Updated on 07.31.14

The Simple Dollar Weekly Roundup: Readjusting Sleep Edition

Trent Hamm

During the summer, Sarah and I tend to stay up until 11 or so, then sleep in until 7:30 or 8 AM (usually when the children wake us up).

During the rest of the year, most of the family has to get up early for school or work, requiring alarms at 6:15 AM (or so).

The problem is that for the first month or so, I don’t adjust my evening bedtime. I’ll stay up until 11, go into bed, probably not fall asleep until 11:30 or midnight, then I’m awakened by alarms at 6:15. Add on top of that the nights when children wake up with a bad dream or something similar and you can start to guess what happens.

Eventually, I hit a wall. I spend a few days really tired, then I start going to sleep at the more rational time of 9:30 PM (or so).

It’s now time for that adjustment. Yawn.

The alternative to failure It is never better to do nothing. The biggest failure we can have as people is to simply do nothing and/or to fall into the trap of ridiculing those who actually are trying to do something. (@ seth godin)

This Time, It’s Different That statement is a crutch that people use to allow themselves to ignore the mountains of valuable lessons that the past can teach us. It’s almost never different this time. (@ chris guillebeau)

The Buffett Rule: Tax for Millionaires The more I study the issue of taxes, the more convinced I am that we need to move to a sales tax model with a rebate for all Americans. (@ consumerism commentary)

Why You Shouldn’t Care About the U.S. Government’s Debt Problems He offers some interesting reasons, but my reason is mostly that you shouldn’t waste your energy on the things you can’t control. Instead, focus on what you can control. (@ the dividend guy)

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  1. Tracy says:

    “The more I study the issue of taxes, the more convinced I am that we need to move to a sales tax model with a rebate for all Americans”

    The more you say things like this, the more I am convinced that you don’t understand economics at ALL. I mean, yay, lets increase the deficit *and* put the greatest burden on the already-struggling, what a GREAT idea! (Even with a rebate – the more you help offset the burden on the impoverished, the greater the deficit will increase – it’s a lose-lose for everybody except the wealthy)

    And how you can have that reply to the post about Buffet is just mindboggling.

  2. valleycat1 says:

    What is a ‘sales tax model with a rebate for all Americans’? First I’ve ever heard of this & on the surface sounds unworkable to me.

    Also, legislators and the general public need to understand that the funding for government programs comes almost solely from tax income, which means you can’t keep holding taxes level or cutting taxes if spending is going up.

  3. Tracy says:


    It’s also called ‘the Fair Tax’, irony of ironies. You can go to their site to read more about it. But it is absolutely unworkable and unfair and just plain stupid.

    “The FairTax is a single-rate, federal retail sales tax collected only once, at the final point of purchase of new goods and services for personal consumption. Used items are not taxed. Business-to-business purchases for the production of goods and services are not taxed. A rebate makes the effective rate progressive.”

  4. Riki says:

    In Canada we have the GST, a federal sales tax on most (but not all) items. It’s 5% and is added on in addition to the PST (provincial sales tax). Some provinces have combined the two into one called the HST (Harmonized sales tax).

    Low-income families receive a progressive rebate cheque in the mail every quarter.

  5. Gretchen says:

    A sales tax model?

    And this is who is helping pick our next president, folks.

  6. Tracy says:


    The GST and the proposed Fair Tax are very, very different (although the GST is still regressive and I know that there’s controversy because of that) – the model Trent is talking about would not be an additional tax but something that would replace every other form of taxation.

  7. Johanna says:

    The more I read Trent’s tax advice in the reader mailbags, the more convinced I am that he hasn’t actually “studied the issue of taxes” very much at all. So there’s that.

    With the Fair Tax, you’re looking at a federal sales tax of at least 30%, on top of the state and local sales taxes you already have. That’s got to introduce an enormous pressure for tax evasion.

    And I don’t believe for a second that the rebate would ever be allowed to stand. From the moment you implement that, you’re going to have people crying “handouts!” And without that, the tax doesn’t even pretend to be progressive.

  8. Riki says:

    Thanks Tracy. I didn’t have a chance to look up details on Fair Tax.

    I’ve been reading this blog for several years and it does not come as a surprise that Trent would suggest this kind of system. Trent’s perspective on things is . . . I don’t even know the word. At best incredibly naive and at worst idiotic.

  9. Roberta says:

    Trent – We handle the earlier wakeup time by making bedtimes earlier for everyone starting about two weeks before school begins (late August for us in Texas). That way instead of staying up later than usual all summer and having to adjust at the last minute, we gradually ease back by 15-20 minutes or so every few days until we’re back to school year bedtime and morning wakeups. (It helped that during the many years we both worked fulltime outside the home, the kids had to get up at the same time to go to their child care provider anyway.) Also, since my husband still has to get up to go to work everyday during the summer, we have discouraged loud activities and very late nights even as our children have gotten older and have more of a social life. Good luck getting over the first few days!

  10. Tracy says:

    “Pretend to be progressive” – truer words never spoken.

    (Even the proposed rebate amounts are laughable, placing an extremely high burden on the poor and middle classes)

  11. Katie says:

    The tax issue has been covered, so I’ll just say, of course sometimes the right thing to do is nothing.

  12. Steven says:

    Just curious people’s thoughts on Jon Huntsman’s idea for taxes. Get rid of the loopholes, drop rates for everyone. I think it makes sense. Then again, I know squat about taxes…but maybe that’s because the tax code in the United States is totally insane, and unless you’re an accountant, it doesn’t really make much sense.

  13. Tracy says:

    Huntsman’s plan is another attempt to shift any tax burden off of the wealthy and even further on to poor and middle class americans (and widening the gap even further)

    Any eliminating of capital gains taxes is going to do that.

    There are some good articles at washingtonpost.com/breakawaywealth that break that down, if you’re interested. (They’re not Huntsman specific, but they address the kinds of things he recommends)

  14. Josh says:

    But can you imagine how much more money we could save by making our own laundry detergent at home if the fair tax was passed? ;)

  15. Tracy says:


    Gosh, I hadn’t thought of that! No wonder it makes sense to Trent!

  16. Nick says:

    One man’s “loophole” is another business’s “incentive.” How about ending the mortgage interest deduction for homeowners? If you rent, that’s a loophole that other people use to unfairly get a tax break. If you have a mortgage, it’s an incentive to further the important goal of home ownership that makes this country great. See? It’s all in your perspective!

    Trying to level the playing field helps those who are at a disadvantage, and hurts those who have the advantage. Of course, those with the advantage have the means to perpetuate the status quo.

    I should know. I’m a tax accountant. :D

  17. jim says:

    Nick, As a landlord I get a tax deduction for the mortgage on the rentals I own too. I don’t hand the renters a tax rebate check but their rent IS cheaper because of it. I also get a big fat deduction for depreciation of the property which homeowners do NOT get. That too helps keep rents lower. If we lost those deductions then rents would go up. But I’m sure you know this if you’re a tax accountant.

  18. Kai says:

    I think the wrong decision is to do nothing at all and think you are doing nothing. It can be right to consider and decide that the best move is to refrain from moving, but it’s not right to simply avoid making even that decision and do nothing simply by failing to do anything.

    To make your laundry soap at home, you’re still going to need to pay a heavy tax on borax and washing soda and all, so it won’t help that much.
    But if you buy most things second-hand, you’ll let the first-timers pay the tax and skip it entirely. I suspect that’s the bigger draw for Trent.

  19. jim says:

    Nick, Hmm, OK, I guess you were just pointing out how any tax rule could be fair or unfair depending on if you get it or not? I might have read too fast and replied too fast. When I first read your article I thought you were seriously saying we should end that deduction, and saying its unfair to renters, but I think you were just using it as an example.

  20. Courtney20 says:

    “The more I study the issue of taxes, the more convinced I am that we need to move to a sales tax model with a rebate for all Americans.” Says the guy who recommends a Roth to EVERYONE?? I can’t square these two philosophies.

  21. Johanna says:

    As a non-homeowner myself, I have no particular love (or hatred) for the mortgage interest deduction. I wouldn’t necessarily mind seeing it phased out, but it would entirely depend on what happens to that money instead.

    Use it to lower overall tax rates for the poor, middle, and even upper-middle classes – fine. Spend it on programs to benefit the poor, middle, and upper-middle classes – fine. Reduce the deficit or pay down the debt – probably fine. Use it to reduce the highest tax rates (the main effect of which is giving away huge amounts of money to the very, very rich) – not fine.

    So many of these tax plans take the same basic form: Throw some tiny bone to the regular people (either in terms of money, simplicity, “fairness,” or the satisfaction that some other guy is getting screwed over worse than you are) to try to distract people from the fact that you’re giving hundred-thousand-dollar breaks to people who already make tens of millions of dollars.

  22. mary m says:

    I find the Fair Tax concept very interesting. If you’ve read the book you’d know that in order to implement sales tax, employee and employer paid payroll taxes are eliminated. Without having to pay taxes on the labor, theoretically the price of every good for sale would be reduced greatly. Then with the Fair Tax you basically control the amount you are taxed by controlling your spending. Everyone gets a rebate every month for a standard grocery amount. Although it sounds interesting, and the book is an easy and interesting read, the bottom line I took away was there would still be a tax increase.

  23. Steven says:

    Here’s my comment to Tracy (haven’t read the others): Huntsman’s plan will increase the effective corporate tax by 7% by eliminating loopholes, incentives and breaks. As for eliminating capital gains tax, I’m fine with that. It helps me and my retirement portfolio. And does it really matter if the rich are 15% richer? Will that affect your life in any meaningful way? I’m not sure it will. What I do know is that if we continue to increase taxes, eventually we’re going to run out of things to tax. Cuts need to be made, and a smart tax code needs to be put in place. If you want to be fair, implement a flat tax. Then everyone would pay the same tax rate…of course, people don’t like that either. I’m with Huntsman. And I’m a liberal.

  24. Tracy says:


    That’s just – not true. It really isn’t. Every single statement you said is just – not true. I don’t have the time to refute them in detail now, I’m about to run to a dinner party but …

    1) Huntsman’s plan will increase the effective corporate tax by 7% by eliminating loopholes, incentives and breaks

    No, it won’t.

    2) As for eliminating capital gains tax, I’m fine with that. It helps me and my retirement portfolio

    No, it won’t.

    3) And does it really matter if the rich are 15% richer? Will that affect your life in any meaningful way? I’m not sure it will.

    It won’t affect my life in a meaningful way if the rich are 15% richer. It WILL affect my life in a meaningful way if the rich don’t pay taxes on their income (and under his plan they, to all intents and purposes, don’t – seriously READ about it)

    4)What I do know is that if we continue to increase taxes, eventually we’re going to run out of things to tax. Cuts need to be made

    Actually, in order for revenue to increase, we need to create JOBS. Also, I don’t see why you’re saying ‘continue to increase taxes’ – if you look at the history, we are currently at the lowest taxation rate since taxation was implemented! We’ve been steadily decreasing taxes (and primarily the capital gains tax you like so much) and that is WHY, in large part, we’ve gone from surplus to deficit

    5) If you want to be fair, implement a flat tax

    That’s the antithesis of fair

    Seriously, you’ve admitted you haven’t done a lot of research on taxation and the implications of different kinds of taxes – so … do the research.

  25. Steven says:

    Maybe I’m wrong, but I recall not too long ago the Wall Street Journal praising his plan…

    Meh, what do I know.

  26. Johanna says:

    You call yourself a liberal, and you think praise from the WSJ is a good thing? I don’t understand.

  27. Steven says:

    I try to take things from all different perspectives rather than from sources that only reinforce my biases. I try to keep an open mind.

  28. Steven says:

    Maybe it’d be better to say that historically I’ve voted Democrat, and would never in a million years consider voting for a Republican. This election season, I’m not so sure…and trying to keep an open mind and see things from both sides.

  29. Johanna says:

    I’m not saying you shouldn’t read the WSJ – I’m just surprised that you seem to think their endorsement is all the evidence you need that Huntsman’s plan is a good idea, and that you seem to expect Tracy to think likewise.

    Anyway, to elaborate on one of the points Tracy made earlier: The capital gains and dividend tax rates have absolutely no effect on your retirement portfolio, provided your retirement portfolio is in retirement accounts (such as 401(k)s and IRAs). Withdrawals from pre-tax accounts (regular 401(k), traditional IRA) are taxed as ordinary income, and withdrawals from Roth accounts aren’t taxed at all. At no point do you pay capital gains or dividend taxes on the money in either of those types of accounts.

  30. Karen says:

    @ Steven, I’m always glad to encounter people who diversify their sources for balance. I’m a Liberal Democrat. I’ve been reading the WSJ for 25 years–since I was 15 years old.

    The WSJ used to be a sound financial publication with a conservative bent. It has, especially in the last 5 years, moved to being a general publication that panders to its target audience of extremely wealthy, middle-age to older Americans who prefer to be insulated from the reality of American economics and hardship. You can see this especially in the editorials, where I presume you read the praise for the Huntsman plan.

    While the WSJ used to be a reliable, nuanced publication that offered a solid alternate perspective to liberal journals, it is, unfortunately, no longer. Sad to say.

    The investment tables are still pretty good though, as are the wine recommendations ;-)

    You might consider the Economist (magazine) as a source. I have not found a newspaper to fill the void of the old WSJ.

  31. Steven says:

    Thanks for clearing that up for me Johanna. I’m not saying I have all the information, and no, I didn’t form my opinion based on what the WSJ writes and tells me what to think. I thought it was a good idea before they’d even commented. Do I think it’s perfect? Far from it. There are many things I’m not comfortable with, especially in regards to his stance on the EPA, but I also feel that loopholes must be closed. It’s beyond frustrating that corporations such as GE are able to pay zero taxes. If Huntsman’s plan, as he describes it, will close those loopholes and increase the effective tax rates, I’m all for it. Will there be things about it that I also don’t care for? Sure. I don’t particularly like that my breaks and incentives would also be eliminated, but if my rate is lowered, it might (or might not) end up being a wash.

    I try to get my information from many sources, major media, and independent sources. I read opinion blogs from both sides, and have really found myself moderating in my political opinion. I’m still socially very liberal, but becoming much more fiscally conservative. At times, those two things will be at odds, but I’m trying to work that out in my mind.

  32. deRuiter says:

    Karen #30, Isn’t it funny that the WSJ has changed, as you mentioned, and the New York Times, which used to report the news has become the house publicity organ of the far left Democrats? #2 valleycat1 “…you can’t keep holding taxes level or cutting taxes if spending is going up.” Well, there is the thought that if taxes on business and income were lowered, people would do more business. For instance, when taxes on capital gains are high, people hold on to assets and the government doesn’t get tax from sales transactions. When taxes are lowered, people sell all those assets because they get to keep the bulk of the money from the profits, it stimulates business which raises revenue for goernments while making people become more prosperous. It depends upon your outlook, is the pie static in size in which case if one gets more another gets less? Or is the pie expandable and if one makes more, there is more pie? During the Cold War, look at the prosperity of democratic countries compared to the poverty of those in the Soviet Block under Communism. One system had supermarkets and plenty of everything, the other had long lines, meatless days, rationing, few durable goods, cheap shoddy goods and not many of them, because no one was inclined to work when they got the same money for working or not working. Same is true today, we have too large a welfare class, too high taxes, and more people deciding not to work because they don’t want their hard work to suppost the sponger class. I could work more and harder and earn more, but the government would confiscate so much of my income that I instead devote free time to keeping what I’ve got, practicing frugality, and not going into the next income tax level.

  33. Tracy says:

    But that’s the thing, Steven – under Huntsman isn’t running on a platform of tax cuts, his plan is about tax reform – and there’s a very strategic reason for that.

    Under his plan, your taxes will go UP. (Unless you are making several hundred thousand a year)

    Granted, your actual rate may or may not go down. the actual numbers of his plan are very different (You mentioned the WSJ article – that was an opinion piece and if you read it again, it’s full of a lot of praise for his plan – and not a single number is actually quoted about what it will do) Your health insurance (even the part paid by your employer, if that’s the case) will be taxed. Social Security for the elderly will be taxed. The earned income credit for working poor families will be eliminated. The mortgage interest credit will be eliminated (which seems like a great plan in light of the number of people already struggling to pay mortgages and the high rate of default.) Education and child care payments will be taxed. Veterans and disability will be taxed.

    The people who are already struggling will be taxed. There is no way that’s not a plan that will cause even more poverty, more of an economic crisis because people who are struggling have less money to buy the goods and services that corporations want us to buy. The math just doesn’t work.

    Someone making 20,000 a year is going to have their taxes go up over 1,000 a year.

    The average middle class family is going to have their taxes go up around 2,000.

    Of course, he’s not raising everybody’s taxes. The wealthiest .1% are going to have their taxes reduced by about 500,000.

    “According to the nonpartisan Tax Policy Center, on the whole, middle-class families would be forced to pay $1,890 in higher taxes under the no-tax expenditure plan compared to what they pay now. They would even pay $738 more than what they would pay if all the Bush tax cuts expired. Meanwhile, because they benefit the most from the lower rates, the richest 1 percent would get a $7,000 tax cut under the no-tax expenditure plan compared to letting the Bush tax cuts expire.”

    Johanna already mentioned that retirement accounts are not subject to capital gains tax.

    Also, there’s some doubt as to whether his plan WOULD make GE pay more taxes. Because it *doesn’t* restructure the tax code to where multinational companies are forced to pay more. The only thing it does is lower their overall rate, providing them with some incentive to bring money back – but depending on where those funds ‘are’ they may or may not do so. There’s an article here that explains it:


    (It’s a very neutral article, from somebody who wants to like Huntsman’s plan)

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