The brilliant Dan Sullivan of Strategic Coach teaches a concept to entrepreneurs called Front Stage, Back Stage. The idea is that, in theater, the front stage is where the performance happens, back stage is where the real work is done. It is chaos. If we were to see the back stage, it would be impossible to watch or understand the performance.
This exists in cooking as well, the preparation of the dish is different than the dish, I used to “smuggle” vegetables into my kid’s favorite meals which they readily ate, had they seen the “back stage” preparation they wouldn’t have.
This brings us to the world of politics and social media. Never in history has the back stage been so obvious, we finally get a peek behind the curtain and sometimes it is messy and sometimes we find out the actors have contempt for the audience and sometimes we find out the chef has spit in the soup. Seeing the chaos effects the show and the meal, but does it make us all better?
I think it does. It gives us an understanding of how hard the show is to put on and gives us a respect we did not have before. It also keeps us honest (chefs won’t spit in soup if cameras are always on them).
It is easy to cast aspersions at leaders for their front stage performances when there is no real understanding of the back-stage reality. For example, When Candidate Obama relentlessly attacked President Bush for Guantanamo Bay he was attacking the “actor,” he had no idea what the President’s back stage understanding was at the time. I imagine that when the candidate became the President and he sat down in a “back stage” room sequestered from the “audience” and the then President Bush and his team disclosed the back stage there was likely a “Oh… that makes sense!” And with that, the new President continued with the earlier criticized and reviled policy.
Obviously, I am not privy to top secret information, but as a CEO of a public company I understand what I can and cannot say for the best interest of ALL stakeholders, even those that disagree. No president of a company or a country can make decisions that serve only their most loyal supporters, policy must be set for a large swath of people and decisions must be made that will make loyal people mad. That is how the world works and that is the price of leadership.
Every four years we go through a relentless onslaught from the media. Every four years it is “the most important election in our life time” and every four years we wake up in the morning after the election, talk about it all day and then get back to the job of living.
Whatever happens, we are resilient, we are flexible, we will adapt. The only thing I know for certain, is that this presidency will be both a surprise and a disappointment over the next four years, I don’t care who you voted for.
The best part of our republic is its design. In two years, the landscape will change again, and in four years you can bet on this one fact, “it will be the most important election of our lifetime.”
The big question for the stakeholders of this company is what does a Trump presidency do for a business that has grown due to proactive tax planning. The simple answer is nothing. Our business model leads with tax planning, but it is far more complex than that and our offerings will change two industries as we roll them out in the coming months. Also, the spending will not change overnight and the debt can’t be eradicated quickly, what this new presidency will bring is changes, let’s look at some possibilities.
Option 1: Tax rates lower dramatically.
This will have little effect on what we do, because government tends to get more complex not less, regardless who is running it. Also, tax reductions in the 1% of the code that levies taxes do not impact the 99% of the code that allows you to reduce your taxes. Our business focuses on the 99%, so should you.
Option 2: New taxes and strategies are added to the law.
This happens in every presidency, so this presidency will be no different. We use a 50+ year old tax strategy to offset the Obamacare tax and reduce health insurance premiums at the same time. We do that NOW, despite the hand wringing over Obamacare. New complexity brings new opportunities.
Option 3: Taxes go up.
It could happen, regardless of promises made (remember Trump will see the back stage soon). If that happens we will do what we have always done, read the rules and exploit them, legally and ethically, for your benefit. Tax law is written to be used, not to be ignored.
Option 4: A hybrid of all three.
This is most likely and we have you covered on each of the three so we have your back on the hybrid.
For those on the right, I have bad news, Trump is not the solution to all your problems. You are still responsible for your own life and since taxes are your biggest expense, and will remain your biggest expense regardless of what the Trump presidency does, you owe it to yourself and your family to do something about it.
For those on the left, this is not the end of the world, any more than Obama was the end of the world for the right. Your job is to adapt to the changing times and this is not just the political environment, the biggest threat is the speed in which innovation is happening, something NO president can keep up with. Your best bet is to do something that has guaranteed results, LOWER YOUR TAXES. You can move to Canada (they have lower taxes than we do) or you can use the laws that currently exist, and the laws that will be written, to lower your taxes here in this country.
This country despite its flaws is the greatest country in the world. And despite its flawed tax code, has a litany of options to lower your taxes regardless of the rate you are paying now, or in the future.
E Pluribus Unum