As another American living in the Netherlands, I completely relate to your frustration with the US tax system and the onerous financial reporting requirements. I’ve read all the comments, and many people do not seem to understand that the difficulty goes well beyond filling in a few forms.
For instance, when my Dutch husband and I went looking for a mortgage last year, few banks were willing to put an American on the mortgage. Think about it: if you’re a Dutch bank that only does business in the Netherlands, why would you want to give a mortgage to someone whose government would require you to report all sorts of details about your bank, the account holder, and the mortgage itself? And in a language and cultural context that is not your own? I think of how a small-town American bank would react if told they had to fill out paperwork for a foreign government to give a mortgage to a couple that included a non-American: no way! But just because America is a bigger and stronger country, they can force other countries to make laws requiring this information. Is it any wonder the banks would rather just avoid the hassle?
The big international banks, though more accustomed to these regulations, would also really rather not deal with them if it can be avoided. Several American-Dutch friends have been forced to close Dutch investment accounts because the reporting requirements were too much of a hassle for the Dutch banks to want to keep their business. And banking in the US with a foreign address is quite difficult; people with overseas addresses are treated as suspects and many organisations will not work with them.
The problems with FACTA and the FBAR go well beyond filling in a few annual forms. They give Dutch banks incentives not to work with us, and American banks often remain suspicious of our foreign residence.
Although I got my Dutch passport last year, I have not renounced my American citizenship. I still have family there and I’m concerned that if this xenophobic political trend continues, it could be difficult if not impossible for a former American citizen to enter the country at all. I love my American heritage and I would be sad to give up the citizenship that goes with it. But being treated like a criminal by my own government for the crime of living abroad makes the notion more thinkable than I ever would have imagined…