How I Simplified the Tax Code in Just One Hour

Disclaimer: I wrote the following paper this evening with only a simply premise to get me started. I am not a tax professional. My complete knowledge of tax issues came from only a few sources. These would be a textbook on Microeconomics, my partial reading of the FairTax proposal, recent completion of a 1040-EZ form, and liberal surfing of the sometimes unreliable Wikipedia. Let’s begin.

Current US tax codes are very long and complex. According to various Republican representatives, the full text of the code is is somewhere between 2,500 and 2,500,000 pages long (http://www.trygve.com/taxcode.html). According to the US Government Printing Office, the adjusted gross page count is 16,845.

These figures are often used by politicians to paint the picture that our tax system is too complex and full of loopholes. Probably the most famous of alternative proposals is the so-called “FairTax” system which reduces the federal income tax, corporate income taxes, and capital gains taxes into a single sales tax. There are downsides not the least being it still allows for loopholes (because there is a ton of exemptions) and significant incentive for an underground economy. It only seems to be the best solution as 45 states already have a sales tax implemented and therefore there already is a large infrastructure for using this tax system. A a better solution would be to use other existing infrastructure that wouldn’t put such a burden on businesses which would be watched by the IRS much more closely under the FairTax.

Property taxes were once a major source of revenue at the state level, particularly prior to 1900, which was before states switched to relying upon income tax and sales tax as their main sources of revenue (http://eh.net/encyclopedia/article/fisher.property.tax.history.us). But times were quite different back then as the federal government was still giving away unclaimed land to those willing to develop it plus there wasn’t enough goods and services being traded to provide adequate revenue for the government. Even if there was, there certainly was no infrastructure to properly track the required taxes. Today’s trading landscape is much different with billions of dollars worth of goods and services being traded daily and the record keeping required to stay compliant is massive. If you’re going to simplify the tax code, moving the entire burden and responsibility to American businesses doesn’t seem to be the answer.

The solutions I would search for are those that achieve three primary goals:

  1. Simplify and reduce the tax code as to place less burden on those required to be compliant. Emphasis would be placed on using existing tax infrastructure instead of implementing new systems.
  2. All taxes shouldn’t explicitly create winners and losers by targeting specific groups of people.
  3. Reducing the number of exceptions, loopholes, tax evasion incentives, and overall level of bureaucracy.

Here’s the plan:

Property taxes (at the municipal, county, or state level) would be increased for landowners and owners of personal transportation property (registered automobiles, boats, and aircraft). The most valuable properties are owned by corporations not individuals, therefore, all corporate-owned properties would be subject to this addition in place of the current 15% to 35% Federal corporate tax.

The reason I’m targeting property owners is simple:

  • It follows rule #1 of using existing tax infrastructure.
  • Real estate is a finite resource and since people of higher incomes are disproportionately likely to own more valuable property, the tax is progressive. For the nearly 1/3 of Americans who don’t own real estate, they will pay the tax indirectly through the increased cost of renting/leasing passed on by the landowner.
  • Personal transportation property has been added to help make up for the massive loss of sales tax revenue from new and used vehicle purchases. Instead of a fixed rate as implemented by the few states which tax personal property, we would use a variable rate based on a “blue book” value of the property.

As always SOME exemptions would have to be created for certain land types and landowners such as Indian reservations, non-profits/charities, unemployed and retired persons, and perhaps the Amish??? (I’m not sure how they handle property taxes right now).

The property tax increase would be implemented in two phases. The first phase would be to replace the income and sales tax at the state level with the property tax. Since most state already a property tax based on it’s value, it just has to be determined how much of an increase would be necessary to match the loses from the removal of state income and sales tax. The property tax on corporate-owned property (which would replace the corporate tax) would by collected by the state and transferred by them to the Federal government. During this stage a Federal income tax would still be levied as usual. It would probably take several years the new system to stabilize and then it would be on to the second phase.

In phase two, property taxes would again be increased simultaneously when the Federal income tax is removed. The money would still be collected locally by the state so at the citizen level you would never be paying money directly to the Federal government.

Taxes also serve an additional purpose besides raising money to pay for government services. They also provide economic incentive (or penalty) for things that would otherwise not make good financial sense. The can help to equalize the playing field between products/services that are more beneficial, but would not otherwise make good financial sense. They can also make it financially costly to do things that would hurt society as a whole (such as polluting).

As such, a few existing secondary taxes would also be kept aside from the primary tax on property. There’s a bunch of them: http://en.wikipedia.org/wiki/Tax#Kinds_of_taxes, but I’d propose keeping current Excises and Tariffs as they are right now and dumping most everything else.

Obviously, this kind of major change isn’t likely to ever happen, but it was a fun thought exercise and I think I learned a bit more about taxation in America while researching it. So go ahead, rip it apart in the comments…


New Business Venture

I’ve begun a new project in conjunction with my friend Ryan Jeanes (from “The Hitchhiking Movie“). The website is called 11 Visions and it will document travel adventures, new experiences, and life events. We started by producing a movie where we hitchhiked across the United States in one week. The success of this adventure sparked the idea to make further adventure movies.

The premise is simple. We start with a great idea, go out and actually do it, and then share our photos and videos of the event. Most great ideas are inexpensive to achieve if you are willing to take the time to do them. When people hear about the projects we are undertaking, they usually react by wishing they could do the types of things we are doing. They can. You can. Join the adventure at 11 Visions.


Obama Could Face Charges in Marijuana Book Scandal

Originally from FOX News

While his prowess in politics got him a spot in America lore, a controversial book could put president Barak Obama in handcuffs.

Richland County, S.C., Sheriff Leon Lott told the New York Post that he will charge Obama with a crime if he is able to determine that the newly elected President smoked marijuana.

“This case is no different than any other case,” Lott told the Post. “This one might be a lot easier since we have a confession. It’s a relatively easy case.”

Obama, who won the American presidential election on November 4, 2008, admitted to smoking marijuana in his book “Dreams From My Father.” The book was published in 1995.

Lt. Chris Cowan said Tuesday that sheriff’s investigators were gathering more information about the confession, but declined to discuss details of the investigation.


How to Record Telephone Calls

This article will explain the basics of recording telephone calls from either a traditional landline or a cell phone. It is not a comprehensive review of all the possible products available so I will only be discussing specific products I have used myself. You may have equally good results using a different product as the basic principles are still the same. Recording a telephone call is not legal in all states so be sure and check your local laws before continuing.

For a regular landline phone, you will need to purchase an “in-line tap.” This device will connect between your telephone and a wired handset. It will NOT work with a wireless phone so you might need to make a quick trip to Wal-Mart to get a old school wired phone instead. Buy a cheap brand name phone (AT&T models worked well for me).

For cell phones, the setup is quite similar except that you will be connecting a different tap between the headset jack of your cell phone and the actual headset. I used a Radio Shack cell phone tap (part number #17-855) and it worked very well with both a Samsung and Motorola cell phone. One note: remember that muting your cell phone will NOT prevent your voice from being recorded since the headset portion is still active.

Someone has pointed out several websites which provide phone recording services for a small fee. I haven’t used any of these so I cannot personally recommend them, but buying your own recording device will always be cheaper in the long run if you plan on doing a lot of interviews or other such calls.


What Type of CD or DVD Discs Should I Buy?

There is many different types of CD and DVD discs making it very confusing for a buyer who might not understand all the various options available. I will try to educate you on what you should look for when you buy blank CDs or DVDs.

The first thing you should consider is to make sure you buy high quality media. In general, name brand discs (such as JVC/Tayio-Yuden, Verbatim, or Memorex) will be manufactured to higher quality standards than a cheaper store brand. I actually purchased a case of 100 discs once that were so poor quality that the plastic layer on the disc was already separating from the recording layer right out of the box! Since CD and DVD discs store data digitally, using a lower-quality disc doesn’t mean that your data will look any different. Instead, the disc just won’t last as long and some devices have problems when playing lower-quality media. Save yourself the trouble and spend the extra money for good discs.

For both CDs and DVDs, you will have the choice of purchasing re-writable discs (usually marked as RW). For most people, this isn’t necessary. RW media was more popular several years ago when discs were much more expensive, but they have little use today. There is also a special re-writable DVD format called DVD-RAM which is supported by very few devices and should not be used unless you have specific hardware that requires it.

Next you’ll have a choice between two competing DVD formats: DVD-R and DVD+R. Most devices made since about 2005 or so support both formats equally so don’t sweat this one unless you have a lot of older electronics. In general, DVD-R is considered to be the most compatible if you have the option to purchase either one.

One more thing you might find is that blank CDs are often labeled as either Music CDs or Data CDs. The discs themselves are identical except for a hidden “flag” that some electronic devices can see. If you are just burning music from a computer, save yourself a few extra pennies and buy regular data discs as they will work just as well. Some standalone audio recorders require Music CDs so check your owners manual if you are not sure.


What is the Best Video Editing Software?

To start with, we’re going to compare Apple Final Cut Pro and Sony Vegas Pro. I know these products are only indirect competitors due to their different platforms, but these are the only programs I have extensively used. If you would like more specific advise, you’ll have to ask someone else.

Final Cut Pro (FCP) is very much an industry standard and is often used along side with high-end systems from Avid, Media100, or Leitch in production facilities. Many theatrical movies and television shows have been edited in FCP which Apple loves to tout at industry conventions. FCP is also a standard in many education institutes so most new editors entering the video industry are trained on it.

That being said, most timeline-based editors such as Vegas and FCP function in a very similar manner. Although the specific names of functions and keyboard shortcuts may change, the same concepts apply and are fairly easy to apply to different editing software. Most new editors (usually with a Premiere or FCP background) can be trained on Vegas very quickly.

Personally I use Vegas because I have a PC and therefore cannot use FCP on it. I considered Adobe Premiere as well several years ago before making the purchase, but chose Vegas for several reasons:

  1. Vegas supports putting nearly any file on the timeline without additional conversions. Premiere requires many “non-standard” files (such as DivX) to be converted to a supported format before they can be edited.
  2. Vegas supports 3D tracks allowing for fairly complex compositions right in the timeline without need for addition FX software.
  3. Vegas supported real-time native HDV playback from the timeline (which Premiere didn’t at the time).
  4. Vegas bundles DVD Architect which (at the time) was significantly less expensive than a Premiere/Encore bundle.

I know I’ve dived into a bit of a Premiere comparison above, but it is another major player. On the PC side, Premiere has some advantages over Vegas as well. Premiere’s built-in titler is far superior to Vegas, and DVD Authoring with Adobe Encore is well integrated with Photoshop making complex DVD Menus way easier to build then using Sony’s DVD Architect.

On the Mac side, FCP has a number of advantages over Vegas including a fantastic titler (LiveType), superior DVD Authoring (with DVD Studio Pro), and supports a variety of hardware that Vegas does not.

If you’re planning on editing for primarily your own purposes, I would suggest you go ahead and learn Vegas. It’s a very powerful piece of software and quite inexpensive compared to other players in the marketplace. If you’re planning on getting a Mac in the future anyways OR want software experience that is more marketable, buy FCP with it and get started with that instead.


How to Convert PowerPoint Presentations to DVD

Many people have taken the time to create large complex PowerPoint presentations only to discover there isn’t a simple method of converting these files for playback on a DVD player. Several companies offer software to facilitate this process, but the software often messes up the timing, music, animations, and fonts contained in the original PowerPoint. While this might be acceptable for simple presentations, more complex ones will require a different solution.

  • VGA or DVI Scan Converter
    Several video hardware companies have created scan converters which will convert the RGB video feed from your computer into a regular NTSC video signal. You could then take this signal and capture it back to your computer using a DV camcorder. The main problems with this arrangement is there will be some quality loss depending on the hardware you decide to purchase. It’s also a multiple step process that is very time consuming. I do not recommend this method.
  • Camtasia Studio (http://www.techsmith.com/camtasia.asp)
    TechSmith has created an excellent piece of software called Camtasia that (among other things) functions as a plug-in to Microsoft PowerPoint and enables direct screen captures of the presentation while it is running. This is superior to most software as it still uses Microsoft PowerPoint to play the presentation. As long as your computer is capable of simultaneously playing and recording your PowerPoint there are rarely any playback issues.

I recommend Camtasia Studio as the best method for converting PowerPoint files to DVD. This software can be purchased for $299 from techsmith.com.


Miley Cyrus Solved… Now Taylor Swift?

Beginning early this summer, my cell phone began receiving unexplainable calls from young girls wanting to speak with Miley Cyrus. At first I deemed it to be a simple prank from one of my more loonly friends, but as the summer went on the calls increased in frequency and they were coming from all over the country. It finally reached the point where I began to tell the female callers that Miley wasn’t available right then, but I would pass a message on to her. By September, the pizza boxes stacked near my door had dozens of scribbled names and numbers along with messages to be passed on to a celebrity that I had no way of contacting myself.

Then came Bethany. Now Bethany is what you might consider an obsessed fan. She and her little entourage of friends in Southern California made a habit of calling a dozen times per day and often late at night. Since she was at least willing to speak to me I decided to locate the source of the calls. After much coaxing, Bethany revealed that she had gotten “Mileys” number from a YouTube video. I quickly located the offending video and such enough, there was a scene for just a split second where Miley is seen holding up a poster advertising a reward for her lost dog. The telephone number is faintly visible: 615-275-9045. My number is one digit different and apparently adolescent teens were mistaking that digit in their haste to talk to their idol. It must have been such a disappointment to hear a mans voice on the phone although I remember one girl slowly questioning “Billy Ray?” after I answered!

I decided to change my number yet again so that I don’t waste precious minutes talking to out-of-control Hanna fans. So imagine my surprise when checking my voicemail on the old phone to find a message from a fan wanting to talk to Taylor Swift! Will the madness never stop?


Impossibly Difficult Automated Phone System (Cricket Cellular Service)

The new economy requires businesses to have both excellent customer service and flexible practices. I’ll talk about companies which are failing in both and what they should instead to succeed.

Business Fail: The Cricket cell phone company uses a complicated and inflexible automated phone system which is does not provide an adequate level of customer service.

Everyone loves to hate their cell phone provider and I’ve certainly had my share of customer service disappointments having used Cingular, Verizon, AT&T, and T-Mobile over the years. Recently after signing up for yet another new plan with Cricket, I experienced the most ridiculous run-around I’ve ever been through with a cell phone provider.

It started with a several simple problems with my account and broken text messaging, but after 3+ hours on the phone and getting told every possible excuse, I finally canceled the service.

Here’s my synopsis:

I ordered a new Cricket phone and service package online and it arrived yesterday morning with a easy instruction card telling me that I only had to dial *228 and the phone would self-activate and I would be ready to go. Instead, after dialing the special code, I got a message saying that my account could not be activated and I would have to go to a local Cricket store (which is 30 minutes from me) to get it working. I tried calling the customer service who said that they couldn’t find my account and they would have to create it. After nearly an hour of going back and forth with the CSR, finally it was working. Fortunately, I had no idea the nightmare I would be in for the following day.

During my lunch break, I took out the phone to write a quick text message to my roommate. I was quickly greeted with the response “Message sending failed.” Thinking that perhaps the service wasn’t good where I was at, I tried again later in Nashville to a different number and got the same response. Surely a quick call to the customer support line would solve this problem.

1:45 pm: I called and pressed option 3 to get to technical support. After asking me to enter my number, I was told that it was invalid. I checked and reentered the number a second time. Then the friendly male voice on the phone system told me that the number was still invalid and to “try again later” at which point I was disconnected.

Calls made at 1:48, 1:50, 1:52 got me the same response. It turns out that you can’t get to any portion of Cricket service without having a “valid” telephone number as determined by their computer. In my case, the computer didn’t like my number and wouldn’t let me talk to anyone!!! (Cricket, why don’t you have an option to let me get past this point even if my number is “invalid”?)

1:54 pm: I finally was able to get to a live person by going through the new phone activation options and pretending that I was a new customer (that takes about 5 minutes to get through!). The rep told me that my text messaging should be working fine and after 30 minutes of debating her on the issue, she suggested that I call a local Cricket store and see if they could help.

2:20pm: The local Cricket store directly me to call 1-800-CRICKET for support. They can’t help me with this problem.

2:22pm: After 10 minutes to get back into the system, the new CSR told me the reason my text messaging didn’t work is because I didn’t have any money in my FlexBucket account. I explained to him that I didn’t want to put money in my FlexBucket account and instead just wanted to have the “unlimited text” I was supposed to be getting with my package. He insisted that there was no other option so I just ended the conversation after nearly 20 more minutes.

6:43 pm: After work, I hooked up a cell phone tap to record the increasing ridiculous conversations with technical support. Here is the first call to a CSR named Linda. I’ve cut all the wait times out of the recording, but imagine waiting for 5-10 minutes before each call. Linda tells me that I have pic and video messaging, but not text messaging? Huh? She later corrects herself and tells me that my service should be working fine. Yeah. Right. Then she transfers me to tech support so they can figure out what’s wrong. Moments after the tech answers, the phone connection disconnects for no reason.

7:03 pm: Kathryn tried next to help me next. She tells me that my information was not in the system and thinks this may be the problem. After verifying a few things, she tells me she is going to get a supervisor. The person who finally picked up (Irene) didn’t seem like she knew anything about my case and we went through the whole routine again. Irene tells me everything is setup fine on their end, but she just needs to refresh the system and my text messaging will work fine. Yeah. Right. Needless to say, the text messaging still doesn’t work.

7:29 pm: I called back and tried again with a new CSR. She transfers me to another tech support person to help me. I explain the problem again to the tech support guy who tells me to call someone so that my phone will be “registered” in the system. Does calling 1-800-CRICKET not qualify to “register” it? He then tells me that my account won’t be added to the system for 72 hours and tells me that 1-800-CRICKET won’t work for at least 72 hours! (Cricket, aren’t the first 72 hours the time most support calls would come in anyways?)

7:58pm: After trying the last advise, I find that text messaging still doesn’t work and call back again and try to cancel my service. The new CSR tells me that the $35/month plan doesn’t include text messaging and wants to charge me $3/month extra to add it! I refuse and point him to my confirmation email and their website which shows under my zip code that unlimited text messaging IS included. He them tried to tell me the website is incorrect and that I have to pay the additional $3/month for text messaging. After a transfer to his supervisor, she tells me that the CSR is incorrect and my service should work just fine. She does however cancel my service for me after some prodding. Finally, 3+ hours later, it’s over.

8:47 pm: I call to get a Return Authorization number so I can return the phone for a refund and the return department can’t find my account either so they said someone will have to call me back within “3-5 days.”

If you hadn’t had the misfortune of having to talk to a cell phone CSR recently, then it’s hard to imagine how frustrating it is to be transferred around many times over and waiting on hold for 5 minutes at a time. I’ve cut all of these waits out of my recordings, but it’s still a very long experience.

Hopefully, by the beginning of next week, this will all be over and I can start looking for another phone plan again. Does anyone know another provider who offers unlimited talk and text for a decent rate? I really wish Cricket had worked out for me…

Business Solution: Cricket needs to improve their automated phone system so that it is not so difficult to reach an CSR. A method to reach the same CSR when calling back would save a tremendous amount of time instead of having to explain the problem repeatedly when calling back.


A Prophet is Born

I’ve made a lot of predictions in the past. I remember downloading my copy of XP RC2 back in 2001 and thinking “Gee, a stable operating system from Microsoft that supports all my hardware? How can they ever top that?” I told several people at the time that Microsoft would have a terrible time launching a Windows XP replacement because anything they changed would be hated.

Now years later, it’s hard to claim a personal victory about this prediction since it wasn’t saved at archive.org for all the world to verify. So from now on when I predict a future event I will post it here so we can check up in the future and see if I’m right. For now, I’m giving myself a 100% prophecy score. Here’s a political prediction to get things started:

This election season, we have seen Democrats try to downplay their support of the 2003 Iraq invasion. I predict that in 2012, Republican politicials will attempt to distance themselves from their vote in favor of Bush’s bailout plan. By that time, the majority of American’s will agree that it was not a solution, was mismanaged, and was a waste of taxpayer money (kinda like the Iraq war).