How Will Executive Orders Impact Government, Business, and You?

This week, Donald Trump was re-elected President of the United States. Shortly after being sworn in, he signed several executive orders that could have a direct impact on business and our economy.

Books & The Biz takes a look at some of these orders and give our insights on what to watch for and how to best position yourself for success.

[00:00:10.14] - Alice

Hello. Welcome to Books in the Biz, a podcast that looks at both the financial and operational sides of success. Please welcome our hosts, Dan Paulson and Richard Veltre. Dan is the CEO of InVision Development International, and he works with leaders to increase sales and profits through great cultures with solid operations. Rich is CEO of the Veltre Group and a financial strategist working with companies to manage their money more effectively.

[00:00:38.10] - Dan Paulson

Hello, everyone. Welcome to Books in the Biz. Rich, how are you doing?

[00:00:50.21] - Rich Veltre

I am good.

[00:00:52.15] - Dan Paulson

Getting a little warmer. After our deep freeze, it seems like everyone's under, Hey, we have a little bit of snow, but we have nothing like they have down in New Orleans and Florida, so they can keep it.

[00:01:05.20] - Rich Veltre

They don't know what to do with it.

[00:01:06.26] - Dan Paulson

No, they don't know what to do with it. I will tell you, you don't have to go that far south before you realize that most people don't know what to do with snow. My place in Missouri, if they even get an eighth of an inch of snow, it pretty much shuts the place down. So it's a different world when you get out the Great White North, doesn't it? Did I lose you? You froze.

[00:01:29.26] - Rich Veltre

Yeah, it froze up a little bit there. Yeah, there you are.

[00:01:32.00] - Dan Paulson

You're back again. You're back again. Well, hey, the powers that be must know that we're going to be talking about stuff today. Since we have completed the election and installed a new President. Trump is back. And while we're not going to get into the deep political stuff of it, because that's not what we're about, we are going to talk about some of the executive orders that he signed. And I I'm going to be curious for your opinions on how financially that might affect things, and I'll talk a little bit about how operationally that might affect things. Because well, again, if we steer away from some of the real controversial stuff, there are some definite changes afoot, shall we say. So let me, let's do this. I tried to find a spot that actually had some of the executive orders listed. So So I guess here's my one issue with executive orders, is I don't believe executive orders were meant to be handled this way. And that is not a right thing or a left thing, it's just a thing. It's just a thing. And in recent years, it's become more common that whoever gets into the presidency will just all of a sudden decide, well, I'm going to negate everything the last guy did.

[00:02:55.13] - Dan Paulson

So I'm going to cancel all their executive orders, and I'm going to install a bunch of new ones of my own. And like I said, this isn't a right versus left thing, because the same thing happened when Biden got in the White House, and he negated a bunch of stuff. Trump did the time before that. And Trump, I'm sure, took stuff away from Obama And now we're just repeating that process again. Do you have any different intake on that?

[00:03:22.02] - Rich Veltre

No, it's 100 % the same. When this all started happening in the last few election cycles, it was almost like, what's an executive order? When we were younger, you never heard anything about executive orders. At least I don't remember them.

[00:03:39.26] - Dan Paulson

Now, they did do them back then because- I'm sure they did.

[00:03:43.04] - Rich Veltre

I'm sure they did. It just wasn't as prevalent. And maybe it's more of a media thing that came about that they started really focusing on it. And maybe it's because it became more prevalent of how somebody comes in and says, well, this is what I want, so I'm going to put it down in writing. Exactly.

[00:04:00.23] - Dan Paulson

And you'll have to forgive me, my civics is slightly rusty. But my understanding the executive orders were for times of emergency, like times of war, where to get something passed through Congress might take too long. So the President had the power to issue executive order in those times to handle certain situations. Well, of course, everything must change. And now I think it's at a whim that is used to create laws before circumventing our Congressional power to do so. But like I said, we're not going to get too much into the politics of it, but we're going to look at some of these and say, well, how do they affect business as a whole. And maybe one of the first ones, because this has been talked about quite a bit, is one of the first things that... One of the first executive orders that he signed was changing the immigration status of many people trying to get either in the US or trying to get in the US. So he declared a national emergency, and that affects, of course, how the federal government can then go about rounding up people who are not in this country legally.

[00:05:22.22] - Dan Paulson

And I'm sure you probably have some thoughts on how that might affect things like employment, payrolls, a number of issues. And I don't think it's just for... They always say, well, now who's going to pick your crops? I think that was besides really racist. I don't think that everyone that's coming through the border is necessarily filling the lowest jobs on the plate. But well, anyway, I'm interested to hear your thoughts on it. Enough of me.

[00:05:57.17] - Rich Veltre

I think the overriding issue is the same as it was the other day before he signed this piece of paper. I think that he is taking a stance of we're going to put federal resources towards stopping what he believes is actually happening. I think the biggest problem that I always have is, I don't know who's telling me the truth. The media says, That's not really happening because here's this fact. And then other people are saying, no, it is what's happening because here's the video. So I'm not really sure, but it does actually, to me, say, here's a president who's come in. He campaigned on this issue. And on day one, he's essentially saying, I'm going to put something up that's going to stop the ridiculousness that he sees or what he believes is true. To me, I'm like, okay, it's in writing, and I'm not sure whether he can actually pull it off. So But at least he's going back to the campaign issues he's had, even from his first campaign, I think. So I understand what he's doing. I understand that you have to block people because if they are actually crossing the Rio Grande, and walking into the country and then getting asylum, basically, in all these other cities where they're putting it, especially, I've heard about New York, because it's in my backyard.

[00:07:29.20] - Rich Veltre

And how many people don't want to go to New York? Because New York has become not as nice as it used to be, or not as... You just can't seem to go there and not have to deal with this issue. So in a way, I'm glad that it's become something that he's put in writing. Again, my question is always, how are we going to pay for it? But if they want to spend the money on it, they figure out how to do it.

[00:07:59.11] - Dan Paulson

So Well, and of course, part of this is the argument is the employment factor. Well, and we've talked about this a lot, too, is that we do not have enough employees to fill key positions throughout the US. And By minimizing or eliminating your ability to bring in outside resources, it's pretty difficult to find employees. And I guess, tied to maybe more impactful to this is the H-1B visas that, of course, have been talked a lot about. I think we talked about a couple of weeks ago, is they're making changes to that. They're making changes to, I don't think birthright citizenship really does much when we look at from a business standpoint, other than it might affect the ability of a child's parents to stay in the US if they continue to enforce that. But a lot of the problems that we're having, I think finding skilled positions is probably the biggest challenge. And when you look at people who, for the most part, have come across or gotten into this country illegally, I do think a lot of those positions are more, I would say, if they're able to work or if they were able to work legally, they would be more entry level positions in a lot of ways.

[00:09:25.26] - Dan Paulson

No doubt, there's probably people that have more experience maybe even have a degree from their country to do things like computer science and engineering. But technically, legally, you can't work in the US for that. So from an operations standpoint, I struggled to see if this is really going to change a lot unless, of course, there's a lot of people under the table getting paid to work that really shouldn't be working anyway. Thoughts on that?

[00:09:56.03] - Rich Veltre

Yeah, I think you're really hitting on the in the head, that does this really address the problem? The rhetoric around shutting down the border is that all these criminals are getting in. And I don't think that the percentage of criminals getting in is as big as everybody thinks it is. I think that the rest of the issue, you're 100 % right. I think the people are coming in and they're getting jobs that are entry-level positions, but they're not taking the that no one else wants. I don't think that every person that crosses the Mexican border is coming in to be a laborer. So I think that is a misnomer So I do think that this doesn't really necessarily address the overall problem. You and I have talked about it a hundred times. When we talk about specific companies, we talk about the fact that culture is a thing. Culture is a big Culture is a big problem. Culture is a big problem with having the right team in place to allow a company to really grow and succeed and thrive. And if I'm just bringing in laborers, I'm not dealing with any culture. So how many companies are really affected here by what's going on in this portion of our conversation?

[00:11:22.20] - Dan Paulson

That's exactly it. And of course, we've also talked a lot about outsourcing, offshoring, especially in the service-based industries. But the other aspects of this that I think we've got to be aware of is whatever these executive orders do, they are going to affect flow of people and flow of money, basically. I'll stay on the labor part for a minute here before we jump onto some of the other stuff. But the whole culture thing becomes very challenging. And I believe also one of the executive orders, and this only pertains to government employees, but I believe he issued the executive order where he wants government employees to be in the office a minimum of, I think, three or four days a week. And from my understanding, and I don't live in Washington, so don't know for sure, but if you do have to do any business with any government entities, a lot of times you hear, well, that person is not in today, or they're not in this week, or they're working limited hours. So I do believe there probably was an issue there where people are taking advantage of the fact that they could work from home, and nobody was really pressing on that.

[00:12:43.14] - Dan Paulson

And now I'm seeing if people have to go back to the office, there might be some natural attrition that takes place because I'm pretty sure people have either moved or gotten really comfortable working from home, and they don't want to give that up. I don't know what you think about that, but that's also part of the culture thing.

[00:13:03.03] - Rich Veltre

Yeah. And I've spoken to a number of recruiters, and their anticipation for 2025 is another great resignation. This is words from them, not from words from me, but they expect that because of all these orders, of all the people saying, get back to the office or you'll lose your job, it is expected that there's going to be an amount of attrition that would relate similar to a few years ago when you had the great resignation. And I think that's a little bit disconcerting, because you're not really sure whether that's a good thing or a bad thing, right?

[00:13:48.26] - Dan Paulson

Well, I'm questioning how that could be a good thing, because, okay, let's say that is true. Let's say we do have a lot of people that leave because they're being now required to go back to the office. You and I are hearing more and more companies requiring people to go back to the office. In most cases, I would consider it an amicable split. Be back in the office for three days, take two days, or whatever it might be. So they're trying to work out some compromise in between. But if people are leaving because they got to go back to the office, but more companies are requiring you to be in the office, what the heck are you going to do? Because eventually you're going to reach a point where Most people want you back in the office, and now the glut of people who don't want to work in the office anymore is going to be much higher than the demand for people that are going to require you to actually be at your desk. I could see real problems there. And I don't know if the fact that a bunch of people resigning because they don't want to go back into work every day is going to be a high enough or there's going to be enough demand that's going to force employers to change their tune on that because it goes back to the culture thing.

[00:15:02.19] - Dan Paulson

If everyone's working from home, it's extremely hard to build a culture.

[00:15:08.01] - Rich Veltre

Understood. I think the only reason that I leave the good side of it in my in my comments, is the fact that I am such a big proponent of consulting or the independent contractor, the move to going into doing more task-based work as a as opposed to the 40-hour work week. And my reason for being more for the task work or the independent contractor model is the fact that I think there's a lot of inefficiency of requiring someone to be at a desk, whether or not they have any work, you just want to know that somebody's at the desk. And from a company thriving standpoint, that's inefficient. And here I go jumping into the operations side, right? I don't mean to do that.

[00:16:02.24] - Dan Paulson

But you look at smaller companies and smaller companies, they think, well, somebody told me I have to have a chief operating officer, a chief marketing officer, chief, chief, chief, chief.

[00:16:15.01] - Rich Veltre

And all of a sudden you got a whole bunch of chiefs sitting at desks and they're playing solitaire for all you know. So are they actually getting anything done? Or are they actually working for you? You don't know. So you think that it's going to be more efficient for you and you're going to get more out of people if they're in your office? I don't know that that's true. So for me, I lean towards, okay, it might be okay to let some of these people resign and go figure it out, because while it's a little bit on the disruptive side and probably a little scary to think about, I think it's natural progression. I think that this is something that people have to realize. I don't need somebody in my office for 40 hours, especially if I'm small and growing. Why do I have to go I'm going to borrow $25 million from a venture capital firm if I have all these people, but I haven't actually built the business yet? So I think there's a little bit on the small business side that this is not such a big deal, except the media is going to make it bigger than it is.

[00:17:18.17] - Rich Veltre

And I have to learn how to either screen that out or maybe my theory is wrong. But I'll find out fast enough, because if 2025 is the way everybody's talking, it be going the way that I think it's going to go, that I think these people are going to say, let me find something to do for this amount of time. And then I can watch my kids, and I can stay from home. I can do everything that's supposed to happen. So the natural balance comes back at some point. It's just a matter of how long does it take?

[00:17:46.20] - Dan Paulson

Right. To me, the biggest challenge that we're going to have with that, because why is the whole push for people to go back to the office? Why do owners want that to happen? As you pointed out, well, if I can see them at the desk, there is a base assumption that at least they're working on my behalf. Now, like you said, they could be playing solitaire, they could be online shopping, whatever it might be. So that is a challenge that you have to face. I believe the shift really started happening back to the office, because people didn't understand what people did remotely. So then the assumption is, well, you're really not working on anything anyway. Well, I'd rather see you here, because if I see you here, then I can at least stop at your desk and tell you need to do the work and get the work done. And to me, that's where if we're making this dynamic shift, where there's going to be more and more, I would say, service place people in a company working remotely, then you got to have very clear parameters and very clear outcomes and timelines to get the results that you're expecting.

[00:18:56.23] - Dan Paulson

Because I do agree in the short term, I believe people were more productive when they were at home because they could work at the times they were most productive. Not everyone is productive at eight o'clock in the morning. Some people are more productive in the afternoon or the evening. It also might free them up, like you said, to be able to watch their children or attend basketball games or do stuff more family-oriented. So now we're getting back to that work-life balance situation, which on an operational side, the more you can do to keep those employees happy, the less likely you're going to have turnover, or at least be able to slow that turnover down. And ultimately, they should be more productive. What you and I also know is that human beings are human beings. And when you work at home, there's distractions. There's a television that you can turn on, because nobody's going to be there to tell you you can't turn it on. So you could turn that on. You could do a number of other things, from grocery shopping to whatever. And eventually, all the other stuff, I think, starts to fill the time that should be productive for work.

[00:20:03.21] - Dan Paulson

And I'm being fully transparent when I'm saying that even myself personally, you have to watch out because it's really easy to slip down those rabbit holes and get busy with things that aren't in your best interest to be busy with at that time. So to me, somehow we got to strike a balance between being able to work remotely, holding people accountable to task, making sure we're getting outcomes in a reasonable timeline and then allowing that freedom to happen. And oh, by the way, we still have to figure out how to make the culture work, because if everyone's working remotely, it's very hard to develop that culture, because we don't have the same team dynamics that we do when you have everyone in a group setting in an office.

[00:20:48.14] - Rich Veltre

Yeah. And just to clarify, my position is not that it should be 100 % one way or 100 % the other. I truly believe in the hybrid. I truly believe that there is a hybrid. I truly believe that. I'm a proponent of people working from home. However, I believe that there is reason to have mandates that people should come in for certain things. And and have certain meetings, et cetera. I can't specifically say what that is, because I think every company is different. I think every business is different, every business owner is different. But I think that business owners Just turning around and saying, well, I want everybody back in the office for 40 hours, is unrealistic. I think everybody's thinking they have to work from their house, and never have to leave the door, and never have to stand up even. I think that's unrealistic. And I think that you can't possibly tell me, if you're really thinking about the results, I don't believe you can say, I'm working on a project that I never have to leave. That doesn't make an ounce of sense either. So to be 100 % clear, I believe in the middle ground.

[00:22:01.05] - Rich Veltre

I believe that we could do an awful lot using Zoom, Teams, Google Meet, whatever. You can do an awful lot of things with that. But there comes times where there's nothing like sitting in a boardroom and going over the results. There's nothing like sitting in a room with 10 other people and getting feedback. And then literally physical feedback, not feedback over Zoom. So I truly believe that the resignation I leave on a good side, because I believe that's how you get to that balance. Because right now, you've got two opposite extremes, and no one's looking at the middle. So the only way you can get there is probably by some degree of a big upheaval, or call it a small upheaval. I don't care. Just call it an upheaval. There has to be enough of a shock value that people say, I can't be without a job or I can't be without this piece. And the owners saying, I can't be without people. How do we strike the balance? How do we strike down to the middle? If you don't have that extreme, they won't feel like they have to actually do it.

[00:23:11.18] - Dan Paulson

Well, here's a challenge. This is probably maybe a better one for you to try and tackle than me operationally, because I think it delves more into the financial side of things. Compensation. So now I'm putting my business owner hat on. And let's say we work this out where, okay, you only have to come in the office three days a week. And there's also been a push, at least in the public sphere, it hasn't been that big yet, but to change the 40 hour work week to a 32 hour work week, or I've even heard lower than that to a 24 hour work week or something along that lines. Nobody's going to want to make less money. So how do you structure a compensation plan where the employee at least feels they're being compensated fairly, or at least that's something that they can afford a reasonable lifestyle off of? And how do you get the business owner comfortable with saying, well, I'm used to Monday through Friday, nine to five, and paying somebody for those 40 hours. And now you're telling me they're probably only going to work 24, and you want me to pay them the same amount of money or more.

[00:24:23.10] - Dan Paulson

How does that change things?

[00:24:26.04] - Rich Veltre

Well, I haven't actually heard that one.

[00:24:29.05] - Dan Paulson

Oh, you have No, I haven't heard.

[00:24:31.21] - Rich Veltre

I've heard the somewhat push for we want a shorter work week. I have not heard where they still want the same money. I mean, how unrealistic is that based on what I just said, right? You want to put up unrealistic demands and then expect the business owner to turn around and say, Well, okay. No, they're not going to say okay. You should know they're not going to say okay. So what are you trying to pull? Now, I hate to say this, but I was on a chat board that I'm involved with, that someone was actually sitting there saying, based on this whole thing, if I'm forced to go back to work, I'll go back to the office and I'll do a really crappy job, and then it'll get me fired, and then I'll have to do whatever.

[00:25:19.26] - Dan Paulson

Collect unemployment or whatever for six months. Yeah.

[00:25:23.07] - Rich Veltre

And we're sitting around, sitting there saying, well, first of all, if you do a really bad job, when you get fired, you're fired for cause. So So no one's going to pay you, including the federal government, state government, for unemployment, if you're just being ridiculous. You go to work, you do a job, you get paid. That's the difference. If you want to find another job, then find another job that doesn't require you to be in the office, then you've gotten what you wanted. But if the mentality is for people to just expect, well, I just want more. Good luck with that. That's not a movement. That's a war.

[00:26:01.29] - Dan Paulson

Right. We all want to be compensated more for what we do. Sure. You always believe that your time and your efforts are worth more than what somebody else is willing to pay you for it. I think that's just natural human nature. What we have is more valuable than what somebody else has and vice versa. So, yeah, I do see a bit of a, this is the tug of war that is going on, because would people come back to the office if they made significantly more money? Probably, because I'm sure the argument is, well, the cost of health care, the cost of maintaining an automobile, the mileage, the gas and everything else is all more expensive. So that all adds up. And if I stay at home, I think a lot of people just got comfortable with when COVID was going on, you could sit at home, do your work You didn't have all these extra expenses, so then you utilize your resources for other things. Well, now the boss is requiring you to go back in the office, which means now you do have more car expenditures. You now do have daycare expenditures and things that you might not have had a few years ago, but you've already allocated all your income or whatever to something else.

[00:27:23.17] - Dan Paulson

Maybe you got a bigger house, maybe you did a remodel, maybe you invested in something else. I think that's part of it. So it's not necessarily just the ego of saying, well, I want more personally. It's, well, I don't have the income now to pay for all these other things, so you have to pay me more money if you want me to do more of these in-person tasks. And to me, that's where the challenge is really going to come in. So that's why I said the compensation idea, where, okay, let's do a hybrid. You work from home part-time, you come in the office part-time. How How do we make the owner feel comfortable with that? How do we make the employee feel comfortable with that? And is that going to ultimately affect how they want to be compensated? Because I do believe that part of the issue is individuals want more compensation, they're pushing back harder on that. And now employers are also pushing back because they're saying, well, we'll run shorthand or we'll automate more because it's now starting to get to where that automation factor is coming into play. And maybe it's more They're cost effective to do some automation instead of having an employee do that work.

[00:28:36.21] - Rich Veltre

Well, this is also where I think people, not just on the business side, but on the employee side, right? So on the business owner, you can't just put your foot down and say, well, this is the way it went, but that's too bad for you. And now we're back. Okay? That's what it's going to be. That, I think, is very disruptive, I think, going back to the culture conversation. If this guy is going to put this... If that's his, and by his, I mean, leadership team, the executive team. If I'm looking at them and I'm saying, if that's the type of person that I'm working for, then do I want to work for them? That's one piece. So you're setting a culture example just by making that push. On the other side, I think it's a realistic thing to say, well, I paid for it before. Now I have to figure out how to pay for it again. Let's have a conversation. And that's where that middle ground meeting of the minds comes in. How do we do this? How can we do this that I can get you into the office at least more, if not full-time, then how do I get you in at least more?

[00:29:51.19] - Rich Veltre

And how do we compensate the cost of going back? Because I have a different problem. New York has now gone to congestion pricing.

[00:29:59.28] - Dan Paulson

Yes, you do.

[00:30:01.20] - Rich Veltre

Okay. So now you've raised the cost of getting the person in, and then you've said, tough shit. Sorry.

[00:30:09.18] - Dan Paulson

Too bad. I don't like it.

[00:30:11.29] - Rich Veltre

Too bad. Coming to New York anyway. So now you're paying more or you're being forced to use more mass transit, which could take longer. I don't know. It depends on everybody's... If you live right across the train, maybe not. But again- You still go.

[00:30:26.26] - Dan Paulson

Typically, you don't take one train to get to where you're going. You have to hop probably two or three trains to get to your end result.

[00:30:34.23] - Rich Veltre

So now you have to add that piece in. So this is an entirely moving conversation. Congestion pricing went in what? Two weeks ago? Right around the time, last time I was in the city, right beginning of January, something to that effect. So you're, I'm crazy. This is a wild set of conversations. So it really has to be an open conversation of this is how it's going to happen. This is what's going on. And it might be employee by employee. So I just think that the ultimate result will be somewhere in the middle. It's not going to be 40 hours in or 40 hours out. It's going to be something that shows leniency on both sides and meeting of the minds and somewhere in there. I think there's going to be some people who are going to have to be educated that things are changing, and you have to accept the fact that things are changing. Ai coming in. I mean, look, we could change this whole conversation and go down nine hours in this podcast. But everything is changing, and everything's on the table. So treat it that way, that it's on the table.

[00:31:45.20] - Dan Paulson

Exactly. Let's wrap up the executive order for the government employees. But I do want to, before we jump off to the next subject. So let's say half of the government employees quit, because now they have to go back in to work. Does that help private sector businesses more, or do you not see a change with that? Because part of me saying is, well, if you have that many employees that have now entered the workforce, they need to work. I'm pretty sure most of them don't have the income that they could just retire immediately. So doesn't that free up talent to then go to the private sector?

[00:32:26.15] - Rich Veltre

I'll leave it as it should. I think, again, it comes down to a conversation you and I had in another podcast, I think, where we talked about the fact that what's the skill set? Coming out of the government, what's the skill set? If the skill set matches, those people will get picked up probably pretty quickly because you've got enough people. You have enough people out there who are saying they can't find good talent for X, Y, or Z. And if you're coming out of the government and you have the talent to do X, Y or Z, you should get picked up right away. You should get picked up pretty good. Now, if you're in a government job that's being hide because why do we have such excess in the government sometimes, then you might be the one that's going to hit a problem because I don't want to just add. If I'm a business owner and I see what's happened over the last 5 to 10 I don't want to just add, forgive my expression, but I don't want to add fat. I want to stay lean. I want to get things efficient. I want to make sure that things are going the way they are going so that I can take care of the employees who are taking care of me.

[00:33:45.16] - Dan Paulson

So as long as they give the talented, skilled people, if those people decide to leave, they probably got a better chance. If it's people who might be more on, I would say, entry level government positions, those are It's definitely going to be harder to find something else outside of that. I do want to touch base on a couple of these other ones here. I think energy, because you have done some work in the energy sector. So there were a couple of big ones that he did. Drill, baby drill has been a popular phrase that he's used. And I do believe, I do also believe that we need more energy production here because lower costs of energy leads to better things all the way around, not to mention a better lifestyle for everyone. He pulled out of the Paris Climate Treaty, which side of the swing are we on this time? We were out, then we're in, now we're out again. How do you think financially that's going to impact businesses?

[00:34:54.03] - Rich Veltre

Short term, I don't... The Paris Treaty we're talking about?

[00:34:56.28] - Dan Paulson

Any one of the energy executive orders.

[00:35:01.06] - Rich Veltre

Okay. So my personal opinion, I've talked to some pretty powerful oil and gas related business people. And the very funny part is when you talk to those people, they are not against alternative energy. Because they believe it's inevitable, as you add more and more people, as the world expands, the needs expand. And the question is, we don't really know where the end game is on the resources. So if you can get an alternative energy source as wind, as solar, et cetera, they are not opposed to it. They recognize it as an ultimate. It has to happen.

[00:35:49.24] - Dan Paulson

An augment, not a replacement, is what I would say.

[00:35:54.25] - Rich Veltre

Exactly. And they've looked at it, and they've said, the government got too comfortable buying into all these electric vehicles and electric, electric, electric, electric. But electric power plants still run on fossil fuels.

[00:36:11.05] - Dan Paulson

For the most part, yes, they do.

[00:36:13.01] - Rich Veltre

The infrastructure has not caught up to the mandate. Let's put it that way. There's an investment going on, but you're decades away from being fully energy-efficient with electric, as opposed to everybody needs buy an electric car in the next 10 years.

[00:36:32.04] - Dan Paulson

Not reasonable.

[00:36:33.19] - Rich Veltre

It's not a reasonable match. So going back to taking some of those mandates out, taking out the fact that going back to somewhat a reasonable fact of having what was here before has a couple of different things. Number one, the price of all these things will change. People are not buying being gas-powered cars because they were told you're not going to be able to keep one. This is what people's mentality was. They all jumped into electric cars. But you have a range problem. You have a infrastructure problem.

[00:37:12.29] - Dan Paulson

A depreciation problem.

[00:37:15.22] - Rich Veltre

Yeah. And there's no resale value in these cars. So everybody's jumping in. They're going to be with it forever. So going back to that, you're going to have a price change in how vehicles are actually priced so people could actually buy them. The other thing is, going back to energy independence, and getting back to being somewhat energy independent, that always makes us stronger, by not being reliant on somebody outside of the US, not reliant on Saudi Arabia or Kuwait or any of these places that's producing oil that we're importing. The more we can be self-sustained, the more powerful we actually are. We influence price. We influence Import-export. So many things we wind up having some more degree of power over.

[00:38:07.11] - Dan Paulson

And for the most part, we are more self-regulated, good, bad, or otherwise on those industries. So we have more protections in place to make sure it's done cleaner and better than maybe some other countries, such as China, such as the Middle East, where maybe there aren't the same number of rules or regulations you have to follow to build a new mine or put in a new oil field, whatever that might be.

[00:38:38.08] - Rich Veltre

I mean, and we're thinking about it from the impact on the environment, I get it, like keep those regulations in place, make sure it's done cleanly. But at the same time, just thinking about the fact of the supply and demand, the minute we start to demand more and more and more from outside and more than we actually have at home, they control the price. We need to stay in charge of what the price is. That's where I think we gain our strength, the fact that we don't necessarily need it, then we can say no. The advent of the electric car, the push for those cleaner sources of energy, still make total sense. No one's saying, Don't do it, because that should be where eventually you're going to have sustainability for yourself, and you're not going to be worried about whether or not the guy down the street just raises his price 10 bucks, and you don't have a choice to go somewhere else. So from an economic standpoint, I believe that being energy efficient, being energy non-reliant is where I think if this is what he's thinking when he's putting these energy numbers out, I totally agree.

[00:39:52.23] - Rich Veltre

Totally understand that.

[00:39:54.27] - Dan Paulson

Yeah, I believe it's in our best interest to really increase our production as much as we possibly can. The cheaper our electric is, the cheaper our gas is, the better off we are because, last I checked, nobody wants to live out in a tent in Northern Wisconsin in the middle of winter. And if you don't have fuel to heat your home or you don't have electricity to keep your lights on, it really changes the quality of life that you have. Not to mention a lot of petroleum goes into every stink in product that we own. So are you willing to go back to essentially caveman days where you're swinging around hides and bones and sticks and stones and willing to give up all the plastics and everything else that you use? My guess is probably not. I don't think there's a single person that's going to really be able to live like that. I don't want to live like that. I'm going to keep my phone, and my computer, and my TV, and in my car, and I'm going to stay happy. And I think just- Let's just say- Well, go ahead. Go ahead.

[00:41:05.29] - Rich Veltre

No, I mean, think about it from the extended piece of it, too. I think if I remember right, and I have to go back and double check it, but I want to say that the US economy has generated 65 % of purchases inside the US economy are by US people. If we're not spending money because we have to turn around and spend money to buy oil or buy energy sources from outside the United States, then what's going to decrease is the US economy purchases. We're not going to buy stuff from inside the US. So if we're not buying, the US economy is not what it was. So again, pricing on energy, which is just natural basic needs, the pricing on that matters everywhere.

[00:41:57.08] - Dan Paulson

Well, and from a cost of production standpoint, when you look manufacturing or anything, if it costs a lot more to produce that widget, it affects you in inflation. And energy is one of the biggest impacts on inflation that we see, because, well, especially a few years ago, anything from aluminum to steel was considerably more expensive due to limitations on the infrastructure on how to ship products back and forth, especially overseas. But when you watch the cost of energy rise, well, those foundries require a lot of energy to heat a metal to a liquid to form rods or bars or whatever it is that that needs to then be taken somewhere else and refined even more into car parts, or panels, or housing, anything like that. So I don't think we realize how much energy impacts everything we do from our food, to the chairs we sit into everything else, And if those energy costs goes up, that pushes the cost of everything else along with it. Yeah. One last thing we'll touch on before we wrap up here, and this is probably the biggest one, and I don't know if it's in this article or not.

[00:43:16.16] - Dan Paulson

There's a lot of stuff in here, and I don't know if they've actually put anything in, but the tariffs. One of the biggest talks that Trump has been is we're going to We'll get rid of the income tax, and we'll be financed completely by the tariffs that other countries are going to pay us to ship us their products. And as utopian as that sounds, I really don't ever see that happening. At the same point, I'm not going to say all tariffs are bad, because our products are being taxed when we ship to Europe, when we ship to Asia, when we ship to China. Everybody else implements tariffs of some sort. So to pretend that tariffs are the only US thing would be completely wrong. At the same point, they become a great negotiated dual. My personal belief is the tariff situation, that's primarily what it's for, is to negotiate with US-based companies to reshore more manufacturing here, also to do some protections on US-based goods and services so that it isn't being imported from anywhere else where it's more amicable for them to ship stuff here because we don't tax as heavily as maybe they tax when we ship our products out to somewhere else.

[00:44:37.26] - Dan Paulson

I mean, what do you see? You do a lot with the finance side, so I'm sure you deal with tariffs and taxes in the past, but how do you feel about that?

[00:44:52.29] - Rich Veltre

Well, I think people should really take a look back five plus years ago. And when you think about it, he put these tariffs in, and everybody complained, and everybody was jumping up and down and screaming. But then you got a new administration who came in, and they didn't reverse any of the tariffs. They left it there. So as much as they blamed him for everything under the sun, they didn't blame him for that, because they left it.

[00:45:22.10] - Dan Paulson

They enjoyed whatever- They just didn't talk about it. They left that part out.

[00:45:25.08] - Rich Veltre

They didn't talk about it. So I look at it, and I truly... That's That's probably the one area where I really believe that he was right. And I believe he was right when he put them in place, because I think that where it was headed was that we were going to be the United States of China, or the United States of Asia, because everything was being made over there. We hit the pandemic, and we couldn't get our medications because they were on ships that couldn't get here. So prices went up, because, again, we didn't have it here. So we lost control. We gave it away, and then when we wanted it back, we couldn't get it. So the tariff basically tells people, look, it's no longer going to be your game. It's going to be our game, because we are the consumer. If you want to keep working with us, work something in, work it out, the tariff stay in place. If Canada, Mexico, if these wind up in the same place, if those get expanded, then it's the same game. It's the same conversation. You know, I don't necessarily think it's a bad understanding.

[00:46:33.16] - Rich Veltre

I think it's something that's radical because it's fast. He wants to do it tomorrow. He wants to do it by executive order because it needs to be in place by tomorrow. And if he doesn't get it in place right away, someone will change it. So that's why the move, and that's why a lot of people are upset on the business side. You want to talk about all the other character flaws and everything else? Go ahead. It's water-cooler. That's water-cooler conversation. Get down to the brass If I look at it from the standpoint of you're not going to have as big of an advantage to send something to be manufactured in China, Korea, Japan, somewhere else, then it puts us back on the level playing field. So I And for that. And I don't care if it's Trump or if it's whoever's after Trump. I don't care who does that. I think it's important. And I think people have to start seeing that it's important.

[00:47:24.28] - Dan Paulson

Well, and we have to make it cost effective to build those products here. So And this is where tariffs are the blunt tool to get this ball started. But again, we tie back into the energy. We tie back into the talent, the employees. We tie into more friendly rules of regulation. Because we're not even going to touch on the deregulation side today. That's probably a future conversation. But if it's impossible to do business, people won't do business here. They'll go somewhere else to do business. And whether it's a US-based company or a foreign-based company, that becomes a real issue because our economy thrives on us buying and selling goods and services. So we really do need to look at how taxation impacts us overall, and ultimately The tariffs, I think, are a good start to get that conversation going. But you and I both know that even reshoring some of these businesses, that doesn't happen overnight. It takes years to build a new... You know, Chip manufacturing was talked about a couple of years ago. So the chips bill, where we're going to build more microchips here in the US. Those plans aren't going to come online for another two or three years yet.

[00:48:40.11] - Dan Paulson

And even though we're making all that investment in subsidizing those plants, it's going to take a while before all that happens. And that's what people don't realize. You can say you want it built here, but then you have to rebuild the infrastructure and the tools and the buildings and everything else that goes into making that happen. So While Trump might want it now, as well as good as that might sound, to me, that's why I say it's a bargaining tool. Because if you implement it, if you say you're going to implement it at the end of February, we'll give them a little runway there. That gives you six weeks to then negotiate with the country that you want to negotiate with, maybe to improve your taxation situation going their direction, to then make your products and services more attractive to go that way. And now we get a more even playing field when it comes to the transfer of goods and services across borders. Because I don't think there's a single company that just wants to say, well, I only want to do business here in the US. I don't want to look at Canada, or Mexico, or Asia or Europe or any place like that, because there are a lot of companies that, even small companies, do business across borders, and they want their goods to flow as freely as possible.

[00:49:55.16] - Dan Paulson

But it gets really difficult when there's a lot of regulations. I know from some of the companies I know that worked in Europe, specifically. To get products there, you got all these different checks, and all these regulations, and all the red tape, and then there's the taxation issues, and all that makes it more difficult. And if we really want to free stuff up, we got to make it easier to transfer those goods and services back and forth.

[00:50:22.11] - Rich Veltre

I think you're hitting exactly the same point that I'm hoping for, that all I I want is a level planning field. I'm not saying that I don't want anything made outside the United States. I just think there's no balance anymore. And I think the conversation over the last, I don't know how long it's been that I've heard about this global economy, global economy. Well, Why is the global economy where the United States is the one who has to pay the most at all? Why are we doing the one paying the money? That's the thing that I resonate with what's going on with If you're going to be in a foreign country, if you want to be protected by the US, then pay your fair share. I don't think that's a bad statement. It shouldn't be United States should profit off of protecting you. That's Mafia mentality, and I don't agree with you. Fair share is the piece. That's the keywords that I see. Fair share. Pay your fair share. Pay what you believe you should You pay. You want all these things manufactured that you can sell in the US. You'll pay your fair share.

[00:51:35.11] - Rich Veltre

And don't expect that the US is just going to roll over because you're overseas and you're coming in. Why am I always being the guy who has to pay the... I have to fight for the lowest price. If my stuff is valuable, if my purchases are valuable, then pay a little bit more to get into the US.

[00:51:57.20] - Dan Paulson

Exactly. Now the argument becomes What is the fair share? No, I understand that. They pay your fair share, but nobody says what that fair share is.

[00:52:08.27] - Rich Veltre

And your comment is well taken. It's well taken that, what is fair share? And how do we get there? And is this just a starting conversation? Sure. But we've never had it before. It's always been, sure, go ahead. Trying to take everything that we ever make. You'll go ahead and make it because you'll make it cheaper and somebody gets richer. The guy is going to get rich anyway.

[00:52:33.14] - Dan Paulson

Well, and that's where companies in the US are going to have to shift that mindset that just getting it done cheap is the best way to do it. I do believe there are a lot of companies that realize that cheapest isn't always best. But there's also the challenge of a stock market and people invest in the stock market and they want those stocks to increase in value. The way they increase in value is more profits. So in some way or another, almost all of us, at least if we have any retirement all, are tied into that infrastructure where you want to see those stock values go up. Well, in the old days when fewer people were trading, they didn't move as quickly as they do now of days because it took longer to communicate that information out. Well, I can log in to the stock market right now and watch stocks click up and down instantly. And I also have the power now as as a normal human being to just go and bid on that. There's nothing special that's required of me other than setting up an account that allows me to trade stocks back and forth and link it to a bank account.

[00:53:40.17] - Dan Paulson

So that part, I think makes it more complicated And somehow we've got to figure out the balance there where we are willing to accept fluctuations in stock prices. We're not going to jump on the buy or jump on the sell. And I think that's going to be extremely hard to do. So this is why we They should invest in smaller businesses that are closely held, privately held, and boost their businesses up because they'll do a better job because it's really tied into their own performance and not whether or not the stock fluctuation by a few pennies one way or the other.

[00:54:17.11] - Rich Veltre

So definitely notice that we talked about a lot of investing in the small business.

[00:54:24.26] - Dan Paulson

Correct.

[00:54:25.27] - Rich Veltre

And the second thing that if we went back and went through this podcast, notice how many times we said balance.

[00:54:32.22] - Dan Paulson

Yes.

[00:54:33.14] - Rich Veltre

The word balance was in the entire conversation, constantly.

[00:54:39.21] - Dan Paulson

And balance is making adjustments one way or the other. True balance is never, ever ultimately achieved. You always have to give and take. The idea is you give and take a little bit, you keep that bike up and rolling down the road. If you lean too far one way or the other, you fall over. So part of that is, if we also look back on this, we talked a lot about people. We talked a lot about talent. We talked a lot about utilizing that talent in different ways. And of course, what we also talk about is our sponsor, our other company, XCXO, is a great way to utilize that talent where you don't need that person full-time, 40 hours a week. And I do believe that we are going to see a shift where you will hire, you will have certain people that you'll full-time, you'll have other people that you'll have that will fill specific needs like you said. So it tends to be more of you come in for a project or you come in to work on some specific part of our business. And then when you're done, you can either work on something different or go somewhere else.

[00:55:45.21] - Dan Paulson

And that's really where XCXO has been designed to help businesses with that. So before we have Bob jump onto our commercial, Rich, how do they get a hold of you if they need to?

[00:55:56.11] - Rich Veltre

Best way to get a hold of me is Rich@xcxo.net.

[00:56:02.11] - Dan Paulson

And you can get a hold of me at dan@xcxo.net. And Bob, take it away. Rich, been a good conversation. We went almost full hour on this one, so a lot to talk about.

[00:56:14.11] - Bob

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