Oh, our wicked spendthrift ways! (Federal deficit)

With all the tumult arising from the deficit, and the incessant mantra that we as a nation must live within our means, I have to wonder where all the money goes. It isn’t just that we let the millionaires off the hook; everyone evidently agrees that we can’t find our way out of the mess just by raising taxes on the rich.

Granted, our overall rate of taxation is said to be much lower than is typical of Western Europe, except for taxes imposed directly on corporations. But I wonder if the gap is as great as commonly believed, especially when local taxes, including sales taxes, are factored in. In many cases, the only way a community can obtain local improvements is to impose a sales tax on itself, as we have done in L.A. just so we can have a few more rail lines.

With the amount of taxes we pay out, I look around me and have to say, just look at this place! Schools are laying off teachers, cities are laying off cops, potholes don’t get repaired, and transit agencies are cutting service. Is it really Grandma’s Medicare that is doing this to us? Surely not, when every other country in the G8 provides healthcare for everybody. Obviously, one big elephant in the room is the military budget, but compared to how often we are warned about the cost of “entitlements”, military expenditures would seem to be hardly a blip on the radar.

American foreign policy is, at times, overbearing and dismissive of other cultures. But it might surprise some foreigners to learn that, internally, self reproach has been a national pastime ever since the evangelical “awakenings” of the early 19th century. Our personal profligacy is supposed to be what has brought us to this sorry state of affairs–too much food, too much drink, too many widescreen TVs. Notoriously, Whole Foods CEO John Mackey ignited controversy–and an angry boycott courtesy of their left-leaning customer base–for opposing health care reform in 2009. As he saw it, we needed to reform our diets, rather than our system of healthcare delivery. In other words, most of us deserve inadequate access to health care because we eat too much meat. Obesity is certainly a serious health issue, but judging by how often I read *Die 2 wichtigsten Grundregeln für einen flachen Bauch. * (“The 2 most important rules to follow for a flat stomach”), when surfing German internet sites, suggests that Western Europe isn’t far behind us in that department.

Forgive me, Lord, for I have sinned, as Catholics say. And as far as Protestants are concerned, most sects officially believe in the “total depravity” of all their members. The Christian concept of total depravity is not actually as horrible as it sounds, but to a casual reader it seems to suggest that to differentiate between Albert Schweitzer and Adolf Hitler is to split hairs. Along with the grace of redemption, total depravity, obviously, is not a concept originated in America by Americans, but the attitude of self condemnation it represents is as American as baseball.

We’re spending the money all right, but not getting much value for it. at least not in ways that appear to benefit us personally and locally.

Where are the leaks?

Medicare, Medicaid, Social Security, defense, and interest on the national debt. I don’t think you really need a cite.

Regards,
Shodan

And all that inefficiency that because of the perverse incentive structure of giving other people’s money to other people.

Yeah, it still is. We have a ‘flat-tish’ tax structure when you consider all local, state, and federal taxes. The ‘average’ rate (+/- 1 standard deviation) ends up being about 40% +/- 5%.

It gets a little hard to compare the exact tax rates payed by individuals across countries, but the general trends are clear - comparedto the European members of the G8, the US has fairly low taxes.

Yeah. It’s pretty well known that we spend waaaaaaaaay moreper capita on health care than any other country in the G8 and get (arguably) about the same health results. Basically, our health care spending is inefficient (by some measurements) compared to other countries.

That’s why the Ryan’s plan and Obama’s plans are controversial, after all. They both recognize health care costs are a major source of future problems, although they address them in significantly different ways.

Nailed it right there. It is too easy for Politicians to vote “Yes” for all of these entitlement programs (and DFence) becasue voting “No” gets you out of office fast. But it is unstustainable and everyone knows it.

I see means testing for SS & Medicare in the immediate future. There is no other way around it.

Defense spending? I beleive it will be cut some, but there are too many vested interests to cut it substantially, and it does provide american jobs.

Debt? Well, people expect services from their government but over and over decree that they do not want to pay for it. So we find another way to do it–debt. Our city has a huge debt burden becauee people want all these neato projects for our city but don’t want to raise taxes for it. So. . . bonds (ie debt). Problem solved!!!

Taxes. We have one of the lowest tax rates in the world for a major industrialized country, especially for the wealthy and corporations. A small, small increase in the tax rate for these groups would add significantly to the coffers to pay down debt, etc. But, since it is these same people that contribute the most to the politicians. . . . .Not gonna happen.

Your so-called “sin taxes” in the US are far lower than other western countries too. Comparing the price of gasoline, alcohol, and tobacco between Canada and the US mind boggling.

How would you feel about $5 gas, $10 smokes, and $40 for 24 beers?

Spectre of Pithecanthropus, why don’t you familiarize yourself with this thread of mine? $145K per year for a civilian contractor Arabic translator in Iraq - WTF? - Factual Questions - Straight Dope Message Board

It’s right from the horse’s mouth. Right from the mouth of people whose bank accounts constitute the receiving end for those “leaks” that you are concerned about. And it’s not hard to understand why some of them may seek to call those unhappy with the situation “fringe”, “mouth breathers” and other bad names.

If all institutions, public and private, run as well as Social Security, if would be a huge step up for America.

Some might just ask you what the fuck that thread has to do with this one

yep, but these “some” would actually be “Really Not All That Bright”. Can’t argue with that dude :slight_smile:

Fair enough. So, what the fuck does that thread have to do with this one?

Well, as I understand it, SoP’s question is “If we’re running these huge deficits handing out money to people on Medicare, Medicaid, Social Security, and the defense sector, how come nobody’s getting rich off those things?”

Now, it’s true, no claimant is raking in cash from Medicare, Medicaid, and SS. Military pay and benefits are fairly generous, but nobody signs up for the Army in order to get rich. A staff sergeant can lead a pretty comfortable life, but you’re never going to mistake her for a millionaire.

code_grey’s thread was about a purported job opportunity of $145K to be an Arabic interpreter in Iraq for a military contractor. I think this is the right direction to look, but I’m not sure its the interpreters who are benefitting the most from this largesse.

No, the people who really make money from our federal government, which Ezra Klein so splendidly described as “an insurance conglomerate with an army and a navy to protect it,” are the defense contractors, Big Pharma, and the healthcare conglomerates.

to clarify what Kimmy_Gibbler said, the thread contained a number of posts by people who were not necessarily Arabic linguists or in Iraq per se, but who nevertheless boasted of having huge salaries and no shortage of job offers working for federal government or for companies that work for federal government.

If the government of today just cannot function (and we will leave the “how well it does what it’s supposed to do” question alone for now) without paying obscene salaries to a whole load of people, then, guess what, the government will be burning through its money faster than a Mach 3 jet burns kerosene.

I guess I should envy even_sven who successfully outsourced the job of “governing” her to the much more efficient Chinese government. Those guys don’t manage to equal us in wastefulness even despite building boom towns in the middle of nowhere and lending hundreds of billions to Barack Obama.

Eh, you know at law schools, deans have a saying: “There are a lot more students with 4.0 averages out there than there are students with 4.0 averages out there.” Like so many other measurements that our egos are tied up with, I’d exercise a little caution and investigation and not accept those salary claims so uncritically.

Heh, $5 gas, I assume you mean $5 per liter, which would be $18.90 per gallon. It’s currently between $4 and $5 per gallon at the moment ($1.06 - 1.32 per L) and people are freaking. I consider that normal.

The US tax burden per person is not that different from Europe’s. The US collects 13,097 tax dollars per person, France 15,556, Germany 13,893, UK 13,714, Canada 12, 789, Italy 12,478, Spain 11,014, and Japan 8,992. The US has lower rates but because we are so much richer the amount we pay is not that much different than Europe.
The US is more wasteful in its government spending because of its size and the diversity of its population.

I’m not really going to go into how wasteful government spending is.

But this comparison is not really fair, either.

Using a mean figure is not appropriate when these countries have different tax brackets and different levels of income inequality.

Consider the following two situations:

Country A:
1 person - $1,000,000, effective tax rate 25% (i.e. $250,000 paid)
99 people - $1,000, effective tax rate 25% (i.e. $250 per person)
Total income = $1,099,000 (= $10,990 per person)
Total tax = $274,750
Mean tax = $2,747.50
Median tax = $250
Mean tax rate = 25%
Median tax rate = 25%

Country B:
10 people - $40,000, effective rate 35% ($14,000 each)
40 people - $10,000, effective rate 30% ($3,000 each)
50 people - $5,000, effective rate 25% ($250 each)
Total income = $1,050,000 (= $10,500 per person)
Total tax = $272,500
Mean tax = $2,725
Median tax = $1625
Mean tax rate = 26%
Median tax rate = 27.5%

So, Country A is “richer” by total income and has higher taxes per person, but it’s a meaningless distinction when the income inequality is so high.

You might think this is not such a great comparison, either, but in 2010, nearly half of US federal filers had absolutely no tax liability.

http://ireport.cnn.com/docs/DOC-590490?hpt=Sbin

“The day after I snapped this picture [showing $5.40 for regular unleaded], the price had risen to $5.47 a gallon for regular unleaded.”

It’s about $3.60 here.

Kind of implied by the context of your post, but they had absolutely no* income* tax liability. Everyone has tax liability.

Thanks, I meant to include ‘income’ but it got left out.

Of course, as I mentioned in a previous post, most of them still pay out about 40% of their income in some form of local, state, or other federal taxes.