There is a fascinating story in today’s FT about the increase in foreigners taking up the UK’s offer of a UK passport in exchange for 1M pound investment. As the piece notes:
“The number of wealthy migrants entering the UK on specialist visas designed to attract millionaire investors jumped by over three-quarters last year, led by people from China and Russia seeking to put down roots in London.
“Tier 1 visas were introduced in 2008 to allow individuals with at least £1m to invest to remain in the UK on a long-term basis. They are seen as a speedy way for wealthy foreign nationals and their children to become British citizens.”
In order to qualify for the visa, no more than 250,000 pounds can be in real estate. The rest must be in other UK investments such as shares or bonds. “Russian millionaires,” continues the piece, “represented 24 per cent of successful applicants in the year to the end of June, according to information obtained from the UK Border Agency by law firm Pinsent Masons. Chinese foreign nationals accounted for 23 per cent of the total while migrants from the US accounted for 5 per cent.”
Of course, the UK is not the only country to offer such schemes but the existence of these “fast track to citizenships” begs an interesting question that reminded me of a book I reviewed recently, “What Money Can’t Buy” by Michael J. Sandel. In his book, Sandel makes a compelling case that most societies agree that there are some things that should not be bought and sold on open markets. I think most people would, if asked, agree that citizenship would be one of those things. Apparently, the UK disagrees but if that is the case, why is it that a private UK citizenship cannot sell his citizenship to the highest bidder? In other words, why is it OK for a government to set a market price (a nice round 1M pounds in this case) for the right to live in the UK when, I am sure, if an ordinary UK citizen cannot auction his passport to the highest bidder on eBay? After all, either a citizenship is a tradable good or it is not. If it is, why can’t private sellers and buyers make a market for it which, one assumes, would be much more efficient than a government scheme? After all, maybe the right price for a UK passport is 2 million pounds or 5 million pounds?
Once again, as Sandel notes, societies are moving closer and closer to have markets determine the allocation of everything. It’s interesting that this UK scheme seems not to have attracted too commentary in the international press. I wonder what would happen if Greece, with it’s budget issues, simply started an open market on Greek/EU passports, as a way to get out of it’s mess. An idea whose time has come, perhaps.
FT subscribers can read the full piece here: