9 ms·

In order to get shiny new trains and big public infrastructure projects like this, you need to pay a lot of tax, and this model does not go down well with the A

by fredley 11y ago

In order to get shiny new trains and big public infrastructure projects like this, you need to pay a lot of tax, and this model does not go down well with the American electorate, generally speaking.

ulfw 11y ago
True. But it is a fallacy to believe US taxes were low. They aren't. Especially in NY and CA.
- fredley 11y ago
  Agreed, being able to levy fees on probably the largest bank accounts in the world, and not having to pay upkeep on a nuclear arsenal probably helps too.
- rayiner 11y ago
  U.S. total taxation as percentage of GDP is the lowest of any of its peers in the West. Only a few developed countries are lower (HK, Singapore).
  - david927 11y ago
    Only because the rich don't pay taxes in the US. As a middle-class American who lived and worked for a decade in Switzerland (and I made more money there), I can confirm that I always paid less as a percentage in Switzerland.
    - harryh 11y ago
      Switzerland has a 8% VAT.
      - nitrogen 11y ago
        That's lower than a number of US cities.
        saiya-jin 11y ago
        and only 2.5% on essentials like food
    - rayiner 11y ago
      To the contrary. The top 10% in Switzerland make 23% of the income but pay 21% of the taxes. In the U.S. the top 10% makes 33% of the income but pays 45% of the taxes. See: http://gregmankiw.blogspot.com/2011/03/what-nation-has-most-progressive-tax.html http://gregmankiw.blogspot.com/2011/03/what-nation-has-most-....
      - david927 11y ago
        That doesn't say that the top 10 accounts for 45% but that it should account for 45%. That's a big difference. The problem is that the US tax system is so complex that once you reach a certain level of wealth, it pays for you to have someone find those loopholes. Warren Buffet famously decried that he pays lower taxes than his secretary, for example: http://money.cnn.com/2013/03/04/news/economy/buffett-secretary-taxes http://money.cnn.com/2013/03/04/news/economy/buffett-secreta... Swiss roads have no potholes, there are no homeless, they have universal healthcare and a free university system. I've lived there and I paid less in taxes, and one big difference is that the wealthy pony up their fair share.
        saiya-jin 11y ago
        - there are some homeless, but usually import from rest of europe that comes in spring and leaves in autumn, some beggars here and there. - universal PAID healthcare (except dental and eye care, that is extremely expensive and out of your pocket) - free university - only state ones, private are costly. - roads are better than elsewhere and drivers are actually nice :) wealthy pay, superwealthy just a bit due to special tax deals (which still benefits the country compared to them leaving for say Monaco or gazillion of other tax havens all around the globe).
lukasm 11y ago
Swiss taxation is very similar to US (only country in Europe that has a Sales tax, private health care etc). The main difference is military budget.
- psykovsky 11y ago
  Every E.U. country has a sales tax. And way higher than the US one. It's called VAT...
  - deleted 11y ago
    [deleted]
  - lukasm 11y ago
    US Sales tax is NOT European VAT tax https://en.wikipedia.org/wiki/Value-added_tax#Examples https://en.wikipedia.org/wiki/Value-added_tax#Examples
    - psykovsky 11y ago
      That's not what I said. I said the EU has sales tax. On everything, even work hours, if you're a freelancer and sell your time. They call it VAT. They could even call it a whistle for all I care, but it still is a tax on sales.
      - henrikschroder 11y ago
        No, it's a tax on value addition. Hence the name...
        markusbrutus 11y ago
        As an EU citizen let me assure you that it is indeed a sales tax. The French guy who conceived it just thought to give it an innocuous name to better sell it to the public. Sure, if you are a company you may offset part of it but for private individuals that makes absolutely no difference whatsoever.
CHsurfer 11y ago
Im a dual US and Swiss Citizen. My taxes are lower in Switzerland. Of course I still have to pay the difference back to the US, but that's not the point. Switzerland has such a great infrastructure because they have been making steady, incremental investments over a long time. They accept that a project can have a very long payback period. Also, they invest to keep their infrastructure very well maintained, which keeps utility high and makes major overhauls less frequent, thus extending the duration that they benefit from their original big investment. So I think you don't need high taxes, but rather a long term outlook and the will to execute it, across multiple election cycles. Boston's Big Dig is the most recent example of such a project from the US that I can think of.
- jcfrei 11y ago
  I'm pretty sure though that Switzerland spends - relatively speaking - much more on public transportation than the US (if I looked it up correctly it's about 8.7% for CH and 1.2% for the US on the federal budget). After all the terrain is more demanding (alps, etc.) and the density of the network is much higher.
  - Tepix 11y ago
    Maybe it's because spends a huge amount on military instead?
- harryh 11y ago
  US Taxes as a % of GDP: 26.9 Switzerland: 29.4 (or about 9% higher) I obviously cannot comment on your particular tax situation but it is not representative of the country as a whole.
  - sebgr 11y ago
    The average Swiss citizen will earn more than your average american - overall swiss citizens will pay a smaller % on taxes than americans.
    - 11y ago
batiste 11y ago
Also to be fair Switzerland is a very compact country although quite mountainous. The length of the train rides, even with very fast trains would have an hard time competing against airplanes in the US. In Switzerland a 3h hour direct, comfortable, Zurich-Geneva train ride isn't much worse than a Zurich-Geneva flight (30 min flight + security and transfer to the city is about 2 hours)
- m_mueller 11y ago
  Fun fact: 8M Swiss do 1.8x the passenger kilometers of all of the US combined [1]. I'm pretty sure you have enough densely populated areas in the US that are larger than Switzerland, especially in the East coast. [1] https://en.wikipedia.org/wiki/Rail_usage_statistics_by_country#Passenger_rail https://en.wikipedia.org/wiki/Rail_usage_statistics_by_count...
  - saiya-jin 11y ago
    There is a bit of mentality too - for Swiss, railroads are part of culture, train stations are always at the heart of a city, and even small places are connected. Train infrastructure is dense. but it is bloody expensive, plain ticket for 20 km ride costs as much as 5 hour ride on fast train back home. everybody here buys early "ticket" that halves the prices of all tickets for 180 usd
greggman 11y ago
Does it need to be public? Japan has a huge train infrastructure all privately owned AFAIK. Singapore's I'm not sure if it's public or private but it apparently makes a profit.
jseliger 11y ago
and this model does not go down well with the American electorate, generally speaking. Actually, the U.S. government already spends about 41% of GDP: https://en.wikipedia.org/wiki/Government_spending#As_a_percentage_of_GDP https://en.wikipedia.org/wiki/Government_spending#As_a_perce..., and that's roughly comparable with some European countries. So taxes are already extremely high. At least on the federal level, about a quarter is spent on Social Security (income transfer), another quarter is spent on healthcare (mostly Medicare, with some Medicaid) and another fifth goes to defense / warfare: https://en.wikipedia.org/wiki/United_States_federal_budget https://en.wikipedia.org/wiki/United_States_federal_budget. U.S. tax mostly goes to transfer payments and defense / warfare. Whether that is a good thing is debatable; personally, I'd like to see more innovation and less warfare/welfare (http://www.amazon.com/Launching-Innovation-Renaissance-Bring-Market-ebook/dp/B006C1HX24 http://www.amazon.com/Launching-Innovation-Renaissance-Bring...), but by pretty much any reasonable standard the U.S. already pays lots of tax.
jacquesm 11y ago
You need to squander less of the taxes you raise. The Swiss pay on average less tax than the Americans on a percentage basis. (11% vs 10% to 39%).
fennecfoxen 11y ago
Pardon me. I'm going to be just a little more dogmatically right-wing economics than I usually care to be in these pages, but: > In order to get shiny new trains and big public infrastructure projects like this, you need to pay a lot of tax That's ideological bullshit that is directly at odds with reality. There's another perfectly good and effective way to get shiny new trains and infrastructure projects, and America is doing it with their freight railroads. It's called private investment, we've been doing a lot of it, very successfully, and railroads have been thriving. (The Economist, in a 2010 article which is linked nearby in this thread, opined that "America’s system of rail freight is the world’s best" and that "They are universally recognised in the industry as the best in the world.") What America's railroads don't have is effective private passenger rail. Private investment won't deliver it because it doesn't make economic sense right now. Some of that is for geographical reasons (population density), some of that is regulatory risk (echoes of the regulatory hangover which helped drive the final nail in the coffin when railroads were already facing difficult competition from the growth of air travel and cars, including implicit highway subsidies) and fear of competing with quasi-governmental subsidized entities like Amtrak, some of that is actual market failure and what the economists call path dependency. Government investment in passenger rail in this nation (including high-speed rail) is something that could be meaningfully countenanced in this nation, though, obviously... if people thought they could trust the government to do make it worthwhile. (We'll see how efforts like the California high-speed-rail project will serve to convince people - boondoggle or good idea?)
- jdblair 11y ago
  The US freight rail system may be maintained with private funds, but it was initially constructed with massive public subsidies. These took the form of land grants, not just for the right-of-way, but for surrounding land. This land was then sold to fund the railway development. http://www.loc.gov/teachers/classroommaterials/presentationsandactivities/presentations/timeline/riseind/railroad/grants.html http://www.loc.gov/teachers/classroommaterials/presentations...
  - fennecfoxen 11y ago
    This is true and accurate. However, substantial ongoing investment in the US rail system in the past 5 decades or so has been mostly private or private-public-partnership.
saosebastiao 11y ago
Americans do pay a lot of taxes...comparable with a lot of European countries (outside of France and Scandinavia). You can't just compare a top marginal tax rate and conclude that one country taxes more than the other...it is the combination of all taxes that determines government revenues. Our taxes are poorly structured, and the spending of the revenue is poorly prioritized and poorly accounted for. That is the real problem.

by fredley 11y ago

In order to get shiny new trains and big public infrastructure projects like this, you need to pay a lot of tax, and this model does not go down well with the American electorate, generally speaking.

ulfw 11y ago

True. But it is a fallacy to believe US taxes were low. They aren't. Especially in NY and CA.

fredley 11y ago
Agreed, being able to levy fees on probably the largest bank accounts in the world, and not having to pay upkeep on a nuclear arsenal probably helps too.
rayiner 11y ago
U.S. total taxation as percentage of GDP is the lowest of any of its peers in the West. Only a few developed countries are lower (HK, Singapore).
- david927 11y ago
  Only because the rich don't pay taxes in the US. As a middle-class American who lived and worked for a decade in Switzerland (and I made more money there), I can confirm that I always paid less as a percentage in Switzerland.
  - harryh 11y ago
    Switzerland has a 8% VAT.
    - nitrogen 11y ago
      That's lower than a number of US cities.
      - saiya-jin 11y ago
        and only 2.5% on essentials like food
  - rayiner 11y ago
    To the contrary. The top 10% in Switzerland make 23% of the income but pay 21% of the taxes. In the U.S. the top 10% makes 33% of the income but pays 45% of the taxes. See: http://gregmankiw.blogspot.com/2011/03/what-nation-has-most-progressive-tax.html http://gregmankiw.blogspot.com/2011/03/what-nation-has-most-....
    - david927 11y ago
      That doesn't say that the top 10 accounts for 45% but that it should account for 45%. That's a big difference. The problem is that the US tax system is so complex that once you reach a certain level of wealth, it pays for you to have someone find those loopholes. Warren Buffet famously decried that he pays lower taxes than his secretary, for example: http://money.cnn.com/2013/03/04/news/economy/buffett-secretary-taxes http://money.cnn.com/2013/03/04/news/economy/buffett-secreta... Swiss roads have no potholes, there are no homeless, they have universal healthcare and a free university system. I've lived there and I paid less in taxes, and one big difference is that the wealthy pony up their fair share.
      - saiya-jin 11y ago
        - there are some homeless, but usually import from rest of europe that comes in spring and leaves in autumn, some beggars here and there. - universal PAID healthcare (except dental and eye care, that is extremely expensive and out of your pocket) - free university - only state ones, private are costly. - roads are better than elsewhere and drivers are actually nice :) wealthy pay, superwealthy just a bit due to special tax deals (which still benefits the country compared to them leaving for say Monaco or gazillion of other tax havens all around the globe).

lukasm 11y ago

Swiss taxation is very similar to US (only country in Europe that has a Sales tax, private health care etc). The main difference is military budget.

psykovsky 11y ago
Every E.U. country has a sales tax. And way higher than the US one. It's called VAT...
- deleted 11y ago
  [deleted]
- lukasm 11y ago
  US Sales tax is NOT European VAT tax https://en.wikipedia.org/wiki/Value-added_tax#Examples https://en.wikipedia.org/wiki/Value-added_tax#Examples
  - psykovsky 11y ago
    That's not what I said. I said the EU has sales tax. On everything, even work hours, if you're a freelancer and sell your time. They call it VAT. They could even call it a whistle for all I care, but it still is a tax on sales.
    - henrikschroder 11y ago
      No, it's a tax on value addition. Hence the name...
      - markusbrutus 11y ago
        As an EU citizen let me assure you that it is indeed a sales tax. The French guy who conceived it just thought to give it an innocuous name to better sell it to the public. Sure, if you are a company you may offset part of it but for private individuals that makes absolutely no difference whatsoever.

CHsurfer 11y ago

Im a dual US and Swiss Citizen. My taxes are lower in Switzerland. Of course I still have to pay the difference back to the US, but that's not the point. Switzerland has such a great infrastructure because they have been making steady, incremental investments over a long time. They accept that a project can have a very long payback period. Also, they invest to keep their infrastructure very well maintained, which keeps utility high and makes major overhauls less frequent, thus extending the duration that they benefit from their original big investment. So I think you don't need high taxes, but rather a long term outlook and the will to execute it, across multiple election cycles. Boston's Big Dig is the most recent example of such a project from the US that I can think of.

jcfrei 11y ago
I'm pretty sure though that Switzerland spends - relatively speaking - much more on public transportation than the US (if I looked it up correctly it's about 8.7% for CH and 1.2% for the US on the federal budget). After all the terrain is more demanding (alps, etc.) and the density of the network is much higher.
- Tepix 11y ago
  Maybe it's because spends a huge amount on military instead?
harryh 11y ago
US Taxes as a % of GDP: 26.9 Switzerland: 29.4 (or about 9% higher) I obviously cannot comment on your particular tax situation but it is not representative of the country as a whole.
- sebgr 11y ago
  The average Swiss citizen will earn more than your average american - overall swiss citizens will pay a smaller % on taxes than americans.
  - 11y ago

batiste 11y ago

Also to be fair Switzerland is a very compact country although quite mountainous. The length of the train rides, even with very fast trains would have an hard time competing against airplanes in the US. In Switzerland a 3h hour direct, comfortable, Zurich-Geneva train ride isn't much worse than a Zurich-Geneva flight (30 min flight + security and transfer to the city is about 2 hours)

m_mueller 11y ago
Fun fact: 8M Swiss do 1.8x the passenger kilometers of all of the US combined [1]. I'm pretty sure you have enough densely populated areas in the US that are larger than Switzerland, especially in the East coast. [1] https://en.wikipedia.org/wiki/Rail_usage_statistics_by_country#Passenger_rail https://en.wikipedia.org/wiki/Rail_usage_statistics_by_count...
- saiya-jin 11y ago
  There is a bit of mentality too - for Swiss, railroads are part of culture, train stations are always at the heart of a city, and even small places are connected. Train infrastructure is dense. but it is bloody expensive, plain ticket for 20 km ride costs as much as 5 hour ride on fast train back home. everybody here buys early "ticket" that halves the prices of all tickets for 180 usd

greggman 11y ago

Does it need to be public? Japan has a huge train infrastructure all privately owned AFAIK. Singapore's I'm not sure if it's public or private but it apparently makes a profit.

jseliger 11y ago

and this model does not go down well with the American electorate, generally speaking. Actually, the U.S. government already spends about 41% of GDP: https://en.wikipedia.org/wiki/Government_spending#As_a_percentage_of_GDP https://en.wikipedia.org/wiki/Government_spending#As_a_perce..., and that's roughly comparable with some European countries. So taxes are already extremely high. At least on the federal level, about a quarter is spent on Social Security (income transfer), another quarter is spent on healthcare (mostly Medicare, with some Medicaid) and another fifth goes to defense / warfare: https://en.wikipedia.org/wiki/United_States_federal_budget https://en.wikipedia.org/wiki/United_States_federal_budget. U.S. tax mostly goes to transfer payments and defense / warfare. Whether that is a good thing is debatable; personally, I'd like to see more innovation and less warfare/welfare (http://www.amazon.com/Launching-Innovation-Renaissance-Bring-Market-ebook/dp/B006C1HX24 http://www.amazon.com/Launching-Innovation-Renaissance-Bring...), but by pretty much any reasonable standard the U.S. already pays lots of tax.

jacquesm 11y ago

You need to squander less of the taxes you raise. The Swiss pay on average less tax than the Americans on a percentage basis. (11% vs 10% to 39%).

fennecfoxen 11y ago

Pardon me. I'm going to be just a little more dogmatically right-wing economics than I usually care to be in these pages, but: > In order to get shiny new trains and big public infrastructure projects like this, you need to pay a lot of tax That's ideological bullshit that is directly at odds with reality. There's another perfectly good and effective way to get shiny new trains and infrastructure projects, and America is doing it with their freight railroads. It's called private investment, we've been doing a lot of it, very successfully, and railroads have been thriving. (The Economist, in a 2010 article which is linked nearby in this thread, opined that "America’s system of rail freight is the world’s best" and that "They are universally recognised in the industry as the best in the world.") What America's railroads don't have is effective private passenger rail. Private investment won't deliver it because it doesn't make economic sense right now. Some of that is for geographical reasons (population density), some of that is regulatory risk (echoes of the regulatory hangover which helped drive the final nail in the coffin when railroads were already facing difficult competition from the growth of air travel and cars, including implicit highway subsidies) and fear of competing with quasi-governmental subsidized entities like Amtrak, some of that is actual market failure and what the economists call path dependency. Government investment in passenger rail in this nation (including high-speed rail) is something that could be meaningfully countenanced in this nation, though, obviously... if people thought they could trust the government to do make it worthwhile. (We'll see how efforts like the California high-speed-rail project will serve to convince people - boondoggle or good idea?)

jdblair 11y ago
The US freight rail system may be maintained with private funds, but it was initially constructed with massive public subsidies. These took the form of land grants, not just for the right-of-way, but for surrounding land. This land was then sold to fund the railway development. http://www.loc.gov/teachers/classroommaterials/presentationsandactivities/presentations/timeline/riseind/railroad/grants.html http://www.loc.gov/teachers/classroommaterials/presentations...
- fennecfoxen 11y ago
  This is true and accurate. However, substantial ongoing investment in the US rail system in the past 5 decades or so has been mostly private or private-public-partnership.

saosebastiao 11y ago

Americans do pay a lot of taxes...comparable with a lot of European countries (outside of France and Scandinavia). You can't just compare a top marginal tax rate and conclude that one country taxes more than the other...it is the combination of all taxes that determines government revenues. Our taxes are poorly structured, and the spending of the revenue is poorly prioritized and poorly accounted for. That is the real problem.