tv Real Money With Ali Velshi Al Jazeera December 21, 2014 5:00pm-5:31pm EST
thank you for watching al jazeera america. i'm richelle carey. "real money" is next, and be sure to check out the website for updates from around the world. that is aljazeera.com. thanks for your ^ below that is aljazeera.com. thanks for your time. open for business with america - cuba. we are breaking down dramatic change between the two nations in over half a century. we look at what it does and does not do for american businesses. quitting america - why some are giving up their citizenship to save on their taxes. the institutional investors buying up forelarges after the housing collapse could look to close in soon. i look at what it could do to your home.
i'm jen rogers in for ali velshi, and this is real money president obama announced moves to normalize relations with cuba's communist government that were broken off in 1961. back then president eisenhower broke with fidel castro's government over its blooming alliance with the soviet union. the changes will include an exchange much ambassadors for the first time in more than half a century. some restrictions on u.s. companies that do business in cuba will be eased. the white house says american businesses will be able to open accounts at cuban banks and travellers permitted to use u.s. credit and debit cards in cuba. what the policy change doesn't do is lift the u.s. embargo on trade. that takes an act of congress,
and both houses were blasted and pledged to keep sanctions in place. for more on the turbulent history, we need to travel in time to the late 1950s. and our story begins with an image of what used to be the cuban capital building in havana. >> to understand why the u.s. and cuba had a strained relationship, you need to go back to 1958. that year president iceep hour in support of the -- eisenhower in support of the rebel fidel castro imposed restrictions against a dictator that rose to power in the years before. then on new year's day in 1959 castro's guerilla army entered havana, overthrowing the battista pal sis. -- palace. castro promised to hold free
election and not confiscate property owned by foreigners. the u.s. immediately recognised the castro regime. he visited the united states 3 months later, touring and meeting with vice president richard nixon. it was a rare and fleeting moment of friendship between the two countries. but it was not long before the relationship soured. the u.s. quickly grew concerned when castro ordered the execution of more than 500 pro-battista storers, and voiced communist rhetoric in speeches. the time straw was in 1960 when castro seized private land and nationalized businesses owned by u.s. corporations. eisenhower responded by imposing trade restrictions on cuba, prohibiting everything but food and medical supplies reaching cuba from the united states. in response, castro reached out to nakita, the leader of the
soviet union. cruchev seized the opportunity and expanded trade. eisenhower cut all diplomatic ties with cuba, an official policy which remained unchanged since january 1961. the early 1960s marked clandestine attempts to the government to overthrow the castro regime, including the botched bay of picks invasion. the dangerous confrontation between castro and the u.s. came in october 1961. that's when an american spy plane photographed evidence that the soviet union was attempting to build an intercontinental missile base in cuba. if completed it would have allowed the soviets to control nuclear weapons capable of reaching targets deep within the american mainland, for 12 days in october president kennedy and
premier cruchev faced off bringing the world to the brink of the nuclear war. >> the purpose of the bases can be none other than to comply a nuclear state quayibility. rcrushov backed down of the the cuban missile crisis caused a wound between castro and the u.s. president obama's decision was welcome news to many in the cuban american community, but has critics. we are about to hear from both. we start with a cuban american businessman who's chairman of the the nonprofit national hispanic business group. his father served in the armed forces before fleeing to the u.s. in 1959. he remembers escaping two years later with his mother to get to the u.s. he told ali that normalizing relations with cuba is a step in
the right direction, but not enough. >> i have to get over the anger is the way i would approach it. it's 50 years ago. it should have been done when we had the opportunity to let the anger and distain that we had for 50 years. what have we accomplished and what has the cuban government accomplished. >> nothing. >> do you have business with cuba. you are in the relocating. >> i do corporate, government moving, medium-sized companies, things of that nature. i started in an addict in brooklyn 30 years ago, and i count my blessings. >> you see both sides of this. you grew up as an american and understand sentiment. do you understand the queensland sentiment. i understand they don't want to see business, they fuel the anger towards castro, but time flies and death is the ultimate
equalizer, if you will. pretty soon he'll be gone. you can see it. it's changing i'm not - i'm not a democrat, i'm a republican, and i hear the republican side of what they have to say, and i disagree with it. as a cuban, as a republican, it is - has to change. change is inevitable. >> there's a lot of anger in little havana, in miami, people are chanting anti-obama slogans, there are people doing the election maths on this saying who wins and who losses. what would you like to see happen, to get this out of the political realm. normalization means normalization, it's not just political. >> i see the opportunity to build cuba, to trade with cuba, i see an influx of cigars. and i understand that there's some within the cuban community that are not for this, they are against this, they feel that
disday for what happened in the past. but we have to move on. it's not only for the trade and the business side of it, but the people of business that probably need the jobs and see the supermarket shelves. here is the other thing. i would like to get a car that they have there and bring it here. >> there would be a good market for that. >> chairman of the national hispanic business group and the president of business re-election services. >> for a different perspective. ali spoke to a lawyer based in miami. it's easy to understand his opposition to the change in policy. born in cuba, he spent 16 years in cuba's prisons because of opposition to the communist led government. in 1977 he received amnesty. he immigrated to the u.s. where he lived since. he called president obama's decision a big mistake. >> i heard obama's speech, and
then i heard raul castro's speech. he is on the same page that he has always been. he has not changed. so i don't think the mere fact that we will lift the embargo or do - you know, do him favors now that he's - that economic situation in cuba is in a real crisis when the subsidies from venezuela have probably stopped altogether. we are talking about 23, 24 million a day. >> you are saying this is not all truistic. it's not about making a good deal. the money has stopped flowing. cuba needs a better option. >> not at all. i think at the end the american taxpayer will end up paying for whatever the cuban government does not pay. okay. we export food there. we exported this and that. put it has to be on a cash basis. if it isn't, then they don't pay
and who will pay for this - the american taxpayers. you know, they'll be insured by a federal agency, and then they - it will end up paying these people, if the cuban government does not pay, which has happened to mir yachteds of of companies. you hear the companies that say they can't wait to do business with cuba. i can't wait to sell goods. what would convince you that the deal is worth pursuing. ? >> let me tell you the deal is not worth pursuing. they will see by themselves, their own experience, like some of the businessmen from canada have experienced when - and some of them, like kardashian, they are in cuban gaols now. they are asking them for millions of dollars to let him go back to canada. so, you know, it's really
ridiculous to think, you know, that we can just, by a presidential decree say "okay, let's go back to where we were, and raul castro is going to respect human rites in cuba. no. >> what changes. we can't stay in the status quo. what would change, does the regime have to change. will it ever change for cuba. >> of course, the regime has to change. human rights have to be respected, they have to respect like people to have freedom of the press. freedom of speech, which nobody in cuba has right now. just a 10th of this month on the 66th anniversary of the human rights chatter, like 44 ladies in white. peaceful marchers, with flowers on their hands, where - were arrested just because they were
celebrating human rights day. the 10th of december, which was celebrated all over the world. >> yes. >> they were imprisoned. they were beat up. and that's going to continue. and now we are going to be accomplices of what happens in cuba. >> next - how far would you go to stop paying your taxes. how about giving up your citizenship. americans are doing it. that story when we return. you're watching "real money". tell us what's on your mind. keep it here. finish with the most interesting people of our time...
here is something you probably didn't know the mayor of london, boris johnson is an american citizens. he hasn't lived in the u.s. since five years old which is inconsequential to the internal residenceal service. if you are an american citizens living overseas, you have to pay tax to uncle sam. and the u.s. wants to levy a tax op boris johnson. he is not too happy but is yet to reelingish u.s. citizenship. which brings us to another group of north americans it overseas who are voluntarily vending her passports. officially it's called expatriation and it's a phenomenon happening in record
numbers. mary snow has more on quitting america to save on taxes. >> would you give up your citizenship to avoid paying taxes? >> thousands of north americans are doing that, giving up the passports in record numbers in order to avoid paying a new tax as part of the foreign account tax compliance act, for f a.c.t. a. it has caused a three fold increase in the number of americans surrendering their passports. between 2010-2014, over 3,000 renounced citizenship, compared to the four years prior to the law. created in 2010 by congress, it was intended to crack down on overseas tax cheats. in fact, the congressional research service projected it would generated 8.7 billion over 10 years. the law was inspired by the testimony in 2007 of bradley
burkanfeldt, a ubs banker turned whistleblower and described how ubs used techniques to help american clients to evade taxes. based on his test mope your, ubs -- testimony, ubs was fined in 2009. the bank turned over the names of 3500 u.s. act holders in irk. the act imposes a 30% tax in foreign banks that are not cooperating with the i.r.s. they are banks and companies that refuse to identify and provide information on their american clients. to date over 77,000 institutions and 112 countries signed off. it leaves 83 countries worldwide that are not compliant. including russia, argentina, monaco, bosnia, pakistan and
vietnam. critics say he has gone too far, is too draconian and imposing undue hard possess son americans overseas -- hardships on americans overseas. so says this man from the cato institute. >> it's causing heart ache and head aches for foreign financial institutions and overseas americans who are treated as pariahs because financial institutions view them as very, very costly to service. the u.s. is one of the few countries which taxes its citizens based on nationally, not residency. faced with a larger tax bill thousands of americans living overseas would rather give up their passports than pledge allegiance to uncle sam. the i.r.s. reported: >> the united states is one of few countries to have extra
territorial taxation. an american living and working in another country is required to pay tax to the country which it lives, but file a tax return to the u.s. no other civilized country does that. >> one thing is clear. for an increasing number of u.s. citizens, holding on to a bigger share of their money is more important than holding on to their american passport ali spoke about this with the executive director of a not for profit called american citizens abroad. and she said the u.s. government's pursuit of millionaire tax cheats that hide their money put unreasonable hardship on americans who need to live and work abroad. americans very much need to have financial tools if they are living and working overseas, in particular people involved with creating expanding businesses, small businesses, consultants. but just americans who are also
working in n.g.o.s, doctors without borders. so we are seeing a two-pronged problem from americans - one is the denial of banking services because of the foreign financial institutions being concerned about having americans as clients. and also on the reporting side for americans, because not only is the fact of form 89:48 in effect, there's the foreign bank account report which is in existence since the 1970s, many americans have increased compliancy burden. they have two forms asking for the same information, and are confused about what needs to be filed, and i guess the real complicating factor to that is the fact that the penalties associated with failure for filing the forms are making errors on the forms is onerous. a lot of people are concerned
about filing the right paperwork. >> tough enough when you are in america and you make an error. they are not known to be forgiving. when we heard about the ubs situation, americans were right fully outraged and said the government should do something, people shouldn't be able to because they are wealthy or have access to banks like ubs, skip out on their taxes. it was designed to solve a problem, it seems like we have caught too much in that net. >> well, aca is trying to educate and inform the congress about the community of americans overseas. that's the nation, is to bring to them the collective voice of concerns and problem, and educate them on the community - what the demographic of the people living overseas is made up of. and we are also trying to look for solutions for the
individuals and for congress in order that they can achieve the legislative goals, but also allow people living and working overseas the tools that they need to function. one of our suggests for faca is same country exemption treating americans in a foreign jurisdiction. their accounts as local accounts to them, not offshore accounts. there would be no reporting from the american stand point, and neither from the bank. it would alleviate the two problems that americans and foreign financial institutions have and allow americans to have access to the financial tools to function and live overseas. >> thank you very much for being with us. executive director of american citizens abroad. next, institutional investors scooped up houses like they were candy. now they are trying to upload the property. i'll tell you what that means
a after the housing crash wall street investors bought up hundreds of thousands of foreclosed homes across the country at rock bottom prices and flipped them into rental units. it was a buying frenzy. now it is cooling and the question is will they sell and when? >> a new report fro reality track says to buckle up folks, the time is right for selling. we'll get to that in a moment. first, let's look at a market outside of atlanta. the auction block here was hot, hot, hot. david shuster reports. [ auction call ] >> reporter: the first tuesday of every month this is the scene on the courthouse in georgia. hundreds of distressed properties sold in the blige of an eye. >> sold. $86,000.
>> very exciting. >> we'll do this one. >> it's bryce's first time at the auction. he and his wife hoping to buy a home on the cheap. he was not expecting the chaos. >> how do you find out who is different. there's locations. >> or the big investors driving up competition and the sale price of the foreclosed homes. >> i go up in there 500, they go up to $5,000. so, you know, i'm trying to get it to $150, and they are 15, 160, 170. you just look and see the house is not worth it. >> reporter: it's a phenomenon happening nationwide. big investors going into distressed communities buying homs the banks repossess. >> we are here to capture as many products. >> sheree is buying property for wall street. >> hedge funds are realising that our market is going from
what they refer to as an owner to renter nation. the rental nation is huge. >> local broker says the institutional investors are changing the housing market. >> in one month we auctioned off advertised for foreclosures. 1,089 houses, what is created is hedge funds are taking those off the market. they are not available for anyone to buy. we are coming up with a shortage of housing. >> reporter: local reality jer greg martin increase. >> in our country, 21 active homes for sale. a third of the inventory that we have in 2008. not down a third, we have one-third the homes that we had before the market downturn. >> locals worry about the investment to the communities that they are buying in. >> at some point in time they'll have to sell. that's a fact.
how long they hold it, i don't know well, they might sell soon. since we did the report in august 2013, homes in the metro atlanta area have gained 22% in equity. it's like this around the country. if institutional investors sold all the 200,000 properties they bought, they'd make almost 9 billion within an equity return of 26%. that's our show for today, i'm jen rogers in for ali velshi. thanks for joining us. i'm richelle carey, police officials raise concerns about attacks on the ambush killing of two police officers. north korea threatens new cyber attacks and washington considers how to retaliate for the devastating attack on sony pictures f.a.r.c. is demanding talks
to end a 50 years war with the government in the middle east - disagreements over the production of oil. all that ahead on al jazeera america. keep it here. launched four satellites to photograph our galaxy across the spectrum of both visible and invisible light. they made up the agency's "great observatory program" and each orbiting telescope saw things a little differently, and now the youngest of the four satellites has just finished its mission. the spitzer space telescope is an infrared camera, it detects objects that our eyes can't see and it has taken 2.5 million photographs over the course of almost 10 years in operation. >> 2.5 million photographs stitched together into one big view, which allows you to zoom in incredibly far to see all the way out past the dust and so forth that blocks our normal vision and look through infrared through all of that dust out at stars that are all the way out
at the edge of our known galaxy. >> and being able to see all of it in infrared means we're seeing distant stars, stars at least 100 times larger than our own sun. the ability to navigate among these stars is invaluable to astronomers, but even to a casual observer it's pretty mind-blowing. [ ♪ theme ] hello i'm richard giz berg, and you are at "listeni p