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Tax reform: It won’t come easy…

capitolOn February 15, I spent the day on Capitol Hill meeting with the tax counsel for a variety of Republican and Democratic members of the House Ways and Means and Senate Finance Committees.  Conducting this type of in-person outreach to legislators and their staff is one of my most important responsibilities as the president of the Alliance.  And with tax reform – the Alliance’s signature and single most important issue – squarely on the congressional priority list in 2017, this role takes on even more significance.

Meeting with policymakers, particularly specialists like tax counsel, can sometimes be intimidating.  After all, these folks have forgotten more about the Tax Code than I will ever know.  They’re bright, committed, and curious about how organizations with a tax preference or exemption provide real value for individual Americans and the nation’s economy.

Fortunately, I come to the table armed not only with a firm belief in the value of the fraternal model, but with statistical and anecdotal evidence to demonstrate how Alliance members secure the financial futures of millions of families, and create and coordinate the philanthropic effort of their members in communities across the country every day of the year.

Here is the “Readers Digest” version of the takeaways from these meetings:

 I’ve got more congressional visits scheduled for March 8-9, and April 20-21.  And I’ll spend as much time in Washington as needed to make sure policymakers know who fraternals are and what we do.  In addition, the Alliance will conduct targeted outreach to members of the House Ways and Means and Senate Finance Committees, previous co-sponsors of the Fraternal Resolution, members of congressional delegations from the states in which most fraternals are domiciled, and freshman Representatives and Senators in the coming months.  These outreach efforts will involve members of the Alliance’s Federal Advocacy Task Force, as well as targeted CEOs from other member societies in key legislative districts.  At this point, we do not anticipate conducting a significant grassroots campaign involving a broad cross section of member companies unless a well-defined threat to the fraternal exemption emerges during debate over the tax reform measure in either the House or Senate.

Alliance members tell us again and again that advocacy is the most important benefit the association provides.  I wanted you to know that we are doing everything possible to make sure that federal lawmakers are aware of the fraternal community and the tremendous value that our tax exempt status delivers to the American public and economy.  We want to make sure that this century-old provision remains in place so that fraternals can continue to fulfill their unique financial and community service missions for decades to come.

Follow-up to “Ladder, Lemonade and Haven post…

blog-graphI’ve received more than a few comments and emails from members who thought last week’s post may have over-emphasized the need for fraternals to develop new distribution channels – specifically on-line platforms that allow consumers to purchase simple products quickly.  As I noted in my post, I am not predicting the demise of professional financial advisors, but I am acknowledging the likelihood that the life insurance industry will not be exempt from the sweeping changes affecting other businesses around the world – including financial services providers.  Want proof? Consider this:

  • The world’s largest taxi company owns no vehicles – Uber
  • The world’s most valuable retailer owns no inventory – Ali Baba
  • The world’s largest accommodation provider owns no hotels – Airbnb

Still not convinced?  Think about home mortgages for a minute.  A hugely important and considerably complex financial product that bankers once felt they owned.  In order to get one, you had to come into the bank, sit down with the banker, disclosure our entire financial history, and sign copious amounts of paperwork.

But today, the fastest growing consumer lenders ARE NOT BANKS.  They are Lending Club, Prosper, and Quicken.

It’s not a stretch to go from “Push Button, Get Mortgage” to PUSH BUTTON, GET INSURANCE!!!

Just sayin…

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