High Tech Survival.

Cliff Jernigan has produced a highly readable book for TEI members and their staffs - and their bosses outside the tax department. Called High Tech Survival, this new book contains more than 80 brief summaries (one to two pages each) of the major public policy issues facing all of corporate America, with special emphasis on high-tech and biotech issues. There is not one issue area you cannot readily understand in three to five minutes of reading.

Cliff Jernigan is a long-time member of Tax Executives Institute. He is the person who started the immensely successful South Valley Tax Conferences in the early 1980s. At that time, Cliff was Director of Taxes and General Tax Counsel for Advanced Micro Devices, a leading U.S. semiconductor company. Held once a month, these conferences routinely attracted a hundred or more corporate tax practitioners. Out of the success of these meetings evolved TEI's Santa Clara Valley Chapter, which is now among the top Institute chapters in membership, attendance, and innovation. For his efforts, Cliff is justifiably one of the folk heroes' of the Silicon Valley tax community.

In his function as a corporate government affairs professional and chair of the highly respected Silicon Valley Tax Directors Group, Cliff has organized scores of tax and trade staff visits from Washington, D.C., and the California legislature. Each one of these visits brought TEI members in Silicon Valley closer to tax policy issues and helped them build understanding and rapport with congressional and legislative staff.

Tax policy issues account for about one-third of High Tech Survival. Bob Perlman, Intel's Vice President of Taxes, Customs, and Export Licensing (and a former TEI International President) has described the tax portions of the book as the most readable and understandable he has even seen. That may sound like hyperbole, but it is true. The tax explanations take complex tax concepts and put them into language your CEO and management can understand. After reading the tax portions of this book, management will have more awareness of the tax department's planning and compliance roles.

The non-tax chapters of the book (on subjects as varied as sexual harassment, trade policy, and political and charitable giving) are also excellent. Indeed, because a tax professional must have more than just a tax background, the breadth of the book is especially welcome. The tax professional must be multi-dimensional - he or she needs a broad public policy issues base to implement tax ideas in a broader context. This book provides that base.

The book aptly points out in the preface that your company may be the envy of its industry, with leading-edge R&D, the most cost-efficient manufacturing, strong customer demand, and an effective sales and marketing force, and yet government policies may slash your sales and take your bottom line from black to red. Cliff's book shows you how to avoid government policy traps and increase your company's sales and profits.

High Tech Survival has twelve chapters. While it was written for primarily high-tech and biotech management,

it has application to any manufacturer. Chapter One, International Trade Issues, is perhaps the most important chapter for management. It describes how companies can increase their international sales through opening up foreign markets, maximizing tariff savings, living with U.S. export control laws, and preventing foreign competitors from engaging in unlawful dumping that can put U.S. companies out of business.

Chapter Two deals with tort issues, including the controversial areas of frivolous securities and product liability lawsuits and onerous environmental legislation and regulations. Chapter Three looks at key antitrust and intellectual property areas. It shows how you can band together with your competitors in R&D and production joint ventures, which is critical when you need to make a bet-the-company mega-investment. It also compares U.S. and European Union antitrust law. The intellectual property discussion provides a roadmap for dealing with pirates who steal your intellectual property and describes when you can apply U.S. law to stop them from selling infringing products in the U.S. market.

Chapters Four and Five contain short explanations of important domestic and international federal tax issues, including some of the recent 1996 tax law changes. The treatment of the R&D tax credit, the foreign tax credit, and the foreign sales corporation are the most readable explanations for the layman I have ever seen.

Chapter Six discusses compensation and benefits issues. I especially liked the comparison of nonqualified stock options with incentive stock options.

Chapter Seven provides helpful insights into workplace issues, such as affirmative action, sexual harassment, and wrongful termination. Those in management know how important these issues are.

Chapters Eight, Nine, and Ten cover state and local tax and non-tax issues, including economic development programs and plant-site selection. Given the growing importance of state and local issues, the perspectives discussed in these chapters are very beneficial.

Chapter Eleven provides valuable suggestions on how political and charitable giving can help your company be successful in the public policy arena. It also tells you how to write to or meet with public officials.

Needless to say, I strongly urge you to buy this book as a resource. It is also appropriate for your management team. In fact, I am aware of one company that has bought books for its entire management team (about 500 managers).

High Tech Survival has a suggested retail price of $24.95, but TEI members can buy it at the discounted price of $19.95. The price is even lower for bulk purchases. You can acquire this book by calling Olive Hill Lane Press at 1-800-473-1761. Applicable taxes, shipping, and handling are extra.