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IT SEEMED SMART AT THE TIME

There was a story in the Los Angeles Times last April that made me want to weep . . . for JOY because the story wasn’t about me. That sounds kind of mean, but let me tell you about it.

In recent years it’s been a hot bonus for workers in the field of technology to be able to buy, for just pennies, stock in the company they’re employed by. An engineer named Jeffrey was permitted, through a plan at Cisco, to snap up corporate stock for just five or ten cents a share. So he did the smart thing: he bought a hundred thousand shares. I mean, any time you can buy something that lists at $63 on the NASDAQ ticker, and pay just a nickel for it . . . well, you’d grab all you could. Everybody was doing it.

And there was something else all the financial advisers were saying in their newsletters: “Buy it and hold it. Hold it for the long term.” So this Jeffrey, who was suddenly walking around Silicon Valley with something like $7 million he’d payed $20,000 for, put the stocks in his sock drawer and said, “Thank you very much, Cisco. I’m set for life.”

Well, hold on. This L.A. Times story was dated April 13, the Friday before income taxes come due. And all at once, Jeffrey the engineer, and literally thousands of other instant millionaires like him, began to hear of a time bomb out there called the AMT. Not the ATM, which can rob you of your fortune $20 at a time, but the AMT — the alternative minimum tax. Uncle Sam, you see — and I’m sure some of you have found this out the hard way — considered Jeffrey to have received income from Cisco Incorporated . . . to the tune of $7 million minus the $20,000 he’d actually paid. The difference between the pennies-per-share price he’d paid, and the official Wall Street valuation of that same stock — ON THE DAY YOU BOUGHT IT — is a profit subject to the AMT tax, which runs between 26% and 28%.

But hold on to your big board bandanna. After Jeffrey bought the stock, which was once worth $63, the NASDAQ took a nosedive, and all of a sudden, Cisco was selling at $17.98 a share. And the bottom line was this: Jeffrey owed the IRS two-and-a-half million dollars in taxes . . . and now had stock only worth ONE-and-a-half million bucks. So this 32-year-old engineer with a wife, eight-month-old daughter, and a three-bedroom townhouse didn’t have seven million bucks in his sock drawer; instead, he was IN HOCK to Uncle Sam to the tune of a crippling million dollars.

Isn’t that a tough story? And it’s so reminiscent of this parable told by Jesus two thousand years before the dot.com phenomenon began turning computer whiz kids into rich young rulers. “There was a man who built his house on the sand,” the Savior told His audience. “And it worked out fine . . . until an unexpected storm came along. But when the rains came down, and the floods came up, the house on the sand went splat!”

You see, everything this Jeffrey did made sense. If you can buy a $63 Cisco share for ten cents, obviously, you do it. And if the market’s been going up and up and up, with no end in sight, with more pots of gold out there at the end of every Internet rainbow, then you buy and hold. You put that $7 million bonus into the safest thing you can think of, like a great big mansion on the sandy beaches of Malibu, as we mentioned in our story yesterday. Put it into appreciable real estate, which everybody knows goes up forever until the end of time. That’s the CW, the conventional wisdom. And the only thing that can go wrong is if a killer storm comes along, in the form of an unanticipated visit from the Tax Man on the 15th day of the fourth month. In the year of our Lord, 2003.

Now friend, we’re not saying a single word — except one of sympathy — for this man Jeffrey, and the thousands of others just like him. There wasn’t anything unethical or wrong or malicious about the moves he made, and really, there but for the grace of God . . . right? But from a spiritual point of view, this parable by Jesus tells us that you can live your life according to certain principles, and have an unexpected flash!, a surprise, wipe you completely out.

Let’s go to the Bible, why don’t we, and just look through this fascinating story? It’s in both Matthew and Luke, and speaking of the IRS, let’s read it from the version written by the tax man himself. Here’s Matthew chapter seven:

“Therefore everyone who hears these words of Mine,” [Jesus said,] “and puts them into practice is like a wise man who built his house on the rock. The rain came down, the streams arose, and the winds blew and beat against that house; yet it did not fall, because it had its foundation on the rock. But everyone who hears these words of Mine and does not put them into practice is like a foolish man who built his house on sand. The rains came down, the streams rose, and the winds blew and beat against that house, and it fell with a great crash.”

You know, it’s one thing to be entertained by stories — and I’m sure the crowd standing around Jesus day by day at the beach or in the temple enjoyed His marvelous talks — but Jesus certainly wanted His listeners to get beneath the surface, to get past the sand and the wind, and understand what He was saying. And that’s what we want to do here. What does it mean to build your house on the rock? In one sense, Christ comes right out and tells us: it’s to hear Jesus’ words and to do them. The house is your life, of course, and you want to base your life . . . ON . . . SOMETHING. And that something has to be the words, the teachings, the example, the principles of Jesus’ kingdom. To DO the agenda of the Christian faith. To do that is wise, because a life based on the rock of the Christian faith is not going to crash down when the inevitable storms come, whether on April 15 or any of the other 364 windy days out there where an enemy named Lucifer is stirring up strife.

In the marvelous book, Descending Into Greatness, Pastor Bill Hybels tells about a guy who had enough money to buy that mansion on the beach, so to speak. Actually, a mansion enters into it; listen to how he tells the story:

“Each year, I talk with hundreds of people who have chased the American Dream,” he writes. “More often than not, they are broken people shattered by the hidden costs of ‘success.’ One man recently had to choke back tears while he talked to me. All his life he had tried to make it to ‘Easy Street.’ Every waking moment of his days was spent trying to achieve his dream. It’s not that he didn’t love his wife and children; on the contrary, he wanted to provide what was best for them. They could wait awhile until he achieved all those wonderful things they deserved. He should have been happy as he spoke with me. He was just a deal away from the big time, a breath away from a vice presidency, one client away from Easy Street. And he had just taken possession of his dream house.”

So far so good, right? Work hard. Make money. Pile it away. Buy a big house right on the edge of the Pacific Ocean. A dream house and a dream ending. Correct? Here, word for word, is the rest of Hybels’ story:

“The only problem,” he writes, “was that it was an empty home. His wife and children had left him, and he was alone with the echoes of his footsteps. The price tag of his dream had cost him everything of value. He found himself spiritually alienated, relationally isolated, emotionally drained, and physically broken. All that was left was a pile of things that mocked him.”

And so Jesus says to him, and to the people standing around Him there in a grassy meadow above Jerusalem, and to you and me right now: “Friend, build your house — your life — on ME. I am the Rock. A life based on My teachings and, even more, on a personal relationship, a saving relationship, with Me, is going to last throughout eternity. It’s going to survive any storm, because I’ve already been through the cemetery, and that’s the worst storm there is.”

You know, there’s an old verse in Proverbs that our starry-eyed friend from yesterday should have read before building his beautiful mansion on the flimsy soil right on the Pacific Coast. Constructing his dream home right on the sparkling sand seemed so smart; everyone else was building there too. It was cheaper there; it was easier there; it was the expected thing to build there. But Proverbs 14:12 tells us:

“There is a way that seems right to a man, but in the end it leads him to death.”

Well, we’ve come full circle: death and taxes. You know what they say. And even God’s people pay taxes, including, once in a while, that AMT. But they don’t die — not eternally, at least — if they build their house on the Rock.