A short while ago, I mentioned bumping into W. G. Hill’s book back around 1990, PT: The Perpetual Traveler, the Perpetual Tourist. The Possibility Thinker.
I said that the first, most basic concept Hill taught that grabbed my attention was this: to get outside your box. Try always to see the world from a larger perspective. There is more out there than you can imagine.
Today—not because I have totally “bought” the theory, but because it has deeply influenced how I view the world and because sometimes you need to hear a concept several times over from different perspectives—I want to summarize the concept for which Hill (and, before him, Harry Schultz) was best known.
It’s the idea of structuring your life so that you are beholden to no single governmental power.
Schultz and, then, after him, Hill, spoke of multiple “flags” (a flag being a symbol of one’s presence and allegiance).
Schultz proposed that any wise person should consider having three flags. By the time Hill was done with it, we were looking at five flags. And last I seem to recall, someone was talking about seven flags. I’m working from their base and from my recollection. Here are the ____ flags that I can remember or that I’m aware of.
The Five Flags
Flag 1—Legal Residence or Domicile.
I imagine most of us would think our residence or domicile is wherever we happen to live. Except legal residence or domicile isn’t necessarily the same as the place you consider “home,” and it definitely need not be where you actually spend most of your time. Indeed, Schultz and Hill (and many others who follow their teaching) urge their followers to establish residence or domicile in a location in which they spend as little time as possible. (More on this later.)
Flag 2—Citizenship(s) and Passport(s).
You already recognize I am speaking strangely, here. Who talks about multiple citizenships or passports? But whether we want to talk about many or just one, Schultz and Hill always encouraged their readers to differentiate between residence/domicile and citizenship-and/or-passport.
(Sorry. There I go again! If you are unfamiliar with these matters, you might be shocked to discover that you can acquire a passport from some countries and not be a citizen. And, of course, many people are citizens of various countries and own no passport . . . because they have no real desire to visit anyplace outside the borders of the country in which they live.)
But Schultz and Hill encouraged us to travel and to differentiate citizenship-and/or-passport from legal residence/domicile.
Flag 3— Business Base.
Oh, my goodness! Strange, doesn’t it seem? Set up a business in a country—under a jurisdiction—other than the one in which you live or hold your citizenship.
Flag 4—Asset Haven or Banking Center.
Don’t keep your money in the same place where you live or have your business!
Crazy, isn’t it?
Where you have fun. Where you go to buy stuff or spend money.
For Schultz and Hill, much of the motivation for raising these multiple flags was to minimize taxes. They had other reasons as well, some of which, frankly, appalled me. (Hill, in particular, seemed rather anti-social and sexually deviant, holding tremendous animus toward at least one former wife.)
For me, being as poor as I was at the time, and having no interest in running around on my wife or finding sexual adventure in other countries, I had to look for gold in the midst of dross. But, I believe, there was a lot of gold to be found. And I found it.
I intend to share the gold in future posts. But for the time being, let me say this.
Why Should Anyone Consider Planting More Than One Flag Anywhere?
Why would you want to go to the trouble of establishing even two or three flags—much less five? Or perhaps I should express the question more personally. Why did this kind of craziness even attract my attention?
I am reminded, again, of events from early in my youth.
I was somewhere between 6 and 8 years old when, I remember, I walked in on my father as he watched a TV program. It was called “Let My People Go!” It was a documentary on the Holocaust. The image on the screen, as I walked in, was WWII-vintage footage of naked, dead, starved bodies being scraped (by bulldozer) into a mass grave. I came into the room from the side. My father was lit by the television screen. And he was weeping, shoulders heaving. . . .
We never talked of the incident. But I am sure the thought crossed his mind—or, I should say, it certainly crossed mine!—that he could have been one of those bodies. His parents or brothers could have been in that grave. But they weren’t. Why not?
Dad told the story only once or twice, but I knew of “Oncle Max” (not a real relative, but a close family friend) who left Germany within months after Hitler came to power in 1933. Max made a home for himself in Bolivia. It was only because he had made those arrangements years before the war began that so many members of my father’s family made it out of Germany in 1939, after the war broke out.
What had Max done?
He had acquired a second domicile and/or second citizenship. (I don’t know the full details.)
I remember slowly acquiring my German grandfather’s stamp collection and being, at first, intrigued . . . and then dumbfounded, by the stamps that bore ever larger-denomination overprints. I was between 10 and 12 years old at the time. And I learned about the German hyperinflation of the post-WWI era.
It created an indelible impression of what can happen when a government tampers with its money.
Then there were the anti-[Vietnam]-war protests of my junior high school years on the Stanford University campus in which I and all my classmates were surrounded by the “message” of the “student radicals” of the era: “Question authority!” and the other message of so many young men (and women) who were only a few years older than I: “H_ll, no! We won’t go!” (and similar sentiments).
And, from that same era, and slightly before, I remember the tensions—even among close relatives—as they discussed the civil rights movement. (Was Martin Luther King pushing black rights “too quickly” and causing “unnecessary” unrest . . . or ????)
Finally, for the sake of this post (and speaking solely from memories that I’m sure were with me at the time I bumped into Hill), there was the 8½” x 11” book (or “report”) by Dr. Gary North I read sometime in the early 80s. It was called 12 Deadly Negatrends.
The key point with which North shocked me: Social Security was (and, of course, still is) a Ponzi scheme. The U.S. government spent all the “contributions” long ago. There is no “trust fund” to speak of. All that’s in the “trust fund” is a bunch of IOUs the government will have to collect from future taxpayers to make up for the funds it squandered from past “contributors” . . . (Ahem!) I mean, taxpayers.
I decided then and there that I could not trust the U.S. government to provide me Social Security payments when I hit retirement age. Maybe they’d give me something (if the entire system hadn’t imploded by then), but whatever I got wouldn’t be worth much.
I learned that I shouldn’t plan on receiving Social Security. I shouldn’t expect it. . . .
And all of those memories together made me realize that there is a reason to beware of “trusting government[s] too much.” Maybe there is a reason not to put all our eggs in one basket. Maybe there is a reason to diversify our risks not only in terms of assets, but in terms of governmental authorities, as well.
Again: More on this in future posts!