It’s difficult not to miss all the media coverage of an election year, and this one is probably the most hyped, frantic, and unusual election cycle in our lifetimes. Business owners are especially anxious because which politicians are elected affects the economy and prospects for growth and profits.
Jimmy Carter is credited for price controls that made the U.S. economy shrink. Bill Clinton was credited for creating a large budget surplus and improving the state of the economy. Ronald Reagan attempted to reduce government spending and balance the budget, yet it never happened. Barack Obama’s policies had both positive and negative effects on the economy and the long-term effects of the ACA is yet to be seen.
Political races usually spur the stock market during the election cycle, yet history shows that markets respond better to election processes whose outcomes are predictable—and the one we are in now is anything but predictable.
It’s apparent to even the casual political junkie that the two leading candidates for President, Hillary Clinton and Donald Trump, are polar opposites. Clinton has experience in politics; Trump has experience in business. Which will give Americans a better future? That remains to be seen. But one thing is certain, whoever comes to power will affect the economy in two ways: it will determine both the laws that shape and drive our markets, and also the taxes and credits that slow or build new business.
Campaign enthusiastically—vote wisely.
Whether you’ve already filed your taxes or your deadline is still looming, it’s seems to be unAmerican to love the IRS.
When Pew Research surveys the 150 million or so Americans who file returns, about whether they love, like, or hate doing their taxes, one-third report that they actually like or love doing taxes because it means getting a refund. And some just take pride in being good at filling out all the forms! I guess we could say that we also fall into the latter category!
Of the other remaining two-thirds, most say they simply don’t like it and 25% of this group hate doing their taxes. It does not take a great deal of imagination to choose which group pays the most on April 15.
Most of us know that the U.S. tax system began in the 1760s with the protest against British tax policy, but did you know that the first items for which we paid taxes were whiskey and glass windows? At first, the new Americans paid federal taxes on land and commercial building. The first personal income tax was enacted in 1861 to pay for the Civil War. As we all know, once the war was paid for the Feds found a reason to keep collecting. In 1913 the 16th Amendment was ratified and we’ve been paying for more wars and more reasons ever since.
It’s interesting that the government has never taxed charities or religious bodies, no Value-Added Tax (but we hear rumblings) and there have been no export taxes or taxes on trade between the states.
For us, when tax season is over, we breathe a sigh of relief but we also feel good about the job that we did for ourselves and our customers…every detail closely scrutinized to pay the least amount of tax legally owed.
As Morgan Stanley once quipped in an ad, “You must pay taxes, but there’s no law that says you gotta leave a tip!”