Month: April 2024

My wife Susan and I were visiting a friend’s home this week and I noticed what appeared to be a branding iron embossed with his initials hanging on the wall. He shared that it was a gift from a friend enabling him to brand steaks he grilled.

That triggered an almost instant connection to the concepts of branding in companies, artists, and service providers. They all leave a mark on their products that distinguishes it or them from competitors and hopefully from copycats.

It turns out that mental connection was right: https://en.wikipedia.org/wiki/Brand

There you see the origin of branding irons was to prevent theft. I think we all are aware of cattle being branded so rustlers could be caught and the cattle they stole recovered. Knowing this traceability, clever thieves would simply slaughter the cattle in the fields and leave the hides behind.

Today, companies recognize that brand identity and differentiation are crucial elements in brand loyalty. Then, how do you differentiate a commodity like electricity or natural gas that are indistinguishable from providers. The only clear differentiator is price, right?

Some of you quick thinkers will respond insisting that it is the way electricity is made that differentiates the provider. Was it produced using solar, wind, hydro, nuclear. or fossil fuels? Others of you will remark that the time and duration of supply matters because the value of keeping the lights on for everyone changes all the time.

So, the value of the commodity depends upon the value of timely and reliable supply for a customer. Therefore, customers who are flexible about when they get their power should pay a lower price than those who simply want it available at the flip of a switch.

In every case, the energy provider leaves a mark on the minds and hearts of their consumers. Now that we define this objective, it seems to me that education and proof of your generation, delivery, and reliability excellence also define that mark.

Over the years, energy providers learned that one of the most important brand differentiators was their energy efficiency and demand response programs and services, which educated and enabled consumers to be participants in this brand identity.

I am not sure energy providers realize how important this is any longer. The mark being left today is the impression that the industry simply doesn’t care about these essentials any longer. The result is we reduce this all to price … it is moving back to a pure commodity.

Well, it’s that time of the year again that many of us dread … filing our state and federal tax returns. As attested to by one of our founding fathers, Benjamin Franklin, over 235 years ago in 1789, nothing is more certain in our lives:

“Our new Constitution is now established and has an appearance promising permanency. But nothing can be said to be certain in this world except death and taxes.”

However, the taxes Franklin was referring to were not income taxes. They were mostly sales taxes by the British and our government on goods being bought and sold here.

The history of income taxes in the United States is remarkable in that it is so recent. It was only 150 years ago (1862) that President Lincoln signed into law a revenue-raising measure to help pay Civil War expenses, creating a Commissioner of Internal Revenue and the nation’s first income tax. It levied a 3 percent tax on incomes between $600 and $10,000 and a 5 percent tax on incomes of more than $10,000. The income level threshold was an enormous amount of money back then so most paid little to nothing in taxes.

It may be surprising given how small this tax appears to us today, but there were terrible reactions to this new tax. By 1867, just five years after it was introduced, public opposition was so fierce that Congress cut the tax rate, and in 1872, the income tax was repealed. From 1868 to 1913, 90 percent of all tax revenue came from taxes on liquor, beer, wine and tobacco. Today, we would call these sin taxes. A few years later, prohibition killed that golden goose.

In 1894, the Wilson Tariff Act revived the income tax and an income tax division within the Bureau of Internal Revenue was created, but a year later, in 1895 the Supreme Court ruled the new income tax unconstitutional on the grounds that it was a direct tax and not apportioned among the states based on population. The income tax division was disbanded. So, what started in 1862 ended in 1895.

Then in 1909, just over 100 years ago, President Taft recommended Congress propose a constitutional amendment that would give the government the power to tax incomes without apportioning the burden among the states in line with population. Congress also levied a 1 percent tax on net corporate incomes of more than $5,000.

The arguments for and against taxes have provided full employment for accountants and lawyers. Just ask any accountant these days how complex the tax code is. Do you remember Herman Cain’s 2012 campaign called the 9–9–9 Plan? It called for the replacement of all current taxes, such as the payroll tax, capital gains tax, and the estate tax, with a 9% personal income tax, 9% federal sales tax, and a 9% corporate tax.

So, based upon this very quick review of tax history, I would hope you agree that taxes are far from certain. Being taxed is certain … we just aren’t sure how much and how it will be extracted. Each year most of us rely on professionals to tell us what this all means and what we must do to comply.

So, eat, drink and be merry! And enjoy one politician’s explanation of his position on alcohol. This funny and true story is from Armon Sweat, Jr., a member of the Texas House of Representatives. In 1952, Armon was asked at a campaign rally about his position on whiskey, which was a contentious campaign issue. From the Political Archives of Texas, what follows is his answer to the question about his stance on alcohol:

“If when you say whiskey, you mean the devil’s brew, the poisonous scourge, the bloody monster that defiles innocence, dethrones reason, and takes bread from the mouths of little children. If you mean that evil drink that topples Christian men and women from the pinnacles of righteous and gracious living into the bottomless pit of degradation, shame, despair, helplessness, and hopelessness. Then, my friend, I am opposed to it with every fiber of my being.

However…. if when you say whiskey you mean that oil of conversation, that philosophic wine consumed when good people get together, that puts a song in their hearts and the glow of contentment in their eyes; if you mean the drink that puts a spring in the step of an elderly man on a frosty morning; or that enables man, if for a moment to forget life’s great tragedies, heartbreaks and sorrow; if you mean that nectar of the gods through the sale of which pours untold millions of dollars each year into our treasuries, providing tender care for crippled children, the infirmed, and builds highways, hospitals, and colleges in this nation. Then my friend, I am absolutely, unequivocally in favor of it.

This is my position, and as always, I refuse to compromise on matters of principle.”

How time flies! But if we are lucky enough to live through it, we can give thanks for the privilege of being part of a community of professionals and friends as these timing marks emerge. Ten years and over 500 blogs make me wonder whether I am just repeating myself and why I keep doing this.

But the events of the days keep reminding me that nobody else I know is blogging to remind everyone of the insanity in the energy industry. That is why I named the blog Captain Obvious … everything I have been writing is obvious to those who are looking and thinking critically about our energy challenges.

It is a bit funny to me that I asked the question to you all whether I should stop blogging about five years ago. I got a trove of responses pleading with me to keep going, and one from a dear Christian friend stunned me. It went something like this in response to whether my blogs matter. He said:

“They matter to me, and I know they matter to many others in our industry. They also matter to God and that should be enough support for you to continue.”

What we say and do matters … perhaps not to move the world’s indicators, but to each other. It is so easy to just sit on the sidelines and complain about what is happening. I try to point out fallacies, like statements made by politicians or people with an agenda that have no scientific or engineering underpinnings. I try to offer concrete steps we all should be taking to move the ball down the field.

We just moved Captain-Obvious.com to a new server so the blog is now refreshed and secure with my IT provider … who was our IT support about the time the first blog was posted. His first name is Joel as well. Relationships matter … a lot.

I try to stay ahead of the need to post blogs because I prefer not writing under pressure. I have to wait for the moment and the issue to present itself in the context of our modern lives before I can write anything. Most often it is one of you writing me a note copying something from our media pointing out the insanity of our mutual plight.

Thank you once again for the privilege of your weekly attention. If you have some words of encouragement or thoughts you would like to share, please send them to me directly in email ([email protected]) or through the Comment box offered on the blog site.