[extropy-chat] Europe vs America (was Depressing thought....)

[randy]

On Thu, 13 Nov 2003 03:28:46 +1000, you wrote

>On Thu, 2003-11-13 at 01:51, randy wrote:
>
>> People who make 23K and under are generally taxed at about 23-27% from
>> their paycheck, and other taxes or fees generally amount to about
>> 7-13%. Those are rough approximations.  So the bottom half of AMerican
>> earners lose about maybe about 27-33% of their pay to taxes. And what
>> do they get for their taxes? That is really the big question.
>> 
>> Those in the 50-70 percentile range, with incomes of 23K-35K, roughly,
>> lose about 33-37% of their income to all taxation. 
>> 
>I always thought the US had a pretty low tax rate, but your post and
>others seem to indicate otherwise.  Googling up US tax rates, federal
>taxes for a single person at 23k would be a touch under 14%, and state
>taxes vary widely but i'll assume a median of about 3-4% for a single
>23k'er.  Could you give me details on what the fees and other taxes that
>make up the missing 15%-19%?  (just to clarify, this is a genuine
>question, and i'm not claiming your figures are wrong.  The little i
>know of US taxation is what i've gathered from an hour of googling
>around)
>alejandro

Good question....

About 7.5% of income is taken out of paychecks for social
security/medicare (and if you are self-employed, it's 15%. Actually,
it is really 15% for everyone, since the employer has to pay the other
7.5%, which of course actually comes out of money that would have
otherwise have gone to the employee). 

Also, I included the numerous local property and sales taxes which
work their way into everyone's life. For example, sales tax on most
food products and commodities and services is ~8% in Texas.  Suppose
you make 23K (median income in the US(about $13/hour)) and you spend
5K in taxable goods and services. That is $400 in sales taxes, which
is about 2% of your median income, roughly....

Plus, we pay property taxes, which typically are hundreds or thousands
of dollars a year (depending on value of the property).  For example,
here in Houston, assuming the median pay is 34K, and the median
home/apartment/condo is worth $60K, you would pay $1000 in taxes.
Which is about 3% of your median income, right?

THis property tax of course is reflected in rents that renters
pay....so everyone pays it, ultimately.

And of course there are sometimes state income taxes.  Maybe 2% added
on, if you average it over all the states.

And then there are various and myriad fees and taxes for every little
thing, which have gone up enormously lately! Say that is 2% added on,
on average.

It is generally acknowledged that Americans pay about 35-42% in taxes.
However, that is an average, and the higher income brackets bring that
figure up. I am really only concerned with the lower 60% or so.  They
are of course the majority of the voters.  And for them, in general,
taxation is probably around 28-35% or so, roughly speaking.

So now you see that we get relatively little for our tax dollars! Or
at least I hope you see that.  (BTW, I have already outlined the
enormous differences between costs for university education in America
and Europe (in a previous post).)

My research indicates that people in the same income brackets (lower
60%) in western europe (excluding portugal and spain) pay perhaps 35-
55% or thereabouts in taxation. But they get so much more! Do you
agree?  

Do you know how much a single, self-employed (or unemployed) person
has to pay for medical insurance in America? Perhaps 10K per year.
That is a young healthy person. A 50 year old person may have to pay
more! There is a state-sponsored low-cost insurance plan, but it does
not kick in until you are 65....
For a person who is skilled and has educated and has been able to
compete for and obtain a "good job", he pays perhaps $350/month for
health insurance for just himself. Perhaps 20-30% of all jobs do not
offer very good health insurance, or they offer none at all. It is
difficult to quantify the health insurance shortcomings of these jobs,
so therefore it is "under the radar" for America. About 20-30% of all
Americans either do not have health insurance or have very poor
insurance.

In America, without good insurance, any healthcare is quite expensive.
Fix a broken leg? Maybe 500-1500 dollars. Birthing a baby? Maybe 5-10K
or more. Appendicitis? 10K-15K or more. Diagnose and treat cancer?
30K-80K or more.

And even if you have good health insurance, you still have to pay
hundreds or even thousands of dollars if you have any dealings with
medical professionals at all in a given year.

An anecdote: a friend of mine is planning to move to Australia. He
recently returned from his vacation there (a short 2 week
vacation--his only one this year). He told me (in his
Venezuelan-German accent (he is here on an H1B visa)) upon returning,
" Randy, the corporations are ripping you (meaning "you Americans")
off!" 

He went on to explain that the Australians do not have to work as
hard, and they do not have to work about not having health care if
they are not working. Nor do they have to scramble to maintain their
lifestyle--govt welfare and unemployment benefits are much more
generous and available.

I agree with him. But it is not only the corporations that are ripping
us off--it is our leaders and the people who control various powerful
institutions. And we let them do it--we subscribe to the lottery
culture, where we all believe that we ourselves will be rich
someday....if we just work hard and pay our dues. And some do get
rich. But the house always wins...you see "rich" is only defined
*relatively*. By definition it happens only to a minority!

Oh well, you may think this rant of mine is depressing. But it is not
unusual for me.  Maybe you have deduced that I think most Americans
are stupid for not seeing what I regard as the obvious.  But I often
have the same feelings about religion. America is also quite
religious. Same stupidity runs rampant....







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The United States of America: If you like low wages, you'll love long hours!