Wealth Actually

We’re going to be talking about the current incoherent world of US ENERGY POLICY. ANNA KRAMER joins the podcast to help us get our arms around the future of energy in the United States. Anna is a reporter for NOTUS, a non-partisan longform journalism outlet. She has written a series of stories on the the disconnect and frustration around US Energy Policy and paths forward. We talk about: The chaotic policy at the federal level (and beyond) The huge cost overruns and administrative complexity The role of nuclear The increased energy demand in this country Finally, we muse about what can be done about it going forward. https://youtu.be/3k-N-AGTNfU Outline Section 1: The US Energy Policy Transition: The Goals and the Problem. Discussing Brandon Shores Coal Plant and electricity prices in the Mid-Atlantic Region. https://www.notus.org/policy/biden-clean-energy-coal-maryland-brandon-shores https://www.notus.org/policy/electricity-prices-spiking-biden-clean-energy-transition https://www.notus.org/policy/nuclear-power-energy-crisis-cost Evidence that the transition is happening. Electrifying = efficiency. Cheap wind and solar, look at the free markets in Texas — ballooning wind and solar there The reliability, capacity, and resource problem: Needing certain amounts of energy and voltages at all times of day. Leads to keeping coal plants online past scheduled retirement dates, plus spiking prices How much do emissions and climate change goals matter to the industry? What role does nuclear energy play? Section 2: Interconnection Queues and Permitting Reform. Bipartisan and Industry wish for Permitting Reform: Why is it so hard for US Energy Policy?  https://www.notus.org/policy/permitting-reform-bill-manchin-environmentalists https://www.notus.org/policy/solar-farm-culture-war-biden-climate-change Section 3: Trump’s US Energy Policy “dominance agenda” disappointing every part of the energy industry. Idea is not aligning with reality. DOGE cutting into the basic functions of energy governance. https://www.notus.org/policy/doge-cuts-trump-drill-baby-drill https://www.notus.org/policy/donald-trump-tariffs-trump-energy-agenda Transcript Frazer Rice (00:01)Welcome aboard, Anna. Anna Kramer (00:03)Thanks for having me, really psyched. Frazer Rice (00:04)I went through a bunch of your articles covering the power industry and energy generation and a lot of things that are happening federally, state level, and it’s going to be a lot to get our arms around, but you were the person to do it. So just generally speaking, we’re at a point in time with energy and transition ⁓ that policy is moving. Maybe take us through a little bit about the goals and the problem we face. Anna Kramer (00:31)So there are sort of two, I would say, competing problems right now. ⁓ The first one is load growth, which means basically more demand on the electricity grid. And that is something that we haven’t seen in this country in decades. for really around 2000 up until maybe a couple of years ago, energy demand on the grid has been fairly constant or even declining slightly. And the reason for that is that everything has become more efficient. Like every appliance you use, every light bulb, your car, everything that could possibly have a demand on the grid is more efficient than it used to be, which is awesome. There’s a lot of wonderful benefits that we get from that, including the fact that for a long time utilities and transmission planners and states and the federal government have not really ever had to think about the grid or about like where you get your power aside from these sort of technical conversations that the average person doesn’t really pay any attention to. That has really started to change as of the last few years. There’s a large number of reasons for that. Basically for the first time in decades we have significant demand expected on the grid. We expect it to grow over the next several decades. The reasons for that are widespread and hotly debated. A lot of people talk about data centers and artificial intelligence which require huge amounts of energy to power At the same time, there’s a lot of research that shows that some of the larger sources of demand are actually going to be manufacturing facilities built in the United States for things like semiconductors. Electric vehicles are a huge demand source on the grid. Basically, the more that we electrify, the more demand there is on the grid. So for the first time in decades, we have the need for a lot more power. And then at the same time, we also have climate change. And for those who really care about With the emissions we create in the United States or globally, there’s a compelling argument that we should be addressing the emissions from the power sector. These are quite significant between coal and gas plants, and then the emissions that come from regular vehicles. Those are somewhat competing because if you have increasing demand on the grid, while you’re trying to reduce emissions, you’re both trying to transition the economy from fossil fuels while increasing the amount of power that’s available. There are a lot of competing tensions there. Frazer Rice (03:06)So as we’re trying to get more efficient ⁓ and we’re sort of transitioning to electricity, how do you think about sort of the downstream effects of that? To me, energy generation is a symphony of measures you’ve got in everything from coal, the natural gas, to oil, to nuclear, to hydro, to solar, ⁓ hydro or sort of hydrogen based things, that type of scenario. Getting power generated and where it’s needed, everything you just described, that’s the part that’s tougher for everybody to understand. Anna Kramer (03:44)Yeah, definitely. And this is really where all the debates come in because… It’s not as simple as just creating the power in one place. The act of moving it to the place where it’s needed is complicated and equires transmission infrastructure. That’s the grid that everybody sort of sees, right? Your power lines, your substations. And there’s only a maximum amount of power that can move, know, or sorry, maximum amount of electricity. My power and energy sources would be very mad at me if I said power. There’s only a maximum amount of electricity that can move on any given part of the grid at any given time. So you need your transmission infrastructure to be really well built to sort of facilitate maximum movement of electricity to the people that need it. And it’s really hard to do that. And our…Transmission infrastructure system in the United States is not well built. It’s quite old. It’s aging. It hasn’t been well maintained. There are some incredible technologies that can be applied to transmission infrastructure to make it better. They can make one line have the ability to carry a lot more electricity than it does currently. There’s a lot of politics around who has to pay for that. When it comes to gas fire generation, one thing you can do is build a gas plant near a place that needs the electricity to minimize the transmission infrastructure that is needed. But there’s a lot of politics there too because the question is sort of like who bears the cost for building, for example, a gas plant next to a data center? If a gas plant isn’t going to contribute to the transmission network, should they have to avoid the costs that somebody would normally have to pay in to maintain it. There’s so many complicated political questions involved in all of this ⁓ down and there’s so many fights about who pays for what. And at end of the day, the average electricity consumer doesn’t know any of this is happening and doesn’t want higher electricity bills. But we’re now in a situation politically and practically speaking where Everyone has to understand how electricity moves around and everyone’s going to have to reckon with higher bills if we’re trying to meet all this new demand. Frazer Rice (05:59)So let’s take as a given, which it isn’t a given, but let’s take it that the costs could be figured out and we print lots of money and do all that stuff. Where does the world of NIMBYism kick in here? When do people say, “I don’t want the power line to go through my backyard or I’m worried about the externalities of a power generation plant within five miles of my house. I don’t want to breathe difficult air or radioactivity is a problem” – that type of thing. Anna Kramer (06:04)It’s probably the single greatest problem getting in the way of all of this. It’s not just NIMBYism necessarily. In general this very anti… It’s not just like I don’t want things built in my backyard, but people in general don’t really like to change the status quo, broadly speaking. So you have a number of things that happen there. The first thing is that… Anytime you try to build a transmission line, takes years to longer to build it than it should because people are fighting it in in local systems. The same thing goes for a gas plant and wind turbines. The same thing goes for a coal plant that, you know, might need upgrades and instead the local community wants that coal plant to close because of air pollution issues. But it’s even broader than that. One of the stories that I wrote was about a solar farm that was going to be built in somebody’s backyard. Basically they have a large farm, they were gonna cover a lot of the land with solar panels because the farm isn’t financially sustainable and the solar panels were going to help. And the local community essentially revolted against the farmer and prevented them from building the solar infrastructure. Not necessarily because any of them would ever interact with or see it, but the idea that this solar farm would sort of change the constitution of the community was so revolting to so many people that they essentially made this family like local pariahs. So it’s important to understand like just how passionate people are about energy infrastructure and specifically how much they don’t like changing it. And that has so many weird political ripple effects. You see, you know, members of Congress coming out against a plan that would make a lot of sense to lower electricity bills in their district because of the fact that that plan will upset a local community in the process. It’s such a huge problem. I’m sure we’re going to talk about this more. There are also a lot of federal, state and local rules and regulations that enable communities to prevent anything new from being built. It’s really important to understand how big of a problem those rules and regulations can be. Frazer Rice (08:38)Well, you combine federalism with sort of consensus-based decision-making and you can turn something that doesn’t, that shouldn’t take much thought into a multi-decade process. So we’ll talk about that in a second. But one of the problems I think that’s interesting is sort of in terms of understanding what is important about energy policy is sort of the physics of it in many ways and having a reliable source of energy that has the capacity and ⁓ the resources to support it. Maybe talk a little bit about that. mean, it goes to the idea of if we like the idea of climate change addressing that and incorporating other types of energy, but then it’s not there for you when you need it, that’s a problem. Anna Kramer (09:05) Huge problem. Yeah, so basically we all take for granted that our electricity system in the United States just kind of works. We’re not experiencing regular blackouts. That is because there is enough power of different types, all the time, to maintain this extremely complicated system. I’m not going to get too far into the physics of it but basically the voltages really matter and the amount of baseload electricity that sort of keeps the grid moving really matters and you need to be able to control precisely how much electricity is moving through the system in different places. And there are parts of the system that are extremely sensitive. Without perfect control of how much is pulled off and put on the grid at the same time, you get this risk of a blackout or a grid collapse. It’s way more complicated than that at the end of the day. But the reality is that our grid system works very well in part because we have sources of energy that you can call upon ⁓ in times of crisis, especially, and those sources of energy tend to be fossil fuels- coal and natural gas for the most part. They’re critically important for those moments where suddenly you have a huge amount of demand on the grid. You need to meet it. Otherwise, what’s being sucked off of the grid is going to cause the whole thing to collapse. They’re also important for maintaining this sort of base load power. One of the other things that works here is nuclear power, which is utterly critical for this base load element where you basically have some guaranteed amount always flowing into the grid at a certain time. Nuclear provides that sort of certainty in a way that literally no other resource can. Nuclear is not so great for the other side of the coin when you have something where you really need an extra amount of electricity pulled onto the grid, sort of at the last minute in order to prevent collapse because of increasing demand. That’s the kind of situation where natural gas-fired power plants tend to be extremely helpful because you can just burn more gas. So… The fossil fuels and the nuclear tend to be really, really valuable baseload power, and they’re really, really critical for making the grid function. Frazer Rice (11:39)You wrote extensively about this related to the Brandon Shores problem and ⁓ sort of what looks like a spike in consumer, how much they’re going to be paying for it in the mid-Atlantic region. Maybe talk a little bit about that because that gets back to the concept of people wanting to shut down coal for good reasons, but then you go and do it and it has all these spillover effects that no one really likes, i.e. you get your, in New York, your Con Ed bill at the end of the month and you go, what the hell happened? Anna Kramer (11:49)Mm-hmm. Yeah, exactly. So what’s happening in Maryland is that Maryland is an electricity ⁓ importing state. Basically, they consume way more electricity than they produce there. So the few things they do have that make electricity are extremely valuable, including a large coal plant called Brandon Shores. The coal plant was scheduled to shut down. I think this year actually was the formal shutdown date, retire. And that it was gonna retire for a number of reasons. It’s not terribly economical. The Sierra Club and state regulators applied pressure shut it down because of the polluting effects of the plant. The the shutdown would have essentially created this problem that I was talking about with your grid physics, where you can’t maintain the appropriate. sort of voltages and flow of electricity that you need for the grid to function normally. The grid operator, the large organization that manages the regional grid, is called PJM, It made the decision that they have to force the coal plant to stay online for several more years. before they can build the transmission. AKA all the wires that I was talking about, that could compensate for the loss of the coal plant. But…when you don’t want the grid operator forcing a coal plant to stay online because it’s extremely expensive. That’s not an economic, there’s no economic logic that’s inducing that coal plant to stay online. PJM is saying, “we’re going to force the rate payer, you, with your electricity bill to bear the cost of keeping a plant online that was supposed to otherwise retire.” This isn’t just happening in Maryland, this is happening all over the country. You have a plant that’s supposed to shut down. Then everyone goes, “my God.” There is nothing else that we have available to address this problem. We have to pay to keep it online even though it wasn’t supposed to be. So there’s huge problems here in Maryland. It is complicated. One thing happened over the course of the last year since I’ve written about this. PJM and then FERC, which is the… federal independent agency that regulates utilities and power in the United States have come to a conclusion. The way that was handled with this particular coal plant could have been done better and lower costs a little bit more. Yeah, unfortunately what’s happening now is… Frazer Rice (14:27)You’re like, “great, thanks!” Anna Kramer (14:34)Rate payers in Maryland are gonna see enormous increases on their utility bills this year. ⁓ The reality is there are probably over the long term are solutions that will sort of allow these coal plants to retire in more economical ways. But because of this problem I was talking about earlier, it’s really hard to build new things now and really hard to change things. Those solutions are sort of stuck. This leaves us in a really weird kind of terrible place right now. We’re keeping coal plants online. It is the only option in large parts of the United States. The other options are too hard, expensive and too politically complicated to get done in the timeline that we need. Frazer Rice (15:16)One of the things, so I think we can all agree the grid needs to be upgraded. I don’t think anybody would contradict that statement. We could use lots of different types of power generation, whether it’s nuclear or solar or wind or whatever, which have their own expenses and issues. Why is this so hard? I get, you know, this gets back to, you know, federalism and consensus and, you know, states interacting with people who have their own interests and red tape that goes with dealing with FERC and other regulatory agencies. But why can’t we get our arms around this and push this forward a little bit more efficiently? Anna Kramer (15:48)Yeah. There are so many problems with US energy policy here that we could go into. The first and the biggest one is permitting. So permitting reform is like the catchphrase of every single person in energy world these days. Every conference I go to, every meeting I have, the number one thing on the wish list of any kind of company or industry group is permitting reform, which means changing the rules of how you get permits from the federal, state, and local governments. US energy policy has complicated rules. They extend from environmental legislation, These environmental laws, passed in the 70s, try to reduce serious pollution effects, try to protect endangered species, that kind of thing. Some of the laws here that we’re talking about are NEPA. which is the environmental protection law. We’ve got the Endangered Species Act. There’s historic buildings conservation. Tons of different kinds of laws that require all these different permitting processes that are really long and complicated. If a company, any company in industry could have one thing fixed, it would be permitting issues. That is insanely politically difficult. We are just not at a place where Congress can reach the kind of compromise that they need to fix these laws. It’s basically like a toxic, horrible mess in Congress anytime anyone talks about it. Everyone says they want to do it However, the reality is no expert expects to see anything significant with permitting reform, at least in the next year, maybe longer. Congress is not really capable of that kind of compromise anymore. Unfortunately, if it were to happen, a couple of folks have said to me maybe next year when they have to do reauthorization of the bill that will sort of manage the federal highway system, that’s like a must pass bill. So maybe there’s a way to end this. There are folks involved in that legislation that are the kinds of folks more inclined to compromise. So if there’s a chance, that’s when it would happen. I’m not optimistic after all of the reporting and conversations I’ve had over the course of the last year that we’ll see that transformation. It doesn’t seem that likely to me, despite the fact that it is like the number one desire of almost everyone who works in or around energy. Yeah, there are others as well. Frazer Rice (18:04)So, maybe we’ll do one more besides permitting. I’m sure there’s a long list, but what else is there that’s causing the roadblock in US Energy Policy? Anna Kramer (18:07)So we have interconnection queue problems and the interconnection queue is the line that power companies get into to get permission from the grid to move, to build a new generation facility and connect it to the grid. There is a reason they call it the interconnection queue. Tying something to the grid is a complicated physics problem. These grid operators need to very carefully do the assessment of what it’s going to cost to bring something onto the grid. They have to know whether it’s going to overwhelm that really complicated system that we’ve been talking about. What has happened, and this is largely the fault of renewable energy, whether this is a good or bad thing is kind of a personal assessment, but… there are so much demand for new sources of renewable energy and it’s so easy to build some of it, especially solar and wind. The projects are on average much smaller than your average gas, or nuclear plant that suddenly you have thousands of projects applying to interconnect to the grid across the country all at the same time. Up until now that has never happened before. Up until the last few years, it’s like a couple of gas plants would try to get online in one place in one year. It’s not that hard for a grid operator to sort of do the mathand figure out what it costs and whether they can connect. Now you have thousands and thousands of generation facilities applying to get onto the grid at the same time across the country. You have no idea if any given project is going to break ground quickly. Or get online if they get application approval. So all the grid operators across the country are overwhelmed. They are struggling to process the applications to interconnect from these different generation facilities. Suddenly you have this like huge quagmire that nobody can resolve. It’s like a massive tangled knot that has essentially stopped approvals for a large number of new energy generation projects. The grid operators are trying to come up with solutions as is FERC. There are things that can expedite this. There’s a lot of pressure to expedite it now and to come up with some solutions. But the reality is that interconnection is now such a huge barrier to entry. It hasn’t improved yet. Frazer Rice (20:30)Crazy. So we have a new president in who in theory is taking a chainsaw to bureaucracy and supposedly wants to have an energy dominant policy where the US is, I guess, not only an exporter where possible, but so self-reliant that everything kind of works as well as possible. But that’s not necessarily the way the energy industry is seeing it. And the Doge efforts are a little bit at cross purposes. Maybe explain that. Anna Kramer (20:40)Yeah, absolutely. the president says he has an energy dominance agenda and the way he defines that is he’s basically going to do everything in his power to increase our energy production and export in this country. If you were to actually do that in a sort logical way, there are a number of things that you would do, which involves some efforts on permitting reform, it involves speeding up the processing of permits. ⁓ You would support really every single kind of innovative energy technology. You would support the production of basically every new source of energy, something a lot of Republicans like to say is an all of the above energy agenda is what they have, meaning they support everything without discrimination. ⁓ None of those things are actually happening, despite the fact that the administration says that’s what they’re doing. The oil and gas industry was a huge donor to the Trump campaign because they assumed that this energy dominance agenda was going to benefit them enormously. Even folks in that industry are disappointed with where things stand right now. Not everyone, this is not an across the board assessment, but everybody that I talked to in my reporting has a lot of disappointment. I had somebody who’s a huge Republican reform advocate for the energy industry say to me the Delta between what they expected and what’s happening is so much larger than he ever could have predicted. He said this to me yesterday because folks are really, disappointed about what’s been happening. So I’ll give you a list of some of the problems here. ⁓ The biggest one now is the tariff and trade situation. Basically, the size and scale of the tariffs that Trump implemented or has threatened to implement are disastrous for anyone that produces anything. That includes energy, the costs for oil and gas drilling, the cost to build batteries and solar plants, the cost to build manufacturing facilities. Anything that you need to make energy in this country is way more expensive than it was before. That’s counterproductive to any kind of energy dominance. It’s a huge problem. Also, if tariffs do shrink the economy in any way or lower consumption or demand, that’s a huge problem. for the oil and gas industry. They can’t drill more, justify drilling more oil or gas if there’s no increased demand. Right? One of the things that always happens when the economy shrinks is that oil prices plummet because there’s less demand. And that’s something that we’re already seeing. ⁓ That’s now the biggest problem. Before this happened, DOGE was the biggest problem. DOGE made the cuts without very careful policy prioritization. This includes staffers, to rules and regulations, to offices and facilities, .So there are very talented federal government workers, or not so talented government workers, who do tasks that are essential for things to function. Especially they produce permits, which we’ve been talking about are very slow and complicated and a problem for folks. If you fire the people who work on permits, it lengthens the permit time. If you fire the people who are really good at working on the permits, it exposes those permits to more litigation later, which also slows projects down. Same thing goes for the folks who inspect an oil and gas rig, or somebody who makes sure a pipeline isn’t leaking, or somebody who inspects a transmission line. You need those federal workers ⁓ in order for all these companies to be in compliance with the law. If they’re not in compliance, then the have litigation exposure. They have lawsuit exposeure, which slow things down. All the cuts happening across government. Because they have not carefully tailored the cuts to policy priorities, they hurt the administration’s agenda, unfortunately. Frazer Rice (24:43)What is the way forward on this? It looks like Trump’s been able to accept doing about faces every other day on lots of different things. Are we too far gone or is this something we can remedy? Anna Kramer (24:51)I mean, it really depends. I think theoretically, yeah, the administration could do a number of things to try to remedy this. There are certain things that are really, unfortunately, of difficult to fix at this point, especially when it comes to government workers. If you wage a campaign of war against government officials, if you make them feel as if their jobs are not important, why would the most talented people ever take a job in government? This is the question that people ask me every day. It’s distressing. The administration hasn’t “ensured” that there are adequate staff to do the necessary work. Because even if you were to try to rehire or hire for very specific issues and hire the best people who work on those most specific things, why would the best people take those jobs, right? ⁓ That’s a question that people ask me every day. A lot of folks who are really good at their jobs are leaving the Department of Energy. There are political appointees in the Department of Energy trying to come up with ways to persuade employees to stay. Because of how important their jobs are! They won’t stay. Why would you not take a job in the private sector? So that’s the area that I think is unfortunately not that remediable at this point. Some of this other stuff that we’re talking about here. When it comes to policy choices, definitely, there are things that Trump could do. If only he could maintain a consistent trade policy and find a way to convince people that that’s the case. That would be huge for the industry. Same thing goes if he decided to leverage his power to force Congress to get it together on permitting reform. That would be such an amazing win that people in the industry. They might not care about all of the other things that have happened. ⁓ As folks have said to me, there’s damage that has been done there that will be hard to undo. Frazer Rice (26:52)As we wind down here, Somehow we’ve managed to cover so much ground in 25 minutes. It’s unbelievable. I’m a big fan of having nuclear being a keystone of future energy policy. It’s expensive to put these things together. Lots of permitting issues, et cetera, What is the state of the union on nuclear energy in this country? Anna Kramer (26:56)I know. People have come around to nuclear sort of across the board ⁓ politically, which is huge. A lot of folks call it the second nuclear renaissance. We’re living in an era where it’s so politically popular. Enough people have finally understood that a lot of the safety concerns around nuclear are not sizable anymore. Where we are with the technology is so good. The track record of nuclear is so good that a lot of folks are finally coming around to it politically. Most of these power plants last a lot longer than projected. Suddenly you have basically free energy after 50 years of a power plant. Which is incredible! I mean that is such an insanely good asset to our grid. There’s a lot of people that agree with that now. We’re finally at a place where it’s you know, where it’s really popular The problem is that even with a strong deregulatory agenda that the Trump administration professes to have but has not yet implemented, nuclear remains bananas expensive to build. One of the few pieces of progress we’ve had in nuclear is the construction of the Votal Plant in Georgia. This is the first new nuclear power plant to come online in a really long time in the United States. The utility commissioners there have said that they sort of regret approving this. It will be expensive for the people who are taking that power, you know, any of the ratepayers.h Which is a real problem, right? How do you build new nuclear when utility commissioners across the country are suspicious of the cost. What will that bring for the people paying the electricity bills? There are a lot of answers to that question. The federal government could step in and subsidize in the early stages. You know, you could…find a way to get a tech company to pay for a lot of the costs. They really want the power for a data center. There’s a lot of interesting theories going around. Theories about things that we could do to make it more affordable. Ironically, one of the most compelling arguments is a really strong policy around climate and around low emissions. That would really help justify the cost, the initial cost, because nuclear power is emissions free. If you have financial incentive for emissions free power, it makes more sense to build nuclear power. If you don’t care about emissions, or greenhouse gasses, it’s harder financially to justify building these plants right now. It is a complicated problem, I have to say. Frazer Rice (29:59)Really, really cool stuff. ⁓ Anna, how do we follow you and your reporting going forward? Anna Kramer (30:04)Absolutely, so there’s a number of ways you can follow me. I’m on Twitter and blue sky on Twitter It’s Anna underscore C underscore Kramer. I write for NOTUS. We have a daily newsletter which encompasses everyone’s work, but Anytime I write something large, it’ll be in there. If you’d rather sort of get a broader political newsletter. But otherwise, you can find me on Twitter or Blue Sky or LinkedIn, and I post almost everything that I write there. TWITTER BLUESKY Frazer Rice (30:35)Great, I will have all of that in the show notes. Thanks so much for being on. Anna Kramer (30:39)Thank you, it was really fun. More Longform Journalism at Propublica https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

Family Office AI has become a dominant theme at the fancy dinners where families and their advisors chart a course to incorporate new technologies. As wealthy families grapple with the risks and opportunities of AI, institutional rigor and structure hasn’t kept up with the often informal world of family offices. This is a mistake High end governance must play a part in the family office AI space. https://youtu.be/n_KHB_gOc9M We’re going to be talking to TIM PLUNKETT, who’s the founder and managing partner of Plunkett PLLC. He advise families on structure, governance and the development of procedure around these exciting, but potentially dangerous concepts. We’re going to be talking about best practices for family offices as they deal with the artificial intelligence theme. Family Office AI “When looking at AI adoption in family offices it is important to remain true to the culture, operations, reputation and underlying trust among those who built the Office in the first instance. Remain true to your principles and don’t get distracted by the new toys.” – Tim Plunkett Family Office AI Transcript Frazer Rice (00:01)Welcome aboard, Tim. Tim Plunkett (00:03)Hey Frasier, how are you doing? Thanks for having me. Frazer Rice (00:05)doing terrific. we’re in the midst of Trump tariff season, so it’s a little crazy, I’m sure for everybody. yeah. so why don’t we, we’re going to talk a little bit about family offices and artificial intelligence, which I think is a theme. both themes are, you know, big unto themselves, but how family offices integrate with the space. I think it’s something where it’s a, it’s an area where family offices can be very informal and. Tim Plunkett (00:11)We’re blessed. Frazer Rice (00:33)Getting some institutional rigor around them is important. And so to that end, you have a lot of broad experiences advising businesses from a governance perspective. Maybe describe your firm for a few minutes and what you do. Tim Plunkett (00:47)Sure, thanks again. I have three pillars in my firm. I can only do certain things well, so I try and limit what I do. My training is as a litigator, and so I consistently think of things always as having to explain them in front of a judge, which helps with a lot of risk, which goes along hand-in-hand with AI and governance. The second part is I’ve done a lot of government relations work, which is working across disciplines and organizations, trying to advocate for certain outcomes and create business environments that are efficient, compliant, ethical. Again, all that ties back to the same foundations in the world of AI. And the third component of it is, is obviously the AI work I do, which came out of working in data privacy and security over the last 10 years. The natural flow was to move towards this sector. And today my practice is Mostly helping companies learn how to implement strategies that are fair, equitable, just, but also compliant with the laws and keeping in pace with the technological change, is really at breakneck speed and an incredible place to be right now in the world of opportunities in front of all of us. It’s very exciting. Frazer Rice (01:57)So when you’re canvassing companies and families that are invested in them, what are the use cases that you’re seeing? Tim Plunkett (02:04)So use cases are, I mean, they’re kind of all over the place. you look at in terms of how do you define the practices, have, there’s operational use cases. so you have use cases that are like document intelligence and automation. Sometimes in places there’s expense tracking and anomaly detection. There’s dashboard creation for organizational purposes. You have investment use cases for deal sourcing. portfolio risk management, alternative data, source and analysis. You have governance use cases for succession planning, philanthropic impact analysis. So there’s a lot of different cases that are out there. Each one of those has lots of different levels beneath them. But back office integration in the family office space, like you said. Some places are single jurisdictions, some are multiple jurisdictions, some are international, some are local, some are really formalized, and some are not. And so you have basically two buckets that everything fits into. One is AI for adoption and operational efficiency, and one is for investment. And those are viewed and treated very differently. Others overlap, obviously. But when you’re talking about getting down to the fundamentals of building the rigor around these things, and what the institutional rigor looks like. That’s where everything emanates from. Risks Frazer Rice (03:31)Got it. So, you know, it’s difficult to put sort of a roadmap around this. It’s all evolving so quickly. And, you know, just when you think you’ve got everything in mind, there’s some new use case that pops up as a litigator, as someone who is trying to advise companies and families around governance so that they stay safe from the various risks that are out there. How do you group those? Tim Plunkett (03:54)Well, the risks are there’s risks that are from compliance. Okay, you have regulatory risk. You have family, know, reputational risks, operational risks. Then you have the obvious investment risks, due diligence, things like that. But and then the fundamental thing about family offices is they’re about family, and they’re about protecting that asset more than anything else, in my mind, at least. And so and so What are the risks that go with that? Those are family reputation risks that you want to mitigate as much as possible. There’s obvious data risks and security risks. Once you start pulling data in places, then it makes it more of an attractive target. You have risks that go around that make them more attractive targets because people seem to think that some data family offices don’t have a strong data governance strategies or security strategies that they may have decentralized security. There’s all kinds of risks once you’re inside the office as well between family members, between generations. One generation looks at technology one way and another generation may look at it differently. That creates a risk from an investment perspective, an operational perspective. the world is fraught with risks, but for every risk, there’s a solution pretty much. And a lot of that comes down to really building the governance strategy properly from day one, focusing on what your foundational documents should look like, your AI governance policy, and that is what your, for lack of a better term, your constitution. That’s what guides you. Frazer Rice (05:32)So a client walks into your office and they’ve got some level of complexity, they’ve got an interest in the space, they’ve got wealth and assets in there. It maybe takes us through your process as how you get them to get their arms around the issue and then put structure. Tim Plunkett (05:50)I think the first thing to do in talking to anybody is finding some common ground. And there are certain principles that guide people, decent people, professionals that have licenses and things like that or certain mandates to do certain things. Tim Plunkett (06:08)I think that when you’re looking at building the bridge, the first thing you have to establish is trust. And trust is something that is in the background of every decision that’s made in the world of AI. So once you’ve established a level of trust, you can start talking about philosophically what the family is looking for, whether it’s from an investment perspective or a philanthropic perspective. But you have to understand what the family is all about, what the family office is all about and their mission. Before you can start putting on legal tools or technological tools or anything else you have to have that that trust at the beginning. Once you do that you start to build your your your frameworks Your legal frameworks and that’s what I said to your AI governance policy becomes your Constitution The good news is that there’s so much information available now on how to set up governance programs. It’s not that hard depending even if you’re you know small office or a big office foreign domestic whatever, there’s frameworks for everything. But at the foundational level, the first thing is to get the trust together, to get the AI governance policy document together. And that will be comprised, if you go down the line from there, we can get into talking about what the specific core rails are and what you’re trying to accomplish there. Frazer Rice (07:26)Sure, and let’s do that. One of the things I think about when we go from paper to operation as many times that, you know, in my world, the trusts or the wills or whatever are well drafted and they stand up to lots of different things. However, the people who are administering them are the weakness on that front. When you’re thinking about the guardrails and the legal structures, how are you advising these families as far as staffing them? Tim Plunkett (07:45)Right. Okay, so staffing, again, This is about knowing your people. It’s about knowing what you have, doing an inventory of what’s inside your organization, who’s good at what. And there’s legal frameworks that you put around those based on what people are good at and what they aren’t. So when you’re looking at staffing in particularly, you basically want to build a structure where there’s accountability. You have to have, there’s expectations in the office for returns on investments and things like that. And then there’s also expectations on how these places behave and how they’re viewed publicly. So you have to define the roles and responsibilities very clearly. You’re gonna want an executive leadership team to begin with. That’s a strategic oversight role. That you’re gonna have ethics officers or maybe an ethics committee, depending on the size and structure of your organization. You’ll have technical teams. which would be your data scientists or your engineers or your developers. You might have a risk management team that identifies very specific AI risks that they want to control or other market risks that they want to account for. And then you have the people in the organization who are actually using things, which I would call the end users, which you want to always be soliciting feedback from. But what you’re really looking for also in addition to skills are the people qualities, right? Because AI is a team sport. And that’s the one thing that is really essential. Teams win and lose together. And sometimes teams have role players. And sometimes teams have superstars. But they’re not always gonna like that. But they have to have the same common mission in defining that. And so what you really wanna find is people who can work across your organization that are multidisciplinary. So in some family offices you have people who wear multiple hats. And so as you start building out your framework, you want to look at the team that you have and say, does Bobby do this really well, then Bobby should do the risk analysis guy should maybe be in touch with the compliance people. know, Sally does marketing really well. Maybe Sally should be talking to the vendors who are going to be doing the marketing. So it just depends on personality a little bit. trust, trusting your people to make decisions and putting those teams together. It’s critical. I mean, I could talk to you about the roles and responsibilities of each of those roles if you’d like but in a large, you know, in an overview that’s what you want to put in place. Best Practices Frazer Rice (10:27)So from the, a general set of best practices, how do you think about the things, if a family office is walking into your office and saying, okay, I understand the need for sort of constitutional frameworks and legal structures, making sure the right people who understand the difference between an LLM and an MBA, that’s probably a bad example because that could be legal versus business designation. Tim Plunkett (10:52)Yeah. Frazer Rice (10:56)Making sure that the people are right. But what are the bullet points in your mind that are things that families should really be thinking about? Tim Plunkett (11:06)The high level, the highest level thing to me is always the family risk. Now, like I said, you have under that bucket, you have reputational risk. You don’t want to be aligned with certain products. If you’re investing in AI, okay, let’s take it from that context first. If you’re investing into AI, you’re investing generally, you’re not, a lot of places you’re not building, right? So you’re buying into things. There’s always, you know, buying into funds or whatever else like that. If you’re making direct investments into companies, that’s again fundamentally about people. You have to align yourself from a reputational perspective with people that you can trust and believe what they’re gonna do. If you’re gonna be sharing data and anyone getting access to your systems, you don’t want your wills, your itinerary, your discussions with a concierge somewhere, any of those things exposed. So what you have to be doing when you’re doing, when you put yourself in position to be co-investing or side by side with somebody, you have to know what their security profiles look like. You have to understand how they’re audited. You have to understand their history. Have they been serial litigants? Who are you dealing with here? And on the data side, you have to understand where the data’s coming from, how it’s been tested, has it been…through several iterations or is it a one time? Is this the first time you’re meeting this data? Is it been anonymized? I mean, there’s a tons of different ways to look at the risk from an investment perspective. But when I think of family office, the first thing I think of is the family itself and the risk around them and protecting them first and then building the business out from there. Frazer Rice (12:56)Let’s talk about the concept of the audit for a second. Whether you have a vendor or you’re tracking an investment or in many ways even tracking your family’s whereabouts. How do you think about that audit piece and who should be, in many ways the family’s not doing it, they’d be hiring people to do it. where does the check and balance come from? Tim Plunkett (13:21)Yeah, so again, if you’re looking at it from an operational perspective inside the family office, executive team, you want to have somebody’s accountable always, that you can point to, that the family can say, you know, that person is responsible for my AI strategy. That person’s answers, know, deputy has my role if something goes wrong, but that person is fundamentally in charge. So you always want to have strong executive leadership in the organization. that you can point to from a family’s perspective. So part of that function will be the audit function of looking at the technology. mean, when you’re talking about vendor contracts and things like that that are under the control of executive leadership, you’re going to have to have clauses in there for data protection for the family. You’re going to want to know about breach notifications and those kinds of audits that you can do. You also are going to have, if you’re very proactive, and you probably should be, running audits and simulations within your organization. Tabletop exercises, penetration testing, trying to find where your weaknesses are. All that will be accountable through one person, ideally. And the other part of it is you want to have risk mitigation tools in there. One could be cyber insurance, one could be other forms of insurance, but also education and testing is underrated. It could become disassociated from their money and trust people to do things with their money. When they have an idea of what they’re actually gambling and what’s happening, whatever, even if they’re very prudent risks that are taking, if they’re not informed about the topics really well, and AI is a hard one because it’s changing so fast, and the world is unfolding so quickly, that training and education programs inside the family can be very, very helpful. Frazer Rice (15:19)When the tools are already pervasive, I see it in my practice, we use AI driven document tools, we use it for other types of things. The tools being used by the staff of the family office and then the family members themselves, both in audit process and maybe even sort of an evaluation process as far as the security protocols, but then ultimately, Getting people to understand the limits of the technology. And to me, that’s an important part of the education. Like you just described, who does that fall under? Is that the chief technology person? How do they wrangle everybody together to make sure that everyone has a good baseline to work from? Relationships Tim Plunkett (16:07)So yeah, again, I think that comes from the people who have the best relationships with interacting with the family are the people who should designate who runs the team. The people that they’re more familiar with. mean, I’d rather get bad news from certain people than others. And so again, that goes back to who do you trust? But once that person is in place, their job is to build out the team. And you do that with an executive level team that starts out the discussion.and then it flows down to AI specific use cases that you’re after. You build teams around the use cases and then below them you would have sort of a shadow layer of professionals who have different skill sets. So you would have your legal, your HR, your communications, your compliance people and the different end user people who are gonna take feedback. Then you have your people who iterate the models and improve them over time there, the ongoing monitoring that happens. And you have this pyramid that goes down like this from top to bottom. When you’re looking at, again, accountability at the top, you want that one person there to be accountable. There’s all sorts of tools that those people can use. You always want to do sort of a pre-adoption exercise so that you can…explain things. Explainability is a big thing everyone talks about in AI obviously. And you can do explainability assessments, know, that’s part of it. Frazer Rice (17:42)Maybe take us through a challenge that a family had where you’re brought in to try to help make sense of a situation where they were getting involved in technology and maybe AI specifically where they went in without the requisite understanding and needed to be sort of brought to a better place. Tim Plunkett (18:01)Sure, I would say I had an example of somebody that came to me, this was in the educational AI context, some family offices like to do things differently than others and have different mandates. And I had two that had mandates to spend money and try and develop AI tools specifically for education. I had an existing relationship with one of them and then someone else came to me and introduced me to another. Putting them together sometimes is a good idea, it’s not always a great idea. And parts of those marriages last and parts of them don’t. And so I had a fairly sophisticated existing client and they are very sophisticated companies and making investments globally. I don’t think that they thought that they were on equal playing field. So there was a personality issue at the beginning. But then we started talking when we started getting into systems and philosophy. You know, there’s personality, there’s philosophy, and then there’s the operations. And we started getting into the practical implications of doing things certain ways. We found that there wasn’t a lot of alignment between the teams so you basically have a situation there where you can’t force an integration. But I haven’t had a lot of situations where I’ve had security risks and family offices. I’ve had him in a lot of other context and and in those situations the best thing that you can do is you know there’s obviously breach requirement notices and things like that statutorily mandated requirements are out there, but putting those in place, turning them on, getting them operational, bringing in forensics teams and things like that, That’s hard. I’ve had other situations where, and this is not technical, this is not AI, but when you bring an AI team or team together under the auspices of investing in AI, you sometimes bring who their vendors are, right? And so we had an accountant who was essentially crooked and we were able to establish that there was some fraud happening. That’s a reputational risk to the one family who had that person in their backyard, right? They’re bringing that person into another transaction. That doesn’t look good. And it makes you one side question the other. So I’ve had those situations. the best thing you can do is rely on the law and rely on your reputation of who you are as an organization because that will buy you credibility even if you have a hard time with another party. If you can look around and say that you’ve never had these problems before and you can look someone in the eye and tell them that this is not familiar to you and you’re being honest, then you can buy a little leeway there. Frazer Rice (20:58)On the investing side, to take it in what’s called a more of a positive direction where we’re not dealing with chaos and loss and things being crippled, how do you sort of think about advising clients in terms of understanding where AI fits in their investment portfolio and less on the investment side of it, but more on the understanding how to evaluate the appropriateness of the investment, maybe.receiving input from a board that might have outside expertise on it and integrating that into a family’s allocation of capital. Tim Plunkett (21:35)I think the concept of an outside board and outside advisors is tremendous. The range of what AI is, again like I said, I’ve dealt with a bunch of family offices that are educationally focused and some others, but that level of expertise, you say education, and then under that there’s so many subparts. If you’re a family that’s interested in drug development, That’s a massive, massive area. And so bringing in that outside expertise is critical in the world of AI. You have legal expertise, substantive expertise on the actual investment itself, and you have security expertise. There’s so many different levels and you can’t have that all in your own house. It’s not possible to do. And with the amount of change that’s happening in AI, as fast as it’s changing, you can’t keep pace internally, I don’t think. Even the most sophisticated entities in the world, the largest banks with huge resources can’t keep up. with what’s happening. I’m a huge fan of having a board or advisory board, sounding board really, for you to talk to, for the family to talk to, to develop whatever it is they’re looking to invest in. Frazer Rice (23:00)Well, and at the board level too, how it integrates with things like HR or risk or insurance and things like that. Oftentimes I’ve seen in a board situation that people sit in those roles that come from that different avenue. so that they reiterate in your point, you not only attack it from a strictly AI technologies perspective, but from a domain expertise perspective that you don’t necessarily have to have on full-time salary in-house. Tim Plunkett (23:28)Yeah, they have to be, they have to,. Everything has to at some point go to somebody who has to make a decision for the family. And, and that’s a board level, you know, there’s an outside board that we’re talking about, but there’s also can be an inside board. Like I was saying, the executive leadership board, and then there has to be board level review of even the most, of some of the most basic things like vendor contracts and things like that. There has to be, you know, the board has to look at the dashboard review. They have to look at a lot of different things. They help you think strategically. And again, like I said earlier, AI is a team sport. if you can bring in the better players, then you bring them in. If your family can afford to do that, that’s what you do. You want to make it as transparent between the family and the project lead as possible. And so the board will have the best information that they can have. And that gives the family the best opportunity to make good choices. Frazer Rice (24:28)As we wind down here, one of the things that’s exciting to me from the AI theme and sort of the technology bent and the advanced use of data, et cetera, is that it’s a way to get the next generations excited about either the investment process or the overall wealth creation of the family entity. And it’s a way to have older generations be able to speak to younger generations, both on their terms from maybe a financial or business side of things to the technology side of things andthe younger set. How do you think about this from a next generation discussion and an overall buy-in slash operating feature of a governance structure for a family long term? Tim Plunkett (25:11)Yeah, I think you have to facilitate intergenerational engagement in that sense. And it has to be something that’s put in. Again, everything goes back to the foundation document, your constitutional document, your AI governance policy. You have to have that in there. I think also when we touched on before sort of the training and education part of this, having that component gives everybody the same information. There can then be discussion between the generations about how do they think about this versus how do you think about this? If you ask somebody right now about TikTok, every kid will tell you it’s awesome, everyone uses it. Everybody who’s over the age of 50 will tell you it’s potentially a national security risk and something else. And so there’s a real breakdown in terms of perception of technology and how it can be leveraged. And data is treated more casually. in younger generations and there’s a lot of information about that that’s available out there. So you have to have some mechanism and that should be built into your documents that requires at least semi-annual, if not quarterly discussions about the technology, how they’re evolving. And I think also at the end of the day, some of this isn’t legal or technical, it’s just basic, which is listen. I think listening to how kids these days. operate and talk about technology. If I listen to my son tell me about how he drafts prompts for ChatGPT, it’s entirely different than I ever have done it or thought of doing it. And it’s intuitive to him and it’s not to me. And I think just listening to that influence in your family is really important. But there is a way beyond just the warm and cuddly notion of listening. There is a legal and mechanical way to make it happen and that’s through your AI governance documents. Frazer Rice (27:02)Really good stuff. Tim, how do people find you and your firm? Tim Plunkett (27:05)I’m Tim at Plunkett PLLC. I’m PlunkettPLLC.com. On Twitter, I’m Tim the AI Lawyer. I’m on LinkedIn. I’ve got a ton of content that comes out there, which is really entry-level posts for people to understand AI, taking it from a very basic level. anybody can call me anytime when we’re around. We’re here to help, and we’re honored to be here. And so thank you. Frazer Rice (27:33)Tim, great having you on. Thanks for coming. Tim Plunkett (27:35)Thank you. Outline Describe practice- “Bringing institutional rigor to an “informal” space” Will discuss the first steps in bringing a plan to fruition.  Discuss the AI Governance Policy as the foundation for “institutional rigor.” Establishes the context for all discussions as this is the bedrock.  Guardrails in operations Guardrails in Governance – making FO’s more institutional Will expand on Policy and then how to ID framework/guardrails; where you can select from, kinds of models that fit from globally available version & looking at the context of the FO platform. Focus on foundation building with core principles.  FAMILY OFFICE AI in practice – how do you define it? Operational Use Cases 1. Document Intelligence & Automation 2. Expense Tracking & Anomaly Detection 3. Family Reporting Dashboards 4. Deal Sourcing & Screening 5. Portfolio Risk Management 6. Alternative Data for Public Markets Governance & Strategic Planning Use Cases 7. Succession Planning Analysis 8. Philanthropic Impact Analysis Back-Office Integration AI-Enhanced RPA (Robotic Process Automation Is the genie already out of the bottle? Data Privacy and information security Security of assets and family Unique Data Privacy Challenges for Family Office AI 1. Blurred Lines Between Personal and Institutional Data 2. High-Net-Worth Target Risk 3. Decentralized Technology Footprint 4. Third-Party & Vendor Risk 5. Global Footprint & Jurisdictional Complexity 6. Next-Gen Privacy Expectations 7. Lack of Formal Data Governance Solutions Data Mapping & Classification, Access Controls & Encryption, Zero Trust Architecture, Cyber Insurance, Vendor Contracts, Regular Audits & Simulations, Education & Training Larger discussion of data security, legal issues, corporate issues Lack of Transparency in Tools (are they working correctly/behaving ethically?) 1. Conduct Pre-Adoption AI Risk & Explainability Assessments 2. Discuss a “Human in the Loop” 3. Implement AI Governance Policies  4. Favor Explainable or Transparent AI Models  5. Regular Review and Audit of AI Tools  6. Align AI Use with Family Values How do you manage FAMILY OFFICE AI vendors? Natural skepticism meets needs discussion; differentiators; examples of risk presented:  Data Security Risk Operational Dependency & Continuity Risk—VENDOR LOCK Compliance & Regulatory Risk Confidentiality & Reputational Risk Misalignment of Interests AI/Automation Risk Onboarding/Offboarding & Transition Risk If I were running a family office, here’s a clear breakdown of best practices and policies I’d adopt when managing vendors: Establish a Formal Vendor Management Policy Conduct Thorough Due Diligence Customize Contracts and Include Key Clauses Assess & Monitor Cybersecurity and Privacy Controls Require Annual Vendor Reviews Integrate AI Risk into Vendor Management Build Relationships, Not Just Transactions Optional: Tools & Templates to Use Vendor Due Diligence Checklist Data Protection Addendum (DPA) Vendor Scorecard (to track cost, quality, trust, and responsiveness) Preferred Vendor List with Tiering AI use in financial decision-making AI Use in Financial Decision-Making How it can help: Guardrails I’d Set: AI use in strategic and family “qualitative” decision-making AI Use in Strategic and Family “Qualitative” Decision-Making Potential Use Cases: Ethical/Privacy Concerns: Governance Actions: FAMILY OFFICE AI as an investment thesis- how do you incorporate due diligence in the investment decision-making process What I’d Look For: Due Diligence Process: Exit Scenarios: Portfolio Strategy: Non financial advice  How do you staff the function? Should there be a Chief Information and Technology Officer Should there be an outside board member to think strategically? Executive Sponsors Biz Leadership Core AI & Data leadership (AI, Data, Core AI leaders) Execution Team (Finance, Risk, Legal, Security, HR, Comms, enterprise Portfolio Management) Working group members on implementation.  1. How Do You Staff the Family Office AI Function? Responsibilities: Should There Be an Outside Board Member to Think Strategically? My View: Yes, especially for larger or institutional-style family offices. Why It’s Valuable: Ideal Outside Board Member: Hybrid Option: Advisory Board or Innovation Council How do you think about this with family and next generation discussions? 1. Center the Conversation on Legacy, Not Just Capital “AI, governance, and innovation are tools—but the goal is family continuity, not just asset growth.” How to Frame It:  Include the Next Generation as Strategic Stakeholders Tactics I’d Use: Build Governance That Evolves with Generational Input Use AI & Digital Tools to Democratize Access and Engagement Treat AI as a Cross-Generational Learning Opportunity Sample Messaging to Bridge the Generations: Where to Find Tim PLUNKETT PLLC Human Resources AI https://frazerrice.com/ai-and-human-resources/ https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

BARRY RITHOLTZ’s new book “How Not to Invest” has received a warm reception. We talk about investing mistakes, the Trump Tariffs, and curating a good media diet. https://youtu.be/pS4f45v2iRk https://www.amazon.com/dp/1804091197/ “How Not To Invest” Transcript Frazer Rice (00:03)Welcome aboard, Barry. Barry (00:04)Well, thanks so much for having me, Frasier. Frazer Rice (00:06)Well, we are recording in the midst of chaos and disorder. We’re basically in day three, trading day three of the tariffs and trying to understand all of that. But back at the matter of hand, your new book, I read it really good. I thought it did a really good job of sort of colloquially putting some process and structure around not making bad investing decisions. Tell me a little bit about the impetus for the book. Barry (00:35)Sure, so the last book, Bailout Nation, was 15 years ago when I’ve had a lot of friends and family say, when’s the next book coming? And, you know, I had a little, like, hey, that was kind of a slog, stuff blowing up and forcing me to rewrite entire sections of the book every time some new company went belly up. And I came home from Christmas break from vacation. You have that dead zone a few days before you’re back in the office January 2nd. And I just started thumbing through some old quarterly calls for clients and research notes and market commentaries. You know, I had moved the blog from GeoCities in the nineties to Typepad in the two thousands to WordPress in the 2010s. And so I was looking at some of these old things and like, God, I never revisited this. This is such a great piece of research. I love this academic take on where alpha or even beta comes from. And I’m just kind of mulling it over. I start writing down chapter ideas on three by five cards like these. And I end up using this giant bulletin board on my wall. It just basically I start putting stuff up and I start rearranging them. And pretty soon it becomes obvious. Hey, these ideas, a lot of them are don’ts. Don’t do this. Don’t do that. Avoid this. Try not to make this bad mistake. And ultimately, I kind of came to the conclusion that, know, we’ve part of the reason I held off writing a book is there have been tens of thousands of investing books telling people what to do. And we’re all pretty mediocre investors still. Maybe it might be useful if we learned what not to do and thus “how not to invest” was born. Frazer Rice (02:35)We found kind of an interesting crucible to test all of this with sort of Trump’s tariff initiatives and a bunch of chaos on that front. As you think about what we’re living in right now with uncertainty, whether manufactured or not, what are some of the top things that you think about that you tell people, your clients and otherwise? to keep in mind as we sort of weather this storm and try to learn a little bit about what the future is going to look like. Barry (03:06)Right. I had no idea what what the sequel would be named. Maybe it could be how not to run an economy or what we’ll play with that. But so so what’s happening these days are kind of fascinating because the first third of the book I spent a lot of time talking about how little we really know about about what’s happening right now. And we learn even less about the future. And so our Frazer Rice (03:12)Ha Barry (03:34)A hot take on these things is maybe we shouldn’t build portfolios based on having to predict where the economy is going to be, what the hot sector is going to be, where the hot geography is going to be, what the best companies are. Maybe we need to be a little more robust and capable of withstanding this. And the tariffs are a perfect example of how little we know. Look, the obvious examples of “How Not to Invest” Nobody had heading into 2020 in their year had forecast global pandemic that shuts the world’s economy. And by the way, stocks go straight up. They just after a 34 percent crash, they go straight up from there. Nobody had that. Nobody had Russia invading it. Ukraine, Israel Hamas war, 500 basis points of Fed hiking, double digit losses in stocks and bonds in the same year. So when you look at all the annual predictions, You would think we would be a little more humble, have a little more humility about this. And the ironic thing about what’s going on, I keep pointing to the television. The ironic thing about what’s going on is like this should have been completely foreseeable. It’s a failure of our own imaginations to imagine anyone would do this. Trump, for his whole adult career, has been enamored and enthusiastic about tariffs. He calls himself Tariff Man. He ran on tariffs and he tried like half a dozen different rationales. We’ll protect domestic industry, we’ll protect our borders, we’ll reduce bad things coming into the country, we’ll get other countries to lower their tariffs and cover more of their own defense costs. Like he said all of this and collectively, and I include myself in this, nobody had the slightest idea that, and he will Completely upend the world’s economic order. He will tear the band-aids off of long-standing allies and relationships and supply chains and all these things in pursuit of a goal that I don’t think a whole lot of people think makes a lot of sense and the market obviously Was wholly unprepared what we see going on now is simply the market saying hey The price today is our expectation of profits and revenues a year forward times some multiple, which typically reflects collective psychology. And we thought the revenues and profits are going to be much higher. This new regime is going to make everything more expensive. It’s going to reduce consumer spending. They’ll have less discretionary cash, less capex spending, less hiring. let’s ratchet our GDP expectations down, you know, 100, 200 basis points. And so it just goes to show you nobody knows what’s coming. Even after a presidential candidate says this is what I’m going to do. We still can’t wrap our heads around. Frazer Rice (06:41)One of the things I think too is, you know, I don’t really ascribe genius to Trump on anything, certainly not economically. I don’t even put it to him politically, but he is in the same sentence as P.T. Barnum as far as understanding ratings and media. And I… Barry (06:55)No, he’s a genius. I will tell you, he in his own way has an incredible feel for what excites the public. As did P.T. Barnum. He knows exactly how to get people enthusiastic. He knows how to craft a message. Just look at his performance in all the debates. He has this incredibly intuitive sense of here’s how to catch people’s attention, keep their attention, and get them behind a story. Now, whether that story is rational or makes sense or, you know, forget even heterodoxy, whether it can be done, that’s another conversation. But credit where credit is due, he’s a communication genius. And you mentioned P.T. Barnum, another showman of the highest order. Trump is a brilliant Showman, we can have another discussion about how effective he is as a steward of the economy and every time he’s won an election, he’s won against a weak unpopular candidate, both times a woman, he’s never been able to beat a man, he’s able to tap into a certain angst and a certain anger that exists at a certain level of the country and it’s kind of fascinating. mean hold the disaster that is this past week aside. There is something fascinating about watching a master at work even if it’s towards ends that seem to really be damaging the US and global economy. Frazer Rice (08:46)Yeah, I mean the other part too is I mean he’s very good at declaring victory or jettisoning things that aren’t working very quickly and moving on and sometimes leaving a path of destruction in his wake that everyone else has to fix. Barry (09:01)No doubt about that and you know when you look at when you look at what’s been going on here They keep coming out like my best-case scenario here is no no this is a negotiating tactic There’ll be a whole bunch of side deals You know we’ll cut a deal with Israel because there’s a special relationship there and then something will happen with the UK and then Korea and Japan and before you know it like When we look at what’s going on now No one really believes that we expect the trade deficit with Vietnam to be closed. I mean, if everybody in Vietnam spent every last penny of their salaries buying U.S. goods, it still wouldn’t close the trade deficit. Unless you’re going to get a Ford F-150 pickup truck, unless you’re get three of them purchased by every Vietnamese, that trade deficit’s never going to be closed. So… It doesn’t make any sense. What was said on its face. We’re tariffing penguins in Antarctica. Like part of me, I am I am both bemused and comforted by that. Because it allows me to hold on to my wishful thinking that dear Lord, please let this be a negotiating tactic. We’re really not tariffing penguins. Are we? Frazer Rice (10:26)No, mean, part of it to me is it feels like that economically speaking, we’re firing Bill Walsh and hiring Woody Hayes to install the wishbone and then drafting a kicker in the first round and a punter in the second round. And I look at it and go, this wasn’t how I was brought up. And I’m not quite sure I ascribe that notion. How do you think about this in terms of the things you talk about in your book in terms of I love the William Golding quote, nobody knows nothing and I subscribe to that too. I I feel like a lot of people are sort of opining on things that they are six or seven levels of abstraction away from and therefore, you know, it’s useless opinion. And then sort of taking data that we don’t understand and then getting all worried about things that they don’t really have a lot of control over. If you were just…sort of take someone right off the deck and say, you know, here’s some things to think about as you’re analyzing our current situation and “How Not to Invest.” What are you thinking about? Barry (11:28)So first and foremost, I’m thinking about what’s your time horizon? How long are you going to be investing? And hey, you my heart goes out to you if you’re retiring in 25 or 26, you you have a sequence of returns issue, you have a whole bunch of other problems. But if you just had a newborn and you’re saving money in a 529 for their college in 14, 16, 18 years, if you’re saving for retirement 10, 20, 30 years, You have to be able to think long term and look to the other side of this. Right? So that’s one thing. The other thing is kind of watching, you know, humans were soft and chewy and delicious. We don’t have fangs or claws or armor. And so we had to evolve as a cooperative species. We’re clever primates and working in a group we prevent getting picked off by leopards constantly. And so that cooperation has led to not only group dynamics, that’s very tribal, hey, our tribe has to be protect ourselves against that tribe. But you see that passed down, you know, a million years later, in partisan politics, or sports teams who you root for. And it’s kind of interesting watching the tribalism sort of unwind a little bit. I keep I keep hearing some friends on the right. people think they know my politics. They really don’t. I’m pretty fiscally conservative, socially progressive, and a lot of people completely misread who I am and what I say because I just call it out as I see it. And that often angers people. But I’m shocked at the number of people who have been saying to me, hey, this this isn’t what I voted for. I take a little perverse pleasure in telling that tribe, no, no, this is exactly what you voted for. Let’s stop kidding ourselves. We make decisions. They have ramifications. You built a lot of wishful thinking into your vote. By the way, this goes to the left and the right. It’s people frequently are not honest with themselves and to bring it back to investing. I love having conversations with people. Hey, How do you think your portfolio is doing? What are your alternatives doing relative to the benchmark? How are you doing relative to your goals? How much risk have you assumed in this portfolio? And very often people really don’t know what they own. They don’t understand their risk profile. They don’t understand how well they’ve done. It’s kind of shocking, but wishful thinking and a little bit of self delusion goes a long way. And again, it doesn’t matter if you’re Republican or Democrat, if you’re a value investor or growth investor. We all kind of, you know, fool ourselves into believing, hey, we’re all better looking, have more hair, way less, are more youthful in our mind’s eye than we are in reality. And the same bit of self-delusion applies to our portfolios and our major life decisions. And so, you know, part of the goal with the book was just getting people to Hey, be honest with yourself, make sure you understand you know what you’re doing and why. And by the way, here are all the little mistakes that I’ve made along the way and it looks like you’re making them as well. Maybe if we can avoid those mistakes, we’d all be better off. Frazer Rice (15:06)As far as self-delusion goes, it reminds me of Garrison Killier and Lake Wobegon where all the kids are above average and everyone kind of thinks that about themselves and about the people they listen to or vote with. And then it gets into people having voice to have their opinion maybe outstretched the reach it should have. And you have people who think that they’re experts on viruses and then tariff policy and then the Monroe Doctrine and force majeure clauses and things like that. Barry (15:11)Ha Frazer Rice (15:36)stitching back to getting under control of your delusions, how do you curate your media diet so that you are taking in high quality information and using your valuable resources, in this case, some time and attention in a way that pulls you forward and helps you to think about things in a good way? Barry (15:59)Sure. A lot of stuff to unpack. Let’s start with the media diet. And if we want to get into epistemic trespass, we can address that a little later also. There’s an old joke, you know, when you’re young, you should read everything. And when you’re older, you should filter out everything. And there’s some basis for that. I started on a trading desk and I quickly figured out that sometimes what I read in the morning would affect how I traded. And so I would Instead of reading this, I would just create a list and that was my reading on the way home at night. So I wanted to go in fresh and thoughtful without anybody else’s voice in my head because they don’t know my risk profile. They don’t know my goals. Why should I have some random journalist author fund manager? They shouldn’t be living rent free in my training brain. And so I started curating this list every day of what I wanted to read. And I kind of found a couple of things. First, there were some people who were consistently thoughtful, that they had a process. It wasn’t just a spasmodic reaction to whatever the news of the moment was. That there was a framework for analyzing the world and that they were more right than wrong. Nobody is going to bet a thousand, but when they were wrong, they owned it and explained what they learned from the process. And so that kind of became my own filter. And I just started putting together sort of an all-star team of my favorite writers and people on TV and radio. They all have lived through a few cycles. They all have a defendable process. It’s not just dumb chance or luck. They all have a fairly rigorous analytical approach to thinking about markets and economics and risk capital and I tell everybody you should create your own all-star team. By the way, this doesn’t mean get three million dollars and hire 20 of the smartest people. Their stuff is available for either free or relatively inexpensively. I list a dozen people in the book that are my favorites. That list could have been 20, 40, 80 people, but you kind of know them when you see them. To paraphrase Powell’s quote on pornography. know it when I see it. know, Jonathan Miller and Bill McBride when it comes to real estate, one residential, one thinking about it nationally. Sam Rowe has a great concept of broad market structure. Jason Zweig and Morgan Housel on psychology. The list just goes on and on and on. And by finding people I know and trust, they have a track record. I know I could take what they write and read it and not feel like this is going to make me crazy. This is going to get me emotionally enthusiastic. This is going to manufacture outrage. A big part of the problem with social media these days, or at least algorithmic social media. I don’t find the same problem on blue sky that I see on tik tok, Twitter, Facebook, Instagram is, know, they they’ve run these giant a b tests, they’ve iterated the process of how do we get people? How do keep people engaged and clicking on links and looking at ads? Well, it turns out, piss them off, make them crazy manufacturer outrage, get them like, get that fight or flight response engaged. And that’s how you end up sending your profits higher. So it’s also what makes social media so toxic. And it’s why a handful of countries have banned social media for children under 18. You know, we’re seeing a giant uptick in teenage suicides linked directly to social media. So it’s bad for your family. It’s bad for your portfolio. It’s bad for your mental health. Other than that, you gotta love it. It’s just the greatest thing ever. Frazer Rice (20:22)Let’s take for a moment, you had a great chapter in “How Not to Invest” talking about a billionaire or close to billionaire family making the same mistakes that maybe the retail investor makes in terms of letting their analysis sort of outstrip their expertise and making a variety of different bad investments. What do you see in that world? What is it that the wealthy do that is also a mistake that other investors do? Barry (20:50)So let’s start out by saying on a day like today or this week where like year to date markets are now down almost 20 percent. In reality it doesn’t affect their standard of living and it doesn’t affect the quality of life. Maybe this is a little uncomfortable but I used to ask a joke of some of our wealthy clients what’s the difference between one billion dollars and two billion dollars? And the answer is really isn’t any difference. It’s not gonna you could do whatever the hell you want Go wherever you want fly private, but maybe you can only buy 20 monies instead of 10 monies If you have a billion dollar, but other than that like really there’s no difference So first we have to really be careful when we compare ourselves to billionaires their choices their risk tolerance their goals their profile very different than ours and I I really despise all those here’s Here’s what this billionaire does before lunch. Right. Well, good for them. know, for a middle class family with a half a million to a million dollars in savings, down 20 % is disastrous for whatever they’re saving for now. The market will eventually come back. But hey, if you’re retiring now or if your kid starts college in September, Jesus, this sucks. You’re 529 that you’ve been saving 15 years. Suddenly it’s a fifth lower. Frazer Rice (21:47)All right. Barry (22:13)You better hope they’re not going to a five-year school. It’s only a four-year school because you just lost the fifth year of funding. So that’s really problematic. But where the parallels are, so that’s the differences, where the parallels are is people are people. know, every now and then I have a discussion with folks about foundations and institutions and endowments. Hey, bad news, they’re run by human beings. And they’re subject to the exact same foibles and cognitive errors that we all make. There’s just no way around it. So I use the not well endowed joke about Harvard. The billionaire trifecta from hell was a presentation I used to give that was so much fun. The audience reaction was so much fun, I had to turn it into a chapter. And so many years ago I gave a presentation to I think it was tiger 21 and I challenged the room with everybody supposedly in that worth of over I don’t remember if it was 20 million or whatever it was way back then and Hey, you don’t know what you’re holding. You don’t know what your performance is You don’t know how that performance is relative to a benchmark ton of pushback And so I challenged everybody right down right now. What are your five biggest holdings? What? How have you done year to date? Wht about last year? How did each of those funds perform relative to their benchmark? Write it down right now. And, you know, a month later, I’m getting emails from people. my God, I can’t believe you were right. was wrong. Fast forward to this presentation. Story about this very successful family. The dad came here just before World War Two started and ends up being wildly successful. uh, the belphers they they belfer petroleum eventually they get bought and then Rebought and you know the company he continues to run each time every time the company gets bought He becomes the president of new company until houston oil and gas buys him He eventually retires his son joins the board of houston oil and gas better known as enron And when enron starts to wobble 15 years later, um, he just rides it down two billion dollars down to nothing Hey, you know, managing our money ourselves is kind of a problem. Let me find somebody who can help us. So they find a guy, long story short, Bernie Madoff. By the way, there’s a semi happy ending to this. After Bernie Madoff blows up, you know, maybe this whole stock thing is not for us. And so they rotate into this newfangled crypto when they give the money to FTX and Sam Brankman Fried. So I call that the trifecta from hell. Enron, Bernie Madoff, FTX. The good news is 96 % of the Madoff monies were recovered. That’s the initial investment you put in, not the fake returns Madoff claimed. And with FTX, it was, I think it’s like 115 or 120 % returns. They just keep finding money. There was combing of funds, totally unacceptable, and money all over the place they just weren’t keeping track of. And a couple of AI investments that worked out well. So they recovered more than the starting point with that. But the takeaway is if you’re to do it yourself, you have to know what the hell you’re doing. You have to be thoughtful about it. You can’t be super concentrated in one stock. We see that time and again throughout the books. Second, if you’re to trust somebody else, you really have to do your due diligence and find a person that, you know, there has to be ordered returns. The process has to make sense. A number of people looked at the madoff split strike option underwriting and it turns out there aren’t enough stock options in the world to cover what he was doing and it didn’t take a whole lot of I know a number of people who in real time the more famous ones were Jim Simons looked at it and said something smells wrong here and who wrote the how to beat the dealer and how to beat the market Frazer Rice (26:31)Charles Ellis? Barry (26:32)L not Charles Ellis. his name will pop into my head. He turned out to have, figured out, it was a problem. How, beat the dealer, the dealer. I’ll tell you exactly who that was. of course it was Ed Thorpe. How do I not remember Ed Thorpe’s name? so anyway, you gotta do your homework. And third, if you’re going to roll into some new products, be aware that most new products don’t work out. Even the products that do work out the vast majority of them are not great you know the I quote Ted Sturgeon in the book who a science fiction writer from the 40s 50s 60s. He was always defending the genre against people said why is so much science fiction junk and his answer was 90 % of everything is crap and that’s true for hedge funds and private equity and mutual funds and ETFs and specs and podcasts. And, you know, if you could get into the top decile, great, knock yourself out. But if you’re this newfangled thing comes out, you’re taking a risk on it, especially. And this is what’s so ironic. If you’re a billionaire, you’ve already won. You get to stop playing the game. This shit shouldn’t matter to you down, you know, 5%, 3 days in a row should be irrelevant because the whole purpose of investing towards a goal is that here’s my objective and here’s the path I’m going to take to get to that objective and what we have learned about human nature is if you can reach your goal with less stress, less volatility, less drawdown, hey, you’ll enjoy the ride more. Some of us, you know, and I credit this to my trading desk days, days like this, you know, I’m looking for down 20 % to deploy more capital. I’m excited about that. Most people want to throw up in the nearest waste paper basket because it’s nauseating. So for, if you aren’t, you know, wired in a weird way and the opportunity that these dislocations create don’t get you excited. Well then create a portfolio that isn’t going to be this volatile. That’s not going to be up and down. It’s not going to be single stock based as we saw with that example with Enron. Just figure out what your goals are. I’m always surprised how many really wealthy people and I don’t mean middle class wealthy upper middle class you know a house and a vacation property and a couple million dollars in the bank. I mean 50, 100, $500 million. Hey, you’ve already won. Ring the bell, throttle back and enjoy your life. Even if you want to keep working. Warren Buffett, know, Charlie Munger worked up until his dying day. If you want to keep working, great. But why have so much stress in your life if this sort of stuff causes you stress? Frazer Rice (29:47)Great stuff. Barry, how do we find the book? Barry (29:49)So how not to invest book dot com if you want to learn more about it, but it’s out everywhere. Barnes and Noble, Amazon Books a million wherever you find your favorite books. It’s there in both hardcover, audible and e-book reader. It’s it’s there for the taking. Have have have fun at it. At the end of the book, I include an email address where I tell people, hey, if I left a lot of stuff unclear or ambiguous, Let me know about it and I’ll see if I can resolve that either in an email or perhaps in the next edition. Frazer Rice (30:26)stuff. Thanks Barry. Barry (30:28)Thank you, Fraser. Barry’s Comments on the Book The challenge in writing “How NOT to Invest” was organizing a large number of ideas, many of which were only loosely connected, into something coherent, understandable, and, most importantly, readable. It took a while of playing around with the concepts, but eventually, I hit on a structure that I found enormously useful: I organized our biggest impediments to investing success into three broad categories: “Bad Ideas,” “Bad Numbers,” and “Bad Behavior.” That insight greatly simplified my task of making the book both fun to read and helpful for anyone interested in investing. Here is a broad overview of each of the 10 main sections, which can help you quickly grasp the key ideas in the book. Bad Ideas: 1. Poor Advice: Why is there so much bad advice? The short answer is that we give too much credit to gurus who self-confidently predict the future despite overwhelming evidence that they can’t. We believe successful people in one sphere can easily transfer their skills to another – most of the time, they can’t. This is as true for professionals as it is for amateurs; it’s also true in music, film, sports, television, and economic and market forecasting. 2. Media Madness: Do we really need 24/7 financial advice for our investments we won’t draw on for decades? Why are we constantly prodded to take action now! when the best course for our long-term financial health is to do nothing? What does the endless stream of news, social media, TikToks, Tweets, magazines, and television do to our ability to make good decisions? How can we re-engineer our media consumption to make it more useful to our needs? 3. Sophistry: The Study of Bad Ideas: Investing is really the study of human decision-making. It is about the art of using imperfect information to make probabilistic assessments about an inherently unknowable future. This practice requires humility and the admission of how little we know about today and essentially nothing about tomorrow. Investing is simple but hard, and therein lies our challenge. Bad Numbers: 4. Economic Innumeracy: Some individuals experience math anxiety, but it only takes a bit of insight to navigate the many ways numbers can mislead us. It boils down to context. We are too often swayed by recent events. We overlook what is invisible yet significant. Instinctively, we struggle to grasp compounding. We evolved in an arithmetic world, so we are unprepared for the exponential math of finance. 5. Market Mayhem: As investors, we often rely on rules of thumb that fail us. We don’t fully understand the importance of long-term societal trends. We view valuation as a snapshot in time instead of recognizing how it evolves over a cycle, driven primarily by changes in investor psychology. Markets possess a duality of rationality and emotion, which can be perplexing; however, once we understand this, volatility and drawdowns become easier to accept. 6. Stock Shocks: Academic research and data overwhelmingly reveal that stock selection and market timing do not work. The vast majority of market gains come from ~1% of all stocks. It’s extremely difficult to identify these stocks in advance and even harder to avoid the other 99% of stocks. Our best strategy is to invest in all of them through a broad index. Some terrible trades are illustrative of this truth. Bad Behavior: 7. Avoidable Mistakes: Everyone makes investing mistakes, and the wealthy and ultra-wealthy make even bigger ones. We don’t understand the relationship between risk and reward; we fail to see the benefits of diversification. Our unforced errors haunt our returns. 8. Emotional Decision-Making: We make spontaneous decisions for reasons unrelated to our portfolios. We mix politics with investing. Emotionally, we focus on outliers while ignoring the mundane. We exist in a happy little bubble of self-delusion, which is only popped in times of panic. 9. Cognitive Deficits: You’re human – unfortunately, that hurts your portfolio. Our brains evolved to keep us alive on the savannah, not to make risk/reward decisions in the capital markets. We are not particularly good at metacognition—the self-evaluation of our own skills. Second, we can be misled by individuals whose skills in one area do not transfer to another. Third, we prefer narratives over data. When facts contradict our beliefs, we tend to ignore those facts and reinforce our ideology. Our brains simply weren’t designed for this. Good Advice: 10. This is the best advice I can offer: A. Avoid mistakes (fewer unforced errors, be less stupid). B. Recognize your advantages (and take advantage of them). C. Create a financial plan (then stick to it). If you need help, find someone who is a fiduciary to work with. D. Index (mostly). Own a broad set of low-cost equity indices for the best long-term results. E. Own bonds for income and to offset stock volatility. Primarily Treasuries, investment-grade corporates, munis, and TIPs. F. Be tax-aware. Consider direct indexing to reduce capital gains and reduce concentrated positions. G. Use a regret minimization strategy when sitting on outsized single position gains. H. Be skeptical of all but the best alts (VC/PE/HF/PC). If you have access to the top decile, take advantage of it. Otherwise, exercise caution. I. Spend your money intelligently: Buy time, experiences, and joy. Ignore the scolds. J. Fail better. Understand what is and is NOT in your control. K. Get rich: Here are the classic strategies to get rich in the markets, including how difficult each is and their likelihood of success. *** I was just discussing the idea with Morgan Housel and Craig Pierce — “Is this anything?” — and now it is the day it arrives! (Hardcover and ebook are published today; Audible audio version is out tomorrow). How did that happen so quickly…? You can order it in your favorite formats in the US, UK, or around the world. If you want to learn more before putting down your hard-earned cash, check this wide array of discussions, podcasts, reviews, and mentions. This book was a joy to put together, and I have been delighted at the response it has received! Please let me know what you think of it at HNTI at Ritholtz Wealth dotcom. Barry’s Masters in Business Podcast on Bloomberg Barry’s Colleague, Nick Maggiuli https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

As the United States acclimates to the “flood the zone” governing style, reasoned discourse around civics has crumbled. https://youtu.be/ngx0GxJjmDM There are many causes. Polarizing media, bombastic claims, and systematized gas-lighting on both sides have created one of the most toxic political environments since the Vietnam War. However, the absence of civics and good citizenship concepts have laid the groundwork for the hysterics of today. LINDSEY CORMACK has a way forward. She is the author of the book “How to Raise a Citizen “ https://www.amazon.com/How-Raise-Citizen-Why-Its-ebook/dp/B0DBWYTXJ4/ Outline: Why are Civics Important? Recent stats on the absence of civics Understanding structures Understanding the “why” of structures and civics Knowing what the Constitution says Knowing that the Constitution evolves too Understanding federalism Government funding mechanisms Communication- how to broach inflamed subjects How to raise the next generation What makes a good citizen?  Going beyond jury duty and voting Civics and Active participation Intersection with wealthy multi-generational families Joint decision-maling Believing in something greater than self Guardrails of ideals melded with open-mindedness and curiosity Right holder vs Duty bearer (Rights come with obligations) Justice vs compliance  Control vs grace Right and wrong in civics Contacting Lindsey Links: www.howtoraiseacitizen.com IG: @howtoraiseacitizen Lindsay discussing civics on Errol Louis’ YOU DECIDE Podcast The Intersection of Civics, Money and Presidents Rights and Obligations with David Haass (Civics) Background LINDSEY is an Associate Professor of Political Science at Stevens Institute of Technology. She is the former Director of the Diplomacy Lab. She is the secretary of community board 8 in Manhattan and the co-chair of the Street Life Committee. Lindsey is the creator of DCInbox, a comprehensive digital archive of Congress-to-constituent e-newsletters.  Finally, she is also the author of Congress and U.S. Veterans: From the GI Bill to the VA Crisis. Frazer’s interest in citizenship and civics: You may be wondering why a show about wealth management (and beyond) would be interested in citizenship and civics.   In a nutshell, I get asked three times a day what can be done to raise responsible kids.  Because families (and the answers to those questions) are different. The answers should come from within, I ask what they (the parents or grandparents what think it takes to be a “good citizen.”  The answer to that question can then lead into the discussions I need to have about stewardship and a variety of other concepts. Additionally, good civics is good business. Businesses ignore the politics around them at their own peril. Board dynamics are also the intersection of civics, joint decision-making and constituent accountability for businesses. Executives have to be good at this. The values that make people successful are also the ones that people want to pass down to their kids Personally, politics and civics are ingrained in me.  I majored inhHistory and political science major in college. I worked in many NYS campaigns, the NYS Department of Economic Development, and ran the Republican Party in Bedford, NY for a year. More recently, I was on the board of my co-op for 7 years and president of the NYC Estate Planning Council. Civics and participation are a big part of my worldview. Transcript Frazer Rice (00:32.447) As we get acclimated to the new flood the zone component of politics, reason discourse has crumbled. And I think absence of civics in public life is the cause. Lindsay Cormack has a way forward and she’s the author of How to Raise a Citizen. Welcome aboard, Lindsay. Lindsey Cormack (00:46.978) Thank you so much for having me. I’m excited to talk with you today. Frazer Rice (00:50.025) This will be a lot of fun. It harkens back to my background before wealth management and lawyering and all that stuff. Tell us a little bit about what you do and the impetus for the book. Lindsey Cormack (01:02.574): Background Sure, so for the last 10 years, I’ve been a professor at Stevens Institute of Technology. This is primarily in an engineering school in Hoboken, New Jersey. It is one of the reasons that I ended up writing this book. I have some of the brightest students that I’ve ever been around. They have really high test scores. They know how to do school. When I teach them intro to American government, I realize most of them have been failed by our school systems. They do not understand the landscape of the government. They don’t understand their own routes of power. They’re not practiced and having hard conversations. I’ve got wonderful students who are going to go on to successful careers in everything. We should make sure that they have this positive look at government and this better understanding than they’re getting. And it’s true that it’s not just happening in New Jersey. It’s kind of everywhere. Frazer Rice (01:47.737) What does the absence of civics look like in the education system? I seem to recall a stat that you put forward that it’s almost like less than 1%. It’s actually focused on in a curriculum in public schools. Lindsey Cormack (02:00.652) on Civics Yeah, so it’s really hard to say here’s how civics instruction happens. Every state has its own approach. Within every state, the independent schools have different approaches than the public schools. The charter schools or the mini schools have different approaches. The modal form of delivery across the United States is usually in your seventh or eighth grade of school. At that grade, you have some social studies class. That’s where students are going to learn a little bit about the founding. They’ll learn about some like westward expansion. They’re taught a history lesson about like how we got to where we are. The actual lessons that they hear vary. But that’s like the basics. We usually wait until the second semester of 12th grade to give students a class called government. The amount of instruction time that we’ve had on civics and government has only gone down from the 1940s. It is the subject that has the least amount of focus and time allocated to it. And it also has the lowest amount of federal dollars spent on it. For every $50 that gets spent on STEM, the science, technology, engineering, math disciplines, only five cents go to civics. We don’t give it enough attention in schools and we haven’t been doing that for a very long time. Frazer Rice (03:07.564) I mean, I’m never going to be one to say take money away from STEM. At the same time, to not have that background is crazy. With the polarization of information that’s out there, the ability to deal with information is vital. The news that you get, the values you have and the understanding of our structures are vital. How do you think about that in terms of structuring your curriculum? Lindsey Cormack (03:34.734) So for me, in my intro to American government class, it moves very, very slowly. Like we’re coming up on midterms. We’ve been in school for about eight weeks and we still are not done with the Constitution. We’re still in the amendments. That’s because I know that if our students know the rules of the game, they can figure out everything else with a clearer brain. And so we go really line by line figuring out what did this mean? What were they trying to say? What are they not saying? I think that’s animportant starting piece that we don’t have in most K through 12 educational systems. It doesn’t surprise me that we don’t have this. The end result is for most kids in high school, it’s a score on an SAT or an ACT. Neither one of those exams has any components of social studies. And if it’s not tested, it’s not taught. So I understand why it’s not in the curriculum, because we don’t think we need to evaluate students on this. Frazer Rice (04:25.531) You dive into the Constitution, which is a great underpinning of how the United States works. I’m sure you go into the history of it and where many of the concepts and values came from. What else surrounds what you’re teaching on that front? Lindsey Cormack (04:41.336): Learning to Communicate Usually I start with:, “what have they heard so far?” I like to start any conversation that might be controversial with this. It’s helpful with students who have difference of opinions. I just like to set the table and say like, well, what have you heard? Here’s something that I heard a few years ago that really stuck. The constitution doesn’t say anything about slavery. And I was like, that is such an interesting take. Let’s go read it with a keen eye for that. Like if you just do a control F and try to find slavery, you’re right. It doesn’t say slavery. There’s three to four oblique references to the practice that are in there that takes a little bit more observation. You just have to have a keener eye to it. And that’s something where I like to go with like, what are they starting with? Then how can we get to something that lets them appreciate something in a bigger? Or fuller or more robust manner? Frazer Rice (05:24.169) The history of the Constitution is important too, For example, you can get things like three-fifths voting for slavery, There may be previous incarnations of slavery, but it’s been changed to reflect different values and cultural norms. Lindsey Cormack (05:40.962): The Evolving Constitution Yeah, that’s right. That’s something that I think our schools do an OK job at. We teach them this is a historical form of theater. You know, we say to our kids 250 years ago, some really smart guys got together and wrote this document. Isn’t it great? But I like my students to think of themselves as the caretakers of this document and the entire enterprise what we’re doing. And in order for that to be true, they can’t see it as a history lesson. They have to see it as an active lesson where they’re a participant in moving this forward. Truthfully, they are. One of the best things about being in the United States is that we have the agency to shape our outcomes. This document sets out a lot of guarantees. However, we have to make sure that we understand how it works to move it forward. Frazer Rice (06:19.002) One of the things that I really enjoyed about your book was the concept of reminding people that civics and our government is not just the three branches in the federal government, Federalism and the interaction between the states and local government are just as important in many ways. And in some ways, the real sort of rubber meets the road impact component of where policy affects people. How do you think about that in terms of sort of conveying that, that lesson? To your students and beyond? Lindsey Cormack (06:49.848): Getting Kids Interested In Civics So usually, my pedagogical approach is to let them go figure something out. So I’ll let them say any policy space that they care about. I don’t care if it’s like I care about fashion or I care about sports. And then I’ll ask them to go see if different states have different orientations to this. And then they really get a clearer picture of like, my gosh, you’re right. The states get to decide so much. And when we think about what students care about generally, things like access to guns or access to reproductive care.or access to drugs. All of those things right now are state level decisions. Most of them don’t really understand how their state systems work because the little instruction that they get in K through 12 is nearly all focused at the federal level. It’s just sort of this task of saying like, hey, why don’t you go figure this out? Then they learn in that figuring like, ooh, this is important or, my gosh, she’s right. There might be something that’s different here than it is in the state where my parents happen to be right now. And I really like that approach. Something else that’s important to me is we all get excited about federal elections, but in this upcoming year where we don’t have federal elections slated, we have over 100,000 state and local election coming. So like we have all these different places to learn and they just need to be nudged and reminded to go look for that sort of information. Frazer Rice (08:00.638) : Good Citizenship The idea of being a good citizen, of being part of the civics discourse is something that I think your book does a really good job of really approaching and understanding and that it really gets back down to communication. And the lesson that I took from it in my day job in many ways is the concept of really understanding communication and building in some structure and values in communicating to families that have multi-generational wealth. When I get the question “hey you know how do I raise productive kids?” or “how do I raise people who respect norms that are around there and are active and participate in civics and society?” My answer to that oftentimes is what makes a good citizen when you’re sort of thinking about this and getting the the students excited not only about the structures and the underpinnings of government and so on. How do you take the communication lessons forward for that? Lindsey Cormack (09:04.142) So in all of my classes, if it’s happening during a non-federal election year, we have a project at the end that’s going to be a debate. And so it’s like it’s a research and a debate. And I don’t let them pick what side they’re going to be on. But I do let all of us decide what are the topics that we most care about. And then some of them are going to have to argue for sides that they believe in. Some of them are going to have to argue for sides that they don’t. And in an engineering discipline or in an engineering school, they don’t get a lot of opportunities to do this. That’s not their normal mode of classroom time. It really is this practice and like, how is it to inhabit someone else’s perspective and then say those things? And at first they’re a little bit like frustrated by it. They’re like, but if I don’t believe it, I don’t want to say it. Then I slowly sort of like keep telling them the more that you understand about the way that the other side or another side sees this issue, the better you will be able to understand your own personal position. Let’s say that you encounter some information that sort of changes the way you see something. That’s not bad. That’s not like a marker of failure in civics. That shows that you’re a human with a working brain who can like add in new information. That’s all we’re doing here. And so by giving them like the experiential piece of like, no, you’re going to have to chat this out against another team in front of all your classmates. I think that’s one of the best things because it is the practice that they’re lacking because so much of our instruction is I tell you, you listen, you regurgitate it to me. But if I give them that sort of like opportunity to do this with each other, it starts to open up their minds like, ooh, maybe I could do this. It’s not so daunting. I don’t just have to listen. I can do a back and forth. Frazer Rice (10:34.012) Well, it also underscores the idea that the sign of true intelligence is being able to house two differing thoughts in your head at the same time and to be able to work through them, which is sort of an unfortunate byproduct of law school for me and, you know, an expensive liberal arts education. But I imagine in the engineering world where things may be a little bit more black and white, it can be a new experience for them. Lindsey Cormack (10:56.962) Yeah, that’s mostly what my feedback is, is that, you know, in every other place there’s right and wrong answers, and here there’s just a bunch of different right answers depending on who you’re asking and what the perspective is. Frazer Rice (11:06.326) So David Haass has a great book out on the rights and obligations of citizens. And something I saw in a website, sort of a curriculum based website was the idea that people were right holders and that duties were borne by somebody else. And it really agitated me. How do you think about that in terms of good citizenship and participation and things that people should feel not only entitled to, but obligated to participate in? with regard to being a part of American society and beyond. Lindsey Cormack (11:39.874) Rights and Obligations Yeah, I appreciate this question very much. I also like that book. If it’s not in my bookcase behind me, I know it is in my house because a mom at my daughter’s school was like, ooh, you should read this book. And she said that to me while I was writing my book. But in terms of rights and duties, I’ll tell you sort of like how I come to this. When I was on sabbatical two years ago, I spent some time going around to different parts of New York City and setting up two chairs, a table, and a sign that said, you chat with me about politics for three minutes? I bought a three-minute sand timer, and I’d just sit with different people and let them tell me about politics. And a lot of times the takeaways that they would have is like, well, I don’t really like where it’s going. They’d sort of conceptualize themselves as passengers on the ship of democracy or passengers on some ship of politics. Then towards the end, I’d be like, okay, that’s really interesting. And then if they were willing to have me talk to them about it, I’d say like, but don’t we kind of think that we’re the crew? Like we’re not passengers on a ship. We are the crew that is powering where the ship goes. And so if we don’t like where things go, we do have an obligation. We do have a duty to figure out things a little bit more and find out how we can turn our own sort of agency on to change those things. An example in my life is right where I am in New York City, we have had undergone an enormous policy transformation on marijuana policy. Like we can now sell legalized marijuana in our stores. But there was a lot of gray zones. And we had so many unlicensed, illicit stores who just like popped up and were like, well, there’s no enforcement. Someone’s going to make money. Might as well be me. At that same time, I took a position at our community board chairing our street life committee, which was talking about liquor licenses and cannabis licenses. And that meant that I was going to have to go to a bunch of illicit stores and try to figure out what’s happening here. Who are these people? Why are they running this business? Why is it happening? And that was like annoying. That’s not my day job. I don’t get paid for it, but it’s an obligation. If I want my society to be better, to be a part of that solution, to figure out what this is, what’s happening. I was really happy and proud to do it, but I know that we need to do a little bit more because so many of us just want to be not inconvenienced, but the price we pay for living in a society instead of just as 340 million individuals that happen to be together is that we’re going to be inconvenienced sometimes. Things are going to be annoying, but if we want to get better, we have to get into it instead of putting our heads down and thinking that someone else is going to do it for us. Frazer Rice (13:51.546) How do you think we broach that subject to get people to think about participating beyond jury duty and voting, which we have to force people to do that anyway, to get more engaged with their surroundings? Lindsey Cormack (14:04.898): Why Are People Afraid of Civics? I mean, I think part of it is that there’s a narrative that politics is either bad for egomaniacs, for people who are like really into themselves or they’re out to like steal from other people, or there’s this narrative that like politics is for nerds. And so it’s like, I’ll let these other people take care of it. But it’s actually a true blessing or something that I see as like one of the greatest things about America is that politics is for everyone. It’s going to happen to us, whether we like it or not. We need to change the narrative that it is a force for good and that there are things that can come to better ends if we have more people who care about them. So the idea that voting is a hassle, or I hate when people are like, I’m trying to get out of jury duty. I’m like, what are you talking about? This is one of your only entry points to influence the judicial system. You really know other ways to do this. And so I think we need to tell our children the positive stories of this. If you have clean water to drink, government has a hand in that or if you have nice roads to be on, government has a hand in it. If you have schools that you can go to, places that you can recreate, usually government had a hand in that. All too often we focus on the negative stuff when we talk about the bad actors in this system. But a lot of the people, especially at state and local government, are essentially volunteers who just think they have something to offer who can make the world a little bit better. And those are the stories that I wish we would champion. Those are the people that I wish we’d introduce our kids to instead of letting them have a narrative that’s characterized by media that focuses sort of on bad outrageous activities or even child’s entertainment, which really has archetypes of people in government as either bumbling, like bumbling idiots, or like slick characters out to defraud the people they’re meant to protect. And so we have to do the work, collectively, of showing them when government does good things. Frazer Rice (15:42.873) Where does the role of bureaucracy fit into that you’re thinking on that? I know that for me, it’s very frustrating. You go to the post office or the DMV, or you’re trying to get something through, you know, whether it’s a tax situation or something like that. The red tape component, which is to me sort of the byproduct of what’s happening up top and how it’s implemented or seen at the ground level. How do get people patient with that? Lindsey Cormack (16:08.12): Bureaucracy That’s a much harder question. I will say I’ve only experienced the DMV in three states and I happen to really like the New York state approach to it, which is like you’re making, you make appointments online, you show up, you do it, it’s done. That wasn’t my experience in Kansas or in Arizona. But for like the day to day frustrations about government, I think something that we sort of misunderstand is we think the government is maybe like some big wigs who are like just trying to make our life hard. Frazer Rice (16:20.002) Right. Lindsey Cormack (16:32.536) When in reality, it’s a lot of like legacy systems with people who are trying to do the best work that aren’t terribly well compensated to do that work. And if we can kind of extend empathy for that, that’s like part one. Part two is let’s get to fixing it or let’s get to a way that we make this better. I do get sad when I see like the beautiful outsides of post offices and I’m like, wow, these buildings are incredible. Then you go inside and you’re like, we don’t have air conditioning in here. my, we still have like COVID things up on the wall. but. That’s like, has to be a point of pride. can’t be just a point of annoyance and we have to get over that one way or another. I don’t know that I have all the right answers, but I do know that I share that sort of viewpoint that you’re saying. Frazer Rice (17:10.521) Something that sort of strikes me and I deal a lot with financial literacy and numeracy generally and that when people don’t have that, they almost don’t have the language to be able to navigate in their own self-interest. How do you think about the language of numbers as it relates to understanding one’s role within civics and society generally? Lindsey Cormack (17:33.934) Civics as Something Bigger So I think you’re absolutely right that if you don’t have that in civics, there’s so many decision pieces that are just harder or impossible for you to sort of get your head around. But something that I like to think about is when you’re like pivotal. In federal elections, I oftentimes hear people be like, well, I’m only one voter. And you know, for the presidential election, it’s a winner take all system. And maybe you’re a Democrat in a red state or Republican in a blue state. You think your vote doesn’t matter, whatever. But when you say, OK, let’s like put that aside or believe that you’re true there. Think about what the denominator is for state elections. Think about what the denominator is for local elections or for even smaller ballot initiatives. We are all so important at the local level, yet these are the elections that are the least attended. Oftentimes there isn’t really good media around it and we think it’s just for party insiders. Soon you realize, no, if I got together with like 20 of my friends, we could have someone on the school board. Those sorts of things are really powerful. However, you have to break down the numbers for people where they see like once the denominator changes. Once the number of people who get to make this decision changes, every individual is more powerful than they were in a bigger system. This is why we really should have more focus on local and state government because we’re all far more pivotal in those arenas than we are at the national level. Frazer Rice (18:45.156) I think too, when you start hearing about numbers being thrown around and the current DOGE numbers, how much is being saved or not saved and whether it’s entitlements and so on and where the actual spending takes place or the interest to pay off federal debt, etc . . . The scale around these numbers is not well conveyed, I think, in the media and people end up focusing on more narrow situations and end up spending a lot of time, energy and emotion around things that are minor in comparison to the tougher questions that we need to be asking. Lindsey Cormack (19:20.376): Innumeracy I think that’s correct and I actually don’t put all the blame on the media. I actually think these are really hard concepts to teach and in a similar way to civics not being giving enough time in K through 12, we certainly don’t have more financial literacy. We need more financial literacy. We have like plenty of math, but the translation of this to dollars and cents doesn’t happen in many K through 12 settings. Something that I do in my classroom is I try to think about what it is where they could sort of have a relative understanding of something. So an exercise that we were doing this last week is I had them look at Doge data. I said, ‘I want you to guys go to the Doge website. “I don’t care what sort of thing interests you, but I want you to go figure something out and tell me what you learned. Some of them were like, I looked at how many people were fired. I looked at how many contracts got taken. Or I saw like, if this state had this much Medicaid funding, do we think they’re talking about DOGE in their legislature? And so I was like really interested to see what they were doing. However, it all spoke to this numeracy component, which is like, everyone had a different insight, but the ability to sort of assess it relative to anyone else is very limited because we really don’t have that comparative ability for most people, at least most people I interact with, which are the best of the best STEM minds that I’ve ever been around. Frazer Rice (20:25.921) Well, one of the, this is my plea to throw in the power of compounding, even if it’s just a sentence in your curriculum, It just- it triggers so many things. I think the light bulb goes off for most people that if you allow things to compound interest wise, either for the positive or negative, it can create some major outcomes with not very much time. As we go through that though, I think one thing that I’m interested in isthe concept of where the spending goes, I bristle when people forget that the federal government can print money, but the state governments and lower can’t. That the taxation that occurs at those different levels has different ramifications. Is this something that you talk to in the federalism component in civics? Lindsey Cormack (21:20.654): Federalims They don’t really understand this, but they hear a lot about it. So we talk about that a little bit. When we talk about federalism, we talk about how states get to make their own sorts of tax rules, whether they’re going to have property taxes or if they’re going to have exemptions for things like clothing and food. So we have a week towards the end of class where we talk about money and politics. And we talk about top marginal tax rates, because most of my students are 18 to 22. They haven’t really been paying income taxes. We talk about why states might make these different decisions or if some states are going to have income tax and some states aren’t what sorts of things happen with that. So we get into that at a very high level thing, but in a 16 week curriculum, there’s only so much that you can do on every, on every subject. That certainly gets like a part, but it’s not an enormous part. We do another exercise that I really like where I have them go use opensecrets.org to look at federal elections commissions data on like what companies or what PACs or what individuals are donating to different sorts of things. And they always come up with the cleverest stuff. They were able to see.how people in my own university, the administration versus the faculty, were donating politically. As a result, they were able to make some sort of deductions about like where you could sort of put our politics. I said, “I’m so proud of you all for trying to figure out things about the world that you think matter to you and that are like right in front of you.” Part of that is giving them the tools and confidence to go play with data themselves. This is something that I see as an integral opponent to teaching civics. If you want to know the civics, this is not just a history lesson. This is a numbers and a data lesson. And so you really got to be able to get into those things if you want to have the bigger conversations. Frazer Rice (22:51.533) You’ve been in different parts of the country, New York, Arizona, Kansas. Any regional differences in the level or interest in civics that you’ve noticed? Lindsey Cormack (23:01.986): Civics Across Regions I think there’s enormous regional differences. I grew up in Kansas and I was there until I was 22. And in Kansas, as well as in parts of the South where much of my family remains, the sort of approach to talking about politics is much quieter. There’s this sort of fear that like it’s going to offend someone. It’s sort of a taboo topic. Like it sits in the same place as like you’re going to talk about sex or drugs or how much money someone made. It would be like, Ooh, that’s an off limits one. We’re not going to do it. Whereas in my 17 years on the coasts, I find that people do talk about politics more, but they tend to do it in like an overtly negative way where it’s like always dismissive. One of the sort of things that happened when I was writing this book was looking about what etiquette manuals said for the longest times about like how we’re supposed to approach this. And there are regional differences. Neither one of those approaches though is truly that functional. Not talking about something doesn’t make it better. Only talking about the negative parts of something doesn’t incentivize children to want to learn more. I think we have like cultural differences, but not one of them is like, we’re getting it more right here. We have room to work in all sorts of parts of the country. Frazer Rice (24:09.462) Interesting. You talk in your book a little bit about the responsibility that parents have in teaching about the political end of things. Maybe go into that a little bit. Lindsey Cormack (24:21.762): Parents Raising Citizens Yeah, so the book’s full title is “How to Raise a Citizen (and Why It’s Up to You to Do It.)” That parenthetical, “why it’s up to you to do it”, is because in researching this book, which we thought was going to be something that said, you know, this state curriculum is the one that’s graduating the students who really understand it. What we found is, like, no state curriculum is graduating a lot of students who really understand things. So if we got to change something, it’s probably going to have to start in the home. Changing the state policies around what you can teach in a classroom or how many hours of instruction time you have or even how many teachers are hired with the requisite expertise is incredibly hard to do. Like something that we heard in these interviews was everyone knows who teaches government, his name is coach. At most of our high schools, there’s not enough social studies hours that are going to be taught to have a full-time employment contract. Many of the people who teach that also teach wrestling or swimming or track or football, what have you. It became a book that said parents have to take this on because there’s so many barriers to getting this done in schools. It’s not that schools couldn’t do better. It’s not that schools don’t do good work in the limited sorts of ways that they can. But we’re not going to fix things if we’re putting this on schools. We really have to take it into the home. It’s also the case that emerging research on parent socialization to kids indicates that one of the best things that allows your kids to understand different viewpoints, be able to engage in respectful dialogue. They should participate in voting and volunteering is having their parents do that with them. They should be practicing it and showing it to them. If we want better outcomes, if we want our politics to feel and function in a better way, where the adults in the room now, we’re the ones raising the next generation, we’ve got to show them what that is and hope that they take that up and continue that work with their kids. Frazer Rice (26:00.853) When I read that part, the light bulb really went off to me because I’m spending a lot of time on intergenerational money discussions and money like you just described earlier, has its own taboo associated with it. Ultimately, if you’re trying to convey values AND value to the next generation, you have to have these discussions. Civics is an important component of it. To be politcally involved is vital in order to not only get the country aspect and the town aspect preserved, but the family aspect too. To not have that conversation, I think would be a mistake. As we wind down here, the media, social media, traditional media, books, newspapers, TV, internet, TikTok, et cetera. Do you have any thoughts or ideas as to how to curate your media diet so that you get more signal than noise? Lindsey Cormack (26:55.074) Yeah, but my thoughts are not terribly popular. My thoughts are you need to be talking to people face to face. You need to be interfacing with people who are in your communities and in your day to day reality. You need less of your online algorithmically derived information, meant to keep you either attentive or disassociative. I think a lot of our online content is going to be different than what I’m going to see is going to be different than what my daughter sees. And we’re actually, none of us. Frazer Rice (26:57.704) Yes. Lindsey Cormack (27:21.686): Political Discourse and the Social Media Diet If we exist in just online spaces or ever seeing the same slice of the world or the same slice of reality. I think if you really want to like get down to it, it’s understanding what the people around you are thinking and hearing. That requires that you do conversation. That requires that you don’t have AirPods in, in every social setting that you might be in. This is something that I think is, is really damaging. We’ve been okay with it for the last eight years or so since AirPods came out. This idea that we can be in social settings, but everyone’s listening to their own podcast or book on tape or music. I think we really have to be able to talk to each other more. If you want to have a rich information diet, you have to not let it just be the one that’s algorithmically designed to come to you. So you’re going to have to have that friction with other people. Frazer Rice (28:04.477) Lindsay, great stuff. How do we find your book? Lindsey Cormack (28:07.042) You can find it anywhere that you find books online. It’s sold on Amazon and on Barnes and Noble and bookshop. It’s also possible to buy it directly from me.I’ll sign it and scribe it and send it to you. I can send it to someone else as a gift. And you can do that on howtoraiseacitizen.com. Frazer Rice (28:23.781) That will all be in the show notes. What is your other information? Lindsey Cormack (28:29.187) You can find me on Instagram @howtoraiseacitizen, on Bluesky and Twitter, I still maintain DC inbox. This harkens back to the first civics project that I ever did as a political scientist. Frazer Rice (28:40.733) Really cool. Lindsay, thank you for being on. Lindsey Cormack (28:42.786) Thank you so much. I love these questions. https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

For those of us who live in New York, mass transit is the norm and traffic is a minor form of apocalypse. In response to this persistent issue, New York City implemented a new congestion pricing plan. https://youtu.be/TeObZEnjmv4?si=fQTxzRCe6b-sGH5F Besides the increased funds for badly-needed infrastructure improvements, the plan made other promises. These also include reduced commute times, better air-quality, and improved safety for all road users. https://www.amazon.com/Movement-Yorks-Long-Take-Streets-ebook/dp/B0CV9FNFWV/ Because the sample size is small, it is an open question of whether congestion pricing has delivered? Can it deliver? And how did we get from the horse and buggy, to the street car, to the train and automobile-based system we have now? Will it apply to other cities in the U.S.? Nicole Gelinas and I took some time to trace New York’s transportation history in her new book and analyze the prospects for congestion pricing’s effectiveness going forward. (*UPDATE: 20 minutes after we stopped recording on 2/19/25, President Trump announced that the U.S. Department of Transportation was pulling its approval of New York City’s congestion pricing plan. Governor Holchul has met, apparently unsuccessfully, with President Trump on the topic. Litigation has already started. STAY TUNED.) NICOLE GELINAS, a Chartered Financial Analyst (CFA) charterholder, is a Manhattan Institute senior fellow and contributing editor to City Journal. She lives in New York City. She is the author of the recent book, Movement: New York’s Long War to Take Back Its Streets From the Car. Outline How did you get interested in congestion pricing and the development of transportation in NYC? New York City’s Transit History What are some of the “tragedies” (Cross Bronx Expressway / death of streetcar) and “near misses” (The Saving of Washington Square Park and Grand Central Terminal) that we don’t know about? How much credit or blame should we give Robert Moses? Congestion pricing- what is it trying to do (and is it trying to do too much)? As a revenue raiser To reduce congestion Help environment Quality of Life What are the early returns on its effectiveness?  (Anecdotally, to me it seems like it is having a positive congestion effect in Manhattan)  Uber/Taxis?  Notwithstanding these initiatives, what about these often empty cars? E-Bikes? Now that the city has addressed cars, what about the safety concerns of motorized bikes? How is the program affecting Westchester, Long Island, New Jersey and Connecticut?   As a result of these changes, has the air quality shown any improvement? Meanwhile, is London a Success?  Because of its heady reputation of being one of the most forward cities on congestion control, urban planners trot out London as an example for others. Is this warranted? (However, having been there in November, I thought the traffic was insane! ) Did they do other things to screw up a good initiative? Congestion Pricing’s Future (*Before Trump’s Involvement) I never met an automatic tax that a politician didn’t see to expand and the tax is automatically going up by law, Regarding government’s growing addiction to revenue, Will the program expand? Will the borders go north? Brooklyn? Queens?  Or can it go backward under Trump? Regardless, does the MTA have the will to cut costs? Notwithstanding the controversy, is there any political will to enhance safety? Wish list: What would be your favorite next NYC transportation initiative? If we want to learn more, what’s the best way to get the book and keep track of your work? Further Details on NeW York’s Congestion Pricing Plan THE WEALTH TAX https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

https://youtu.be/xNeFuqsU7A4 Podcast Trailer Welcome to the “Wealth Actually” podcast trailer. I’m FRAZER RICE. After 170 episodes, I thought I’d check in to make sure that everyone understood what to expect from the show going forward, especially if you’re new to it. For those newcomers, it was time for a quick podcast trailer. Ultimately, I’ll be talking to a lot of different experts in their various fields. By day, I’m a chief operating officer / wealth strategist for large complicated families. This involves wealth management, tax, trustee issues, family dynamics, and the odd business succession story. I’m also a lawyer which means I’m interested in legal issues that surround these concepts. Finally, I enjoy politics and public policy. I grew up in it, and so I like to think about it and its interaction with my day job. Ultimately, this show is paired with a book called Wealth Actually, and the best way to reach me is via www.wealthactually.com. I hope this podcast trailer was helpful. I’m always looking to get it better. If you have guest ideas, topics to explore or or other ways to increase its reach, I’m happy to listen. Finally, if you have other shows that I think are worth experiencing, send them along. (For those repeat listeners, you will notice I changed the theme music too. It’s a little more thunder, a lot less synthesizer. Let me know what you think of it.) Enjoy the show and be sure to like, subscribe, and share with your friends. More Episodes Find more episodes in the podcast section HERE Book To buy a copy of the book “Wealth, Actually”, see the link below. (There is a great audiobook version that I just produced and is accessible on Amazon too) https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/ Social Media Linkedin Twitter IG BlueSky (NEW!) Podcast Trailer

The Internal Revenue Service is a massive “Three Letter Agency.” It’s a bureau of the Department of the Treasury and (believe it or not) one of the world’s most efficient tax administrators. In fiscal year 2020, the IRS collected almost $3.5 trillion in revenue and processed more than 240 million tax returns. It has over 90,000 employees. It is also about as popular as Communism and Dog Catchers with most people! This makes running this most public of organizations a challenge for garnering resources and maintaining safety, stability and confidence in the revenue collection that makes this country go. https://youtu.be/mXxwh0IR3Ig Charles “Chuck” Rettig is a Shareholder at Chamberlain Hrdlicka in the Firm’s Tax Controversy & Litigation practice and served as Commissioner of the Internal Revenue Service (IRS) from 2018 through 2022. He shares his experience with us and some pointers in dealing with the Service. How the IRS operates and its priorities: The volume of work and responsibility of the Internal Revenue Service The structure of the agency Data Science is the Future What it does that people may not be aware of Other parts of the Treasury opine on tax policy, but the agency provides guidance on workability Chuck as the Commissioner appeared before Congressional Committees 37 times in 4 years. Personality matters both internally and externally The Commissioner has an 11 person security detail and receives 3 credible death threats / week. What to expect in the next years: Legislative Uncertainty Administrative Challenges The Service has almost 400 Million “clients” with huge disparities in sophistication Resources are always a struggle- getting bang for the buck Personnel departures from the Service Prediction: Increased aggressiveness at the state level What best practices in front of the IRS look like. Setting up your affairs with a ling term strategy in mind Interacting with an Examiner Speed and Humanity The 3 headed approach to family office planning High end advisory work with the T&E group The overall context in working with the structure and culture of the IRS – having a backdoor channel Litigation support for those situations that need it. Links With Kelley Miller: The IRS Audits You- What’s Next?” Transcript of the Show https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/ Frazer Rice (00:01)The IRS and taxation in general is in all sorts of tumult with the new administration. How to deal with the IRS, how to file your taxes, how to plan for things going forward. It’s something to think about. We have Chuck Redig on and he is a terrific resource for all of our listeners. He’s a shareholder at Chamberlain Herdlica. It is in the firm’s tax controversy and litigation department. Frazer Rice (00:26)Most importantly, he served as commissioner of the IRS from 2018 through 2022. So we have a little inside baseball here on how the commission works and things to think about in your own practice. So Chuck, welcome aboard. Chuck Rettig (00:32) Thank you for having me. It’s a privilege to be out. Frazer Rice (00:42)Well, it’s a treat for us to have you and a real great opportunity. First and foremost, look, the three letters IRS are scary to just about anybody who comes in contact with them on a personal basis. Maybe break down a little bit how the IRS operates and what its priorities are. Background Chuck Rettig (01:01)Yeah, you know, when I went on board, somebody high up in Treasury, and I’m basically a kid from Los Angeles and Irish headquarters in Washington, D.C., and somebody from Treasury said to me, you know, congratulations, it’s a Senate-confirmed position, and you are one of the five most powerful people in the United States, but you are absolutely the most hated. And I remember shaking his hand going, okay, thank you, you know, and this is something I’m still interested in doing. Reflection Looking back, I look back with a lot of pride.for the opportunity. basically a tax guy from a tax practice, 36 years in tax and state planning and other related things in one firm in Los Angeles, the opportunity to go on board of the IRS. And if you will make a difference. This was in 2018, which was about a year and a half-ish, right? Depending upon when you say COVID started and gave us the opportunity to go in and see what we can do to change things. But I always kept in my head. the anxiety people have for the IRS. At all levels, you could be the most sophisticated tax professional, or you could be the taxpayer on the street. Individual, corporate, everything in between. And everybody interacts with the internal revenues of us. The IRS interacts with more Americans than any other public or private sector organization on the planet. And for a variety of reasons, there’s a lot of challenges for the agency. But the operation itself, The physical part of the operation, I’ll just kind of give you a once over, is headquarters is in Washington DC, 1111 Constitution. I moved to Washington DC, had an apartment a few blocks away from there, thinking, oh, I’ll just walk to work. The IRS Commissioner and Security And one of the first things you realize is, okay, well, the commissioner is not going to be out in public by themselves, tying into this most hated thing. had what mostly was an 11 person protection detail with you at all times, averaged one to three to five, what they call credible death threats per month. And it’s hard to adjust to, right? It’s like, if you will, for a federal government salary, you really have to want to do government service and make a difference when you see the things that most people are not aware of. But headquarters, Washington, DC, the… The Size and Scope of the Service Headquarter ability is 1.2 million square feet. You know, there were about 85,000 employees when I was there. Currently, it’s about 100,000 employees, 519 offices throughout the world in terms of what we think of in terms of operations. So I was there in 2018 to 2022, and the commissioner has a term, my term expired November 12th, 2022 by statute. But just during the term that I was there, IRS implemented seven major tax acts, right? Starting with TCJA in December 2017. So in five years, you’re redoing all your systems, right? You have to figure out how you have to code the systems for changes in tax law. And in addition to that, you gotta be prepared. So you redo some of your systems and put them on the shelf so you’re ready to go with the changes, but everything you think is gonna become tax law doesn’t. So tremendous effort to try to get things moving and get it operating, if you will, behind the scenes. And then, you know. Frazer Rice (04:28)And so, you were put in charge of this, the scale is massive. You’re dealing with essentially one of the largest corporations in the country, even though it’s a government agency. Chronically underfunded, as we always hear in the news, and so you don’t have the resources to do what you want to do, either technologically or people-wise, and so on. And then you’re called to account for why things go wrong when they do or how awful you are on a daily basis because you’re the you’re the you’re the bearer of bad news oftentimes. How did you adjust to that? Job Requirements Chuck Rettig (05:01)So I think you have to have thick skin. You have to know why you’re there. We were there to serve the country, right? What a lot of people said is, hey, Chuck followed his son into government service. My son is a major in the United States Army. When I went on board, my son was deployed. He’s deployed three times. And sort of if you will serve in the country and look at the flag, I do pause when I look at the flag. DC is different than pretty much any other part of the United States. Everybody points fingers. Nobody takes responsibility. Nobody takes accountability. And they all want to send out a tweet of, we just grilled the IRS chief. I testified in Congress about 37 times, Ways and Means Committee and Senate Finance Committee. And a lot of that also was during COVID, where we had tremendous struggles during COVID, as the rest of the world did, right? And so, Frazer Rice (05:53)Huh. Right. COVID and the IRS Chuck Rettig (05:57)You just really have to hunker down, move forward. And by nature, the commissioner of the Inter-Northern Service, the only person who could ask me to leave would be the president of the United States. And I served equal terms under President Trump and President Biden and relied on the fact that, you know, if they want to fire me, they can fire me. But my lines inside to the employees were, we’re going to do what we’re going to do. We’re going to do the right thing. Very impartial, non-political at all.and we’re going to move forward. And then I would always add in, if somebody wants to fire me, they can fire me. Of course, I would add in and send me back to my home in Los Angeles, to my friends, you know, get me out of the snow in DC. And then other people come in and go, it sounds like you’re trolling to get terminated. I go, no, but when I think about home compared to I think about DC, you know, maybe I’m ready. But that was my, if you will call it. My son in the military has a thing. If you think you’re all that, bring it, right? The Personal Touch And I adopted that, I adopted that for the IRS. If people wanna take shots at us, if you will verbally, make your comments. I will say I got counseled on when I testified that the staffers for some of the senators thought I was intimidating the senators when I wanted to testify. Senate finance has 28 senators. And I said, it’s one against 28, how can I intimidate them? They said, well, sir, you. You have a look and then you throw tone if you disagree. I said, go back up there and you tell them they won’t get the look, they won’t get tone. Two things. If they, as they’re asking a question, put out accurate facts, right? And then stay away from the employees. That’s all I’m asking for. Accurate facts, it up, your question is, and then ask me your question and do not go after the employees. They won’t see tone or, or, Frazer Rice (07:55)or faces. Right. Chuck Rettig (07:55)or the look, right? Resources But I felt my job was really to get it right in the trenches, not to, if you will, be swayed by somebody who has a title, senator or congressman, is most of the folks we interacted with. I served under Secretary Mnuchin and Secretary Yellen. They really gave us free rein to do our thing. And we did. And in the same time as all this is going on, keep in mind, Iris maintains two level five computing centers, one of the largest call centers in the world, one of the largest law firms in the world, one of the largest processing sites in the world. So you can start to see the 63 separate operating systems. You can start to see how technology and the complaints the agency has about technology, technology becomes important when you want to bring it into 2024, 2025, 2026, and technology requires money, right? So the idea is Frazer Rice (08:58)Well, the crazy part is, your largest processing, largest law firm, whatever, you also have 360 million clients. I don’t care how large they are, the scale and the many to many relationship that you’re dealing with here. Chuck Rettig (09:05)Yes, exactly. Well, and think of that, you know, the taxpayers, We had, the IRS, we had the most sophisticated individual and corporate taxpayers on the planet, just by far. We also had some of the most, and I don’t mean this in a disparaging way, but the most unsophisticated individual taxpayers who live in an area where they don’t have a smartphone, they don’t have, you know, a laptop, they don’t have wifi access. Inclusion as a Revenue Raiser And IRS has to service everybody. Then I’ll add into that what was very important to me was the concept that, I’ll just say, I used say to the employees, where do you live? And I said, don’t say America. You live in the United States of America. I think you know, Fraser, but some people may not. My father was born in Germany and my wife is born in Vietnam. The in-laws ultimately made it out of Vietnam. My wife got to the country, she was a refugee, a boat person, nine months in a refugee camp in 1981, she escaped at age 17. My in-laws live in Little Saigon in Southern California, do not speak English. And so when I would say to the employees, where do you live? You live in the United States of Most of us can go back one or two generations and somebody culturally identifies with a different country. So for the conversation about sophisticated and unsophisticated individual and corporate. Languages There’s also, there’s 170 languages fluently spoken in the United States. When I got on board, by and large, was operating in English. And we did a big push to get into other languages. Again, trying to knock down this anxiety factor. And a lot of the folks who come to the United States come from hostile countries, Vietnam, Cuba, Hungary, Ethiopia, you know, there’s a list, right? And so if you can get… in the language of the people who are trying to get it right, with people from their community and send, you know, bring those people into the send those people back. We had a decent shot of building trust and confidence in the IRS. And I’ll just say, know, lot of people say, well, what are some of the things you’re proud about? Well, it is, you we could go on for eight hours, but among the top liners, we did the 2019 Form 1040 in Spanish. First time IRS did a individual in context return a really significant form in a language other than English. And they’re ultimately going to have those forms in eight different languages. And so there was pushback. People said, you know, cost us a lot more to do this in another language. And my response was, well, one, we’re not a profit making activity, although gross revenue when I was there was $4.9 trillion a year. That’s 96 % of the gross revenue in United States of America. Back Home And if you just think, if you go up 1 % because maybe the folks that you get into their language get it right, that’s $50 billion a year without doing anything other than getting into their language. But one of the comments I made internally when people pushed back about the cost of going into another language was, this should help take the pressure off our phones and off our mail. Because I would say, my father-in-law is 90. And I said, so every year he files his tax return, he sends in his $8. If in looking at it, he thinks, it should have been six, he’s going to call us every Thursday and ask for his two bucks back. And he’s going to send us a letter every Friday and ask for his two bucks back. And, and he doesn’t speak or write or whatever English. So we’re going to have to deal with that on our end. Whereas if we get it right, if we get our guidance into simple terms, things that people understand, we can actually, we should be able to bridge part of that gap and, and move forward quickly. So that was significant. I will say, you know, the employees, the workforce embraced that a thousand percent. I’m not smart enough to see some of the benefits we got, but I will tell you that when we did the 1040 in Spanish, a significant percentage of our employees identify with, you know, Hispanic in some form. All of a sudden I became their guy, right? Like they could see me respecting their community. Integration with Other Policy Frazer Rice (13:26)Well, and it’s a major component of policy elsewhere. mean, whether it’s immigration or otherwise, mean, you’ve got to be ready to meet the people that live in the country where they are, especially when you’re revenue, which in my opinion is important, especially when you’re trying to fund things, making it easier to intersect with that. Chuck Rettig (13:34)Yeah. Well, they are in circles. Yeah. Frazer Rice (13:53)Service. In theory, think as long as you’re not dealing with a language that only has a couple hundred speakers, that should increase things as you move forward. Chuck Rettig (14:03)Yep. We had in fiscal 22, which was my last fiscal year, government’s on a September 30 fiscal year. We had 90 million visits on our non-English speaking pages of iris.gov that by and large did not exist when we came on board. And again, for the folks who want to go online and do it themselves, getting into their language. And the key was If you will, I refer to myself as a single syllable guy. I’m a public school kid out of LA. Only person in my family go to college. The key was not using, if you will, the equivalent of Shakespearean English in our, when we go into other languages, but something that real people could understand. That was critical because the purpose of getting there was to touch base with people, knock down some of the anxiety, and hopefully they get it right when they send it in the first time. Technology and the IRS And if it comes in right the first time, the automated systems, 98 % of the 1040s, a set of eyes never look at it. It just sails through the system. If they get something a little bit out of kilter, then it goes to a filter, our people look at it, notices happen and stuff like that. So the goal was to streamline the filings for everyone and then free up resources so we can spend more time on areas that obviously there were not enough people for, but we needed to. We hired left and right, as many as we could, data scientists. And as we were talking before, you said, that’s one of the things that surprised you. Like most people, or like most tax folks, I saw the IRS as a tax administrative agency, processing returns, collection action, issuing a lot of refunds, issuing a lot of refundable credits and such, examinations and all that. Data Science Really, you need a lot of data scientists as you start to really rely on technology and you modify your technology. And IRS has compliance data warehouses, what’s called Insight CDW. It’s one of largest data warehouses in any organization that has three letters that you’ve heard about. I met a lot of three letter organizations that I didn’t know existed. And I met a lot of people that don’t exist. You know, you go into a room, there’s… Frazer Rice (16:23)Guys in suits with pistols. Chuck Rettig (16:27)There’s five guys named Sam and nobody has a last name, okay? This is unique. But really the idea being that if you can streamline and make it user friendly, my terminology on there is Apple friendly, right? Ergonomic, acceptable from all facets of the organization. What a of people refer to more sophisticated than me, we call it the private sector experience. Hey, can I help you today? You know, when they answer the phone people at Iris were phenomenal given the lack of resources they had. But data scientists are behind all of that. And so we hear about hiring people for the phone. We hear about hiring people for examinations or collection or HR. There wasn’t so much talk about all the data scientists, but inside they really, they make a difference for the internal interactions as well as external interactions. Cybersecurity And having said that, I just want to touch one thing that I like to throw out, because it helps understand the size of the operation, but also the issues around it. While I was there, we averaged between 1.4 and 1.6 billion sophisticated cyber attacks per year. Government-speak, a sophisticated cyber attack means it’s essentially North Korea, Iran, Russia, or China. And our entire campus is designed to attack US systems, we were responsible for ours for treasury. But also we had information sharing agreements with at my time, I it was 83 countries around the world. If you have taxpayers here or there and information goes electronically and it’s the weakest link here. So we not only had to protect if you were the home front, we had to protect 83 systems in foreign countries. And you know, you did not hear hey, there was this large bump in the theory, I guess, be somebody could get in and possibly think that they could. I don’t think they can, but if they got in, trigger billions of dollars of refunds. And we looked at that, and that’s obviously, without saying, important. But beyond that, what my pitch was to the folks there who were phenomenal, the emotional component of this, right? If somebody gets into the financial operating system, the United States government, if a foreign country is to get into that, the emotions for people in the country will suffer. You you want to think we’ve got the thickest armor and we’re there and we’re prepared. You don’t want to think that, you know, an eight year old in China got through or whatever. And not thinking on China. I’m just telling you, we know, we know. The Service and Congress Frazer Rice (19:13)I don’t know, but, no question about that. As you look at, we’ve now flipped back to a Trump administration and the IRS, we have sort of Doge over here, which is evaluating things and Elon throws tweets at the IRS and we’ve already know that it’s not as well resources that really should be given the importance of its function. How do you view what we’re looking at? Either both legislatively or administratively for the IRS in this new administration. Chuck Rettig (19:46)So the most significant role I played at the IRS really was going for the money, right? I went up to the hill left and right. We need timely, consistent, multi-year funding. were, the agency had been starved forever. There’d been a hiring freeze from 2011 to 2018. I walk in the door 2018 and it’s duct tape on the carpets, duct tape holding people’s laptops together. I know, folks by large in the field, if they wanted to pin some paper on their own, they got to go to Office Depot kind of a thing. yeah, that’s one thing, but also it’s the emotions of what you’re asking your employees to do. So my significant effort was to go for the money. We went for the money. I started out doing what every other commissioner said. We need timely, consistent multi-year funding. We have no money, you know, and it kind of drones on on the hill. And the response almost routinely was, well, we don’t think you’re efficient enough, right? Talking to Senators And I offered for certain amounts of money, billions and billions of dollars extra every year, I offered any oversight they wanted. know, Tuesday at 10 o’clock, I’ll be in all of your offices and explain what we did since last Tuesday kind of a thing. Where it shifted, and I think this is important and people need to see this. So I have a kid in the military who wears a military uniform with a flag on his shoulder. The IRS brings in 96 % of the gross revenue in the United States of America. The Importance of Collecting The federal government does not build aircraft carriers internally, doesn’t build bridges internally and all that. They contract that. So my comments went from IRS kind of, this is what we do to showing how IRS supports the country, right? And that we’re important was the line, IRS is important. Everything we put out had red, white and blue stars and stripes on it. If you will, we sort of branded. the IRS, right, as red, white and blue, not putting this on the military level, but they want to support the military, you got to fund it. That really, I think changed the way a lot of people looked at it. COVID changed, we were the only operating federal agency during COVID. We issued 475 million payments, totaling $830 billion in three crunches, all in record time. So all of that came in, and IRS August 16, 2022 got $80 billion of IRA funding allocated how Congress wanted it allocated. The majority going to enforcement, $45.6 billion going to enforcement. The reasoning behind going to enforcement really wasn’t, gee, we really love the IRS, is its scores. If you put a dollar into enforcement, you can get $10 or $11 back elsewhere. Now Congress can go spend $10 or $11. That’s what’s going on there, where it’s the rest of the money, modernization, Frazer Rice (22:28)Right, sure. Chuck Rettig (22:38)Taxpayer services, operations support, didn’t score so they could go after more money. So Congress has, they left alone, they’ve left alone a lot of, sorry. The Service and Tax Policy Frazer Rice (22:46)As we as we know, that’s OK. As we think about it, how involved is the IRS get in the form formulation of tax policy? I’m sure Congress comes to you and says, hey, you you’re in charge of implementing this. Is it doable? But do you go in and have an opinion on good ways or efficient ways to raise money or places to places to attack, for lack of better word? Chuck Rettig (22:57)So, that’s a Treasury role. We’re just tax administrators. So Treasury works with the Hill and also an administration on tax policy. What we were able to achieve, which was also critical, we were able to get in the room when Congress, Treasury, and everybody else decided what would, how, be taxable, et cetera, et cetera. We were able to get into the room to help draft the legislation for what we could administer. So rather than setting us up to fail, Frazer Rice (23:12)Mm-hmm. Got it. Complexity Chuck Rettig (23:39)We want provisions that we actually can administer in tax code, right? And we were instrumental in getting that done in part. A lot of credit there goes to the then chief counsel of the IRS, who was also a Senate confirmed position. Mike Desmond, he did not see the role as chief counsel as just the lawyer in the law firm for the IRS. But when you send a Senate confirmed person up to the Hill to go in a room with Senate staffers and talk about what we can do, people listen and Mike’s great guy and was in to try to make a difference. He came on board shortly after I did and our theories was we’re gonna sit in our office and go look how cool we are. We’re commissioner and chief counsel. Let’s get our hands dirty. Let’s go to work. So it’s a thing. You don’t want the tax administrator deciding tax policy. Best Practices Frazer Rice (24:27)That makes sense to me. What’s your best advice to people who are in front of the IRS, either as far as setting up their affairs or then interacting with them when it’s time to talk to the IRS or if you’re being audited or there’s some by-play in between? Chuck Rettig (24:46)So know today that the IRS has the technology, and this is kind of what we’ve been talking about. They have the technology in place to uncover, if you will, issues of noncompliance that weren’t even remotely possible just a few years ago. So they’re very data-driven. In the digital asset virtual currency space, there are no anonymous transactions. There are no random audits. The examinations that happen happen for a reason. It’s either The IRS is running a campaign on a specific type of issue. In the high wealth world, you have art donations, you have business aircraft and such. So it’s either a specific type of issue or it’s a type of taxpayer. know, high wealth taxpayers, complex partnerships, large corporations, multi-tiered partnerships, those are all high on the radar screen for enforcement presence. Backing into the beginning of question, so what do you do? You do your homework. You do your homework on fun. Pattern Recognition And it’s not unusual for IRS to engage and find out that maybe it wasn’t a tax return that doesn’t track to if you have a partnership agreement or the LLC agreement or something, particularly in closely held family type operations. know, entity needs money, mom and dad put money in. Where did the capital accounts adjust accordingly, Effectively, if not, you might have a transfer of wealth from mom and dad to children just by that act alone. And so agents are trained to look for that. THE BEST EXAMINATION IS THE ONE THAT DOESN’T HAPPEN. And then number two, the one that you’re prepared for. The agents are doing their job. The training for an agent is not to get in and make a lifetime endeavor out of this. Get in, get a sense of feel, if you will, and then get out. And so there’s a marginal return. So it goes like this. And so about here, they should be getting out.and the longer they stay in, they don’t get a more significant adjustment. But agents are people and coming really to the beginning, question is, I’ve found in now 44 years of interacting with IRS five of which were from the inside, I’ll just tell you, maintain the appearance of reasonableness at all times, stay professional. The agents are trying, they’re doing their best. Some of the questions may just make no sense to you, right? Checklists And it may just be a checklist that they have. By the way, in the high wealth world, there’s enough out there now, you global high wealth, the information document requests that they roll out with in an audit. want all this information. I would say if you’re on the front end of, you know, involved in preparing returns for wealthy clients, ought to take a look at one of those because that’s going to roll out quickly. Better to have, you know, a file or digital file that has that stuff and you’re kind of ready to go. I’ll tell you. in thousands and of specialized agents of the IRS, having the right thing in the right place on the return. It’s like reading a book. Can you read the language or do you stumble on something? They look at a tax return like we would look at a novel or a magazine and they glance through it. Then when they hit something that’s either in the wrong place, it’s called the wrong thing, it’s a bit of an issue to them. You don’t want them to slow up. They go look. You don’t want them to slow up. You want them to go fast. And then if they find something, you should be hopeful. If it’s a mistake, that it’s only in the year they’re looking at, because they’ll immediately go to the prior year. They should be looking always at three years, the year of the exam, the next year, and the year before. And when you have pattern that’s a mistake, and using quotes around the word mistake, when you have pattern that’s a mistake and it’s always in the taxpayer’s favor, When the Puzzle Becomes Personal It’s really when they start to dig in, right? And remember, know, tax professionals sign these returns, prepare these returns. Most agents don’t have private sector experience. So the idea of, and I would routinely say, listen, on the outside, a client is somebody who always gives you everything you want in a timely manner, exactly the format you want. And then I would go, that doesn’t exist, right? Tax professionals. are up against deadlines, they’re trying to put all this together. They got a lot of people who are procrastinators. know, somebody’s thinking October 15th, so they must be the only person in the world who’s gonna give their guy the stuff on October 15th. And I said, remember how these things come together. And then I pitched another one that wasn’t as universally accepted, but something to think about. I said, the second question the agent should ask, other than good morning, how you doing? It should be, Being Upfront In preparing for this examination, did you notice anything that you want to tell me? And my third or so week on board, I said that to the chief of exams. said, I’ve never understood why you just don’t roll out with that. Concept being, is there something you want to tell me? And then the agent should say, what you put on the table right now, there’ll be no penalties for the adjustment. You’re keeping me from having to do it. I get it that things happen. I’ll use word mistakes, but we don’t say that really. Frazer Rice (29:59)It’s a type of thing where you want to make their job easier and be ready for explanations of things that may be weird speed bumps along their thought pattern there. Chuck Rettig (29:59)But yeah. thousand percent and remember they’re people, right? So they don’t get graded on, they got a big adjustment or this or that. They get graded on how quickly they go through a return. The data says which returns have are more likely to have potential for adjustment, but that doesn’t mean that every return you look at is in that vein. So, you know, examination and interacting with agents, the appearance of cooperativeness, appearance of reasonableness. Stay Uncomplicated Trying to explain things and often the agents can have no clue about the type of business operation that’s involved, right? Or the financial nature of the financial transactions involved. I wouldn’t get too far in detail trying to explain some real sophisticated thing to a person with the IRS. I would do it by analogy, right? Find something that we all understand in our daily lives. Say this is kind of how it works. You’re familiar with whatever. you know, this thing, that’s how this system works. They don’t need to know how to duplicate the business activities of the taxpayer. They need to get a modest comfort level that what’s in the return is appropriate and agents stereotype, right? So if you come at them hard, don’t expect an easy resolution. You know, my wife, as I said, from Vietnam, she was an auditor for Franchise Tax Board in California, residency auditor for like 12 years. Rudeness . . . Not a Good Idea And she and every other residency owner can tell you stories where somebody says, listen, little lady, let me explain this to you. Exactly. You know, I’m so much better and smarter than you. Let me explain how this works. you know, you just kind of think, why would you go there? But they do hear it. And so I’m not saying take them to lunch, but I’m saying treat them like you’re going to be treated. Yeah, exactly. Frazer Rice (31:48)That always works: Be reasonable. One of the things, especially as we move up the ladder in complexity, in terms of staffing the advice around you, whether it’s your accountant, your tax preparer, your lawyer, if it gets to that point, is not only having the right people from creating the transaction, getting the compliance right, et cetera, but also having the people who are used to either litigating or dealing in a pure legal sense with the IRS and then having someone with let’s say the back channel or relationship with the IRS as part of that, that that’s a good way to go or to think about staffing your own personal affairs as you sort of get up the food chain. Does that make sense? Staffing your tax team Chuck Rettig (32:49)Yeah, I have to tell you, so, you my first six years, I was not on the controversy side. was transactional tax person, tax lawyer, you know, handling some of those sophisticated stuff out there. And then branch was doing both. And it floors me how seldom people call in, if you will, the firefighter to see is the house flameproof, right? Kind of a thing. You know, what’s your look at this? Or if they came at us, how would you approach a response to them before the return goes in? And my personal reaction, this isn’t like saying, hey, create business for us, but a set of eyes who’ve been in the trenches, who’ve been in the courtroom, who’ve been in the appeals courtroom, who know how the government thinks, invaluable to go. Usually it’s just a little tweaking here and there. It’s that tweaking that really the examinations are gonna… Get in . . . Get Out . . . Fast It’s that tweaking that makes those examinations flow smoothly. I just think sometimes, it’s the old thing, pressure. I’ve drafted a lot of things in my career, 42 years, 43 years of practice. Early on somebody said, draft it, set it aside, and come back and look at it. So I do that, I come back and look at it. And my first response is to myself, who drafted this thing? I’m in love with Frazer Rice (34:14)I think we’re all like that. Chuck Rettig (34:16)I’m in love with it on Wednesday. It’s a masterpiece. I wish my mom was still alive. She’d be so proud of me. And on Friday, I look at it and think, what was I thinking? And that’s in this world. you’re representing a client. Do you want to do your best for the client? People who do what we do are a quick study. You’ve been in those trenches that long. You start to know exactly where they’re going to go, how they’re going to go, what they’re going to look at. And sometimes it’s just a simple thing that sets them off in one direction or another. And you want to get through this activity quickly. If you really want to save money, get in and get out. And then the other thing, and for clients, what you want to provide the client is certainty, right? Getting out gives them certainty. Having an examination linger, even if somebody’s reporting the agent doesn’t know what they’re doing, et cetera, et cetera. In the meantime, that client can’t go on and… Frazer Rice (34:58)No, speed is key. Speed Chuck Rettig (35:17)Realistically conduct a lot of business activities. Cause if you will, the fear, what we talked about in the beginning, the fear, the anxiety of the government and what if the government takes a left turn and comes in heavy on us on some issue. Now I’ve got at least mentally set aside some amount of money to possibly pay it, but also to fight it. Whereas if you can close it down today, quickly, you give that client the comfort to go forward in their own world. And unfortunately, I’ve been involved in things. I’ve seen businesses break up and I’ve seen marriages and families break up because some people miss her or miss America. can’t function with the iris sits doorstep, right? Even if all the reports are good. Let alone there is a mistake. Frazer Rice (36:05)Well, that kind of fighting and litigation is just a drain. And at some point, you want to graduate to work on different and fun problems, not that. Chuck Rettig (36:13)Nobody will. I used to have clients come in and I’ve seen some of it since I’ve come back and I’m with Chamberlain come in and you know, we want you because you you’re going to be able to slay the government. my now my typical response is, so my wife and I have four children, they’re through college. You’re not going to have to pay my kids college education. I had somebody recently say they wanted me want us to go biblical on the IRS. were so right. Frazer Rice (36:45)No. Don’t Tug on Superman’s Cape Chuck Rettig (36:46)And I said, well, we’ll revisit that, but I can just tell you, that’s not what’s going to happen. You’re going to hear at some point me say to you, this is how we get it resolved. And I can do it economically. You know, I was an economics major at UCLA. I can tell you why, but I’m also going to tell you for your own sanity why you’re going to do it. And the comment has always been the same. And think your tax controversy folks should routinely bring this in. Better to pay them than to pay us. You pay off the government, right? What you were going to pay us, you put it in the kitty. It’s not such a big difference, but you’re buying certainty with that. We think we’re right. The line is, if your name’s in a caption, it hasn’t been a good experience. And I tell clients, if we become best friends, it’s not a good experience. We were involved too quickly. And we really pride ourselves, if you will, on the surgical strike. Take a look. What are the things to go after with government and controversy, madam, and try to put that to rest. And you see the rest of the case just evaporates. Outro Frazer Rice (37:47)Really cool stuff. Chuck, how do listeners and watchers find you? Chuck Rettig (37:53)So the same way that when I got my government phone, they got handed to me, IRS phone, there was a message on it, I played the message, and I found out that the FBI was about to arrest me for failure to pay taxes. But like, how do the spammers get my IRS phone number, right? Yeah, so you can just Google Chuck Reddick, R-E-T-T-I-G, or former IRS commissioner. I’m very proud to be on board Chamberlain Hurdlicka. We have over 100 tax lawyers on board. We’ve got, you know, a whole estate group and high wealth and family office and all of that. you know, coming out of government, I had 25 or 30 or more opportunities to join all types of professional practices, as you can imagine, right? I’m essentially the only tax commissioner in recent history to be a tax guy and then go back into private practice. So… Nuance The question is, how did you pick Chamberlain? I have a quick answer. It’s not just me, but it’s the people. There’s dozens of people that I’ve known for decades. And you want to work with people you want to work with. I found out about Chamberlain and that’s how I ended up with Chamberlain. And like I said, we pride ourselves on surgical strikes, getting in, getting out. that’s my reaction to who folks want to work with, tax professionals and who you want to help. I represent your clients and it’s important, you know, and we see it, you know, I, we don’t go with thundering in, Hey, I used to be commissioner. Let me explain how you’re doing. That’s the, that’ll be a commissioner version of listen, little lady, let me explain to you. You know, we’re very subtle on, on that. I’ll just, you know, if we’re at the closing level, say, when I was leaving, a lot of people said to me, what do you think folks at the IRS think about you? Frazer Rice (39:36)Heh. Chuck Rettig (39:48)I said, well, I’d hope that 95 % of them would tell you that I had their back a thousand percent, because I did. I went in for the tax professional community, the taxpayer community, tax administration in general, and the IRS workforce, and see if we can pull it together and be better. Frazer Rice (40:05)Really cool stuff. Chuck, I really appreciate you being on and look forward to seeing how the IRS operates in the new administration and going forward. Chuck Rettig (40:13)Fingers crossed.

https://youtu.be/h1yo6l7V0Yw Preserving legacies is about more than cataloging “stuff” and keeping a spreadsheet. Done well, it can provide the grounding for intergenerational communication, engagement with outside constituencies and, in certain cases, monetization. This involves a organized process: Preserving Legacies and Cataloging With the horrible recent storm damage in North Carolina and Florida and the horrible Los Angeles wildfires, the cataloging process is on the forefront of many families’ minds. Storytelling Development The artifacts of a family can be the keystone of family narrative building and next-generation education. Fan/Constituency Engagement The building of physical digital museums can be the centerpiece of engagement for internal and external constituencies. From extended families, to customers and extended fan-bases, advanced legacy preservation is more than just “stuff.” Monetization In certain situations, these efforts can lead to new forms of business and monetization. For artists, authors and musicians, these museum efforts can add value to IP revenue streams and transactions. Preserving Legacies We talk about case studies with stars like Def Leppard, Chris Paul and Jon Bon Jovi. However, we also go through the importance of preserving legacies with families that aren’t filling 50,000 person stadiums. We distinguish “Preserving Legacies” from Estate Settlement (where many families first begin this process). That said, this show pairs well with the Estate Settlement episode with Joel Schoenmeyer. Background BRAD MINDICH is the Founder/CEO of Inveniem which is the leading archiving/fan engagement company that works directly with artists, estates, athletes, brands, and individual celebrities on finding, organizing, preserving, and monetizing their artifacts and history. INVENIUM, and its fan-facing brand Definitive Authentic’s, overarching message to its clients is Your Past Is Your Future® and this philosophy sets the tone for how the company holistically and strategically partners with its clients to both preserve and extend legacies and connect clients deeper with their fans. The company’s client list is confidential, but it includes some of the world’s most iconic creators. https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/ https://bsky.app/profile/frazerrice.bsky.social/post/3lgul3z7nrs2a https://open.spotify.com/episode/0C9Bost6uihR1Pj8MnsppE?si=cbf4a554b9f04cfa

Estate Settlement is one of the most feared parts of wealth transition. It is where trust and estate planning meet their first real test- usually when a will is put in front of the probate court system. JOEL SCHOENMEYER, Head of the Family Wealth Group at a Major Regional Bank joins us to discuss the ins and outs. https://youtu.be/OwepMwX0uao?si=YKevHbmDrtrRv12b What is Joel’s background? I spent the first 15+ years of my career as a trusts and estates attorney. First at a few different law firms, including Sidley Austin – back when they had a T&E group. Then as a solo practitioner for more than a decade. In 2012 I made the transition to working for financial institutions, where I have held a number of roles: Legal department, in the trust counsel group Senior Trust Advisor on an ultra-high net worth team National Head of Estate Settlement Senior Wealth Strategist in a multi-family office group I’m now in charge of the Family Wealth group at Fifth Third, which is an offering for ultra-high net worth clients and families. Just broadly, can you explain what happens from a legal perspective when someone dies? Sure. First, a little terminology: “Estate settlement” is the overall process of wrapping up a deceased person’s affairs, a job that’s usually handled by an “executor”. That settlement process can include lots of different things, but it can be broken down into a few broad topics: Inventorying and collecting all assets; Identifying and then paying debts and expenses, including taxes (both final income taxes and, if the estate is large enough, estate taxes); and Distributing what remains according to the decedent’s estate plan (or if they didn’t have one, according to state law). “Probate” can be a part of estate settlement, and involves court supervision of the above process, to make sure that it is handled correctly. I spent some of my time as an attorney drafting Wills and Trusts. However, I spent even more time in court, dealing with probate issues (including litigation). We are going to be talking about messy estate settlement issues and how to avoid them. Why is this important? I will say that, throughout my career, I have met clients (or potential clients) who say, “I don’t care what happens when I die – that’s someone else’s problem.” However, most people do NOT want to cause problems for their loved ones. The death of a parent or spouse or sibling is difficult enough without having to figure out where their stuff is, or what they wanted to do with it. There’s also the positive aspect. You have family and friends – and possibly charities – that you hope will thrive after your passing. Why wouldn’t you want to set things up so that they actually get your hard- earned money? Do you want to have that money go to the IRS or some probate litigators? How should people start to think about their estate? I break the issues to consider down into four interconnected categories: Assets Debts and expenses (including taxes) Personal Relationships Estate Plan (Will, Trust, etc.) One thing you will notice is that your estate plan is only one category here. A lot of people think that having a Will and/or Trust in place means that they are “done” with planning for their death. That’s just not true. So let’s start with assets in the estate settlement process. What is the big mistake people make with their assets in the context of planning for death? The main mistake is not paying attention to how your assets are titled. This is especially the case where people have an estate plan but then also have assets with a listed beneficiary, or assets owned jointly. For instance, I once handled an estate where the decedent’s Will gave away her interest in a home – but the decedent already owned the home in joint tenancy with her sister! As a result, the gift under her Will was ineffective (but the situation created a lot of litigation as well as conflict). Too often people don’t have a handle on how assets will pass when they die, so they don’t have a holistic plan. One other example: husband marries later in life, then dies with a $5 million life insurance policy. That policy was purchased before he got married, and the initial beneficiary was his mother. After the decedent got married, he should’ve updated the beneficiary to his spouse, but he never got around to it. Another asset-related issue that I encounter: “dead” assets, which is my term for assets that really have little or no value but that are painful to get rid of. Timeshares are the quintessential dead asset, to my mind – estate settlement folks HATE them. It sounds like there could be estate settlement issues with debts and expenses. That’s correct. Keep in mind that debts survive your death – they don’t just disappear. If you name beneficiaries for all of your assets but then die with debts, your executor will have to figure out how to come up with the money to pay those debts – and that will probably involve a court proceeding. Another issue – specific to wealthy individuals – involves the estate tax. That tax is due nine months after death, with very few exceptions. Now, nine months might seem like a long time, but it really isn’t. That’s especially the case if the decedent owned a lot of illiquid assets, like real estate, or private equity, or even a working business. For instance, what if the decedent dies with an estate of $100 million and gives all of his assets to his children? The estate tax will be roughly $40 million, which is a LOT of money to raise in a short amount of time. Do you obtain a loan? Do you sell the business or real estate quickly? What’s the best solution for a living person looking to simplify things with respect to both assets and debts? Speaking generally, you need someone to take a deep dive into both your assets and your debts/expenses/taxes. Who this “someone” is depends on your personal situation. Some people pay their attorney to do this work, although that can an expensive proposition. Other people use their financial institution, or their financial planner, or even an accountant. But the important point is that you – with the assistance of an advisor – need to have eyes on all of your assets and liabilities. You mention personal relationships as another important issue. What do you mean by that? I’m really talking about understanding whether your estate plan takes into account the relationships between your friends and family. It might actually worsen those relationships. This comes up a lot in the context of beneficiaries. An obvious situation: you have two children but giveone child 2/3rds of your assets and the other child only 1/3rd. Now, you may have good reasons for doing that – or even bad reasons, which is allowed, since it’s your money. However, you are also potentially leaving a mess. What are the ways to deal with these personal relationship issues? Three Things to Keep in Mind: First: Family Dynamic Awareness You need to be pretty clear-eyed about whether your kids get along, or whether your spouse gets along with your kids from a prior marriage. Don’t close your eyes to reality. Don’t assume that your family will have good relationships after you are gone. (You being alive may be the only thing forcing them to be civil to one another.) Second: Staffing You should be thinking not only of family members as beneficiaries, but also about who is in charge of handling your estate (and any trusts created as a result of your death). It’s vitally important to NOT create situations where people who don’t get along have to work together. This applies to co-executors or co-trustees. or in a situation where one of them is “handling” the other person’s finances. Pro tip: If you have a son and daughter who don’t get along, do NOT name your daughter as trustee of the trust for your son’s benefit. They are both going to be miserable! Third: Communication I think this goes for all categories. Transparency solves a lot of these issues, although it may involve some uncomfortable conversations. But I really believe that telling people what your plan is, and explaining the rationale BEHIND your plan, is key. To go back to what I was just saying about leaving differing amounts to your beneficiaries: maybe this makes sense. For instance, maybe one of your children helped to grow the family business and the other one never contributed. In that case, you should articulate this reason why the child who helped gets more than the child who didn’t. Similarly, if one child is very wealthy but another is struggling but working hard you might want leave more to the struggling child. Please, make sure you explain why! FInally, how does the actual estate plan factor in here? Usually we aren’t talking about obvious errors, like a Will or Trust that gives away 105% of your assets. I often encounter situations where the estate planner tries to translate your wishes into legal language that doesn’t work when applied in the real world. Here’s a situation I encountered a couple of years ago: Dad (a widower) has a son and a daughter. His Will gives daughter a right to buy his home within 30 days of his death. Now, I found this provision while dad was still living, and had to ask: Why did only daughter have the right to buy? Not to get ahead of myself in talking about personal relationships, but would daughter’s right to buy anger son? Is this just a situation where daughter was in the area, or lived at the home for longer than son, or had more of a claim to it? “30 days” is really fast – did the daughter have the ability to raise this type of money (or obtain a loan) that quickly? What are your quick take-aways on the Estate Settlement process? I would say there are two of them. Number 1 is: track (or have someone else track) your assets and your debts, with an eye toward making things easy for whoever has to handle your estate. Number 2 is: communicate! One of the things we have done at Fifth Third – which is growing in popularity – is have professionals focused on what we call “Family Alignment” or “Family Governance.” On my team, we have someone who is focused on conducting family meetings, anticipating some of these pain points with an eye toward resolving them, and even mediating disputes. And we are not alone – this is becoming a much bigger topic of conversation as wealthy individuals and families realize that being rich can create a host of problems. Related Estate Settlement Episodes Estate Settlement in a Cryogenic Scenario Whom should you name as executor? https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

This week, “Wealth Actually” meets “THE SOUL OF WEALTH” as I speak with DR. DANIEL CROSBY, Ph.D. about his new book. https://www.amazon.com/Soul-Wealth-reflections-money-meaning-ebook/dp/B0CP625K99 https://youtu.be/Y6dUcW_eQW4 Outline (Soul of Wealth) -Behavioral Finance-Issues with the “research”-Building consensus around money decisions-How our brains trick us into faulty wealth processes-Teaching people to stretch the time horizon of their planning Biography Educated at Brigham Young and Emory Universities, Dr. Daniel Crosby is a psychologist and behavioral finance expert who helps organizations understand the intersection of mind and markets. As a leading voice on the impact of behavioral finance, “The Soul of Wealth” isn’t Daniel’s only writing. Dr. Crosby’s first book, Personal Benchmark: Integrating Behavioral Finance and Investment Management, was a New York Times bestseller. His second book, The Laws of Wealth, was named the best investment book of 2017 by the Axiom Business Book Awards and has been translated into Japanese, Chinese, Vietnamese and German. His latest work, The Behavioral Investor, is an in-depth look at how sociology, psychology and neurology all impact investment decision-making.  Finally, Daniel publishes the highly respected Standard Deviations podcast- where you can find his personal thoughts on financial psychology and interviews with experts in the wealth management and psychology fields. Money – The Soul of Wealth Daniel’s book presents 50 short essays which explore what wealth really is and provides practical suggestions for how to change your thinking and your actions in small, powerful ways, for a wealthier life. Soul of Wealth Topics: How you spend your money reveals your values. That money can buy happiness if spent well. What makes a good financial plan. Why willpower is overrated. How to master delayed gratification for the ultimate wealth hack. Why anything worth doing carries some risk. Contacts: @DANIELCROSBY TWITTER STANDARD DEVIATIONS PODCAST Behavioral Scientist, Brian Portnoy on the 100th Episode of “Wealth Actually” https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/