Nine things the rich don't want you to know about taxes
Supply-side economic tweaks are a joke, at least in practice. I've been saying it all along here and I'm sure you, fair readers, are tired of hearing about it. But today, I read essentially the most succinct distillation of the point I have made with respect to socialising certain, targeted goods (the basic needs for human life and social success, such as food, clean water, healthcare, clean environment, basic education). This vision I have doesn't up-end the private sector: what it does is provide a public good to keep the private sector honest. For example, I'm going through a bit of a headache with my private healthcare insurer right now. If I had an alternative, though, then I would have some negotiating power to leave them. That would lower private healthcare costs because there is a check in the marketplace. Similarly, with food: we all make decisions around food... all of us who can afford it, that is. The bottom line is that not everyone can afford food. And a certain, basic, subsistence level of food should be available. If you choose to use private sources of food (education, clean water, etc.), that's your prerogative and is none of my business. You can go to the grocery and get anything cheaper (almost) than you can when you eat out. We all know that. Yet we'll buy a beer at a bar for 4$. An economist would say we're crazy for doing that, but it happens daily.
So, here's the moneyshot:
Germans work less, make more per hour and get much better parental leave than Americans, many of whom get no fringe benefits such as health care, pensions or even a retirement savings plan. By many measures the vast majority live better in Germany than in America.
To achieve this, unmarried Germans on average pay 52 percent of their income in taxes. Americans average 30 percent, according to the Organization for Economic Cooperation and Development.
At first blush the German tax burden seems horrendous. But in Germany (as well as in Britain, France, Scandinavia, Canada, Australia and Japan), tax-supported institutions provide many of the things Americans pay for with after-tax dollars. Buying wholesale rather than retail saves money.
A proper comparison would take the 30 percent average tax on American workers and add their out-of-pocket spending on health care, college tuition and fees for services, and compare that with taxes that the average German pays. Add it all up and the combination of tax and personal spending is roughly equal in both countries, but with a large risk of catastrophic loss in America, and a tiny risk in Germany.
Americans take on $85 billion of debt each year for higher education, while college is financed by taxes in Germany and tuition is cheap to free in other modern countries. While soaring medical costs are a key reason that since 1980 bankruptcy in America has increased 15 times faster than population growth, no one in Germany or the rest of the modern world goes broke because of accident or illness. And child poverty in America is the highest among modern countries-almost twice the rate in Germany, which is close to the average of modern countries.
-David Cay Johnston, via Willamette WeekBoom. There it is. That's what I told the libertarian I argued with once (which actually got him to think it over), and that's what I've been saying all along. Money is money. And expense is expense. If the government wants your money, they will have it. And if the private sector wants your money, they will make sure to get it in certain, inelastic market sectors (where they hold the power and they know it). No one is willing to play chicken with their health; corporations know that. It is an unfair advantage.
In our system, we, the people, shoulder the risk of inflationary costs, of systems breaking down, and of financial burdens when things don't go right. Those things don't happen in the socialised systems... it is illogical to bear the brunt of education costs when they are free. There is NO danger of anyone defaulting on their education loans because there's no danger of you defaulting on your taxes (You can be a dick and dodge taxes, or you can be rich and avoid them by taking loans out against your assets and paying yourself back... read the article for those choice tips!). They're taken out of your income when you're paid. It is a foolproof system.
So, add it up, folks. Add up the cost of your education, of your healthcare, and just re-account for it as taxes. See what your marginal tax rate is then! I just did a back-of-the-envelope*. Grand total? 17% of my income. I just computed my taxes a bit ago. After the house deduction and all that, my federal rate was about 25%. Oregon income tax was another ~7%. Grand total of basic needs plus taxes? 49%. Show your friends and your Right wing relatives! Anyone can play!
All the costs of socialism without any of the benefits. What a country!
*Many of you don't know what your company is paying for your healthcare. Assume about 250-400$/person in your plan. I have really inexpensive, but out-of-pocket healthcare (and it sucks) and it is 250$/person for me and my wife. Of course, if this were truly socialised, it would be roughly half that, I would guess, if not less.
So, here's the moneyshot:
Germans work less, make more per hour and get much better parental leave than Americans, many of whom get no fringe benefits such as health care, pensions or even a retirement savings plan. By many measures the vast majority live better in Germany than in America.
To achieve this, unmarried Germans on average pay 52 percent of their income in taxes. Americans average 30 percent, according to the Organization for Economic Cooperation and Development.
At first blush the German tax burden seems horrendous. But in Germany (as well as in Britain, France, Scandinavia, Canada, Australia and Japan), tax-supported institutions provide many of the things Americans pay for with after-tax dollars. Buying wholesale rather than retail saves money.
A proper comparison would take the 30 percent average tax on American workers and add their out-of-pocket spending on health care, college tuition and fees for services, and compare that with taxes that the average German pays. Add it all up and the combination of tax and personal spending is roughly equal in both countries, but with a large risk of catastrophic loss in America, and a tiny risk in Germany.
Americans take on $85 billion of debt each year for higher education, while college is financed by taxes in Germany and tuition is cheap to free in other modern countries. While soaring medical costs are a key reason that since 1980 bankruptcy in America has increased 15 times faster than population growth, no one in Germany or the rest of the modern world goes broke because of accident or illness. And child poverty in America is the highest among modern countries-almost twice the rate in Germany, which is close to the average of modern countries.
-David Cay Johnston, via Willamette WeekBoom. There it is. That's what I told the libertarian I argued with once (which actually got him to think it over), and that's what I've been saying all along. Money is money. And expense is expense. If the government wants your money, they will have it. And if the private sector wants your money, they will make sure to get it in certain, inelastic market sectors (where they hold the power and they know it). No one is willing to play chicken with their health; corporations know that. It is an unfair advantage.
In our system, we, the people, shoulder the risk of inflationary costs, of systems breaking down, and of financial burdens when things don't go right. Those things don't happen in the socialised systems... it is illogical to bear the brunt of education costs when they are free. There is NO danger of anyone defaulting on their education loans because there's no danger of you defaulting on your taxes (You can be a dick and dodge taxes, or you can be rich and avoid them by taking loans out against your assets and paying yourself back... read the article for those choice tips!). They're taken out of your income when you're paid. It is a foolproof system.
So, add it up, folks. Add up the cost of your education, of your healthcare, and just re-account for it as taxes. See what your marginal tax rate is then! I just did a back-of-the-envelope*. Grand total? 17% of my income. I just computed my taxes a bit ago. After the house deduction and all that, my federal rate was about 25%. Oregon income tax was another ~7%. Grand total of basic needs plus taxes? 49%. Show your friends and your Right wing relatives! Anyone can play!
All the costs of socialism without any of the benefits. What a country!
*Many of you don't know what your company is paying for your healthcare. Assume about 250-400$/person in your plan. I have really inexpensive, but out-of-pocket healthcare (and it sucks) and it is 250$/person for me and my wife. Of course, if this were truly socialised, it would be roughly half that, I would guess, if not less.