So I did this as an interesting exercise. I begin with the USA. When I remove all my deductions that effectively account for income taxes, pensions (social security + 401K), medical insurance, other taxes – I pay about 50% of my earnings to things that I get in some other more socialist countries for FREE, where I would get free education (or heavily subsidized), free medical care, great transportation, and so on.
So I pay 50% up front in my home country and I pay big deductibles if I get sick, potentially to the point of bankruptcy. The Chinese are buying up US properties and businesses by the dozen with US treasury notes, and all I get to do is finance things like aircraft carriers through my taxes, that nobody else has or wants, and I get lots of roads with potholes and I can’t get across the country on a MagLev train, which might be kind of fun. And when my kids go to college I will have bigger problems (as will they). And college tuition rates keep climbing by 7% per year.
In the UK I would pay 38%. That’s it! But I have also heard Englishmen describe the UK as a poor country now. Even in Sweden where they apparently pay 85% tax and get everything, it appears I would pay 58% up-front. So in the USA I can decide what to do with my money, where pre-ACA/ObamaCare I can to choose to be uninsured and die if I get reasonably sick, get huge education bills, pay when I get sick, watch my 401K dwindle in a crisis, and still I pay 50% – I’m not getting much for half of my hard earned pay – why is that?
In the year Y2K I earned X. Today I earn exactly the same, except that inflation has done maybe 2-2.5% per year, and now 17 years later I should be earning at least 50% more simply by applying a Net Future Value calculation at a 2.25% average inflation rate. This of course does not account for the general economy having increased by as much as the stock market – 100% in 20 years?
What are we doing wrong?