Absentee Congressman

We are living in an era when the leaders we elect do not uphold the rights and interest of the citizens at large. Instead, they pursue a path of self-enrichment and corruption at taxpayer expense. Nowhere is this deficiency more evident than the Congress. Here we see elected officials consistently miss votes that are inconvenient for them to participate in.

When we elect a politician, we expect that person to vote against legislation that will harm us and vote for legislation that will benefit us. However, that very politician received money from their party, private donors, corporate donors, lobbies, etc. It is those monetary contributors to their campaign (and back pocket) that they owe their Congressional votes to first, before any of us.

There is a very useful, but severely underused, tool that the government provides us with, which allows an average citizen to track the Congressional votes (or lack thereof) of their Senators and Representatives. Here is the website: https://www.govtrack.us/congress/votes

Based on a 2015 study, our Congress was rife with Senators and Representatives that missed a significant portion of their votes. To be fair, those dutiful elected officials that cast every single vote they are called upon drive the average absenteeism down to a palatable 4%. However, there are some that reach as high as 30% absenteeism and over 20 officials consistently miss more than 10% of their expected votes. Imagine if you don't show up for work 10% of the time? That's right - the Senators and Representatives play by a different set of rules.

But absenteeism is only a part of the problem. A lot of the time, the Senators and Representatives are present for the vote, but abstain from voting on an issue that may be problematic for them.

Let's suppose you're a Senator in North Dakota and you are asked to vote on the Dakota Access Pipeline regulation. Your voting population does not want the pipeline approved for environmental reasons. But your big money donors have a financial stake in the project and want your vote for approval. You are not going to deny your sponsor, but you will also not want to upset your voters. So you chose neither - you abstain from voting, citing the legislating is lacking, incomplete or some other irrelevant excuse. That way, you remain safe with the donors and most of the voting public.

In order for us to clean up the Washington landscape, we have to turn our votes into weapons. We must fight Congressional Absenteeism and legislative vote abstinence. Your elected officials have an important job - to vote for or against legislation on your behalf.

Take a look at your elected officials' voting record here  https://www.govtrack.us/congress/votes
And if they're not doing their job, we must fire them. Don't sit on the sidelines - weaponize your votes!

At Taxpayer's Expense

Let me start off by saying - I know it is my obligation as a citizen to pay my fair share of taxes and I make sure my employer withholding every year is right on target to meet my tax obligations. I may not like the amount of money chopped off my paycheck, but neither does any other citizen. It is one of those things we know we must, but wish we didn't have to.

My problem revolves around the "wonderful" legislation that dictates the Highly Compensated Employees (HCE) rules. These rules are applied in a blanket manner across this country, whether you live in Wyoming, Texas, New York or California - you become an HCE if you either own 5% of the business or earn more than $115,000.

Once you become an HCE in the eyes of the IRS, you are no longer eligible for several education related tax deductions - and that is right, because those deductions were designed to protect the lower income population.

However, there is another side to the HCE rules. That side relates to the 401K and IRA tax deductible status. Ordinarily, employees are allowed to contribute money from their earnings towards these retirement plans. For 401K, the contributions are pre-tax and for IRA the contributions can be deducted from your taxable income when filing your return. Both plans allow investments to grow tax-deferred for the life of the plan.

When applying the HCE rules, which were advertised by our Washington legislators to the public as "making sure lower income individuals benefit from retirement plans as well as the HCEs", they were actually trying to apply the proverbial 'defibrillator' to the US Treasury investment (as most safe components of any retirement plan contain a healthy dose of Government Bonds and Treasury Bills).

Their crazy way of thinking was explained - each company will have to undertake a 'stress test' to make sure that their lower earners benefit in no lesser proportion than their HCEs. Meaning if the lower earners don't contribute to the 401K plan or don't contribute enough, the HCEs become ineligible for the tax-deductible status of their 401K contributions and will have a refund of those contributions issued (which will then be considered taxable income).

The rationale was - the company HR and the HCEs should encourage the lower income employees to participate fully in the 401K program. Sounds like a collective social pressure applied to a work environment in order to pump up the Government's Treasury bottom line. Don't worry, comrade, the government has your best intentions in mind.

But this idea backfired - you cannot convince lower earners, some of whom live paycheck-to-paycheck, to contribute to 401K the money that they simply do not have to spare. As a result, the lower earners will not contribute because they cannot afford to and the HCEs will not contribute because they have been flagged as ineligible. In conclusion, unless this legislative mess is corrected, the 401K and IRA plans will suffer a contraction - one which will negatively impact the US Treasury investments (the exact opposite of what this legislation intended to do).

P.S. Consider the inconsiderate nature of this legislation - the HCE 'stress test' will surely pass an Investment Bank or a Law Firm, where every HCE will remain eligible for 401K's tax deductible status. Then consider a consulting company, where a lot of workers are per diem, don't earn enough to be considered an HCE and typically do not contribute to the company's retirement plans. The people who just barely meet the HCE criteria (through pulling in a lot of extra overtime) will now be unfairly punished simply because of the per capita income composition of their company. Also, geographically a non-HCE employee earning under $115,000 will probably be able to contribute to a greater degree in remote areas of Texas and Florida (where there is no state income tax to chop off your paycheck and the cost of living is relatively low), as opposed to New York and California (where state taxes are quite high and so is the cost of living).