I know a lot of rich kids, and the difference between them inheriting 10 million or 12 million just doesn't make any difference to their lives. They're equally up and trying to please daddy with their Range Rover they didn't earn. Little angry. Little angry. I hate rich kids. Let me just come out and say it. And every time I meet a rich kid that works really hard, I'm really impressed, because if I was a rich kid, I would have had a cocaine habit and a Range Rover and not much else.
In today's office hours, we discuss whether America should have a national sales tax, why corporate speak has taken over the workplace, and how to choose between career ambition and relationships. Question number one, our first question comes from David, who emailed us: Scott, I'm writing to get your thoughts on the concept of a national sales tax. Specifically, what do you think about a tax that would apply to everything other than unprocessed food, with an additional luxury tax included? I would be interested to hear your perspective on this idea.
I think we have that. I think it's called federal taxes, or a VAT, a value-added tax, which is big across Europe. So the lowest income quintile spends $35,000 a year exceeding their reported income, while the highest quintile spends $150,000 a year. A flat sales tax effectively hits the bottom group at nearly 100% of disposable income. So I don't like sales taxes because I feel like they're regressive. I'm just not down with pretty much any tax at this point that taxes any household making, say, less than 60 or $80,000 a year. I just think they've gotten so hit so hard from inflation, from outpacing wage growth, you know, oil price spikes, 22% of their costs related to energy. So it feels like we've outsourced so much pain to lower-middle-class households recently. I don't like it is the bottom line, because I think it just disproportionately — I wouldn't feel it, and that's not where we need to tax. We need people who are wealthy to feel it and pay a disproportionate amount of it.
In sum, the rich pay proportionately far less. Low-income households spend 16% of their budget on food versus 10% of the highest earners. So the unprocessed food exemption helps, but housing, transportation, and utilities, all taxable, still dominate low-income budgets. The existing national sales tax proposal, the Fair Tax Act, sets a 30% rate and attempts to offset regressivity with a monthly prebate. But analysts note it still hits retirees, large families, and students the hardest. The Tax Foundation. So I don't like a national sales tax. What do we need? We need to remove the exemption on estate tax.
Well, the best tax is the tax that is the least taxing. So if you were to tax all food, that's a really bad tax because everybody's got to eat. And if all of a sudden the percentage low-income households spend on groceries goes from 30% to 40%, that's not helping anybody, and it doesn't affect upper-income households at all. So you want to tax it as the least taxing. So what are the least taxing taxes? Lower the estate tax exemption from 30 million to 1 million. We're going to have something like $120 trillion passed down over the next 30 or 40 years. We don't need dynasties in the United States. One of the key points of distinction between the US and Europe is meritocracy, meaning that we don't build dynasties. We like people to make their own money. And if the Bezos kids inherit 30 billion instead of 40, they're going to be just fine, and so are we.
So only, I think, 8% even qualify for that exemption. So only one in 12 households would be hit by additional tax. I wouldn't even call it an additional tax — we would not have that tax loophole. And I don't think the kids would be any worse off. I know a lot of rich kids, and the difference between them inheriting 10 million or 12 million just doesn't make any difference to their lives. They're equally up and trying to please daddy with their Range Rover they didn't earn. Little angry. Little angry. I hate rich kids. Let me just come out and say it. And every time I meet a rich kid that works really hard, I'm really impressed, because if I was a rich kid, I would have had a cocaine habit and a Range Rover and not much else. I don't know where kids get their fire if their parents are rich. And that's something I think about a lot. But that's another talk show.
Anyway, lower the tax exemption on estates from 30 million to 1 million. An alternative minimum tax. The tax code has gone from 400 pages to 4,000, and those incremental 3,600 pages are there to screw the middle class. 1202: first 10 million on a company sold tax-free. Well, who starts companies? Typically people — the kind of company that gets sold is typically someone who has the capital to start a company, or the venture capitalists who invest in it. Raise capital gains to the same rate as income tax. Go back to Reagan. One tax rate. Why is the money that money makes more noble than the money that FUD makes? If there's any tax rate or a lower tax rate, it should be on people who actually show up and do the work to service us all, as opposed to the people who sit behind a computer and trade their stocks on Robinhood or hedge fund managers. And that might sound like class warfare, but it's not. It's Reagan. Income is income.
And then an alternative minimum tax of at least 40% on anyone making over 1 million a year, or any corporation, say, making over 50 or 100 million a year. And I think we'd mostly have the tax burden solved. So I do not like any universal tax because it ultimately is a regressive tax.
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Question number two, another listener email: Hey, Prof G. I've been working as an engineer in a manufacturing facility for four years. One thing that has struck me is the difference in how manufacturing and HQ personnel communicate. Put plainly, HQ personnel seem to lean more into corporate speak, which I think creates more confusion than clarity. My question is, what do you make of this phenomenon, and why is it so widespread in corporate America? Thank you for all you do.
I think it's probably because middle management comes more from business schools and consulting firms and uses terms like synergy and operational leverage and benchmark — you know, just all this sort of consultant speak. And I think some of it is fine, whereas I think people on the factory floor are just trying to get stuff done. So I don't think it's either good nor bad, but I do think occasionally more than syntax or semantics, it's about everybody in the organization — even managers — have to do a certain amount of actual work. They're producing something, not just managing others, which I think is important, but they actually produce work because that way they stay in touch with the work. That way they earn the respect of their colleagues and they're better managers, if you will.
So everyone at Prof G — we have 27 people now — everyone has work they work on. Everyone is attached to revenue, even if they, you know, have to manage people and people report to them. And I think that's a healthy thing. But I think the corporate speak — it's not corporate speak you need to be careful of. It's trying to avoid what I did the first 20 years of my career. And that is, most of the time when I was saying something, I wasn't saying something to add value. I wasn't saying something to try and learn. I was saying something that I thought would make me look smart. And I do think that trying to just ask good questions, be thoughtful, add value, or say something when you think it's going to add value — you know, that takes a certain amount of discipline.
But I think really good leaders — Tim Cook just stepped down and he was known for not saying anything in questions. I think typically you have a bad culture or a screwed-up culture or a culture that can be improved. Let's do that. And this was most of the cultures I think is that — am I being unfair with myself? I was just a mistake I made is a lot of the meetings I was in where I was running the company, I spoke more than most people, and that's just not good. I used to think that was leadership. I've now come to believe that good leadership is asking people a lot of questions, giving them an opportunity to speak, and listening, and trying to get to the right answer as opposed to impress everybody and convince yourself of them why you're the top guy or gal.
So if I had it to do again, I don't think it's corporate speak. I think it's less speak is what you want to aim for, and ask a lot of questions as a manager, and then participate. Don't be afraid to talk. Don't be afraid to try and replace your corporate speak with data, and that is: here are the numbers, here's the evidence, I think this might be telling us X, I found some interesting data, how I interpret it is the following, I'd be interested in the group's response. But I think people sort of begin to wince a little bit when someone just uses a ton of BCG speak, if you will. So listen more if you can, especially as a manager. Don't be afraid to speak up, but make sure you're adding value or asking good questions. That's one thing junior people don't do a lot of is ask questions. I think that's important too — when you don't understand something, to say, well, what about this, or what do you mean by that? And then try and replace the corporate speak with data, if you will.
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Welcome back. Question number three comes from a listener who emailed us: Scott, I'm a 25-year-old male early in my career who took a two-year contract in London last September. It's been professionally transformative, but personally brutal at times. My partner stayed in the States, and the distance is straining. I'm debating cutting the contract short at the end of 2026 to be with her in New York. I feel genuinely alive here, but I can't share it with the people who matter most, which hollows it out. You preach optionality and doing hard things while you still can. But you also say don't over-optimize for status at the expense of relationships. So which is it? Finish what I started, or go home to her? Love your work. Thanks.
So this is a good problem. You're in London with a good job, it sounds like, and you love somebody or you're into somebody, and you want and miss each other. So, boss, I don't know if you're 21 months away from your 24 months or three months, but my advice would be to stick it out and figure out a way to get home more often, or get back to New York more often, or figure out a way to get her here more often, because time goes really fast. And if the relationship is really weak — long distance is hard, but if the relationship is really weak and you move back thinking you're going to save the relationship, and then the relationship doesn't work out, you're screwed out of luck with no relationship and no job.
So I hated investment banking. I knew that from day one. It was a 24-month analyst program, and I knew right away in the first week, I'm like, I'm not good at this and I hate it here. But I'm like, it's two years, and it'll be good for me to stick it out. So I'm kind of — I'm just not a Hallmark channel here, you know, go with your heart, go with love. No. Spend two years, finish out your program in London. Work really hard. Take advantage of the isolation, if you will, to just really dive into work. Try and demonstrate excellence, and then look for another job back in New York. And if you're really good at what you do and it's a multinational, they'll maybe try and figure out something for you such that the two of you can be together.
You know, if the relationship is strong, I'm going to assume that you're halfway through, so you got another year. Twelve months goes fast. It may not feel like it goes fast at your age because the reference point, not having been on this planet for very long, seems long, but it's not. It'll go fast. And I think you're going to look back, and quite frankly, if the relationship doesn't survive it, it probably wasn't going to survive. Although I realize long distance is stressful. You know, tricks: do a lot of FaceTime, plan trips together. But I wouldn't give up a job at this point for love. This isn't like you're away from your wife and three kids and miserable. This is you're away from young love, which is awesome and fun. But I don't know, 24 months. I say, boss, put your head down. Before you know it, that 24 months is going to be over.
And as a means of giving yourself something to look forward to, start thinking about opportunities and ways for the two of you to get to the same city, and start planning that together. About what jobs each of you are going to try and get such that you can ultimately be together in whatever it is — three, six, or 12 months. But like, we live in a capitalist society, and economic and professional trajectory is really important, not only for your own sake but for the sake of the relationship. Relationships are just easier when you're economically secure. And part of that economic security comes from sacrifice when you're your age. So it's probably not what you wanted to hear. I find with advice like this, people have already made up their minds and are just looking for validation. But my advice to you would be, most likely without knowing more information, to stick it out and start planning how you both figure out a way to be in the same city at some point. But it doesn't sound like it's that far away.
But anyways, like I said, good problem. You're in London, the second greatest city in the world. New York is number one by a long shot. But number two is pretty good. And you have someone that you're — sounds like you're crazy about. So your worst days are better than most people's best days. That's all for this episode. If you'd like to submit a question, please email a voice recording to officehours.com. That's officehours.com. Or if you prefer to ask on Reddit, just post your question on the Scott Galloway subreddit, and we might feature it in an upcoming episode.
