ACA Chickens Coming Home

The underlying issue that many of us saw with Obamacare was that inexpensive (Affordable) insurance didn’t seem to be in the cards – regardless of what the President and his team of “experts” said.  Most of those folks never lived in the world of having to deal with the convoluted health care system of PPOs and HMOSs, paying for health care insurance, or making decisions on a company’s group health insurance plan so that you could provide a benefit without bankrupting the company.

As more and more pieces of ACA are becoming implemented and the reality of who is really using the subsidized programs (individuals who have REAL problems) the chickens are coming home to roost. Case in point is the recent 36% increase that was approved in Tennessee by its insurance commissioner.  The commissioner said that the increases were necessary to cover higher-than-expected claims from folks who had signed up for individual policies in the first two years of the Affordable Care Act.  In an article by the Wall Street Journal, it reflects that this is not an isolated trend but one being faced by many states.

It’s going to be an interesting election discussion in ’16, but of more critical interest, how do we fix this MAJOR challenge to our economy and social well-being.  And don’t tell me “let the market fix it,” or “single-payer is the only way to go.”

Two Wolves

I’d like to share a story that was sent to me by Jeff Bracken with Bracken & Associates.  With today’s pressures to succeed and live life “fully,” it’s worth considering.  The story is titled “Two Wolves” based on Cherokee Indian lore.

As the story goes, one evening an old Cherokee was sitting by a campfire with his grandson. As they quietly watched the flames and listened to the crackling of the burning wood, the grandfather broke the silence. He said: “My son, there is a battle that goes on inside all people. The battle is between two wolves that live inside us. One wolf is evil. He is anger, envy, jealousy, sorrow, regret, greed, arrogance, self-pity, guilt, resentment, inferiority, lies, false
pride, superiority and ego.” He paused, and said: “The other wolf is good. He is joy, peace, love, hope, serenity, humility, kindness, benevolence, empathy, generosity, truth, compassion and faith.”

The boy quietly thought about this for a while, and asked his grandfather: “Which wolf wins?” The old man simply replied: “The one you feed.”

Expanding Markets

I was catching up on my readings and read “Printed Electronics – Salvation or Snake Oil” by Bruce Kahn published in PIA’s “The Magazine” earlier this year.  I really liked Mr. Kahn’s brutal honesty on this topic.  As he stated, “I have been involved in printed electronics for over 10 years. In every one of those years, pundits, prognosticators, and soothsayers predicted great things for the future, particularly the near future, most frequently ‘next year’.”

Although he did a nice job of making the reader consider that which glitters is not always gold, I felt he could have gone further and reminded the audience that too often we think of technology as the product rather than as a tool to create a successful business.

In the case of printed electronics AND 3D printing, these technologies are not really printing – they are enhanced forms of manufacturing.  Consequently, the target audience for that product is not normally people who buy print – and that’s where many of these soothsayers and futurists go astray in challenging our industry to expand into these markets.  Yes, some print providers may have the know-how to make the technology work, but what is required are customers who buy – in serious amounts – what they are capable of producing. It also requires a sales force capable of selling in that market space.  This is a MAJOR challenge. One just needs to see the uphill battle the industry (as a whole) has experienced in having established sales reps sell digital printed products.

Does that mean printers should just fold up their tents and go away?  NO.  It means we need to focus on the fact that our industry is an integral part of the channels used in marketing products and providing information.  That’s where our focus should be – not necessarily manufacturing technologies which happen to have “printing” in their title.

Mad Dogs, Englishman AND Texans

It’s about 10:00 a.m on Sunday morning, and I’m cooling off after a bike ride. I recall the days of joining my brothers on jaunts to the beach following the San Gabriel river-bed (OK, the concrete river bed – it’s SoCal), but that was a LONG time ago.  I’m no longer interested in pounding out the miles of a twenty-something (or is that a fifty-something?) but 60-70 minutes of a steady-pace does it for me.

Another observation strikes me as I drink my cup-a-joe.  Those morning rides in SoCal started in sun and frequently ended at the beach while the Southern California “purple” was lifting.  And it was 68 degrees.  I haven’t seen 68 degrees for the past three months.  It was rapidly approaching 92 when I was storing my bike.

I am frequently asked by family members (Left Coast) and friends (East Coast) do we Texans bike (or play golf) during the summer.  What a silly question.  We’re Texans.  We don’t hibernate during the summer.  We embrace it.  Bring it! Bark, bark, bark!

I’m Too Busy

In our hectic business life, too often we overlook an opportunity because “we’re too busy.”  Is it that we’re too busy — or we have not prioritized correctly?

As a business CEO, or senior decision maker, we cannot afford to become bogged down with “stuff” that’s repetitious in nature, or which can be readily delegated – no matter how good we are with it, or how much we like it.  As a C-level exec or company owner, we need to be searching and exploring, or to put it in Trekkie terms, “to boldly go where no one has gone before.”

The world around us is changing so rapidly that if we don’t take the time to explore the shifting dynamics of communications, we could find ourselves marooned on a desert island.  So, take the time to read that online article you’ve been ignoring; listen to that webinar; spend time with the supplier who wants to talk about new technology; attend one of our Association Quick Take programs, or even take a trip to Chicago this fall and explore McCormick Hall (GraphExpo).  I’ll close with one of my favorite quotes.

In times of change, learners inherit the earth; while the learned are beautifully equipped to deal with a world that no longer exists.

Cuba. Why Not?

I’m of an age that I vividly remember the Cuban Missile Crisis and the Bay of Pigs fiasco.  Yet, the world has moved on, and I think it’s time that we do as well. So, I have no problems in creating an Embassy in Havana, or for that matter working hard to create “normalization,” which very well could mean lifting embargos.

Are the Castro Boys our BFFs?  NO, but neither are the majority of the world leaders.  One has to remember, if you read your history, we didn’t do the Cuban people any favors prior to 1953 when the Cuban Revolution began.  Nor did we handle the situation in our best long term interest during the six years of Batista’s fight with Castro.  There’s plenty reasons to harbor ill-will — on both sides.

Today, more than ever, we need to consider the Monroe Doctrine.  Not in terms of creating puppet governments, nor military might, but in economic power to create stability.  Cuba has been our sore spot for over 50 years, let’s find a way to salve that wound rather than keep fighting the same old wars.  If there’s a lesson to be learned from the turmoil in the mid-east, it is that people tend to hold grudges and fight to the death over issues which began in the 7th century.  So, let’s not go there.

A Hidden Liability

During my career with PIA I have seen businesses destroyed (or nearly so) because of the firm’s lack of understanding about tax laws. It could have been untimely deposits of payroll taxes; not classifying themselves properly regarding franchise tax laws (Texas); or mis-applying sales tax.

Why this comes to mind is that I recently attended a sales tax seminar regarding nexus which featured Chanel Davis, who is an expert in this unique part of sales tax regulations. The seminar was attended by CPAs, and I found it interesting that for several of these professionals the nuances of nexus were either a.) mis-understood or b.) they had no knowledge of the topic. If you are a print provider in the 21st century — you NEED to know about nexus. More importantly if you rely on a CPA for tax information — make sure they understand sales tax laws that apply to our industry.

For example, if you are a Texas, Kansas, or Missouri printing company doing business in Oklahoma and use your delivery vehicle to deliver product to Oklahoma, you are have nexus in that state. That now requires that you collect sales tax on those items being delivered to Oklahoma and submit taxes to the Oklahoma Tax Commission. Oh, by the way. If you have sales reps calling into Oklahoma — you have nexus.

What’s really getting interesting is “click-thru” nexus. Some states (Kansas, Missouri) are beginning to take the position that a remote seller has nexus in regards to online sales. For example, you have a web portal with a print broker in New York. New Yorkers order from the site. You fulfill the print orders and the broker gets a commission. Because you used a third-party in New York, nexus has been created and now your company is required to collect New York sales tax. There about 24 states who are adopting similar rules, although there are a lot of legal challenges being discussed and no clear answers. To quote Elmer Fudd — “Be afwaid. Be wewwy afwaid.”

Supremes Support Subsidies

I may be in the minority within the group of folks who don’t care for Obamacare, but I think the Supreme Court got it right with their 6-3 ruling this morning (June 25).

This was a crazy gambit from the folks who felt that blowing up what is in place was a solution.  It’s not.  Healthcare is a major mess in this country (in how it’s funded) and if the subsidies had been overturned, I feel it would have created MAJOR turmoil within the healthcare system.

So, now that this has been perceived as a win by the Administration — and many in the U.S. — it’s time to really look at Obamacare and see what is good (yes, there are good aspects of it) and what really needs to be changed to make it better.  I’ve given up on any idea of getting employers out of the system — that’s tantamount to the IRS supporting a flat tax. So, does Congress have the guts to find a way to address this issue?  Sad to say, I don’t think they do, and even if things turned Republican in ’16, Congress may not have the cojones to truly address healthcare.

Big Data

Boy did I get an eye opener this past Wednesday.  I attended the Greater Dallas PCC meeting and heard a presentation from Mike Hail. Hail is the founder of Knowledgebase Marketing, former CEO of market research firm Yankelovich, Skelly and White, and current CEO of Web Decisions Group.

While I’m not a novice on the topic of Big Data, Hail’s presentation helped open my eyes to the sheer mass of data being created.  As Mike pointedly stated, all of man’s written material would consume 50 Petratbyes of data.  Google captures 20 Petrabytes of data on a daily basis.

He went on to share how his company (and probably others) are going about mining that data and the ability to transform how we communicate.  Some of the potential is very interesting while other aspects are a bit scary from a privacy perspective.

Regardless, I challenge anyone who reads this blog to do a bit of research on this topic – and watch it closely.  There’s a lot of potential for those firms who are able to tame this monster – or at least cage it!

The Living Wage

San Francisco has adopted a $15.00 per hour minimum wage.  Los Angeles will meet that threshold by 2020.  There are more and more companies adopting minimum wage structures above the federal minimum wage.  Some feel that it needs to be done to allow individuals to survive while others are reacting to keep from being castigated in the media.

From a social perspective, I accept the notion that $7.25 is not a “living” wage.  Yet, is $15.00 going to guarantee a “living” wage?  How is the person making $16.00 per hour going to react when the person who was making $9.00 is now making $15.00?  It ain’t going to be pretty – or cheap.  Are the folks clamoring for a “living wage” willing to pay more for their product/services as companies have to respond to rising cost of wages?  Or are they going to react as consumers have for decades and buy the cheapest product – which normally comes from overseas – and could very well cost those folks making $15.00 an hour their jobs.

As with all things dealing with economics, the answer will not be clear cut.  Some businesses will survive with a new minimum wage and others will fail.  Some folk will do better with $15.00 an hour and others will not.  Here’s the question I have for those clamoring for a “living wage.” Does raising the minimum wage REALLY going to help solve many of the social ills we’re seeing right now?

I don’t have a straight-forward answer to this problem, because someone who is willing to accept a minimum wage (at any level) has a variety of challenges in front of them ranging from lack of education, to lack of skills, to questionable legal status in this country.  These problems won’t be fixed with a few more dollars per hour.  The true solutions are much, much more than just wages.  Let’s have a good conversation about those issues and see what can be done to provide more opportunities.  Regardless of what folks on both sides are suggesting, cutting corporate taxes, or providing higher education, will not be THE solution — but it may include raising the minimum wage.

Wall Street Journal article to read – “Wage Pressure Hits Small Business”