Breaking the Small Business Code

Taxes and College Support

                  

                         I am seeing serious BIG time feedback on many blogs about taxation, patriotism and "critical" services!  With the  melt-down in the financial market combined with the higher taxes that will come with the "bailout" with the losses in home equity with [pick your own financial problem], we have ANGER coming from many taxpayers!  And it is growing. . .

     One of the items in today's Inside Higher Education is a little tidbit about the income tax ballot item in Massachussetts and how the state universities are reacting.  The article was predictable with university officials warning about cut-backs and higher tuition to make up the tax losses. But what I find the most interesting is the responses. Here's one from ProfessorMojo, SUNY-Plattsburgh (I've added bolding for emphasis):

     "As usual, the academics focus on their own livelihoods as opposed to examining the larger issue at hand. Certainly, some taxation is necessary, and few would argue against funding a state university system. However, the issue is the state government’s constant desire to suck more money from the taxpayer as opposed to being responsible stewards of the public treasury.

     We’re facing budget cuts here at SUNY, and it is noteworthy that my co-worker’s first reactions are to increase taxes and tuition as opposed to reforming the union-driven state spending practices that got us in this mess in the first place."

      I made no secret of my anger at the PORK inside the so-called bailout bill for the financial markets.  That pork will cost ALL of us more tax dollars and redirect them to places we as taxpayers have no say over!  I am ANGRY enough to support a ballot issue just like this for my home state of California AND for the nation over all!!!

      I think this brings up the reason for taxes.

     As I write this, there is a large brush fire in Northern L.A. County where the 118 and 210 freeways meet.  I listened to the City of LA officials point out that there are 1,000 firefighters on the line and that THIS IS WHAT TAXPAYER want from their government - protection of the people.

    I agree that colleges and universities are critical to the well-being of America as are many other essential services like roads and water. But where does the definition of "essential" that stop?

   This question comes from an article in Education Week that talks about the complaints about changes inside the Department of Education combining the Title I and Title III programs for English as a second language programs.  Obviously there are savings in combining the programs as well as oversight issues. But predictably, there are screams that "their" issues are so important that they "deserve" a separate agency.

    Just how many things can we afford to make "special"?  How many tax dollars can we afford to spend on what?

    I appreciate that everyone wants their special needs handled.  I understand it's easy to say mine's more important than yours.  But in TOUGH ECONOMIC times, you make priorities.  You cut back on things that are "nice" and things that might even be "important" and focus on what is essential.  But we need COMMON SENSE.   

   What do YOU think we should pay for?  Where should we say, yes, I know it's important but NOT as important as firefighters or colleges or ????

 

       

NO Limits on College Political Speech - Part 3

       Per this morning's Inside Higher Education, the University of Illinois President  B. Joseph White sent an eMail affirming the right of employees to wear campaign buttons and attend political rallies on campus.  He said that university policy would not bar attending partisan rallies on campus, wearing political buttons, or having political bumper stickers on cars. 

     HOWEVER, he did say that these activities should not take place while employees are on duty [I bolded the phrase for emphasis].

     Gotta love those "wiggle phrases".  So President White, what constitutes "on duty" for a professor?  When are they "off duty" when at their campus worksplace? Can they wear their buttons when on "company" business off-campus? Is this how will you make sure your TAX-EXEMPT nonpolitical status is protected?

     Per my Blog on October 3, I had no objection to academic freedom of speech within the classroom. BUT I do think that University employees - and by this I mean mostly professors -- should be required to meet the same levels of neutrality WHEN IN THEIR WORKPLACE AND WORKING that I as a private citizen and employer also need to follow! The tax-exempt status of a state operated university should be held to the same standards!

     Having grown up on college campuses I can smell that this is a CYA eMail.  I know there will be little (if any!) attempt to enforce the off-duty requirement.  So professors will continue to do what they have always done  under the banner of  "academic freedom".  The university's nonprofit status is supposedly now protected by the insertion of the "off duty" phrase. 

    If I read about enforcement of the off duty requirement I will apologize.  But until then, I see this as another way professors will be allowed to break the rules that rest of us have to follow setting a bad example for our college students. 

Limits on Political Speech at Colleges - Part 2

 

    Yesterday, October 2,  students and faculty at the University of Illinois at Urbana-Champaign held a rally to show support for the presidential campaign of Barack Obama. In addition to showing their support, the goal was to show that the faculty will not follow guidelines issued by the university that bar them from rallies or wearing political buttons on campus. (See the Chicago Tribune for great report on the event).

     Per the article, the university says it isn’t enforcing the guidelines, which it says are required by state law.

     I admit that bothers me more than the predictable reaction of the professors. Why tell your employees about a rule if you aren't planning to enforce it!  That is CYA hypocrisy at its best. If someone complains about the violations the state will point to the rules - "gee guys, not our problem if those independent thinkers at the college don't want to follow the rules".  The university will then say it is "working with the state to clarify their intention".  A perfect dance trying to have it both ways!

    As I predicted in my September 24, 2008 Blog, the professors say that the guidelines unreasonably limit their freedom of expression:

     "They're trying to control our bodies and our voices any time we're on campus. These policies are clearly a violation of our 1st Amendment rights," said Dan Colson, an English graduate student who, along with other students, professors and free-speech experts, has lashed out.  Colson and others argue the University of Illinois was unfairly expanding state law.

     Here is the phrase from Colson that summarizes this and other debates on what laws should we PRIVATE citizens and businesses follow that ACADEMICS should not.  Per Colson:

" . . . that academic freedom meant campus communities should not be held to the same standards as other state employees."

     I appreciate the need for "academic freedom" as the daugher of a retired college dean but no offense guys, I need freedom in my business too!  But I am NOT allowed to say and do things that you are allowed to say and do at your workplace.  I cannot voice or demonstrate my personal feelings on many social and political issues because it is often ILLEGAL. 

     Per the State of Illinois, you have been notified your "workplace" has rules on endorsing candidates that jepoardizes the workplace's tax-free basis.  Yet you have decided you know best and will not follow those policies.  I see your point and I agree and I disagree.

     You have the right of free speech BUT you give up some of that freedom in exchange for a job.  I agree that there needs to be a more flexible standard on campus to allow for frank exchanges in a classroom on topics of concern.  However, I do not see that as being extended to a PERSONAL demonstration of support as in a rally or wearing a button until you leave the workplace.

    This is an important issue that needs to be discussed.  Where is the line between academic speech and unlimited speech exist for a college campus and ITS EMPLOYEES?  Where is that line compared to my freedom of speech in my workplace?

     And even more importantly, should professors be allowed to flout the rules and policies of their employer (the taxpayer in this case since this is a STATE university)?  Should they be allowed to do things you and I cannot simply because of where they work and what they do?  Should "academic freedom" be so broad that they can break the law with impunity compared to you and I?

    Let's chat!  I want everyone's opinion - colleges and private citizens.

Pork Barrel Bill and Transparency by Blog

     You may or may NOT have heard about some of the shennanigans burried in the new "Relief" aka BAILOUT bill passed last night by "our" Senate from the "mainstream" media.  But no one else said anything including NPR other than "this was an important bipartisan bill" or showed the self-congratulating senators pushing to get to the microphone.  I saw just ONE outside expert commentator on Fox plop down a telephone book-sized bill that had evolved from Paulson's 3 page outline but he gave no details!  And the eMail alert I got from US News today also only summarized the high points that related to the crisis. 

       I was clueless about the bill's REAL details and contents until I started reading my morning blogs like "Don't Mess with Taxes".

     Thank you blogosphere!  Thank you "Don't Mess With Taxes!" and the 20 or so other blogs I subscribe to each day.  Yes, I know there are kooks and way-out-there blogs but there seems to be no where else to learn what is REALLY going on in our congress.  Blogs by citizens like me who share what they have learned seems to be the best place to learn what is really going on out there!

     Here's what got me so angry:  Did you hear about the arrow tax break provision? This little add-in waives the tax on child's practice arrows and costs taxpayers about $200,000 a year (enough to send 8 kids to UCLA free every year).  Granted, this is a very teeny tiny part of the NEW ADDITIONAL $108 billion (!) in businesses and individual taxpayer "sweeteners" that were added to make the bill pass.  BUT IT SHOWS how our politicians can't help but pork out everything -- something even as critical as this bailout bill!

    Politico lists some of the various "sweeteners" and their costs. While an kid's arrow tax may soon become great fodder for Saturday Night Live or Jay Leno, it is the poster child for PORK BARREL POLITICS.  The Senate sounding so serious about how critical their efforts were was nauseating this morning on the AM news.  They were all patting themselves on the back for a bi-partisan effort.  Yeah, bi-partisan means they both were equally adding pork!

    My client families and the members of the College Leadership Foundation's College eCoaching Club have been flooding us with questions on how to afford college with their savings and home equity cut or gone.  They want to know what they can do to pay for college while waiting on the "financial rescue" AKA "bailout" bill. Most think it will someone help them personally.

     My recommendation to these families is to call the House of Representatives and tell them to scrub out every ounce of pork.  Focus only on what Congress SAID was important to stabilize the financial industry if that is STILL as important as they make it sound.

    In my opinion, if this was soooo critical, they wouldn't have taken the time to stuff it like a goose full of special favors and little unknown tax breaks! 

     SO what are your feeling on this mess?  Mine can't be printed because it would scorch the screen I am so angry.  Pass this blog along so Google will pick up all your comments and maybe we can get the idiots  we elected to come to their financial senses!  STOP THE PORK BARREL POLITICS disguised as crisis!

 

Response to the Market Meltdown - A Person POV

    

         In the last 4 hours I have received so many calls and eMails on the meltdown and cries for help from college-bound families that  I have lost count!  So I wanted to put up my two cents worth from my personal point of view as a college funding expert, a grandmother of two, and as a business owner.

                       This is an OPEN LETTER TO ALL POLITICIANS & THE MEDIA

    You work for me.  I vote, I pay taxes, and I love my country.  I want you all to stop and listen to me - the voter - for a change.  I didn't rip off anyone, I don't have a golden parachute and I didn't dump bad home loans on Wall Street.  Yet I and my grandsons are the one who will ultimately pay for your programs, cushy pensions (which are not in the market) and for your blame game politics.

    First, stop all the finger pointing.  I DON'T CARE who created the mess.  Stop bickering, grab a mop and clean it up.

     Geewhiz, I feel like I am listening to a bunch of 5 year olds who think it's more important to blame the other person for playing with matches than stop and fight the fire.  I want to grab both sides by the collar and give them a time out.  WHERE ARE THE GROWN-UPs in all this? Talk to me like I have a brain.  Stop trying to do 10-second platitude filled soundbites.

    And oh by the way Ms Pelosi, don't insult the other guy when you need him to help solve the problem.  Excoriating the current administration and the Republicans as being to blame  (true or not) from the floor of the House and then expecting them to support your bill is NOT good leadership. We need people working together and blame (coming from both sides) is not good team building tactics. 

    Second, EVERYONE stop saying it was the "other guys" and explain exactly WHAT HAPPENED.  Today's captain of the ship may NOT be responsible for the ship sinking if it was badly built and maintained by the previous captains!! Let's have a REAL examination of why it sunk so it DOESN'T HAPPEN AGAIN!!!!   I'm an engineer and politics have no place in examining a failure if you want to learn from it and keep it from happening again. So . . . 

Shut up about who's to blame and start bailing together  or we all go down together!

    Lastly, vague generalities and blame makes me think my elected officials on both sides don't KNOW what happened or why.   As a responsible citizen, I have done my homework.  I did the research, looked at the graphs and even I can see what happened when.  WHY CAN'T YOU?!!!

How can  I trust whatever plan you have to fix things IF you apparently don't know what you are fixing!!

      I don't want platitudes and slogans -- I want facts and concrete answers that lead to reasonable and clear fixes. I don't want pages and pages of special deals and carve-outs and attached amendments.  I want to be able to CLEARLY see what you are doing, what is supposed to happen and see accountability ON YOUR SHOULDERS TOO!

     And oh by the way, all you "reporters", start REPORTING!!  I don't want you to be a commentator who is parsing it for me into little bite-sized pieces like I was a child.   Don't disguise the news wyhen it is clearly editorial opinion.  WHERE is the neutral research about WHAT happened, the WHY and the mudraking for players on BOTH sides of the aisle?  You are sooooooo transparently biased I can't trust you any more.  I want facts not thinly disguised and sneering interviews.

      I want someone to step up and say we had a good idea in making housing more affordable but it had unforeseen consequences because we measured success wrong.  We had a good idea but making lenders lend when they shouldn't for political reasons backfired.  Our programs encouraged people to cook books and dump risky debt.  I want to hear you say it is not good policy to do the same old junk bills filled with special pork and singling out those who only took advantage of what you created.

   Stop looking for whipping boys ("the rich"), stop pointing fingers ("them"), and start giving me answers.  THEN I MIGHT want to elect/re-elect you to fix the problem no matter what party you're from.  I want leadership NOT politics.  I want answers, not slogans.  I want accountability, not blank checks. I am not allowed to spend more than I make, not allowed to dump my bad debts and not allowed to stay in business by blaming the other guys for my mistakes!

   So get together, stop name calling and get to work on something that I can understand and trust in. Let me know what you did, why you did it and TAKE RESPONSIBILITY if the fix doesn't work.

   That's my two cents . . .   

Paying for College When Your 401K becomes a 1K

     Good morning.  You just woke up to yet another bank being bought out, news of the bailout plan being used as a political football, your house value (and your home equity) has fallen another 10%, and your 401k has been reduced to a 1k.   And tonight's dinner table conversation will be about which $20,000 to $50,000 a year college your high school senior should be applying to. 

     Welcome to the new American nightmare -  paying for college while the financial world you were planning to use seems to be falling apart before your eyes.

     So what is a college-bound family supposed to do in today's chaos?

     First, slow down, take a deep breath and focus on what you can control and create a plan.  The reason firefighters seem so in control during an emergency is they have plans for what to do in various situations.  Families who have a plan will not react in panic when something outside their control happens -- they move onto plan B and then plan C.

     I am counseling my families to think of college planning in these turbulent times as a road trip.  You know you want to get from New York to California for a particular budget.  You decide to drive and begin the trip.  You get 30 miles away from home when traffic stops and the radio tells you about a crash on the main highway ahead.  You can choose to wait it out OR take an alternative route.  You probably wouldn't turn around to go home and decide to fly would you?  If you don't know an alternate route you may pull out a map or pull off the highway and ask someone.  College planning in these strange financial times is the same way!

     Have a TRIP (College) PLAN!  Know where you want to go, how much you can afford to spend to get there, and alternatives in case of an emergency.  If you don't know the alternative routes, find someone who does!  And like driving across the desert, I wouldn't recommend listening to advisors who aren't experienced in that dangerous part of the journey.  I often end up fixing college plans that were based on heresay from friends, family and "professional" advisors who are well-meaning but have never successfully created college plans.

     So where should you turn for professional help on your "road trip"?  You can hire college financial planners like me to be your personal chauffer and take over the trip.  But that's an expensive option and not for everyone.  Instead, I would suggest you consider joining a  "AAA" for college planning.  That's why  I am suggesting that all families learn more about the not-for-profit College Leadership Foundation's College eCoaching program. 

     I am proud to be one of the Technical Advisors to the CLF's eCoaching Club.  I feel they are the most cost-effective way I have ever seen for getting help for the college journey for virtually every college-cound family.  They are unbiased and independent so there is no risk that they will send you down a "road" that only benefits a lender or a mailing list company!

     If you can't find or afford a local "Linda" to be the chauffer, I suggest looking into the CLF eCoaching program to help you on your journey.  For a modest monthly fee, you get the information you need sent direct to your family's inbox several times per month. Compared to the ultimate cost of the trip you and your student(s) are about to take, having a college planning "AAA" will be a small but valuable investment.

     In the meantime, if you have questions or concerns about your college future in today's economy, respond to this blog or contact me through my webpage at www.LindaPTaylor.com. 

    

Free Speech Versus Candidate Endorsement Limits

       A VERY timely and interesting article in the Inside Higher Education daily eMail today about the new University of Illinois policy that bans the wearing of campaign buttons, sporting of bumper stickers, and attendance at campaign rallies ON CAMPUS for employees of the University.  As expected, the outcry from staff and especially professors was quick and loud.

     Without taking sides, I wanted to explain to everyone what the issues were because it is a 4-way conflict between:

1. The right to free political speech,
2. Workplace rules,
3. The college's broad definition of workplace free speech, and
4. The IRS rules that nonprofits cannot directly support political candidates.

    First, we all have the right to support the political party and candidate of our choice under free speech.  On our private property and in the public locations, we can do, wear or say pretty much whatever we want as long as it follows the law.  It is not only allowed, it is encouraged that citizens be legally pro-active in the political process.  So if you want to wear a button or put a poster in your window or a sign on your lawn, it is your right.

     However, political speech can be constrained by the policy of your workplace as long as it is equally applied.  Companies usually restrict things that an employee may find offensive. This is because of all the lawsuits that have been filed regarding hostile or discriminatory work environments.  So most employers practice work site neutrality for virtually everything from religion to politics.  As an employee, you can expect to be asked to remove or cover political buttons or t-shirts.

    What creates a challenge for colleges is they do not think of themselves as a "traditional" workplace.   Colleges consider themselves a unique location where free speech of any kind is considered an essential part of their reason for being.  University staff usually felt their colleges were  "public" areas where workplace rules do not apply.  Students as "customers" are allowed to freely express their beliefs on campus.  So it was natural for professors and staff  to feel they too could participate as if the college were not their workplace!    But this has now run headlong into IRS rules for nonprofits!

     The IRS rules on nonprofits are VERY clear that they are not allowed to be partisan and support a specific political candidate.  This means that university employees including professors cannot show support WHILE THEY ARE BEING EMPLOYEES.  So to protect their tax-free status, the U of Illinois has issued rules on what staff can and cannot have or do while on campus -- their workplace. 

    It will be interesting to see if the professors on the U of Illinois finally understand what it is like out here in work-land where we have to adhere to rules that they have traditionally supported but not been constrained by because of their "special" nature. 

    What do you think of the new policy of U of Illinois?