Uncle Sam Packs for Home, Vexing Americans Abroad

If you think you might lose your passport on your next trip abroad, try holding on to it a little tighter - it could take an extra five days to replace.

Washington budget cuts are taking a toll on services to Americans in foreign lands. In the next budget cycle, up to 50 overseas US missions could be terminated, if proposed State Department budget cuts are implemented.

"We've had to find funding for 20 new posts in the former Soviet Union, at a time when we're working with fewer people and less money," says a State Department budget official in Washington. "To do that, we had to close 30 other posts."

Such cuts will fall hard on diplomatic services in Western Europe. The US Embassy in Paris expects to see a 43 percent drop in core diplomatic personnel from 1995 to 1998.

In Paris, American passports that used to take a day to process will soon take three to five days. The US consulate, which often attracts long lines well before opening hours, will reduce access to the public to two hours a day, and consuls will no longer attend the trials of US citizens.

"We will continue to assist Americans in emergencies, but we have to ask people to be patient," says a State Department spokesman in Washington.

For example, last week the embassy in Paris fielded a question from an anxious couple in the US. Their daughter had been in an accident in Bordeaux and the French speaker who called them could not explain in English exactly what had happened or where the girl could be found. The US consulate in Bordeaux, which had operated since George Washington was president, closed in February due to budget constraints. So Embassy officials back in Paris tried to sort out the puzzle long distance on the phone. It took longer, but finally the parents were reassured that their daughter was all right.

"I'm very concerned that in five to 10 years, we'll realize too late that we've taken the guts and heart out of the American foreign service," US Ambassador to France Pamela Harriman told the Monitor July 4 in response to a question about the impact of State Department cuts.

Such cuts also worry US citizens living abroad, who depend on diplomatic services to register the birth of a child, obtain Social Security payments, or notarize documents needed for business back home. In addition, US consuls monitor the treatment of Americans in overseas prisons, a service that the Paris Embassy says it will cut back to one visit a year.

According to the latest State Department estimates, there are more than 3 million Americans living abroad. The popular image of Americans abroad as a privileged group, uninterested in US politics, makes this group an easy target for budget cuts, say expatriate activists.

"We are out of sight, out of mind," says Gregory Good, president of the Paris-based Association of Americans Resident Overseas, a nonprofit group started in 1973. "When Congress is looking for budget cuts, they come after us."

Since the 1960s, when many American expatriate groups were founded, Americans abroad have won some victories through lobbying the US government. Among them: easier absentee voting and naturalizing of children born overseas, and defeat of a recent proposal to increase taxes on Americans living abroad.

A worldwide letter-writing campaign helped scuttle a Clinton administration proposal to end the Section 911 exemption, which allows taxpayers to exclude $70,000 of their income earned abroad.

The government began taxing income earned abroad after a series of well-publicized cases in which Americans with large incomes claimed foreign residency to avoid paying taxes.

The Section 911 exemption eased the burden of double taxation (in the country of residence and the US). It has been supported over the years by US businesses with a strong overseas presence, especially the oil and construction industries.

"Americans living abroad automatically have a double tax problem that can be outrageously complex," says Stephanie Simonard, a Paris-based tax attorney and chairman of the business competitiveness committee of the World Federation of Americans Abroad, an umbrella group of US associations overseas. "This creates a huge financial burden for employers who have to pick up the tax burden."

To defend this exclusion, American citizens' groups abroad joined forces with groups of large and small American exporters to lobby Congress on the slogan: "Jobs Abroad, Jobs at Home."

The Treasury Department subsequently dropped its recommendation. "It's extremely important that American companies are able to compete abroad and send people abroad to expand. And with that in mind, we changed our mind," said Treasury Secretary Robert Rubin on a recent tour through Asia.

"We can safely call 911 a victory," says David Hamod, executive director of the Section 911 Coalition and president of Washington-based Intercom International Consultants. "But in an election year, with Capitol Hill so geared to short-term benefits, it's a tough sell."

Mr. Hamod and other expatriate activists say that counting Americans abroad in the next US census is a key step toward making sure their interests are visible in Washington. "Most of the problems of Americans abroad can be solved through Congress. But the first question a congressman asks is, 'How many will be affected,' and the fact is, we don't know," says Dorothy van Schooneveld, executive director of the Geneva-based American Citizens Abroad, a nonprofit group with chapters in 80 countries.

The US Census Bureau counts members of the military and other federal employees in the US census. But it does not count private citizens overseas. American expatriate groups want that changed.