What is Occupy Wallstreet?

[kandrathe]

Big difference is that in Denmark and Sweden you actually get something back from your taxes.
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So again, I really understand why you have the opinion you have, seeing you are living in the US, but this does not have to be a general truth.

First... I don't believe in measuring a country by the size of their handouts. There should be a social safety net sufficient to prevent people from suffering, and anything more is gratuitous. In the US, the federal FMLA allows for a minimum protection of 12 weeks leave, and most companies have some policy about how they pay during that period. But, in the US, paid leave is at the discretion of the companies paid benefits. We don't get a leave check from the government for having a child. Personally, my wife and I planned for it, and saved up for about 5 years before she gave birth. She took off 3 months (1/2 of it was paid) then worked three 10 hour days for a year with the first one, and quit work for 5 years for the second one. I took off a month for both (1/2 was vacation time).


Denmark budget $181.6 billion for 5,564,219 people ($32,637.10). Revenue collected = $172.8 billion. And, about 72% ($23,498.35) goes back to the people in Health, Housing, and Human services.


In the OECD, Denmark has a pretty competitive tax rate.


US Budget spent $3.8 trillion for 312,513,000 people ($12,159.49) per person. Projected revenue of $2.228 trillion.

Interest payments on the debt are 10% ($380 billion double the entire Denmark budget). 20% is defense ($744 Billion), that Denmark has near zero percent. $2165.3 Billion (57%) are locked up in three programs, Social Security (pensions), Medicare (health care for the elderly), and Medicaid (Health care for the poor). Everything else, including education, transportation, TSA, agriculture, NASA, etc. comes from the remaining $670 Billion.

In order to match Denmark's spending per person, assuming the same distribution (i.e. pretty much eliminate defense), we'd need to raise the spending to $10.2 Trillion (72% of GDP), and raise about 8 trillion more in tax revenue. Denmark's budget to GDP ratio is 26%. The US 2011 est. GDP is ~ $15079 Billion, and est. total government expenditures all levels would be ~ $5968 Billion, so we are already at 39.6% of GDP. (source) To push spending to Denmark levels would bring total government spending in the US to 82% of GDP.

If we are arguing that the US taxes to revenues are a problem, I'd agree. If we are arguing that not enough people pay taxes, then I'd also agree. And, I'd argue even that the top quintile should pay slightly more than they pay now (%5-10%). For equality sake, you might even reduce the <$10,000 group to 2.5%. Then, 5% ($10,000 to $40,000) on the bottom earners, 10% for the middle($40,000 to $75,000), 23% for the upper middle ($75,000 to $200,000), and 40% for the top earners (=>$200,000). Still progressive for Jester's sense of justice, and not much of a change for most people. The rich pay more, the poor will need to pay a little instead of zero, and the middle pay slightly less. The end result is double the income tax revenue, and the key is that all income is treated the same. I still like the idea of a small consumption tax (maybe, 5%) for buying new items, excluding food, education, and medicine. The estimated tax base, on just new items, and excluding those items would be around $5 Trillion, so estimated tax revenue would be about $250 billion.

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For corporate tax rates, I'd peg it to the GDP growth rate. <2.5% the rate is zero, 2.5-6% the rate is 10% or maybe 15%, > 6% the rate goes to 20%. Total corporate tax revenue in 2010 was $225.5 Billion, and our estimated effective rate is about 24%. Relative to 2010, if GDP was at the usual 6%, we'd get an additional $140 billion, if times were booming, we'd get and additional $187 billion. On the face of it, this seems unfair that we'd tax companies less, but in reality corporations don't earn money to squat on it, they use it to invest in new ventures, pay workers, and buy things. These are things we want our companies to be doing. Instead of taxing corporate earnings as much directly, and then again taxing investor capital gains, we just tax capital gains directly as income, and we also tax corporations just like anyone else, when they buy new things. Having the tax rate adjustable to GDP would act as an automatic stimulus during slow, or recessionary times, and as more of a speed governor as the economy got too hot. The effective rates would be low enough for the US to remain competitive against those places that are currently kicking our butts.

I'd remove the special status of capital gains. I'd simply treat gains as income (and leave into the tax code the part about spreading gains and losses over 3 years). For inheritance, this again should be amortized, and probably longer, like over ten years. I'm tired of seeing farms and small businesses sold because the children cannot afford to continue the family business due to the taxes. Remove the special deductions for mortgage interest over 5 years.

All that still does not add up to $3.8 Trillion, so we need to realign our spending priorities. I'd start with some cutbacks to the defense of non-US interests, then fix Medicare / health insurance spending, then fix Social Security. I'd work out a plan to better partition airports, abolish the TSA and turn over screening passengers to the airlines. I'd un-kneejerk the formation of Homeland security, and set a four year plan to reorganize it under the DOD. All in all, I think we can pare it down to under $2 Trillion, and start reducing the trillions in debt we have, and start refunding those unfunded federal pensions.

How is China doing since the reforms?

Well they are owning you.

That is my point. If you were building a manufacturing plant to build circuits, where would you want your company? Would you build it where wages are higher, costs are higher, regulations are strictest and taxes are highest? If companies are choosing China over the US, then the bulk of the employment will go there. What will remain here are the ones that cannot move, like dentists, doctors, educators, and the people that man the shops that sell you foreign made products, i.e. retail clerks, cashiers, stockroom. But, not only that, the wealth moves to where the company buildings are located.