The sermon this past Sunday by my pastor, Rick Tigchon, was based on Revelations 3, the letter to Philadelphia, the original City of Brotherly Love. The theme of his sermon was Open Doors. The Christians in Philadelphia evidently were aware of what was going on and as things happened in Philadelphia, they adjusted on the fly. They were able to discern when a door was closing and when a door was opening and they were given kudos in the Bible for their judgment and perseverance in serving the Lord. We don’t know specifically who those people were but being lauded in the Bible I would say is about as good as it can get. As Rick said, the lesson we can learn today is to be vigilant of doors as they open and close in our lives, surroundings, and businesses. It’s easier to write that sentence than it is to make a call that a door has closed or a door has opened. In the 1950’s, Henry Ford II thought the Edsel was going to open the door to Ford regaining #1 status in the car business. He was wrong. The Edsel didn’t open any doors. In fact, hardly anyone opened the Edsel’s doors either. Coca Cola thought that the door was closing on its’ flagship product so it came out with New Coke. That was a disaster so they brought back the original Coke. Coke lovers everywhere seem to be quite happy that Coca Cola closed that door. However, for every situation where the perception that a door was opening was incorrect, there are a myriad of examples that the door really was opening. Lee Iacocca brought out a sporty little car in the 1960’s called the Mustang that simultaneously brought Ford back to respectability and successfully closed the door on the Edsel fiasco. In 1973, Fred Smith saw a door opening for a company that could successfully compete with the U.S. Postal Service for the private delivery of packages so he incorporated Federal Express. He was correct. What an open door that was and what a company FedEx has become.
We could go on and on but let’s look at a couple of door casings that we are peering at right now. First, does the Affordable Care Act (ACA) open the door to a better system of health care or does it just close the door on health insurance as we have known it without really improving the total system? Our present system is substantially based on an employer-provided health insurance platform. It has flaws that needed fixing. ACA fixed several of those flaws including eliminating lifetime benefit maximums; eliminating pre-existing condition requirements; allowing dependents up to age 26 to be claimed on a parent’s policy; and requiring several routine maintenance features be included in each issued policy. These are all good things. The door is opening. However, there are potentially not so good things that may signal the door as such is closing. Beginning in 2014, all employers with 50 or more employees will be required to maintain a certain level of coverage or be subject to a per-person penalty of between $2,000-3,000 per year. Since the annual premium for most health insurance is much more than $2,000-3,000, potentially limiting an employer’s cost to the penalty amount will be a financial decision that many employers have already said they may not be able to pass up. The question in the long run is this: does closing the door on the employer-provided health insurance system constitute a good or a bad thing? Only time will tell.
Second, Congress is debating which, if any, of the Bush Tax Cuts to renew. The Fiscal Cliff appears to be looming closer every day. Is the door they are looking at an open door to using the tax system to run the country and to reduce the deficit or is Congress running face first into a closed door by using the tax system to divide the country by defining the wealthy and affluent at $200,000 of income for single filers and $250,000 for married filers? I believe it is a dangerous precedent to use the tax system in such a direct “us vs. them” manner. My logic in stating that is this: what’s to stop a future Congress from defining the wealthy and affluent at $50,000 for singles and $100,000 for married filers? Once Congress starts drawing a line, the debate can then become more about the placement of the line than about the policy. The open door uses the tax system to run the country. The closed door uses the tax system to define who is wealthy and affluent. Again, only time will tell what type of door we are walking into.
This is Jerry Coon signing off but before I do, I wish all of you a Happy Thanksgiving. We have much to be thankful for and it’s right and proper that we have a day set aside to celebrate those blessings. Safe travels to those driving and a Happy Thanksgiving to all!
Jerry Coon is an Enrolled Agent and a
Registered Tax Return Preparer.
He owns Action Tax Service on
Northland Dr. in Rockford.
Contact Jerry through his website: