I once had a corporate career. I had corporate accomplishments. Costs were reduced, profits maintained in the face of obsolescence, and even increased. I had the respect of my peers. I worked sixty hours a week, every week. And while it seemed like every simple thing was a battle, I knew the results were good things.
One day I Iearned that a particular salesman had received a commission check larger than my annual salary, after closing a contract with an important customer on a certain program that was quite familiar to me.
It was familiar because I had – not to be too delicate about it – rescued it from failure. It had started out as an idea I knew no customer would ever pay for. But I also knew what they would pay for. I knew what they would need in the next few years, and I turned this particular program into a revenue-generating step in that direction.
No, I did not see a commission or bonus. Everyone else was very happy, though.
My wife was in school, we had three small children in the house and minimal savings, but I screwed up my nerve and walked out of my corporate job to start a business. It was hard. Sometimes it seems like a lifetime ago. Sometimes just yesterday.
My third business eventually ran into trouble with a litigious ex-partner. The litigation caused big problems for the business, and the only solution I could see was to sell it all to a larger company and pay everyone off. It was not a happy time.
I received a tidy payment from the sale. When I saw my tax return for the year, I was flabbergasted. I would not be mailing a check to the government; in fact, they wrote one out to me.
What was my secret? Very simple: That payment was treated as ‘capital gains’. Thanks to the kindness of the tax code, there was a little icing to go with my otherwise bitter-tasting cake.
That same year, the US federal deficit exceeded a trillion dollars.
To be continued…