The OECD has a useful little table taxation data for all the OECD countries. It measures total taxes (federal + state + local) as a percentage of the GDP of the country. i.e. of all the money that the country makes per year, what proportion of it does the government collect in taxes?
2012 is the most recent year they have full data for. Here's the English-speaking world plus a few others:
United States - 24.4%
Australia - 27.3%
Ireland - 27.3%
Canada - 30.7%
New Zealand - 33.0%
United Kingdom - 33.0%
OECD Average - 33.7%
Germany - 36.5%
Sweden - 42.3%
Denmark - 47.2%
Of those nations in my list, the US has lowest taxes, and in fact, in the entire OECD only Chile and Mexico have lower (perhaps not nations it's ideal to copy).
Denmark, on the other hand, which has the highest taxes of any OECD nation, is the world's happiest country, is ranked the best country in which to do business, and is the world's least corrupt country. Likewise Sweden, Germany, Norway, Iceland, Finland etc, all are some of the world's happiest and most successful countries, and they have taxes above the OECD average.
So having really high taxes is demonstrably not disastrous. In fact, people who study the subject have found that happiness appears to correlate with higher taxes (not only do the poor get happier when the taxes on the rich go up and more benefits are given to them, but the rich get happier too, because they benefit from living in a society with more government services and less poverty and crime).
The data is pretty clear: The US could increase its taxes by half, no problem. In fact, it could double them, no problem. Doubling taxes would bring the US on to pretty much par with Denmark.
What could the US government do with all that extra money? Basically everything good any American could ever think of, because that is a looooot of money. Free healthcare for all, expand social security, free college, paying off the debt, infrastructure improvements. You name it, that money would pay for it, easily.
So when members of the Tea Party insist that taxes in America are 'too high' and that it's absolutely imperative that taxes are cut, I'm like...
![rofl](https://theologyweb.com/campus/core/images/smilies/rofl.gif)
(I am, however, open to the argument that the taxes are wrongly distributed at present in the US, and that the ultra-rich pay far far too little and everyone else pays too much)
However. That said, we're not quite comparing apples and apples here, because Americans pay for healthcare outside of their taxes. Americans spend $8,500 per person on healthcare per year, which is 15.8% of GDP. Whereas all the other nations pay for healthcare through their taxes. So the cost to the average taxpayer of taxes plus healthcare is 40.2%. So that's actually comparable to other countries at the higher end of the tax-spectrum. But taxes + healthcare being at 40.2% should be buying America amazingly good government services, and it clearly isn't. So why not? Where's the money going?
The answer is private healthcare. That 15.8% of GDP that the US is spending on healthcare is a massive rip-off. Other OECD countries are paying only a third to a half of that for their healthcare. My country spends around 5.5% of GDP on healthcare. That's one third of what the US is paying. So the US is currently wasting roughly 1.7 trillion per year due to its inefficient healthcare system.
The problem with the US healthcare system is rather obvious: It's privatized. Almost every other OECD country runs a government single-payer system equivalent to "medicare for all", and as a result gets 2 to 3-fold cost reductions. Why? Well the entire medical insurance industry becomes unnecessary for starters. When you guys add the health-insurance middle-man your premiums are going towards paying the salaries of every single employee in those organisations, plus their profit margins, plus the bonuses for their CEOs. And when you have privately run hospitals you're likewise paying for their profit margins and bonuses. And when you let the pharmaceutical companies charge whatever they feel like for their drugs, they become the most profitable industry in the US, and exploit you no end.
Thus, if the US were to move to a single-payer medicare-for-all system, then forecasts suggest that its healthcare costs for the next decade would drop from $42 trillion to $15 trillion. Want to pay off an $18 trillion national debt? No problem. You can do that, and have $9 trillion left over to spend as you please. That's even enough for another War on Terror if you really really want. And do keep in mind how much wars cost before starting them. Bush W racked up about $5 trillion worth of debt for wars that he paid for with the credit-card, and if you start factoring in the life-long healthcare costs for veterans that estimate sky-rockets.
So in the context of various people on TV and elsewhere whining about Bernie Sanders' extravagant spending intentions, it's worth bearing in mind that Sanders' proposal of medicare-for-all would save $27 trillion over ten years, which could easily pay off all the national debt and pay for a wishlist as long as your arm of everything a socialist utopia could ever dream of having. If it all went straight into decreased taxes, then essentially the total that individual taxpaying Americans pay per year for taxes + healthcare, could go down by around 20%.
2012 is the most recent year they have full data for. Here's the English-speaking world plus a few others:
United States - 24.4%
Australia - 27.3%
Ireland - 27.3%
Canada - 30.7%
New Zealand - 33.0%
United Kingdom - 33.0%
OECD Average - 33.7%
Germany - 36.5%
Sweden - 42.3%
Denmark - 47.2%
Of those nations in my list, the US has lowest taxes, and in fact, in the entire OECD only Chile and Mexico have lower (perhaps not nations it's ideal to copy).
Denmark, on the other hand, which has the highest taxes of any OECD nation, is the world's happiest country, is ranked the best country in which to do business, and is the world's least corrupt country. Likewise Sweden, Germany, Norway, Iceland, Finland etc, all are some of the world's happiest and most successful countries, and they have taxes above the OECD average.
So having really high taxes is demonstrably not disastrous. In fact, people who study the subject have found that happiness appears to correlate with higher taxes (not only do the poor get happier when the taxes on the rich go up and more benefits are given to them, but the rich get happier too, because they benefit from living in a society with more government services and less poverty and crime).
The data is pretty clear: The US could increase its taxes by half, no problem. In fact, it could double them, no problem. Doubling taxes would bring the US on to pretty much par with Denmark.
What could the US government do with all that extra money? Basically everything good any American could ever think of, because that is a looooot of money. Free healthcare for all, expand social security, free college, paying off the debt, infrastructure improvements. You name it, that money would pay for it, easily.
So when members of the Tea Party insist that taxes in America are 'too high' and that it's absolutely imperative that taxes are cut, I'm like...
![ahem](https://theologyweb.com/campus/core/images/smilies/ahem.gif)
![rofl](https://theologyweb.com/campus/core/images/smilies/rofl.gif)
(I am, however, open to the argument that the taxes are wrongly distributed at present in the US, and that the ultra-rich pay far far too little and everyone else pays too much)
However. That said, we're not quite comparing apples and apples here, because Americans pay for healthcare outside of their taxes. Americans spend $8,500 per person on healthcare per year, which is 15.8% of GDP. Whereas all the other nations pay for healthcare through their taxes. So the cost to the average taxpayer of taxes plus healthcare is 40.2%. So that's actually comparable to other countries at the higher end of the tax-spectrum. But taxes + healthcare being at 40.2% should be buying America amazingly good government services, and it clearly isn't. So why not? Where's the money going?
The answer is private healthcare. That 15.8% of GDP that the US is spending on healthcare is a massive rip-off. Other OECD countries are paying only a third to a half of that for their healthcare. My country spends around 5.5% of GDP on healthcare. That's one third of what the US is paying. So the US is currently wasting roughly 1.7 trillion per year due to its inefficient healthcare system.
The problem with the US healthcare system is rather obvious: It's privatized. Almost every other OECD country runs a government single-payer system equivalent to "medicare for all", and as a result gets 2 to 3-fold cost reductions. Why? Well the entire medical insurance industry becomes unnecessary for starters. When you guys add the health-insurance middle-man your premiums are going towards paying the salaries of every single employee in those organisations, plus their profit margins, plus the bonuses for their CEOs. And when you have privately run hospitals you're likewise paying for their profit margins and bonuses. And when you let the pharmaceutical companies charge whatever they feel like for their drugs, they become the most profitable industry in the US, and exploit you no end.
Thus, if the US were to move to a single-payer medicare-for-all system, then forecasts suggest that its healthcare costs for the next decade would drop from $42 trillion to $15 trillion. Want to pay off an $18 trillion national debt? No problem. You can do that, and have $9 trillion left over to spend as you please. That's even enough for another War on Terror if you really really want. And do keep in mind how much wars cost before starting them. Bush W racked up about $5 trillion worth of debt for wars that he paid for with the credit-card, and if you start factoring in the life-long healthcare costs for veterans that estimate sky-rockets.
So in the context of various people on TV and elsewhere whining about Bernie Sanders' extravagant spending intentions, it's worth bearing in mind that Sanders' proposal of medicare-for-all would save $27 trillion over ten years, which could easily pay off all the national debt and pay for a wishlist as long as your arm of everything a socialist utopia could ever dream of having. If it all went straight into decreased taxes, then essentially the total that individual taxpaying Americans pay per year for taxes + healthcare, could go down by around 20%.
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