TAX TIME 2011: “I’ve changed my name to General Electric!”

“I shall never use profanity except in discussing house rent and taxes.”

– Mark Twain

I just read 100 comments posted on the Yahoo News site in response to a recent article about “tax excuses the IRS won’t buy”. Good place to vent with a few intelligent posts, and one made me laugh out loud: “I’ve changed my name to General Electric so I don’t have to pay taxes for 2010.” Funny in a dark way. Funny in a way that makes us groan inside.

GE made 14 billion in profits in 2010, didn’t pay a dollar in taxes, and got their PR machine to defend this unbelievable fact with data about their write-offs being connected to helping the environment. Lots of technical things GE does with energy allow them to skirt taxes because of their contribution to helping the planet’s environment and working towards renewable energy sources. Great idea. Heart-felt applause. No, really.

In practice, however, PLU’s (people like us) gasp in anger and contempt. For the record, thank you GE for trying to make the world a better place and thank you for employing people. But if that is a criteria, then what about teachers, moms, coaches, therapists, artists, entrepreneurs, or restaurateurs? We make the world a better place, and we don’t see oodles of loopholes waiting for us at our CPA’s. Ok, yeah we do. We look for ways to creatively account our line items towards paying less taxes. Guilty as charged. And that’s the problem. We are ALL looking for a way out, and we are ALL very good at rationalizing this.

Perhaps this problem can be balanced out by imposing an extra tax on professions whose livelihoods do not contribute to the planet. Stock brokers, for example, or companies that create pollution (BP: are you listening?) will have to pay a special tax for their blood-sucking work. (A personal apology to all the financial planners with skills to help us! You would be exempt.)

Furthermore, another solution can be found via the flat tax. This argument has not worked thus far, according to one venting post: “the only reason why the flat tax favored by the MAJORITY of Americans will not fly is because all the lawyers and others who benefit from translating tax laws will be out of business – and their lobby will not stand for it.” This resonates as true. Perhaps another reason why the flat tax approach has not yet happened is because it makes too much sense. Heaven forbid we do something intelligent and fair. Where are Flat Tax Lobbyists and Flat Tax Political Candidates when we need them most? Help.

Taxes are a privilege to pay as well. Don’t forget your local library (if it hasn’t yet closed due to lack of funding!). Don’t dismiss local pools, hospitals, and freeways. If we privatize everything, what will happen when food and water shortages happen (in our lifetime, according to scientists), and PLU’s don’t have the funds to cover these extra costs? Laissez-faire capitalism is alive and well in the world, contrary to popular news, and this is the path the planet seems to be taking: privatize the planet and eat the poor.

Currently, I am officially living below the poverty level, although I live a middle-class lifestyle. This is changing as my financial/employment situation is about to take a positive turn. I just sent W-2 and W-4 forms to my CPA since I worked both as an employee and as an independent contractor (sole-proprietor business ownership) in 2010. I made … drum roll… 13K and lived off the last of my savings (my investments are gone). Thank goodness I have a natural talent for living frugally (and no house or kids to support). This same story is being told with different plot twists all over the country. And we are tired… but still hopeful. This is the strength of human resilience.

Curious about what the IRS will say about my situation, I did some research about PLU’s. I found out that I am still too rich to get help or a break. The main reasons are:

• I still own a car.
• I still pay all my bills on time.
• I still have a credit rating that is low risk for lending institutions.

So if I stop paying my bills on time, get rid of my car, and let my credit score slip into oblivion, I will then officially be living in the poverty belt where help is available. Metaphorically speaking, my situation is classic in which I have fallen through the cracks of the system. The only thing keeping me from really going under is fear. The good kind. The kind that makes me wake up everyday, and start from zero. It’s a new day.

Personally, I have never felt cheated by paying taxes. Instead, it is a privilege of living in society with luxuries such as cars and roads to drive them on. At the same time, the waste of money in this country alone is appalling (private and public equally), our roads suck, our police forces are corrupt, and don’t even get the conversation started on the public school system. Shame on us. All governments and all businesses are either run well or not, mostly not. I don’t adhere to the current American climate that is polarized into actually believing that all governments are good/bad, and all businesses are good/bad. They are all run by humans, and are therefore intrinsically flawed. Yep, I’m mad as hell as much as the next guy. But…

I am still not willing to NOT pay taxes for a society that somehow works. Kinda. I wonder if General Electric understands this. I think not. Shame on them, too.

For more info: www.VeloCityCoachingServices.com

A great CPA firm: www.mhccpas.com

THE MONEY CONVERSATION: Radicals, Tea-Partiers and Middle-Class Rage in America

“Empty pockets never held anyone back.

Only empty heads and empty hearts can do that.” – Norman Vincent Peale

The last taboo subject on earth is money. Not incest, divorce, mental illness or addiction. Why is it that commerce and basic economics are still muttered by wise old men, either behind closed doors or blasted on CNN and FOX News? I think one of the answers to this question is cultural. In China and Japan, people will openly ask what you earn, how much you have. In Egypt they haggle over prices like a boxing match without gloves. And in Germany, the general population has a pretty solid grasp of basic math and money matters. They know that what you have is what you have, and spending needs to have a cap.

Here in the US where credit is king, and you are considered a solid citizen if you are in debt, the rest of the world looks on in disbelief. I spent much of my adult life in Asia and Europe, and when I returned in 2004, shock and dismay do not come close to what I saw: my friends in over their heads in the real estate sector, consumer debt out of control, and regulation all but a whisper in the back alleys of Congress. And because I was “off the books” due to living overseas for 17 years, and my perfect credit abroad was not considered valid, I actually had to lie (with the help of a kind bank manager) to get credit in America. She was appalled by the fact that I was fiscally being treated worse than my 18-year-old nephew, so we filled out paperwork stating that I was military personnel stationed in Germany, which was a loop-hole we found. This risky move paid off, as a year later I was able to start the process of Credit in America.

The depth of The Money Conversation is too much for a blog posting, however the rage that is building up needs to land. America needs to wake up, plain and simple, and DO something about greed, empty promises, the haves and have-nots, and allowing ignorance to become the norm. For the record, I am a realist-cynic at heart who has had to overcome many obstacles in life to become positive – a self-made business owner with a global background – but there seems to be an opportunity right now to start the Money Revolution. I am not a violent person at heart, but after seeing Scorsese’s Shutter Island yesterday, I wonder. What am I capable of, if this trend towards hellish greed on the planet continues? So I look for answers, outlets and solutions. At the very least, this may help me sleep better at night, since the nightmares are increasing.

There seem to be three areas of focus in the media, living rooms, and hearts and minds of citizens: radicals, tea-baggers, and middle-class rage. Personally and professionally I am surprised that I can relate to all three. For the first time in our history, The Money Conversation might be the glue that creates forward momentum, and could ignite the public outrage that needs to happen.

Ariana Huffington has spearheaded a group called Move Your Money, and this movement has caught on rapidly (within a year, 9% have shifted their money from the big four to community-owned banks, for example, and their rating system to also hold community banks accountable is rather useful). Their idea is to create awareness about consumer power, supporting the local economies, and holding Wall Street and the Gang accountable for one of the most heinous crimes of the century. I am a radical at heart but a social libertarian in deed (my business is for-profit), and I must admit that I have fantasies of sending stink bombs to all who created and are still creating a gag order on regulation, credit card greed, financial lobbying, and the futility-apathy factor of the American people. They are not dividing and conquering us with a Machiavellian Method – instead, their activities are possibly uniting us. The irony is palpable.

Newt Gingrich supports what are now called Tea Party Protests, which were formed in 2009 to say no to government tax and spending policies. The mainstream media uses the term “tea-baggers” to describe the conservative anti-tax movement. Although I am not a fan of this movement’s foundation (nor most of its supporters), as it seems to be based on seriously twisted statistics, I find myself drawn to attending the Washington DC rallies against the policies of the current administration in order to watch the Tea Baggers’ forward momentum and outrage in general. I applaud them in their resolve to not talk about doing something, but rather do something and then talk about it. What I want to say here is: as misplaced and dangerous at this movement is, I can relate to their outrage. I just wish more insight and intelligence were a part of it.

Joe Middle-Class sits at his dining room table, eats canned vegetables ten for a dollar, and wonders what is going to happen next. At the pit of his stomach is pain, stress and the beginning phase of an ulcer as he tries to keep or find a job, keep divorce at arm’s length (divorce rates for people in transition are even higher than the outrageous 54% national average), and make sense out of Information Overload. His bank account is almost dry, his oldest daughter can’t afford a quality education, and every time he watches TV or listens to the radio, his gut knows that he is being lied to. His inner rage occasionally seeps out over a beer with his buddies, and he is right now at a crossroads: one fork in the road is marked Status Quo Do Nothing, and the other fork reads Wake Up Do Something.

At my company, whenever we begin a new Client, we give preparation homework before session one. It is a simple yet complex list of six questions to get an overview of their personal and professional lives. Question number two is: What is the bottom line monetary number to live your current life? In the years we have been in business, not one Client has answered this question the first time out accurately. After filtering through resistance, entitlement, ignorance, or shame, we come to their real-time number. Then, we have The Money Conversation to find out where they are now, where they want to be, and what steps they need to take to get there. But lately, as their fear and rage sit tangibly under the surface, they leave this question blank. Like the months, weeks, and days before revolutions, they sense something profound about to happen. The question is: will it be peaceful, slow and steady… or violent, rapid and out of control? And in the worst case scenario, will absolutely nothing happen?

I would like to see a mixture of  peaceful and radical change. I would like to see my Clients exchange their toxic, unstable, and short-term relationship to money for a more sane, long-term, and intelligent one. Move your money, engage in consumer power, look at your own greed, contribute to your local economies and commerce, STOP letting your money create wealth for the wrong people, deal with your fears, and have The Money Conversation with your friends, families, colleagues, politicians, local advocates, and leaders. But first, have The Money Conversation with yourself. Turn talk into action, go out and have dinner at a local restaurant (and tip well for goodness sake), invest in your future, and seriously think about how inaction only contributes to the problem. The revolution is about to begin: what will be your part, what will be your legacy?

Twenty Suggestions for Joining the Money Revolution:

1. Post your fees and prices for ALL products and services on your website. Set a trend in your industry. Be transparent.
2. Haggle over prices when you buy a car and wear the salespeople down.
3. Buy a Ford. Drink Bigby Coffee. Eat Trader Joes products. Shop at Borders Books.
4. Tithe 5% and give 5% to a local foundation or better yet, a start up business which does not qualify for a loan or grant because they are for profit. (I sense God will understand.)
5. Don’t always have enough money to fix a problem, and never have enough money to prevent one.
6. Tell a restaurant owner that you think the prices are too high for the quality and quantity you get.
7. Announce to your network about a great local business and explain why you give them your money.
8. Do the same for a great bank or financial institution.
9. Change your phone service to T Mobile and give AT & T and Verizon actual competition.
10. Do the same for a local cafe vs Starbucks, a local store vs Walmart, even Linux or Apple vs Microsoft.
11. Use Google not Bing. Use gmail not yahoo. Use Kaspersky not Norton or McAfee. Stop getting seduced by people like Bill Gates.
12. Send your local government, private, and bank agencies and offices a PLAN for investing differently in your community. (I just sent the local MEDC a 13 page case study, well researched with a tangible solution and plan for lending micro loans to businesses in the services and retail sector. It is now sitting on 3 people’s desks and I am on it, checking in at regular intervals.)
13. Stop allowing credit card payments on your website.
14. Stop using credit cards.
15. If you have maxed out your credit cards, do NOT let others who did not do this pay for your lack of repayment. Find a way to pay it back. Avoid at all cost credit card consolidation. Take responsibility.
16. Pay your bills on time. Take care of your finances. Get support and advice.
17. Downsize if you need to, invest in your future, community, and local businesses if you can. Do this today.
18. Engage in trade agreements, service exchanges, and barters.
19. Give money to charity, Haiti, the Red Cross, local food banks, local literacy programs.
20. Talk to a conservative if you are a liberal about money. Talk to a liberal if you are a conservative about money. You both might learn something, and may even find common ground.

For more information: www.VeloCityCoachingServices.com

For information on Move Your Money:  www.MoveYourMoney.info

Economics 101: Scarcity and Abundance in Detroit

Greetings from Detroit, Michigan!

GOING “HOME”: I moved my company to Detroit (where I was born) from San Francisco during the worst ice storm on record in January 2009 to be near an elderly parent. As I drove across this beautiful country of ours, I felt trepidation in bringing my coaching and training business to the Heart of the Recession. Although I have been in business for almost 26 years, I was about to become what I call a “geographical start-up”. My connections in the City by the Bay just nodded their heads in disbelief. I am known for taking challenges head on with grace and tenacity, but this seemed over the top even for me.

KINDNESS OF STRANGERS: Here I am 10 months later. After reconnecting to my family, including a cousin who worked the Cadillac assembly line for over 32 years and is now a member of the 15.3% Unemployment Club, I hit the ground running in March. I have been networking like a pro, developed relationships via two high profile professional women’s organizations, set up a new website, started this Blog, got Linked In… I was advised by a trusted business contact here: in order to survive the Recession in Detroit, I would need to cut my fees in half and give away the store for a year, at least. Gasp. Ok, I thought to myself – I actually live what I teach, so I will rely on the Laws of Attraction, Reciprocity and Contribution to see me through. If the Universe wants me to succeed and contribute to this extremely depressed area of the globe, I will do what I can to pay it forward and trust in the kindness of strangers.

CASH FLOW: Cash flow has become an oxymoron for most people here. Miraculously, I have created cash flow for my company through having an extraordinarily effective service that people here need, engaging people with a soft-sell approach, posting fees on the website (VERY uncommon in my profession), and working practically 24/7. I have never worked so hard in my life. Allow me to repeat that: I have NEVER worked so hard in my life. I am in awe of the abundance of determined, approachable, reciprocating, kind, intelligent, tenacious people who are committed to staying here, helping each other through this economic nightmare and not allowing a “brain drain”. And, I have never met such rich “poor” people in the many years I have been in business.

ABUNDANCE: In Northern California, we pay a “Paradise Tax” for living in a healthy and open environment. Money flows more easily as it is socially acceptable to live on the edge. Steven Covey’s Scarcity Mentality is not so common as Abundance seems more the norm, even for people living paycheck to paycheck. Perhaps the negative ions of the Pacific tweaks our brains and makes us blissfully happy to buy a $27 bottle of local Pinot Noir or a $4 gallon of gas. Here in the Motor City, the first business breakfast I bought for a prospective client cost me $11.37 for two, including a 22% tip. The 3400 square foot home I share with my sister in an affluent western suburb would sell for under 200K, and I pay $12 for a really good haircut.

SCARCITY: As I talk about money with prospective clients, I hit a wall. The Scarcity Mentality regarding money is alive and well here in the Midwest, and even as I offer additional discounts on my rather low fees to Professionals in Transition (it is all relative, I know…), I am starting to see a pattern. Several of my clients and prospective clients are ex-Chrysler, GM, EDS, Delphi employees who have from 400k to 2 million in their savings. They own HUGE beautiful houses and boats and summer homes on one of the many lakes here. They wear nice clothes, have gorgeous jewelry, drive big cars, eat in abundance and give to their churches. Yet, they don’t seem to have cash for supporting each others’ businesses or hiring high-caliber talent. For commerce, they hold onto their cash, waiting for the magic moment when a Financial Referee will blow a whistle and say: ok, you can spend your money… now… go! What are they waiting for?

THE RICHEST “POOR” PEOPLE: Is it possible that they simply do not understand Economics 101? WE are the cash flow referees. WE are the people who will create Scarcity or Abundance with our fearful mentalities or our consumer confidence. WE are ultimately responsible for creating the lack of cash flow among ourselves, and not (contrary to popular belief) the government or the banks or the magic whistle blowers. Granted, this is an over-simplification of a rather complex situation – however, it is also true. The generosity and resilience in abundance of the fine people of Detroit are not being expressed in supporting the local economy, as the richest “poor” people in the country sit paralyzed on their bags of gold… and wait.

PAY IT FORWARD: How long the rest of the local business community and people in transition can wait is unknown. For my company, we are surviving and on the verge of a rather positive tipping point: I manage to pay my bills on time every month, watch billable hours increase and tip well – even in this tough economy. There are no “Five Secrets for Surviving” that I can share, except that I continue to pay it forward and regularly engage in contributing to the local economy. For others not as resilient as I am, I hope that the cash (and hiring and tips and services and Abundance Mentality) begins to flow sooner rather than later.

For more information, please visit: www.VeloCityCoachingServices.com

Links to the two professional women’s organizations mentioned in this posting:  www.mcwt.org (Michigan Council of Women in Technology) and  www.inforummichigan.org (Inforum –  A Professional Women’s Alliance)