Citizenship is also a commodity

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By MARCO D'ERAMO*

With the triumph of neoliberalism, citizenship became a commodity, that is, something that can be bought and sold

"Aux armes,citoyens!”. Thus begins the chorus of La Marseillaise, adopted as the French national anthem by the Revolutionary Convention of 1795. No longer servants, nor subjects, nor vassals, but equals. Citizen: a political category that had disappeared with the ancient world (cives romanus sum) resurfaced to encapsulate the rights won by the Revolution and to unite the imagined community of the nation-state.

Citizenship rights would be expanded over time (right to education, right to health, right to work…) along with their corresponding duties (military enlistment, jury duty, imposition of taxes…). Here lies a fundamental distinction with contemporary human rights: the objective of giving positive content to an equality that would otherwise be formal and theoretical, expressed in the principle of “one person, one vote”.

This conception of citizenship – and, therefore, of the State – peaked in the 1960s, but then began to decline. It continues to be considered a form of belonging, which can be conferred by birth (ius soli), by blood lineage (jus sanguinis) or for a prolonged period of residence. However, citizenship, as a common expression says, “shrank”. Rights diminished with the end of the welfare state; in turn, duties shrank to ease the tax burden; They were sometimes completely abolished, as was the case with military conscription.

With the triumph of neoliberalism, citizenship became a commodity, that is, something that can be bought and sold. There is now, as the American sociologist Kristin Surak writes in The golden passport, a “citizenship industry” that spans the world. The book contains a treasure trove of information, data and first-hand accounts of the history of the first forty years of this industry.

Why would it be necessary to buy citizenship? Another nationality is coveted because not all citizenships are equal. Our lives depend on a “birth lottery”. As Kristin Surak reminds us, if you were born in Burundi, you can expect to live an average of 57 years with $300 a year at your disposal; if you were born in Finland, the numbers are 80 years and $42.000, respectively.

The great migrations we see today depend on this unlimited geopolitical inequality. Borders serve to maintain this abyss: Turkey receives six billion Euros a year from Brussels to prevent Syrian, Afghan and other refugees from entering the European Union; Starting this year, Tunisia will receive 1,1 billion Euros to stop sub-Saharan migration. The small republic of Nauru (a 21 square kilometer island with a population of 12.600) has derived half of its gross domestic product over the past decade from admitting asylum seekers rejected by Australia.

Yet even though citizenship is fiercely unequal, we are still routinely presented with the legal fiction that all states are equally sovereign – a notion that dates back to Le droit des gens (1758), by Emer de Vattel, who argues that if in the state of nature men are equal to each other, despite all their differences, then this must apply to States.

Of course, states are by no means equally sovereign. Nauru does not have equal sovereignty to a country like Germany, despite its vote having the same weight at the UN. Behold, it can open embassies around the world, offer immunity to its diplomats and so on.

It is in this regard that Kristin Surak quotes Stephen Krasner, who in his book sovereignty (1999) says: “what we find most often, when it comes to sovereignty, is organized hypocrisy”. The reformulation of citizenship as a commodity is the result of this contradiction between formal equality and real inequality. As Thomas Humphrey Marshall said in 1950, “citizenship provides the basis of equality upon which the structure of inequality can be built.”

Many naturally want to escape this inequality and, in the vast majority of cases, this occurs through migration. But for the few who can afford it, there is an elevator rather than a steep staircase that leads upward into the ranks of citizenship. Citizenship is typically purchased by the privileged classes of disadvantaged states – those on the peripheries of global commerce, subject to imperial sanctions, marked by political unrest, war or authoritarianism.

The citizenship market arises, explains Kristin Surak, “from the confluence of interstate and intrastate inequalities”. The price of citizenship for yourself and your family ranges from a few hundred thousand dollars to a few million. Buyers tend to be multimillionaires, but may be Palestinians looking for status legal, Iranian businesspeople hit by sanctions, Chinese elites trying to protect themselves from party-state expropriation, or Russian oligarchs seeking refuge from Vladimir Putin's volatile government and, now, the dangers of war.

For a time, the biggest customers were Hong Kong residents nervous about Beijing's takeover of the city. But they could also be high-level managers and executives – Indians, Pakistanis, Indonesians – working in the Gulf States, who have no legal right to stay there when they retire and have no desire to return to their home countries.

Precisely because the citizenship of some States is an exorbitant privilege, its current holders are keen to protect it, erecting insurmountable barriers. Thus, even for the extraordinarily rich, it is not easy to buy citizenship from states at the top of the geopolitical pyramid (although there are exceptions: France naturalized Snapchat billionaire Evan Spiegel; New Zealand did the same with billionaire PayPal founder Peter Thiel).

Another path is to purchase a lower-ranking citizenship that allows entry and residence in higher states – the hierarchy of states corresponds to a hierarchy of international mobility. Those with European Union or Japanese passports can freely enter 191 countries; American passports allow entry into 180 countries; the Turkish passport allows entry into only 110 nations. In essence, writes Kristin Surak, while immigrants must live in the state they hope to enter, for those purchasing citizenship only their money needs to reside there.

The first to capitalize on the citizenship trade were the Caricom nations: the fifteen Caribbean microstates with a combined population of 18,5 million. Saint Kitts and Nevis broke precedent by enacting a law in 1984 that granted citizenship to anyone who invested a certain amount. This became known as “citizenship by investment” (CBI).

For centuries, the islands thrived on sugar – producing 20% ​​of global production in the 1970th century – but in the 35s they entered an economic crisis, exacerbated by the growth of the cruise industry. The CBI program ended up generating XNUMX% of the GDP of these mini-states. They had the advantage of being part of the British Commonwealth, where “common law" English; As is known, this law is based on previous court decisions, defining only what is prohibited; It therefore differs from “civil law” which defines what is lawful and, therefore, is much more restrictive.

Unsurprisingly, the Caribbean states of Commonwealth, such as Antigua, Granada and Saint Lucia, followed suit. Next came Dominica, whose economy was entirely based on banana production, which it exported mainly to Europe until, in the 1990s, WTO regulations allowed Chiquita to set up a successful competing business.

As the ensuing “banana war” brought the island to the brink, the CBI program became its main asset; in order to equalize the benefits of its neighbors in the Commonwealth, offered citizenship at lower rates and other benefits (such as facilitating name changes). Since 2009, Saint Kitts and Antigua passports have given their holders free access to the so-called “Schengen area”. Since 2015, Dominica, Grenada and Saint Lucia have offered the same perk.

The convenience of a passport depends on the mobility it provides. In this sense, citizenship is different from residence. There are around fifty countries (Portugal, Spain, Australia and the USA among them) that in exchange for investment offer residency, but not citizenship. Mobility, however, depends not so much on the State that naturalizes you, but on the one that allows you to enter (in 2015, for example, Saint Kitts lost free entry into Canada to such an extent that its passport suffered a considerable devaluation) .

This is why, as the citizenship industry has increasingly moved out of its homegrown phase, developing more rules and procedures, large states have gained more and more influence over the granting of citizenship. To acquire citizenship in Caribbean microstates it is now necessary for the United States (and, increasingly, the European Union) to give its approval.

In the Mediterranean, the main sellers of citizenship are Malta and Cyprus, for reasons related to their history. In the case of Malta, this is due to the English language, its location and its membership of the European Union. The terms of its CBI program were hotly contested by both Maltese opposition parties and the European Parliament, which imposed a cap of 1.800 naturalizations. It was even closed in 2020, but has since reopened with a limit of 400 naturalizations per year and 1.500 in total (at the modest price of an investment of 700 thousand euros, plus 50 thousand euros per family member or employee). Cyprus also has the advantage of being in the European Union; however, it is also part of the non-aligned nations during the Cold War in addition to having a strong communist party.

When the USSR collapsed, there was a large population of Russian-speaking professionals, many in the fields of law and finance, with strong connections to Moscow. Before long, Cyprus became a favorite destination for Russians because of its proximity, its sunshine and its access to Europe. Its capital was unofficially renamed “Limassolgrad”, or “Sunny Moscow”; It now has “Russian schools, Russian shops, Russian clubs, Russian restaurants, Russian newspapers”, as Kristin Surak reports.

However, with the Greek crisis of 2013, the troika imposed large fees (of up to 100%) on all uninsured bank deposits above €100.000. Thus, Cyprus' CBI program was terminated several years after it was created. Just as the pandemic increased demand for passports from those who wanted to escape lockdowns draconian policies imposed on China, the Russians had to look for a new refuge.

They found him in Turkey, an unusual candidate among citizenship sellers. With a population of 80 million inhabitants and a powerful army, it is one of the 20 strongest economies in the world. However, today it receives more than half of the world's citizenship buyers. It may not be a member of the European Union, but it has other advantages. Unlike the Caribbean microstates or Vanuatu, or even Malta, Istanbul is a metropolis that is perfectly livable for an affluent expat.

At first, most orders came from Iraq, Afghanistan, Palestine and Egypt. Then, Dubai's foreign residents also jumped on the bandwagon. With Covid-19 and then the war in Europe, Ukrainians and Pakistanis joined the ranks of those looking to Turkey as a place to live. For wealthy Iranians, Turkey has a special appeal – not only because it is a neighboring country and one of the few that Iranians can enter without a visa, but also because the Turkish lira has suffered a strong devaluation (in the last two years it has lost half of its value). value against the dollar) due to high inflation (39% this year).

Iranians, less penalized by the devaluation of their currency, are buying property in Turkey, much more than elsewhere: they are currently buying an average of 10.000 housing units per year. These are profitable assets, as housing prices are rising in Istanbul as on the entire Mediterranean coast. As one citizenship application agency said: “You can think of Turkey as a home, as insurance and as a good investment.”

In this way, citizenship was financialized, transformed into a product similar to structured investment vehicles. Although compared to the global flow of migrants (around 200 million), naturalizations through investment are tiny – around 50 thousand per year – they reveal more about citizenship than we could imagine.

We all know that citizenship affects citizenship outside the State, since we always carry it and cannot take it away. Visiting India, I was always amazed at the locals' ability to guess the nationality of European tourists. I realized that our nationality system is for them a kind of caste system; why, they are well trained to distinguish between the many castes they grew up with (there are about 3.000 in total, with 25.000 subcastes).

Perhaps the most curious phenomenon reported by Kristin Surak is that of Americans seeking dual citizenship. Many of them are foreign residents who do not want to continue paying taxes to the USA (where the tax regime stipulates that you must pay no matter where in the world you live or earn your own income). Others seek a second nationality to be able to travel. A great sociologist with dual nationality told me that since September 11th she always travels with her European document. Some applied to be travelers after Donald Trump's election. Who knows what they will do again on November 5, 2024.

*Marco D'Eramo is a journalist. Author, among other books, of The Pig and the Skyscraper (To).

Translation: Eleutério FS Prado.

Originally posted on the blog Sidecar da New Left Review.


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