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Flip side of the welfare state is the heavy tax burden. Heavily progressive income tax makes it harder for individuals to accumulate capital for enterprenial e

• jliptzin 4y ago
  Their tax rates are only a few percentage points different from ours. I think the difference is that we funnel 20% of it to the military (2% for Norway) and their tax code probably has fewer loopholes for the rich to exploit.
  • pclmulqdq 4y ago
    Their total tax burdens are much higher than US citizens' tax burdens unless you're making 7 figures of W-2 income. The top marginal tax rate kicks in an order of magnitude lower in those countries, and hits most of the middle class. In the US, it hits very few people. Also, the military is 20% of the discretionary budget, but 10% or less of the total budget.
    • defrost 4y ago
      For a full picture factor in outgoings for world class health and education per person (and other benefits that are free | much cheaper than US); these are very low cost for individuals and offset higher taxes by offering better value for money.
      • koobe 4y ago
        If this is indeed the case, shouldn't there be an influx of skilled professional and entrepreneur immigrants into all of these nordic welfare states? Something doesn't quite add up, as there's appears to be a constant shortage of such talent.
        • don_esteban 4y ago
          Sweden actually is one of the favourite destinations for immigrants. Perhaps high skilled ones would prefer a country with better climate ... :-)
      • Jochim 4y ago
        "World class" health and education brings you some of the worst maternal mortality rates in the developed world[1]. Doubling Canada's rate and adding a bit more really screams world class. You do pay out the ass for it though so good job making someone rich I guess? Shame about all the dead babies though[2]. [0] https://www.statista.com/statistics/283221/per-capita-health-expenditure-by-country/ https://www.statista.com/statistics/283221/per-capita-health... [1] https://www.healthsystemtracker.org/chart-collection/quality-u-s-healthcare-system-compare-countries/ https://www.healthsystemtracker.org/chart-collection/quality... [2] https://www.americashealthrankings.org/learn/reports/2019-annual-report/international-comparison https://www.americashealthrankings.org/learn/reports/2019-an...
        • defrost 4y ago
          > "World class" health and education brings you some of the worst maternal mortality rates in the developed world ... Just to be clear, I was referring to the Nordic countries, Australia, better performing OECD countries, etc and not referring to the US. Your links bear out my position, that US "free market | low taxes" approach doesn't deliver good outcomes for the masses.
          • Jochim 4y ago
            Indeed! Forgive me, I misinterpreted your earlier post to be claiming that the "low cost" of US healthcare offsets the "high taxes" of comparable countries.
    • Lalabadie 4y ago
      For comparable benefits per citizen, the US are prohibitively expensive. The argument that other countries might be technically higher in taxes will remain moot so long as in the US, needing an ambulance could mean years of financial hardship if you're not sufficiently well off. The same goes for lodging, food safety, etc.
    • alistairSH 4y ago
      You haven’t accounted for health insurance, college education, and possibly retirement. Once you add those in, the Nordics still pay a bit more, but not by the margin you might expect.
      • pclmulqdq 4y ago
        The US government provides retirement benefits, including healthcare at retirement. You are not required to pay for college, and you can go to a cheap school if you want.
    • vidarh 4y ago
      When I at one point considered moving to the US, I did the numbers for UK and Norway, because I'm from Norway and live in the UK, and while Norway certainly came out higher in terms of tax than some US states, comparing with places I might be prepared to consider, like California, the difference was small enough it'd be more than eaten up by health insurance before considering the other costs of a reduced welfare system (e.g. needing a far bigger cushion in case of unemployment, far higher childcare costs etc.) Your mileage will of course vary a lot depending on specifics, and especially which US states you compare with.
      • deltarholamda 4y ago
        Yes, it is remarkably hard to come up with a US tax rate, because in single-payer healthcare countries your healthcare is covered. Here, how much do you pay? I couldn't even begin to guesstimate. While you could probably find cheaper places to live in the US than California, and therefore find much more agreeable tax rates, it's not that easy. Culture varies a lot in the US. I love the South, but a some folks would rather drink poison than live there. And you can't forget property taxes. These vary at the county or city level and can be quite significant. And, just for fun, they generally pay for the public schools, which depending on where you are may be abysmally awful, so now your "tax rate" includes stumping for private school, which could be the equivalent to a year's salary in some Nordic countries.
      • TheOtherHobbes 4y ago
        Health care in the US is effectively a corporate tax and should be labelled as such. If you want to compare the real costs and benefits of starting a business you need to compare like for like, which includes all national, state, and privatised taxes and other indirect costs. When you include those the reality-based answer is that the US fares relatively poorly. Which is why the US has a more aggressive VC sector. Whether by accident or design start-ups are forced to look for outside funding far earlier, and bootstrapping is far harder. The result is more of a monoculture that chases unicorns and less of a vibrant sector of independent small and medium businesses, some of which will grow into unicorns naturally.
    • Retric 4y ago
      US total government spending is officially 34% of total GDP, Germany is 43.7%. With much of that covering healthcare and collage education which more than makes up the difference for the median family. In the end, the US’s extreme defense spending and horrifically inefficient healthcare system is a massive drag on the economy. What the US does differently from most of the EU is to hide as much spending as possible in the form of targeted tax breaks. From a cash flow perspective little changes but from a political standpoint it’s not spending.
      • pclmulqdq 4y ago
        US military spending is 4% of GDP. When a warmonger is president, that goes up to about 6% of GDP. The NATO commitment is 2% of GDP. It is not particularly extreme. The real drag is the US healthcare system, which effectively finances most of the medical R&D for the US, India, South America, and Europe, and also provides ridiculous levels of treatment for people who are about to die (in comparison to other health systems). There is also the US social security system, which seems to be very inefficient at best...
        • Retric 4y ago
          Officially it’s $1.64 Trillion in 2022 on defense vs ~23.4 Trillion GDP or 7% GDP. https://www.usaspending.gov/agency/department-of-defense?fy=2022 https://www.usaspending.gov/agency/department-of-defense?fy=... You can see different numbers based on if you include stuff like the DoE spending on nuclear weapon ‘stewardship’ or only parts of the coast guard, national guard, VA etc. US healthcare spending hardly subsidizes the rest of the world. Paperwork and insurance overhead don’t magically turn into R&D money. Litigation, malpractice insurance, excessive testing etc is just waste. At best ~12% of US healthcare spending is for retail drugs, but it’s not that relevant globally when you consider how much US companies are spending on advertising vs R&D. Which is then compounded by how much more expensive US drug trials are.
          • pclmulqdq 4y ago
            That's the budget. The actual outlays are less than $1 billion. Around 3-4% for the last few years.
• meristohm 4y ago
  Burden? If the substrate/infrastructure you're playing in is maintained by our tax money, count your blessings and work to build trust in a system that, as others in this thread have already said, helps set everyone up to more-safely fail and grow. No one person is so important that we need to cultivate philanthropists. I'd far rather we collectively decide what to do with wealth generated from natural resources (all the way up to human resources). We can do better than the relatively few wealthy people with the means and inclination to give back. The question is, how do we build a stronger representative government in the United States (where I live) when we're so divided and distrusting? Having a common enemy might work, but it can't be another group of people to go to war with. Might need to be the metaphorical devil(s) on our shoulders, and for that we need good mental health training from a young age, which now, given how broken and dispersed so many family groups are, requires tax money guided by science and wisdom. You and I are here but a moment. The bleeding edge of life will quickly pass us by, and the positive impact I am most proud of is the love and care I give to future generations, human and otherwise.
  • starkd 4y ago
    He's saying the heavy tax burden drains capitol accumulation. Too generous benefits prohibits the filtering mechanism built into markets that stops a society's resources from being drained into unproductive resources. Not ideal, but advocates of near universal welfare support do not seem to have a good answer to this problem.
  • kortilla 4y ago
    The taxation part is a burden no matter the outcome. It’s not optional, it’s a duty as a citizen to give a chunk of your money to the government. That is the load we are obligated to bear - a burden. Also, you’re romanticizing what happens with tax money. When a major portion of it is going to a military I have no say in, I don’t get warm fuzzy feelings contributing my portion to the feds. > how do we build a stronger representative government in the United States (where I live) when we're so divided and distrusting? You’re assuming the conclusion here. Many people want a much weaker federal government and your question can be rephrased as “how do we make the anti-government people go away?”
• svnt 4y ago
  Early stage investment is usually paying below-market salaries of entrepreneurs — that is, doing exactly what the government would, except the government doesn’t take a big cut of your startup. Additionally, the government doesn’t require you to network with the right people, come from the right subculture, etc. Do you want your “taxes” to go to the needy or the wealthy? Because in startups angel investors are capturing bigger percentages of the capital from your labor than the government.
• Sodman 4y ago
  In Finland, Denmark, The Netherlands, and Sweden, the income distribution ratio[0] of the total income earned by the top 20% of earners vs the bottom 20% of earners is about ~4x. Denmark has a personal income tax rate of 56% [1] Best data I could find[2] after a quick google on USA puts income distribution ratio around 5.2x, so not much of a substantial difference in gross income disparity vs USA at the 20th/80th percentiles. Personal income tax rate is about 37%[3], so certainly USA lets you keep more of your paycheck than Denmark. So high earners in US are making ~20% more than their peers in Denmark relative to the bottom 20% in their respective countries, and folks in the US pay ~20% less tax as well. Certainly it's a notable difference but we're not talking orders of magnitude here, especially since the above math doesn't account for all of the benefits that higher tax rate brings, both tangible and intangible. However, when we're talking in absolute numbers, most Danes out-earn most Americans. The median wage in the US is ~$52k [4] vs Denmark at ~$72k [5], which closes the gap even more. I suspect there are significant differences and outliers at the extremes however, and that is likely where most of the VC money lives - whether we're talking about angel investors dropping >$100k or VCs spending millions on pre-revenue companies. I'd wager we're well into the top 1% of earners in the US doing the funding. This is the most likely explanation to account for the differences in early stage investments and growth opportunities you described above, imho. [0] https://tradingeconomics.com/denmark/income-distribution-eurostat-data.html https://tradingeconomics.com/denmark/income-distribution-eur... [1] https://tradingeconomics.com/denmark/personal-income-tax-rate https://tradingeconomics.com/denmark/personal-income-tax-rat... [2] https://dqydj.com/average-median-top-household-income-percentiles/ https://dqydj.com/average-median-top-household-income-percen... [3] https://tradingeconomics.com/united-states/personal-income-tax-rate https://tradingeconomics.com/united-states/personal-income-t... [4] https://www.averagesalarysurvey.com/united-states https://www.averagesalarysurvey.com/united-states [5] https://www.averagesalarysurvey.com/denmark https://www.averagesalarysurvey.com/denmark