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An IRS Christmas Tale

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An IRS Christmas Tale

When our thoughts turn to the Holiday Season, we usually don’t associate it with the Internal Revenue Service. This is a little tale that is true and unembellished in the telling, and though the role of the IRS is marginal, our story would have no point without it. Many years ago when Maureen and I were raising our three children, when the bills were abundant but the money was not, we would participate in the “Giving Tree” at our church at Christmas.

One Sunday after Mass, Maureen asked me to select one of the “ornaments” from the tree, which were made of color construction paper with the name of a gift for a needy family written on it. Alas, the ornaments were picked over so I took one of the few left. The deal was that we would buy the gift, which had to be new, and return it to the tree the following Sunday before Christmas with the paper ornament attached.

In previous years we would buy mittens or a scarf as indicated on the paper we chose. But when I got home and showed Maureen that year’s gift she was not pleased. “A woman’s winter jacket, medium!” she exclaimed.  “What’s wrong with that?” I replied. Maureen let me know that a woman’s winter jacket was a lot more expensive than mittens or a scarf and we weren’t the people who should be tackling that. I was instructed to return it to the tree and find something less costly.

Of course, she was right. I don't know what I was thinking, maybe that we were part of the wealthy side of the Fells family. [Note: actually, we WERE the wealthy side of the Fells family!]. But the days slipped away and they don't call me the King of Passive Resistance for nothing. By the time Saturday rolled around, we planned to go out to the stores to complete our Christmas shopping. “Do you want me to return that ornament to the church?” I asked Maureen, subtly letting her know that I never did. “No,” she said with an air of weary resignation, “we’ll figure something out.”

After a while, we ended up at BJs and found a large rack of women’s winter jackets. All were priced at $34.99. “That’s not a bad price but I wonder how well made they are,” Maureen said. She tried one on and expressed surprise that they were quite nice. She decided that we could buy one of these jackets for our Giving Tree gift, and at 35 bucks we were getting off cheaply. Maureen then said that she thought these jackets were so nice for the price that she needed a new winter jacket herself.  I was already feeling vindicated by our finding the gift with a reasonable price but now Maureen wanting a jacket for herself was the icing on the cake.

From BJs we drove home, our various errands and shopping for the day finished. I said that we would be making some lady very happy with that jacket and Maureen agreed, although lamented that it still cost more than we should have spent. Half-humorously, but half-serious too, I said that God always provides for those who give, returning to them more than they ever gave. Maureen expressed her hope that this might be the case.

Arriving home, I checked for the mail and found mostly junk. But there was one letter, a curious little brown window envelope. The return address read, “U.S. Department of the Treasury.” A little apprehensive, I opened the envelope to find a Treasury check made out to Maureen and myself. There was no letter but from the stamped codes and abbreviations I gathered this was a refund check for the tax return we had filed the previous March. But I remembered that we had to pay more taxes then, rather than apply for a refund.

Coming back into our home I announced to Maureen that we got an unexpected refund check from IRS. This had never happened to us before, and indeed, would never happen to us again. She asked the amount of the check and I asked her, “How much did we spend on the two jackets?” Maureen said they came to 70 dollars plus tax. I handed her the IRS check – it was for $70 exactly.  We both felt a little dumbstruck as we recalled that God always provides for those who give, we just didn’t think it happened so promptly.

 

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The Curse of Second Term Syndrome

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The Curse of Presidential Second-Term Syndrome

[Note: This essay is one in a continuing series by ICCFA executive director Bob Fells focusing on various issues in our federal government. Although the subjects are political in nature, the approach is bipartisan in outlook, at least so far as that is humanly possible. The goal of each essay is not to persuade the reader to adopt a particular political viewpoint or party, but to illustrate why an understanding of the system is important to protect our businesses, our homes, and our families.]

There seems to be something jinxed about a U.S. President’s second term in office, especially by the time we arrive at the 20th century. It doesn’t matter who the President is or his party affiliation. Especially since the 22nd Amendment to the Constitution was ratified in 1953, Presidential second terms just never work out very well. It wasn’t always that way although you can argue that the respective second terms of Abraham Lincoln in 1865, and William McKinley in 1901, didn’t go too well because both men were assassinated when barely into their second term.

The most unique two-term President is Grover Cleveland. He actually lost re-election to his second term in 1888, but came back four years later to win. He remains the only occupant of the White House to have a split-term Administration, thereby becoming the 22nd and the 24th President of the United States. Cleveland also coined the term “lobbyist” and he did not mean it as a compliment. Cleveland’s second term had barely begun in 1893 when a major depression hit the nation, then called a Financial Panic. He was unable to turn the economic situation around thus advancing the Curse of Second-Term Syndrome.
 
Franklin D. Roosevelt broke the two-term tradition – it was only a tradition then observed by both parties and not a Constitutional limitation – by running for an unprecedented third term in 1940. FDR cited “emergency” conditions such as the Second World War raging in Europe since September 1939 as a reason for experienced hands to postpone their retirement plans and keep their shoulder to the wheel of responsibility. He said that he would not exempt himself from this call to remain on duty and FDR readily won an historic third term that spanned almost all of this country’s involvement in WWII from 1941 through 1945. FDR actually won a fourth term in 1944, prompting comedian Bob Hope to say, “I’ve always voted for FDR for President. My father before me always voted for FDR for President.”

Our nation did not see another two-term President until Dwight Eisenhower in the 1950s. Ike’s Administration – “Ike” was his nickname that made a clever campaign slogan, “I Like Ike” – was viewed as a snore at least in retrospect. I can recall a joke from my youth that asked: “Did you hear about the new Dwight Eisenhower doll? You wind it up and it does nothing for eight years.” Oh, where’s Ike now when we need him!

The jinx of Second-Term Syndrome began in earnest with Richard Nixon. Re-elected by a landslide in 1972, less than two years later Nixon became the first President in U.S. history to resign. We all know that the fallout from the Watergate burglary and subsequent cover-up forced Nixon to resign to avoid the growing possibility of impeachment hearings. Feelings ran so high that many Americans felt that he should have been sent to prison. When Gerald Ford pardoned Nixon in 1975 to avoid a divisive trial, many observers felt this move cost Ford the White House in the 1976 elections. I always thought this ironic because if you had asked Americans in 1970 what they would think of a President who ended the war in Vietnam, brought home our troops, and ended the military draft, most would have pronounced such a man as the most beloved President in history. Nixon did all these things yet was considered one of the most despised Presidents. 

We didn’t have another two-termer until Ronald Reagan in the 1980s. Perhaps because his Presidency started off with such energy – the Iranian hostages were released exactly as he was taking the oath of office – the Gipper’s second term seemed like a tire with low air pressure. But his final White House years were marred by the Iran-Contra scandal of exchanging weapons for hostages. Col. Oliver North eventually shouldered much of the responsibility (yes, the same Ollie North who now has his own show on Fox News) but many politicians and their allies in the news media tried to pin the blame directly on President Reagan. It might have worked too if these same people hadn’t spent all of Reagan’s first term trying to convince the public that he was nothing more than an “amiable dunce,” a term coined by Washington superlawyer Clark Clifford (who ended his days in an embarrassing Arab banking scandal that made him look like a dunce).

The problem Reagan’s critics faced with Iran-Contra was convincing the public that this so-called dunce of a President was really an evil mastermind who called the shots in the scandal.  TV’s “Saturday Night Live” even did a skit on this with Phil Hartmann as Reagan, alternating between a cuddly “Gramps” persona when greeting visitors to the Oval Office, then switching to a fast-talking mastermind as soon as they were gone. The skit was hilarious and showed the world the absurdity of the allegations. Nevertheless, Reagan’s second term ended with a wimper instead of a bang.

Everyone remembers the soap opera that characterized Bill Clinton’s second term with the Monica Lewinsky affair and his subsequent impeachment. Then Bush 44 had the bad luck of presiding over the housing bust and the Recession of 2008 that ended his hopes of finishing his presidency on a high note of achievement. This brings us to President Obama who will begin his second term on January 20, 2013 and will be Commander in Chief through January 20, 2017. What could possibly go wrong? For one thing, it is impossible to predict the problem, scandal, or affair if we look to history as a guide. None of the issues that plagued Nixon, Reagan, Clinton, or Bush were foreseeable but came out of left field.

However, we can examine the political tug-of-war that an incumbent President can have with his own party that bogs down his final years in office. A classic example occurred early in 2005 when the newly-reelected George W. Bush appeared before Congress to deliver his annual State of the Union address.  He announced that now was the time to tackle Social Security reform. Bush’s impassioned call to action was virtually the last time this subject was mentioned during his second term. So what happened? There is another word to describe a second-term President – and that’s a Lame Duck. Second Term Presidents seem to occupy the best of two worlds: they will reign for another four years but never, ever have to be judged by the voters again. Unfortunately, the 535 members of Congress won’t have that luxury. Half-way through the President’s second term, in 2014, one-third or 33 members of the Senate and all 435 members of the House will face the voters, and again in 2016, while the President will be home free across the finish line.  

So when President Bush announced early in 2005 that they were all going to reform Social Security, the members of Congress, Republicans and Democrats alike, collectively responded with, “That’s easy for you to say, but we have to get reelected and you don’t.” And that, in a nutshell, is why Presidential second terms are anti-climatic at best and disastrous at worst. 
 
President Obama will be tackling some huge problems during his second term that we are all too familiar with: raising taxes, cutting spending, reforming entitlements, reducing unemployment. His lame duck status will embolden him to act whereas his partners in Congress are likely to shrink from making tough decisions. We have already seen a preview with the “Fiscal Cliff” dilemma. An unfortunate result of having career politicians in Congress is that all issues, domestic or foreign, are viewed through the prism of “How will this affect my reelection?” Should the Curse of Second Term Syndrome hold true, then our President will yell, “Charge!” and his troops will answer, “Are you speaking to us?”

 

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Reflections on the Elections

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Reflections on the Elections

[Note: This essay is one in a continuing series by ICCFA executive director Bob Fells focusing on various issues in our federal government. Although the subjects are political in nature, the approach is bipartisan in outlook, at least so far as that is humanly possible. The goal of each essay is not to persuade the reader to adopt a particular political viewpoint or party, but to illustrate why an understanding of the system is important to protect our businesses, our homes, and our families.]

Just one month ago today, approximately 128 million Americans went to the polls and voted. There have been countless analyses in print, online, and via broadcast since then. If there is one thing about the elections that’s clear it is, as I suggested in an earlier column, that Americans voted for Big Government. Another explanation is also possible: maybe a majority of voters only chose the party they felt would deliver on its promises. The 112th Congress is roaring its way into the history books as its time dwindles down to expiration on December 31st. At this writing, the all-consuming issue is the “fiscal cliff” and whether Bush-era tax cuts will be extended beyond year’s end. The 113th Congress is set to convene on January 3, and like actors waiting nervously in the wings to go onstage, they are told that titanic issues are going to be decided there. Perhaps it’s a sign of the anxiety level on Capitol Hill that a Missouri member of Congress who successfully won re-election has just announced her retirement. NOW she tells us!

Humans constantly seek to make order out of disorder, sense out of nonsense, so a careful shifting of data has yielded some signposts that may or may not be the proverbial handwriting on the wall. At least we can try. Everybody knows that the House of Representatives will remain under Republican control for the next two years, and the Senate will remain under the control of the Democrats. Less obvious is the fact that the Republicans (henceforth known as “the Rs”) lost seats in both houses and the Democrats (henceforth “the Ds”) gained seats. Currently, the House has 241 Rs and 192 Ds. On January 3, the new House will have 233 Rs and 200 Ds. Of course, the Rs will retain control of the committee chairmanships and of the legislative agenda, but party-line voting will be trickier because fewer Rs are needed to “cross over” and vote with the other party for the Ds to prevail even though technically in the minority.

The current party makeup in the Senate is 51 Ds and 47 Rs, and 2 Independents. The new Senate will have 53 Ds and 45 Rs (and still 2 Independents) giving the Ds a larger working majority than today. Partisan politics aside, the Ds have gained ground in both houses while the Rs have lost it. Some individual elections were only decided in the last couple of weeks because the voting was so close. I believe the outcome in each district was a win for the Ds. But former Congresswoman Shelley Berkley (D-NV), who has been a friend to the ICCFA, decided to seek a Senate seat in Nevada, and the ICCFA PAC supported her bid. She narrowly lost 46% to 45% but the very next day after the elections she send me an email saying that she would be back. Too bad she just can’t take the seat of the gal in Missouri who is resigning. I know – it doesn’t work that way.

NBC News conducted exit polling that produced some interesting results. For example, more women than men say they are Ds, 55% to 44% respectively, while a majority of men in just about the same percentages say they are Rs. Most young people, ages 18 to 29, voted for the Ds, and most older folks, ages 45 to 64, voted for the Rs. This older age group also made up the largest voting block at 38% of the voters. Forty percent of all voters consider themselves political moderates, the so-called “swing votes” that really decide our elections. Of those who claim they are liberals, 86% are Ds while 12% are Rs. Eighty-two percent of Rs describe themselves as conservative, 16% of Ds say they are conservative.

I’d say the data above shows what most of us already suspected – that we are a politically divided nation in two distinct camps. The divide continues when we turn to specific issues: more Rs are worried about taxes, 66% to 32, but more Ds are concerned about the housing market, 63% to 31. Regarding the new health care law that the President himself is pleased to call Obamacare, 88% of Ds want it expanded and 92% of Rs want it repealed.

 
One more factoid is worth mentioning and that’s the role of the federal government in our lives.  Seventy-nine percent of Ds said that the government should do more to solve problems, compared to 18% of the Rs. Seventy-five percent of Rs felt that the government is doing too many things better left to businesses and individuals, with 23% of the Ds also feeling that way. This polling data almost sounds like each party’s platform positions. Less documented is the public’s perception of which party is more likely to deliver what it promises when in the majority. Between the beginning of 2003 through the end of 2006, the Rs had majorities in both houses and, of course, in the White House. Beginning in 2007 it was the Ds turn to be a two-house majority.  The D’s lost the House at the end of 2008 but still retain a majority in the Senate.

Does this version of musical chairs tell us why the 2012 elections turned out the way they did? You may not agree with this statement but it may be argued that when elected to the majority the Ds tend to keep their promises, and the Rs don’t. By that I mean that Ds have proven reliable in living up to their promises of expanding government assistance programs and related spending. The Rs maintain that this approach is financially unsustainable and must be reduced to avoid future economic disaster - and a lot of people agree with that. But during those years the Rs controlled both houses of Congress and the White House, 2003 through 2006, they really blew it. You may remember Dennis Hastert who was Speaker of the House during those four years of Republican control. For a party that got elected on a policy of reducing the size of the government and cutting spending, the Rs during the Hastert years spent money like drunken sailors – even the Ds complained! The bottom line is that the Republican Party suffers from a "credibility gap" where even voters who agree with its goals doubt the party has the resolve to follow through. In a two-party system, all Americans lose when only one party functions effectively and the system of checks and balances are out of whack.

 

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Four Words You Need to Know for the 113th Congress

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Four Words You Need to Know for the 113th Congress

[Note: This essay is one in a continuing series by ICCFA executive director Bob Fells focusing on various issues in our federal government. Although the subjects are political in nature, the approach is bipartisan in outlook, at least so far as that is humanly possible. The goal of each essay is not to persuade the reader to adopt a particular political viewpoint or party, but to illustrate why an understanding of the system is important to protect our businesses, our homes, and our families.]
 

You’ve probably seen this movie before. Certain tax breaks are about to expire so the question is whether Congress will act in time to prevent them from being repealed. If we ran our businesses the way Congress runs the government, we’d have closed down long ago – and probably be in jail. The federal government can’t close down because: 1.) it has no competitors, and 2.) revenue it collects from its customers (as IRS refers to all of us) is under penalty of law and imprisonment. Best of all are the prices the government charges for providing services. It charges nothing and we wonder why the deficit is so high. It is significant that nobody uses the federal government as a business model.

I suspect that the “fiscal cliff” will be averted because Congress will turn it into a ski slope. That is, it will extend the Bush-era tax cuts for another couple of years and time them to expire with the next election in 2014. A mere coincidence no doubt. The “rich” won’t care if they are excluded because by now they have already taken steps to shield their income from increased taxation in 2013. People don’t become rich by being stupid.

The new Congress, number 113, will convene in January 2013 to finally get serious about tax reform. This is fitting because the federal income tax was first enacted a century ago in 1913 (I hope you’re not superstitious). Those of us who are a certain age can remember when Congress reformed the tax code in 1986. Then, the announced goal was tax “simplification” but once it was realized that some beloved tax deductions and exemptions would be lost, the goal of tax reform was changed to tax “fairness.” By the time the dust settled, tax deductions on interest paid on credit card debt and car loans were abolished. I’m not sure who benefitted from that dose of fairness.

So early next year, we will be hearing lots about four words that many members of Congress will misuse and abuse for their own purposes.  The ignoble four are closing “loopholes,” ending “subsidies” for mortgage interest “deductions,” and “rights” as in the right to own a home and even the right to a job. At least this time they’ve already jettisoned “simplification” and we’ll start with talk about “fairness.” The goal among those jockeying for position will be to make sure the new tax code is fairer for some people than for others. To pull that off, it is crucial to persuade the public that certain terms – our fabled four - no longer have their intended meaning but really mean something quite different.

For example, and you’ve already heard this a million times, we must close tax “loopholes.” The so-called loopholes that our favorite politicians are referring to are perfectly legal exemptions, deductions and credits that Congress itself enacted into law. True, many of these were added to voluminous bills, tucked in so that most members of Congress didn’t even notice them. But this doesn’t make them into loopholes. A loophole is an unintentional oversight that should be against the law but isn’t. Our friends in Congress intended each and every “loophole” in the tax code.

Next, we have been told that we must consider ending or at least curtailing the subsidy for home mortgage interest deductions. You don’t have to be Noah Webster to know that a subsidy is when the government takes money from one person and gives it to another person. The second person is being subsidized by the first. On the other hand, a deduction is when the government allows a taxpayer to keep more of his own money. Nobody is subsidizing the home mortgage interest deduction, including people who can’t claim this deduction. But homeowners will be put on a major guilt trip that renters are paying for their Cape Cods with this loosey-goosey newspeak.

Also, beware of the siren call for phasing out the interest deduction. That will work the same way all state sales taxes have worked. First, the proposed sales tax is a mere 1% and the proceeds will go for education or to improve roads. We might call that getting the foot in the door. Once enacted and the public has become used to paying it – it’s for schools you know – then the legislature will hike it up every few years. No state sales tax started out at 5 or 8 %. I think this is the same method for boiling a frog in a pot of water so it doesn’t jump out – turn up the heat slowly. Anyway, support will grow for curtailing the home mortgage interest “subsidy” by phasing it out for – you guessed it – the rich. You perhaps noticed by now that the fastest way to get new taxes imposed is to say it will just affect the rich. Class envy and divisions has been a reliable method of getting unpopular legislation passed.

The classic case is the Alternative Minimum Tax that was supposed to ensure that those rich so-and-sos would have to pay some income taxes. But Congress “forgot” to index it for inflation and never got around to doing so ever since the ATM became law – back in 1969! So an increasing number of middle class taxpayers are getting zonked with the AMT. This year, “rich” people who make $48,450 are subject to the AMT. If we hurdle over the fabled “fiscal cliff” and pay more taxes in 2013, then the AMT will hit individuals who earn $33,700. Never before has being treated as rich been so affordable.

This same incremental approach will be used to begin the end of the home mortgage interest deduction. When will Americans learn that soaking the rich always backfires? This reminds me of a slapstick movie where a guy throws a pie at another guy, but the fellow ducks and the poor slob standing behind him gets the pie right in the puss. The pie thrower is Mr. Government; the guy who ducks is Mr. Rich, and the guy who gets hit is Mr. Middle Class. The pie of course is a tax hike. Ironically, Mr. Middle Class was all in favor of Mr. Government throwing the pie when thought he thought that it would only hit Mr. Rich.

The fourth word to watch out for is “right” as in having a legal or a constitutional right. Today, we are told that we have lots of “rights” that we never knew about. Politicians are conveniently confusing a right with a privilege. A privilege is a special benefit conferred by the government on people who qualify for it. For example, there is no such thing as a right to drive a car. We must qualify for this privilege by passing a written and road exam, then we receive a license that can be revoked if we drive badly. A blind man has no “right” to drive because he doesn’t qualify. You can think of other examples such as marriage. We are told now that there is a right to marry, but if that’s true then why does the government still require marriage licenses?

In the last few years we have been told by countless politicians about the right to own a home. True, nobody needs a license to buy a house but we still have to qualify for a mortgage as if it were a license. Having a right to own a home means that we have a right to get a mortgage. Some say the housing collapse in 2008 was caused in large part by political pressures put on banks to grant mortgages to people with incomes that would not have qualified them in earlier times. I personally know people today who are struggling to pay jumbo mortgages they obtained because they assumed the bank would have never approved them if it felt they couldn’t handle it. I’m not sure how eliminating or just reducing the home mortgage deduction will help more people to buy homes. But I suspect that members of Congress hope we won’t trouble ourselves to find an answer until the change becomes law.

In sum, as the tax reform debate grows more voluminous just remember that a lawful tax break is not a loophole; that a subsidy is money that we give to another person; a deduction is where we get to keep our own money; and a right is something that nobody has to qualify for.  We will be challenged to forget these minor distinctions in order to make the tax code fairer. No doubt, if tax reform is handled properly we will all share in the pain of lost deductions, exemptions and credits. But we’re not off to a very good start when our leaders tell us that up is down and front is back.
 
 
 

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"Money" Makes the World Go Around: Money Magazine's "The High Cost of Saying Goodbye"

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“Money” Makes the World Go Around: Thoughts on Money Magazine’s “The High Cost of Saying Goodbye”

I’ve learned to detect a media hit job on the funeral profession whenever I see a reference to Jessica Mitford’s book, The American Way of Death. Now look, what are the chances that the journalists in question have ever cracked open a copy of this half-century old book, written before many of them were born? I guess that the purpose in citing this book is to “prove” that problems with funeral homes aren’t new. OK, but my problem with the reporters is that they haven’t bothered to find out exactly what problems are in the book. They’d be surprised if they did.

I have actually read the book, and I’ve also read its forgotten sequel, The American Way of Death Revisited, which Mitford was working on at the time of her death in 1996. She was quite a character and had she lived to do the TV talk show circuit, her new book might have made more of an impact. I remember seeing Jessica on ABC’s “Nightline” with Ted Koppel around 1991. The full hour was devoted to a cremation scandal in California where cremated remains were commingled, among other things. Every guest on the program expressed their regrets and condolences to the families affected. But not Jessica. She said (from my memory), “What difference does it make? Those people were dead anyway.” I never saw Mr. Koppel so nonplussed either before or after that particular show. Mitford revealed what many of us had suspected – that she saw no value in funerals or in commemorating the dead. It really wasn’t the issue of a funeral director’s ethics but why people were wasting their money for no reason.

With that for context, I began reading the November 2012 issue of Money Magazine. I had spent some time on the phone answering questions from the magazine’s reporters and researchers. Just based on the tenor of the questions, I suspected that the fix was in before the research had even been completed. But let’s get real, nobody is going to write a three-part series on how wonderful the funeral profession is. And we do have a common purpose with the media in informing the public about scams out there. More important, we all can agree that most people have little idea of all the options and decisions there are in arranging a funeral, and the knowledge of these things is the best preventative to guard against being taken advantage of.

Money Magazine had an opportunity to provide its readers with a well-written piece on the advantages and pitfalls of funeral planning. There is the almost obligatory statement that “many funeral directors are compassionate helpers who follow the rules,” but that’s the last we hear about that. I will hold off on a final judgment because there are two more installments to go, but if Part One is characteristic of the overall tone, Jessica Mitford would be pleased. First, the title, “The High Cost of Saying Goodbye,” suggests that funerals cost too much. If we can agree that housing, cars, gasoline, and groceries cost too much, then I have no problem saying that funerals are no exception. The Money article begins with a family who prepaid for arrangements back in 1992, but were charged thousands more at the time of the funeral in 2010. They felt they were taken to the cleaners, and understandably so. Yet I couldn’t help thinking that if they were taken to the proverbial cleaners, they provided the transportation to get there.

By that I mean that after paying for arrangements in 1992, there was apparently no effort made to find out what happens next. They assumed that because they had paid for everything they selected, there would not be other items needed at the time of the funeral they had not prepaid. They also didn’t realize that the funeral home could not refuse to accept a casket they had bought online, among other things. I can understand when people are blindsided by the death of a child (as was the case tragically with Mitford, an event she never mentioned in her book), but in the anecdote cited by Money Magazine, the consumers in question might have been more savvy. I’m not suggesting they had to be like Ralph Nader or John Stossel, but even the Federal Trade Commission staff has wondered why after nearly thirty years of the Funeral Rule, most people still have no idea they are entitled to a written price list at the beginning of a conversation about a funeral.

Money next points out that one out of four funeral home checked by the FTC for Funeral Rule compliance were in violation of it. Let’s be candid and admit that’s indefensible. But violating the Funeral Rule is not necessarily the crime of the century. Most problems stem from the timing of giving customers the written price list. I have no sympathy with funeral directors who never give customers the price list – throw the book at ‘em – but the timing can become like the little bird on Groucho Marx’s “You Bet Your Life” that comes down from the rafters when the “secret word” is said. In this case, the secret word is “funeral” and upon hearing it that little bird better have the price list in its beak. This is not consumer protection, especially when customers who properly received the price list say they didn’t even look at it but just held it in their hands.

Some funeral homes just can’t please the folks at Money. Even armed with the price list, we are told that four out of five funeral consumers don’t comparison shop. A consumer advocate is quoted telling a whopper: that government agencies don’t track cemetery complaints. It would be more accurate to say that not all states track cemetery complaints - I suspect that Montana or North Dakota don’t – but tell that to the agencies in New York, Florida, Texas, California and other states and they will disagree. The article provides some good advice about comparison shopping, bringing along a friend who is not emotionally invested, and knowing your rights under the Funeral Rule.  

But then Money has to ruin it all by advising readers not to prefund their funeral or burial arrangements. They even cite the FTC as being against prefunding but I believe the staff’s concerns are much more nuanced than “just say no.”  AARP is opposed to prefunding but then it markets its own “final expense” insurance product they want their members to buy (no conflict of interest here!). Consumers Federation of America doesn’t like prefunding either because sometimes the funeral provider in question has financial trouble. This is a valid concern but it’s also statistically small. The fact is the virtually all prepaid arrangements are honored and performed even if the individual funeral provider is incapable of doing it.

It is fair to ask why take any risk at all? Actually, the typical consumer incurs a higher risk by NOT prefunding. The standard advice from consumer advocates is to just put aside sufficient funds to pay for the type of funeral you want and have it payable at the time of death. That sounds reasonable until we realize that such accounts are not shielded from creditors’ claims such as the all-too-common expenses of the final illness. Most funerals aren’t nearly as expensive as the costs of the final illness, which can last for months or years and may not be entirely covered by insurance or Medicare. There is even statistical data to back up this concern: The September 2007 issue of Consumers Union Magazine detailed the results of a survey among adults 18 to 64 who had health insurance coverage. Asked how many had to “dig deeply” into savings to pay their medical expenses even with health coverage, ten percent said they had. Another ten percent said they had to borrow money from relatives and friends to pay their medical bills. Since the age spread was so wide, 18 to 64, I think it’s likely that those percentages would have been much higher had the survey focused exclusively on older people.

The big question to ask opponents of prefunding is: if consumers put aside money for their funerals (and that’s a big “if” – most people don’t even save for their retirement) as you urge them to do, but they must tap these savings to pay their medical bills, how would you suggest they pay for their funerals then? I’m still waiting for an answer. In sum, this first part of Money’s coverage of funeral planning contains some good advice about knowing your rights, comparing prices, and knowing the law – it’s not that complicated -  but it is so weighed down with anecdotes of bad experiences that readers will emerge more fearful than informed. Well. let’s see what the next two parts bring.

 

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The Night America Voted For Big Government

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WHY WE VOTE

The Night America Voted For Big Government

[Note: This essay is one in a continuing series by ICCFA executive director Bob Fells focusing on various issues in our federal government. Although the subjects are political in nature, the approach is bipartisan in outlook, at least so far as that is humanly possible. The goal of each essay is not to persuade the reader to adopt a particular political viewpoint or party, but to illustrate why a knowledge of the system is important to protect our businesses, our homes, and our families.]

This morning after a game-changing national election brings lots of second-guessing, armchair quarterbacking, and just plain “I told you so.”  The fact that an incumbent President won a second term has happened many times before, and the re-election rate of Congressional incumbents of both parties still hovers at about 97 percent, thus making it one of the steadiest jobs in the world. So what’s so “historic” about the 2012 elections? It can’t be that we elected the first African- American President. We’ve been there, done that in 2008. It can’t be that states with a large population in labor unions voted Democrat or that states with a large percentage of workers employed by the government or private sector government contractors went for the Democrats. That’s old news too.

It seems beyond question that a historic shift in the electorate has reached critical mass and won’t be changing any time soon. Basically, last night we learned that American voters actually want Big Government. More specifically, Americans want assistance, benefits, and even jobs that only a big government that takes a huge chunk of the GNP (gross national product) is capable of providing. It would be easy to “blame” the liberals or the Democrats, but a clear-eyed review of yesterday’s voting trends show that the preference for big government cuts across party lines and political ideologies.

The term “Big Government” is no more derogatory than “Big Business” in the sense that everybody supposedly hates Big Business – until they are reminded to stop by Wal-Mart to pick up a few things. Nobody likes Big Government either, unless of course they are enjoying some benefits thereof. This anomaly was shown years ago when Ronald Reagan had the support of Americans to cut “wasteful” government programs – but, as it turned out, not “my programs.” Multiply this viewpoint by 300 million people, and government spending isn’t going to be reduced any time soon.

The election of 2012 provided Americans with a clear choice between two very different views of government. For once, we didn’t hear the usual complaint of there not being “a dime’s worth of difference” between the candidates. President Obama said the job of the federal government was to help people. Governor Romney said the federal government had grown too large and costly, obstructing the very people who create jobs and the country’s prosperity. We know what happened. A majority of yesterday’s voters treated Mitt Romney as though he were trying to sell ice cubes to Eskimos, or worse, bathing suits in Antarctica.  

Not unreasonably, the Obama Administration is interpreting yesterday’s vote as a mandate for the federal government to continue spending on assistance programs, but did voters also agree to pay more taxes for those programs? This is less clear and the argument that we are burdening our children with massive debt seemed to have caused little concern in the voting booths. Likewise, yesterday’s vote seems a mandate for increasing the regulation of businesses by Congress and by the federal agencies. And this is where our Association comes in.

You don’t have to be a cynic to recognize that among the winners of the 2012 elections are lobbyists of all types. Whether one wants to ride the wave of increased regulation or try to stem the tide as it affects your own business, arbiters between the private sector and our government will be in greater demand than ever. ICCFA members can be assured that their Association’s Government Relations program will be geared to meet the challenges of a re-energized bureaucracy. But member support is the fuel in the tank of an effective Government Relations program in terms of talent, time and treasure.

By January, all ICCFA members will have received our biennial Congressional and Federal Networking Survey to determine who our members know in Congress and the federal agencies. If you do not know your Congressional representatives, then you are letting others provide the input that will influence how he or she votes. The ICCFA will be organizing its Washington Congressional visits whereby our members can gauge first-hand the issues that confront our legislators and renew – or establish – personal connections with the people who decide the laws we must obey. Will Rogers once observed that we should be grateful that we don’t get all the government we pay for. Today, we are getting more government than we pay for – and that’s the problem. When ICCFA calls for your help, please respond.
 
     
 

Gail Rubin's picture

Create a Great Funeral Day 2012

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October 30, 2012 is the 13th annual Create a Great Funeral Day, an opportune time to start a funeral planning conversation.

It's appropriate that Create a Great Funeral Day comes right before Halloween and the Day of the Dead celebration. Before ghosts can go a-haunting and spirits of the deceased can be celebrated, someone's gotta die.

The idea behind Create a Great Funeral Day is to consider how you would like to be remembered. By letting loved ones know how you’d like your life celebrated, the survivors’ experience can be so much easier.

Create a Great Funeral Day began in 2000, started by Stephanie West Allen. She saw her husband struggling to pull together a meaningful funeral for his mother, who had left no directions before she died. Observing his grief, Allen felt that knowing what her mother-in-law might have wanted would have eased the pain of memorial service preparations. As a result, she authored Creating Your Own Funeral or Memorial Service: A Workbook.

Create a Great Funeral Day prompts us to be mindful of our mortality. This self-awareness enables us to plan reflectively in advance, so we don’t leave our families to react, disorganized and stressed, after our death.

Blue Öyster Cult’s 1976 hit song, “Don’t Fear the Reaper,” is a perennial favorite on classic rock stations. Its intended message is that love transcends the actual physical existence of the partners. The Reaper refers to the Grim Reaper, a traditional personification of death in European folklore. (Check out the song on YouTube: http://youtu.be/ClQcUyhoxTg)

A fear of funeral planning equates to fear of death. Those who hold fear in one area of their lives often have fear in other areas. It won’t kill you to move away from the fear of funerals.

Act with love, plan ahead, and talk about what you might want. Your courage will help your family reduce stress at a time of grief, save money, and create a meaningful, memorable “good goodbye.”

On this 13th annual Create a Great Funeral Day, don't fear the Reaper.

Todd Van Beck's picture

The Power of Funeral Home Visibility

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“Behold I have set before you an open door . . . . “  Rev: 3:8

I have often wondered privately to myself the motivation for people in our profession to make comments such as “When people are done with the funeral home, they don’t want to come back.”  Or, “I don’t believe in giving tours,” or “Open houses, seminars and that stuff, well I know my people and they just won’t go for such ideas.”  Or “Oh, a seminar in the funeral home, oh yeah, we tried that and it didn’t work.”  

I used to adhere to the same thinking.  In fact, looking back, I well could have been the poster boy for such myopic thinking, such narrow vision, such basic disinterest in the power of making the funeral home more visible.  That was until the summer of 1977 in Cedar Rapids, Iowa.

My employer during those early years was a stellar human being by the name of John B. Turner.  He operated the John B. Turner & Son Mortuary, which was opened, I believe, in the same year that Moses died.  The organization was truly amazing.  We not only did about 55 percent of all the funerals in our market area, the Turner family also owned the Turner Porti-boy Embalming Machine Company.  It is true.  The story was that one of Turner’s longtime embalmers, a man by the name of John McNabney, had actually invented the electric injector in the 1930s.

I suspect that many readers of this anecdote—and that is all it is, folks, an anecdote—will jump on this claim of who invented the embalming machine and have other names of other claimants to such a distinct honor.  All I know is that the Turner family invented and manufactured the Turner Porti-Boy Embalming Machine for decades, along with high quality microphones.

Now back to the story about visibility of the mortuary.  

John Turner was not particularly progressive by today’s standards.  I don’t believe many funeral directors in the 1970s can possibly be judged by the standards of success in 2012.  However, even by today’s or yesterdays progressive standards, John was not progressive.  In fact, he did not have to be progressive; he was doing 800 funeral a year, selling 500 embalming machines a year, and who knows how many Turner microphones ended up in funeral homes, churches, lodges, schools or government halls over the years.

So it came as a tremendous surprise to everybody on the funeral home staff when John boldly announced that he had set up a tour for a group of Webelos, which we discovered was a segment of the Boy Scouts of America.

I had been a Scout growing up, but I had never heard of the Webelos in my life, but I was soon not only going to learn about this extremely interesting group of 10-year-old boys, but one little 10-year-old was going to change the course of my career in short order.

When John made his stunning announcement, you can just imagine the grumbling that went on in the bowels of the mortuary.  I was the leader of the complaints, because John had assigned me to give the tour.  I had never given a tour in my life, and thought that other funeral directors who did give tours were kooks.

At the appointed hour, 72 Webelos arrived at the front door of the mortuary.  The Webelos’ leader looked as stressed out as I think I have ever seen on a man’s face, and with good reason—he had 72 10-year-old boys irritating him at every turn.  He told me that the group would be at the mortuary 20 minutes; they stayed 3 hours.

The Webelos were mighty curious about everything in the funeral home that I wanted them to leave alone.  They were fascinated by our water cooler, and stood in line with their own Dixie cups to get a cup of water just to watch the bubble go up to the top of the water jug, and then after consuming all this water they formed a line to go to the little boy’s room.  It was just a bloody damned mess, and it was not going to get any better.

The Webelos could have cared less about our magnificent chapel.  The pipe organ bored them to tears.  They were also not in the least interested in looking at the oil painting of the founder of the funeral home, which was painted by the famous Iowa artist Grant Wood with the impressive title “John B. Turner – Pioneer.”  I loved the oil painting and was annoyed that my little band of Webelos could not have cared less.

The preparation room was off limits, but the Webelos did care; they just went back for more water.  However, when I opened the door to our garage, in a New York second their very limited attention span moved immediately from the bubbles in the water fountain to our automobiles.  I know this to be true:  Little boys—and big boys—like automobiles.  

The good news for the Webelos is that John B. Turner & Sons had some dandy automobiles.  We had two Hess and Eisenhardt Victoria funeral coaches.   We had two 64-inch Miller-Meteor high top ambulances, two limousines, and two flower vans.  The Turner fleet was impressive, to say the least.

Immediately one of the Webelos, who was obviously courageous, asked me to open the back door of one of the funeral coaches.  For 20 minutes, this little boy was spellbound by spinning the casket rollers back and forth.  Soon most of his little Webelo associates were once again standing in line waiting for their turns.  One thing was obvious: Somewhere along the line, the Webelos had been taught manners.

By 9:30 p.m. the tour from hell had ended.  The Webelos, from all accounts, had had a marvelous time, because scores of them loudly announced to me as they left “We’ll see ya soon, we’ll be back!”  All I could think was “Lord, give me strength.”

When I arrived home that evening feeling terribly sorry for myself for having to have endured this Webelo nightmare, I opened the bottle of Canadian Club and the bottle of Pepto Bismol and sat in a chair contemplating just how my life was going.

That is an account of the first public tour ever given by the John B. Turner & Son Mortuary.

 The next morning I could not wait to give my grumbling associates the gruesome details of my Webelo ordeal.  All my associates took pity on me, sympathized with my plight, and we all concluded that John Turner was slipping badly.  I assured my grumbling associates that “next” time it would be their turn.  They all unanimously said “no way, no way, man!”

I remember it was about 4 p.m. that same afternoon that Dr. Percy Harris, who was the Linn County medical examiner, called the funeral home and gave us the name and address of a man in his 30s who had dropped dead at his home.

House calls did not alarm me much.  They concerned me, I knew we needed to respond quickly, but by this time in my career I had been on so many of them that I did not feel stressed, and when we got to the house nothing unusual was happening.  The poor man was on the kitchen floor.  The sheriff was there.  The widow was in the living room absolutely an emotional disaster, and with good reason, and she was all alone.

I called her priest, who quickly arrived, and I made an appointment with her for 10 a.m. the next morning.

At the duly appointed arrangement hour, the widow, her parents and a couple of brothers and sisters arrived at the mortuary.  Also in attendance was a little 10-year-old boy.

We used big impressive desks in those days to make funeral arrangements, kind of like the one you see in the Oval Office.  I sat behind this big intimidating desk and began.

Out of the blue, this little 10-year-old boy marches right up to me and says, in all seriousness of purpose, “Do you remember me, mister?”  I looked at this little chap and I could not remember ever laying eyes on him, and that is when his mother said to me, “Oh this is my son Roland, and he was with the Webelos on the tour last night.”

My heart hit the floor.  I asked, “Is this your father?”  Roland just nodded his head yes.  The man who we removed on the house call was this little boy’s father.  I did not have a clue as to what to say, how to act; I just froze.

At this point Roland’s mother looked off into space and said, “What am I supposed to do  I don’t know what to do!  My husband isn’t supposed to be dead at 39!”  She began to sob and weep, and I got up to go over to try to help her, but Roland beat me to it.

Roland marched right over to his weeping mother, put his hands on her cheeks and said with all the manly conviction at 10-year-old can muster, “Don’t worry Mommy, I know what to do; you know I have been through this entire building.”

And so Roland took charge.  He explained where everything was, and basically took on the role of his mother’s protector.  Roland knew what was expected, he knew the lay of the land, and he was on familiar territory.

Later that same day John B. Turner came in and asked how the tour had gone.  I told him the entire account of this unique experience, and John just quietly listened.  Finally, after I was finished giving the play-by-play of this extraordinary happening, John walked over to the window, paused for a moment, and then said, “This might well be the most wonderful thing that has ever happened to this funeral home.”

 Two weeks later, I received a letter from Roland’s mother.  In essence she thanked the funeral home, she was very satisfied, we had done our job well, but then she added two remarks which have always stuck with me.  First, she wrote that when she found out that the Webelos were going to tour, of all places, a mortuary, she did not want to let him go.  She admitted she wanted to protect him, keep him from seeing aspects of life about which she herself was uncomfortable.

After sharing with me her true feelings, she ended with this thought, “But given what happened to my husband and Roland’s father, I believe the good Lord sent him over there that night.  Because he got the right information, from the right people and he used it within 24 hours.”

Revelations 3:8 states in part “Behold I set before you an open door ... .”

I never looked at opening the door of the funeral home in the same negative way again.  I never complained about giving a tour, ever again.  It took a little 10-year-old Webelo to teach this old grumpy undertaker something about just what a powerful, life-affirming presence all funeral homes offer to every community.

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