Opinions on proposed tax reform

Excuse the multi year absence from my blog.  But I’m back to talk about Tax Reform.

Full disclosure: my taxes will in fact go UP under this bill.  But I think that’s ok, because overall this makes the right tradeoffs for the country.

Starting at a high level: the #1 problem we face as a country is that we can’t afford the projected growth in entitlements if our economy grows as slowly as it has grown over the last decade (about 1.5% – 2.0% in real terms through 2016 https://fred.stlouisfed.org/series/GDPC1).

So, regardless of your feelings about fairness or other elements of the tax code, that is the core problem that needs to be solved.  We simply need to grow the economy faster, and that informs much of my belief about policies for taxes, immigration, and the like.

Positives of the tax plan include:

1) Reducing corporate income tax for C corporations.  You’ve heard of corporate inversions, parking money overseas, ability to exchange money between subs, moving IP offshore, etc.  The era when corporations were an effective entity to tax is long gone as countries compete for a business’s domicile and technology removes many of the physical boundaries that kept profits where they were made.  Simply reducing corporate taxes goes a long way towards triggering renewed investment and avoiding the complex list of laws that would otherwise need to be in place to ensure taxes are paid.

The reduced rate should trigger investment, over time, and therefore increased growth.  How?  If a company now retains $800 of $1000 of pretax earnings instead of $690, that extra $110 can be used to invest in improvements in equipment, buildings, etc.  The growth results of this move won’t show up immediately but should permanently step up GDP growth rates.

Corporations are faceless entities, so it is a natural instinct to want to tax them.  However, this tax reduction should benefit the entire economy, and gets a big thumbs up from me.

2) Eliminating the estate tax.  The argument against eliminating the estate tax is that “it is only paid by the wealthiest 0.2%” – in other words, this is a redistribution argument.  However, the estate tax is an incredibly inefficient way to redistribute wealth.  Even the most optimistic estimates of its tax efficiency show it is “average” efficiency.  More likely, the hidden and direct costs of compliance are almost equal to the actual cost that the tax generates for the federal government every year.  The lawyers, accountants, time, and economic contortions to avoid this tax are all wasted to our society.  If you want redistribution, let’s get it another way.

https://www.cbpp.org/research/cost-of-estate-tax-compliance-does-not-approach-the-total-level-of-estate-tax-revenue

https://www.jec.senate.gov/public/_cache/files/bc9424c1-8897-4dbd-b14c-a17c9c5380a3/costs-and-consequences-of-the-federal-estate-tax-july-25-2012.pdf

3) Simplifying and consolidating deductions.  The concept of reducing specific tax giveaways always has interest groups crying how “Un-American” it would be to eliminate their preferred deduction.  Of course, it’s simple to be “for” an ownership society (aka the mortgage interest deduction), “for” kids (the child tax credit), “for” health care (aka deductible health care insurance) – each one sounds wholly justified.  But the combined effect of all of these is that it perverts and contorts the tax code, leads to inefficient economic behaviors, forces us to spend greater time energy preparing taxes, bloats the IRS which has more deductions to argue against, and raises marginal tax rates.  Doubling the standard deduction, as this bill proposes, goes a long way towards making tax forms easier to understand and fill out, and reducing the inefficient use of resources that is tax accountants, people’s time, and the IRS.

Additionally, itemized deductions like the mortgage interest and SALT deductions are regressive.  Eliminating them or reducing their deductibility is a simple way to redistribute without harming tax efficiency (vs. the estate tax mentioned above).

4) Immediate expensing of investment.  Again these investments should grow the economy which is the #1 goal.  Also reduces the complexity of the tax code with its myriad timetables for depreciation.

Negatives of the proposed tax reform include:

1) Reducing the tax rate on “small businesses” (aka S corps and LLCs).  Opening up an avenue for people to redefine what is passive income will lead to all kinds of new tax avoidance, making the carried interest loophole look like small potatoes.  It is almost certain that we see a massive increase in income flowing through these corporations, and a corresponding increase in audits.  If business owners want a lower tax burden and the ability to retain earnings, they should incorporate as C corps.  Best thing to do here is to drive the corporate tax rate down even further but end the preferential tax treatment of S corps and LLCs.

2) Retaining the carried interest loophole.  This is a second avenue used by wealthy people to avoid paying appropriate income tax.  Carried interest is a form of income that pays a vastly reduced tax rate.  A better way to deal with all of this is to have ONE rate – and it should apply to all income, however garnered (including capital gains!).  You then avoid the shuffling of profits to the lowest tax regime or the timing of sales to make sure a gain or loss is short or long term.

 

 

 

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Soylent, Metrx, Green shakes, and my quest for a perfect meal replacement

The recent soylent craze (soylent.me) has brought me back to my college years, where I swore by my daily Metrx meal replacement shakes.  The year I religiously took Metrx every morning (with skim milk and a banana) ranks as one of the healthiest of my entire life – I had a six pack, worked out intensely 3-4 days per week, and felt like a champ.

A couple of years ago, I acquired a Vitamix blender, and it once again revolutionized my morning meals.  Instead of powder and milk, I now mix up spinach and protein powder.  It’s great for breakfast, but is definitely lacking as a meal replacement – it doesn’t really have carbs, and lacks many essential nutrients.
Reading about Soylent inspired me to advance my meal replacement a little further.  However, I’m not Soylent’s target customer – why?
1) I’m not trying to eat for the lowest price possible.  Extra money for extra health is a worthwhile tradeoff for me.

2) Philosophically, I don’t like the idea of highly refined ingredients separated from their source food.  Maltodextrin is a key ingredient in Soylent, but this is essentially a corn-derived chemical.  It’s exactly this type of factory processing of food – breaking it into parts and reassembling it – that I think we need to get away from.  I want things that more closely resemble real food.

3) I try to avoid corn, dairy, and soy (three of the most common causes of food allergies).  So maltodextrin (based on GMO corn) is a no-no.
4) I am not looking for a total meal replacement, just a great balance to my diet

5) I believe that low inflammation should be one of the primary goals

So, I’m experimenting with Solyent alternatives.  My starting base is Schmoylent vanilla – http://diy.soylent.me/recipes/schmoylent-vanilla.  Recipe below

cups Oat Flour
cups Rice Flour
1 cup Vanilla Rice Protein
tsp Potassium Citrate
1 tbsp Psyllium Husk Powder
½ tsp Iodized Salt
tsp Calcium Citrate
½ tsp Choline Bitartrate
½ tsp Magnesium Citrate
¼ tsp Stevia Powder
tsp Xanthan Gum
2 capsule Celebrate Multivitamin Capsules
tbsp Canola Oil

I have ordered the base ingredients, but will be trying certain changes.
1) Replace the White Rice Flour with Brown Rice Flour
2) Use both a soluble fiber and an insoluble fiber
3) Use a broad spectrum, complete vegan protein such as Garden of Life Raw Protein
4) Eliminate the salt (I’ll get more than enough at my other meals and I’d like my blood pressure to be a bit lower)
5) Replace Magnesium Citrate with Magnesium Theronate
6) Reduce the Calcium Citrate by about 75%.  The dairy lobby has the US RDA at about 4x where it needs to be, and let’s not forget that “calcification” of your arteries is caused by – guess what – too much calcium.
7) Add a leafy green – rotating between spinach, chard, dandelion greens, beet greens, mustard greens
8) Add turmeric – great anti-inflammatory spice
9) Add Garden of Life Primal Defense Probiotic to aid digestion and improve immunity
When I eat whole sardines with bones for breakfast, I’ll reduce the oil, eliminate calcium, and reduce protein.More to come, wish me luck.

Life Lesson from Scrabble #1

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I’ve been playing Scrabble since I was a little kid across the kitchen table from my mom.  When you play as much as I have, you begin to see parallels between Scrabble and life.  Because of this, I’ve decided to start a series: “Life Lessons from Scrabble”.  I certainly do not always follow these lessons myself, but I hope they get us thinking!  Enjoy!

Life Lesson from Scrabble #1 

“Take the situation as it is”

 

In Scrabble, the board is as it is.  The seven letters in your hand are what they are.  You must accept this.  This is a crucial lesson about how to spend your precious time and energy.

 

You could spend time regretting what should have been; lamenting how unfair it is that you’ve ended up with seven vowels when the game’s down to the wire.  Or maybe you’re upset because the open E is now blocked and your elegant 62-point play got busted.

 

The board isn’t out to get you.  Your situation isn’t out to get you.  The only task in front of you is to play your hand the best you can.  In other words, spend your energy in a realm where you have choices and can take action.  Complaining and lamenting don’t change a thing (except your mood, and almost always for the worse).  All great Scrabble players learn to break themselves of the desire to play with a hand or on a board that simply isn’t.

 

Same goes in life.  Maybe your boss had promised you a promotion but just took a job somewhere else and you’re left without an advocate.  Or you were supposed to get in early to work but your child just threw up on the carpet.

 

What should or could have been is always a phantom, a negative suck of energy.  Once something is no longer possible, you might as well be upset that your magic carpet didn’t show up.

 

So ask yourself, what are the possibilities that arise from life as it is now?

 

Can you imagine how different things would be if you could rid yourself of “could have” and open up to “could be?”!

 

Saying goodbye is a gift

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My life is filled with goodbyes these days.  I’m moving from San Francisco to Austin, leaving a city that I’ve been connected to since 1994, and my entire family is coming with me.  We’re saying goodbye to the house where my three sons kept us up with their scared newborn cries, where they stood on their tiptoes to look taller against the mark on the wall showing their height…where we tearfully took a home video of our son taking his first steps around the living room corner.  Countless other precious moments stare back at me every step I take through my increasingly bare home, and my heart alternately drops or soars throughout the day.  It’s an emotional time.

I’m saying goodbye to friends I’ve written music with; friends I’ve sung my heart out with, friends I’ve laughed with to the point of my stomach hurting, friends I told excitedly about this awesome girl I met who then became my wife and mom to my three boys.

I’m saying goodbye to my brothers (all three live here) and my parents, as we enter a phase where dropping by on a whim is no longer available to us, and Skype with the grandparents replaces meeting up with the cousins in Grandma’s basement.

Yes, goodbyes can feel sad.  It’s hard to let go, to know that those types of memories and the circumstances that created them will no longer be there.  That the chapter is ending.

Yet what a privilege to have the opportunity to KNOW things are ending, and to have whatever time we are given to honor those moments, to reflect on their meaning, and by doing so give them a rightful place as they are part of the fabric that you are woven from.  What a privilege to be able to tell people how much they have meant to you, to laugh or cry as you retell the stories together, of knowing that the good ol times are always happening all around you.  We so often don’t get those opportunities – nobody announces that it’s going to be the last time you have a pillow fight with your son, or the last time you share a beer at your favorite bar with your buddy, or the last time you get to tell a parent you love them.  We are in fact, always saying goodbyes, since never again will we experience what we are experiencing now.  Know that and honor that.  Life is really one goodbye after another.

I am so thankful for the chance to really honor this chapter of my life.  And yet, as we say our final goodbyes to our life in San Francisco, we are making room for a new life in Austin.  We have no idea what this will be like, and in this light I have been inspired by a quote from Joseph Campbell:

“As you go the way of life, you will see a great chasm.  Jump.  It is not as wide as you think”.  And jump we shall, holding hands, enthusiastically, and confident that we will find our way.

7 Best Tips for Getting Things Done

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Today’s post is different.  It’s not about spiritual matters, it’s about the very concrete and practical; specifically, how to get a project done.  I’ve been reflecting on it as I tackle my own project of creating a new melodic line on a several hundred year old Bach piece.  I’ve had a lot of training in this: project planning, GTD method, etc.  What follows is a distillation of the ones that work best for me.

1)   Have goals that are specific, measurable, actionable, realizable, and time bound.  For more, click here http://topachievement.com/smart.html.  But essentially, you need to state your goal as “write a one hundred word post and put on my blog by tomorrow at midnight”, rather than “blog more”.

 

2)   A related point: many goals are too enormous and daunting when faced in their entirety – break it down into smaller steps.  A useful if overused example: it is overwhelming to try to “climb Everest”, but rather achievable to tie your boots on and take one step.  A good tool for breaking down a goal is the Work Breakdown Structure: http://en.wikipedia.org/wiki/Work_breakdown_structure .  Sometimes the most important thing we can do is define the elements necessary to really get a project done.

 

3)   Related to #1, make a “next action” list rather than a “to do list”.  Saying you need to “repot plant” requires you to think every time (and likely get hung up on) what you actually need to do to make that happen.  Try “go to ACE Hardware and buy new 12” pot”.   http://www.gtdtimes.com/2011/02/10/how-is-a-next-action-list-different-from-a-to-do-list/

 

4)   A nice tip for things that require daily involvement: “Don’t Break The Chain”.  This is a simple technique where you put Xs on your calendar every time you do something (workout, meditate, post on your blog, whatever).  The goal is to keep the chain going!  Apparently Jerry Seinfeld credits this method as the most important element of his success. http://lifehacker.com/5886128/how-seinfelds-productivity-secret-fixed-my-procrastination-problem

 

5)   Set aside dedicated, distraction-free time on your calendar to get the tasks done.  Turn off your internet (really, the best thing to do is actually force it off using a tool like http://macfreedom.com/), turn off the TV, get away from other people, turn off your phone, and have all the things you need in one place.  Then work, distraction free, for up to 90 minutes or as long as attention allows.   Some people swear by the Pomodoro Technique – I personally need more time in a block but agree with the general concept http://en.wikipedia.org/wiki/Pomodoro_Technique

 

6)   “Climb the right wall”.  It’s really important to keep checking in, with yourself, others, and/or experts who have done it before, to make sure you are following the right action path.  It’s a terrible feeling to be getting a lot of the wrong things done, so make sure your ladder is on the right wall.   I recommend checking in weekly to ensure that your idea of how to get things done matches the reality of how it should get done.

 

7)   A related and important point: know when to ask for help from others.  One of the biggest problems is not knowing the next step to take, or being unable to do it without the help of others, or more information, or different resources.  Life is about having allies to help you out: have a group of experts, counselors, friends, etc. who can give you thoughtful advice when you hit those inevitable times when you don’t know what to do next.  Bonus: if you still can’t find the answer, just try to move in the right general direction.

 

Hope you are all doing well on your projects!

Chris

3 Quick Thoughts about Fatherhood for Father’s Day

It’s Father’s Day, and this past week has involved a lot of thinking about fatherhood.  One friend is creating a time capsule for his newborn to be opened in 18 years and is wondering what to write in a letter to him; another friend wakes up today to his first Father’s Day without a father; I personally have been “missing the mark” in my own fathering and have been reflecting deeply on how to be a dad.

Three quick thoughts

First, if you have a living father, speak to him today – not just a quick hello, but hopefully to truly connect for a moment – laugh, share, reflect.  For my friend who lost his father, today he wakes up and knows he can never speak with his dad again.   It doesn’t take time, it takes heart.

Second, if you are a father, remember that your overarching responsibility/role is to let your children know and feel that you completely love them.  Every dad is imperfect.  Ever dad regrets things he didn’t do or say, and other things he did do or say.  However, studies show, and intuition confirms, that if your children know you love them, things will probably work out ok.  And if you answer every question with “how can I act in a loving way”, it’s pretty easy shorthand for the right answer.

Third, encourage your sons (in particular) to have other “father figures”.  Many dads (including often, yours truly) really want to be it all – the mentor, the parent, the friend, the counselor, etc.  But it turns out that the most centered and happy men find and develop second father-like figures in their life who often balance and support the things that their father didn’t provide.  Rather than resist that, we should encourage it.  You don’t have to do it all, and in fact, developing other close mentors is an important driver of growth later in someone’s life.

Happy Father’s Day!  Share your tips in the comments section!

Ordinary Heroes Project – Meeting #3 (Group)

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Welcome back to the Tavern, men!

Today was a further process of really naming our projects, of narrowing in on their specifics, and committing to them publicly.  We were reminded of the more general goal of this project – that is, living into our project with more awareness, and taking advantage of the format we are in to feel into this and experience it more completely than we otherwise would.

The project is designed to be a metaphor for all of the tasks in our life.  There was extensive discussion of feelings of apprehension, of requests for support, and demonstrations of that support.  Such a joy to be in the company of these men!

Many people had projects that were “things they longed to do but never got to do”.  Or in other words, something they’ve wanted to do one day – and now today is that day!  We were challenged to explore what we were crossing into with our projects.

Follow your bliss…