by David K. Holmes, Chief Operating Officer • 4 min read
As I write this, we are just past the historic re-election of Donald Trump to be the 47th President of the United States. You may feel as I that we have a front row seat at the opera and the full ensemble cast is set to take the stage. Audience excitement is palpable, as a Reagan-like manifestation of traditional American values has pushed progressivism and its socialist actors off stage and out the exit door – for now. We may be witnessing the dawning of a new economic age of prosperity in America, and one for religious liberty as well. But for it to take place, actions must be bold and decisive on both fronts to take advantage of these times. Standby for Donald Trump, the Blue Mountain Opera’s leading tenor, as he is just taking the stage while performing the opening aria.
The simultaneous alignment of breakthroughs in religious freedom these past few years with the potency of the high growth economy coming forthwith could spawn breathtaking outcomes presenting once-in-a lifetime opportunities to secure your family’s religious freedom rights. Never have we seen such a chance to “lock-in” a family’s religious liberty by leveraging the economic power of past and future wealth generation with the current panoply of conservative judges and their rulings.
Sound estate planning, properly structured, can optimize both the amount you leave to heirs and simultaneously help secure their religious freedoms during this limited window of opportunity. On our end, First Liberty is poised at the forefront of the battlefield with a full arsenal of legal arguments to maximize those achievements. Here’s how the operatic theme should play out in the coming months.
In his opening notes, Mr. Trump has nominated my fellow Wall Streeter from New York, Scott Bessent, as Treasury Secretary. Mr. Bessent has already indicated legislation, and monetary and fiscal policy must work together to curb inflation and stimulate growth by opening energy spigots thereby lowering energy costs, cutting taxes, decreasing interest rates, reducing the deficit and national debt, rationalizing trade through the threat of tariffs, and instilling regulatory and governmental reform. Such growth could be beyond Mr. Bessent’s stated 3% target – which while well above where it has been, it is below the economy’s potential, non-inflationary GDP output. That’s music to investment markets in the US and worldwide and they are starting to react accordingly albeit grudgingly in Europe.
Look at what happened to the US stock market as represented by the S&P 500 stock index in the graph below after Mr. Trump was first inaugurated on January 20, 2017.
The DOW index also mimics the story portrayed above by the S&P 500, generating a “blue mountain” of aggregate wealth generation since 2017. To further the enormity of this point, draw a horizontal line, as I have done, parallel to the x-axis starting at the 2017 inauguration date and ending at the far-right hand of the graph. All the white area above the line and below the craggy blue line underscores the extent of the aggregate, pent-up wealth generation for those who simply bought the index and held it since the time of Trump’s first inaugural – just 8 years ago! Amazing to say the least. That’s the Blue Mountain Opera’s masterpiece performance entitled The Prosperity Economy. And, the next version of the Blue Mountain Opera, the Redux, is just now beginning.
The graph indicates what many of you may have experienced following the tax cuts enacted in 2017, and consequently may have large, pent-up capital gains in stock portfolios. You have either large single-stock positions or more diversified portfolios. It’s a good news, bad news story, however. Yes, abnormal investment returns have been great, but taxes on them are not. Fortunately, there are ways of escaping or minimizing the embedded capital gains hit and simultaneously satisfying your philanthropic intent. If you face this capital gains good news-bad news dilemma, what can you do? You certainly can simply gift stock outright to a charity and escape capital gains and take a charitable deduction if you can use it. Yet, there are other interesting vehicles you can use to donate in even more tax-efficient ways and continue your journey up the Blue Mountain. Please visit our website at www.firstlibertylegacy.org or give us a call for more information.
Simultaneously with prospects for renewed economic growth, religious liberty proponents are poised to continue the march toward freedom during this same period. Because of Mr. Trump’s nominations to the Supreme Court of the United States, we have a judicial landscape much more aligned with conservative values, and religious liberty. During the past 9 years, First Liberty has by the grace of God won 9 cases – an epic outcome – but don’t think that because Trump won this election that we are out of the threat zone forever. Within a week of the election, the ACLU had already posted a full-page advertisement in the NY Times vowing they will fight Trump’s agenda every step of the way with “the full power of our resistance”1 when their views differ from his.
What then is meant by a religious liberty legacy? It means financially supporting organizations who are winning on the religious liberty battlefield and in so doing achieving precedent-setting victories that institutionalize your family’s rights and inoculate them from future attempts to take them away. How can this be achieved? It is through coupling your wealth generation over these past years, and the prognosis for renewed high growth on the way, with legal victories that can insulate your children from harassment and discrimination into the future.
Crafting a plan to ensure First Liberty is supported over the long term can generate a legacy your heirs can rely upon. Unlike some firms, we are not sustained by an endowment, and this is fine. Happily, there are other, terrific ways to help First Liberty be sustainable and adaptable over the long term – and be there for your family. The bottom line: through proper estate structuring aligned with your investments, you can maximize the amounts left to heirs and at the same time secure their religious heritage. That’s quite a legacy in my book.
The next act of the Blue Mountain Opera Redux is about to begin, so sing along, join the chorus, and support religious liberty for the future! Call me if you or your connections would like to think of creating a sustaining legacy of freedom at First Liberty, or if we can be of assistance.
1 New York Times advertisement, November 8, 2024
* The information contained in this article is for information purposes only and is believed to be accurate at the time of its creation. First Liberty Institute is not a registered investment advisor, nor does it offer advice on the purchase or sale of securities. Information contained herein should not be used to speculate in or purchase securities of any type based upon the points of view presented in the article.
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