safeguarding of your large amount of money because they are being paid some of this money to do so. You want to be able to unilaterally centrally plan where it’s going to go, including sending massive amounts out of a town or community just because it found its way into your accounts.
But all your “principles” ironically are just extrapolations of rights and affordances given to you by a state or other organization that has been running things in an orderly manner. The reality is the other way around - no organizations owe you the safeguarding and enforcing of a monopoly on the unlimited use of {insert resource here} while you unilaterally get to exclude all others from using this resource more productively. You want to centrally plan how the resource will be utilized and you get upset that your “slippage” (eg progressive taxes) is getting bigger and bigger!
I choose the family, I choose the job, I choose what I consume and where I live
Unfortunately I can't walk away from being stolen 50% of my revenues every year.
If you want to find a jurisdiction that will be willing to enforce your property rights above every other right of all its citizens, you’re welcome to try to immigrate there, leaving your family and others or taking them with you. Maybe the Honduran cities are such a jurisdiction, or the high seas, but you’ll probably find they are not. And the jurisdiction you are moving from has no obligation to let you move any arbitrary amount of money out of it.
You don’t really choose where you live unilaterally. Wherever you go, people have already formed organizations and have jurisdiction with laws, and by moving there, you have to agree to abide by those laws. If you have ever traveled, you’ll know this is the case!
And no, it’s not “stealing” when it’s according to the laws of the jurisdiction. And furthermore, stealing implies that it’s your property to begin with. You should look up the difference between Sovereign/Alloidal title and Fee Simple. Read up on property laws. Your revenues are simply numbers in the account of a banking system chartered by your jurisdiction.
I just applaud fair countries that don't extort their own citizens.
My question is ... why does any organization owe you to enforce your monopoly ownership of resources and let you unilaterally exclude others from using them? Is it better for society to let high “net worth” individuals to centrally plan where the resources will be diverted, and at a whim move arbitrary amounts out of a town, emptying it of jobs and resources?
Let me put it in stark terms. Should a city allow a few individuals to buy up arbitrary amounts of its fresh water reservoirs, removing them from being collectively managed? Once that they “privately own them” should the city allow the individuals to pollute them for profit, subsequently moving out and taking the profits from externalizing the costs to the people living there? It may result in “more revenue” to the city in terms of job creation, and cheaper goods, but can do you agree there is a trade-off?
But the point it's that taxes should be phrased and understood for what they are, a whitewashed extortion. It has no proportion at all with costs of running a rule of law society. Be grateful that we take just 50% from you because we could take everything!
So now, imagine that each city’s owner chose to “go public” and sell shares of the city to each citizen equally, and they put in place bylaws. So now you have a democratic society.
In fact that is how cities like Boca Raton came to be owned by the residents. How is paying taxes to the city of Boca any different in your view than paying rent to locate your business in Walt Disney World?
This issue is present in any political system, even full egalitarianism, increase population by an arbitrary amount to reduce land per citizen to an epsilon.
Provided you are a good neighbour, it will always be possible to find space to rent at the marginal cost, without a rent-seeking political class.
https://www.economist.com/the-world-if/2017/07/13/a-world-of...
The marvels of modern life are all due to the stability and infrastructure provided by government. For one to rise to a high level of wealth by exploiting public resources, then simply abscond with their pile of gold, is to breach the social contract that enabled them to rise so high in the first place. It's pulling up the ladder.
It's also strange that getting places in 3 hours rather than 2-3 days is the radical change you predict. If people can get anywhere quickly and cheaply, the posited ultrarich would have to spend an awful lot on security, which will bring up their travel times/costs.
The question will be mostly whether it's an actual state or more of a vacation/work travel location. If it's an actual state, they'll have to deal with all the annoying stuff, like running their own prison system, running whatever level of welfare programs they want. If it's not, they can just "deport" people and let their home countries deal with them.
Btw the wealthy have already taken their stuff, live in their yachts or multiple houses around the world.
Until then we're at a point where governments are too small for us to have free movement across continents and truly beneficial globalisation, and too large to represent minority cultures adequately. I think this reversion to city-states will continue to grow across the world as governments struggle with their size and powerful individuals who are not politically linked chafe at the legal bit. Can't really tell whether it's a good or bad thing yet.
Small things dont blow up and cause huge collateral damage.
Restaurants go out of business all the time. 1 collapse doesn't do anything.
However, 1 monster entity collapsing (LTCM, Lehman, AIG, any pharma today, or Amazon, Google, or 1 ship blocking a key waterway, etc) and its pandemonium.
City states may have warred more frequently, but they never led to the type of destruction that you saw with WWI, WW2 or the french wars of revolution.
Its wise to have resiliency by decentralizing central power, even if it costs a bit of convenience to the individual.
This baffles me. I’m genuinely curious what this would look like to you. Would you please describe how you imagine this to look like? What makes it beneficial to give governance power to machines? What fundamental changes (technological, social or otherwise) have to happen to get us there? And lastly, what components make up the plumbing of a system like this?
If we don't assume magical AI, machines are never better than humans at social decision-making so I can't see the President of Earth being a machine in this scenario. What machines are better at is information gathering and processing, which would allow them to synthesise minor political events happening in one corner of the world more effectively than any person and then present findings to a human to make decisions on. In other words it wouldn't be machines doing the governing, but they fulfil governmental roles in that they make increasing bureaucracy efficient enough that a body of humans could realistically govern at a global level.
This isn't necessarily a good thing. China already has an incredible level of surveillance and info gathering ability within its borders and while their governmental structure allows them to be very effective and decisive with it, I don't think it's a good thing for corruptible humans to have that much power. Cue our magical AI.
[0] http://pac.hn/wp-content/uploads/2020/10/Prospera-Legal-Code...
It works as follows: For anyone living in a high-crime ,or high unemployment,or failing public school zone, offer :
- A paid one-way trip(bus fare to any destination and a prepaid debit card to buy 2 luggages), for each member of the household.
- Limit 3 free trips per taxpayer household.
- Limit 1 household trip , every 365 days.