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2020 Democratic Presidential Nominees

 
I do know this Bernie Sanders preferred policies would put him at the far left end of Nordic politics and economies.

Yes. He's essentially peddling what some of those countries tried decades ago and then ran away from when it failed miserably. The problem is not Bernie's heart, it's his math. To make his economic projections work you have to believe -

A - You can raise taxes by a minimum of 8% on everyone. I.e. that's the minimum tax increase any American would experience, some would be far more.

B - You can put that headwind to growth on the economy and then experience an economic expansion for over a decade that our economy has never once experienced for more than a couple of years in succession.

What amazes me is how many well intending people just refuse to look at the two above facts and have any sense of skepticism.
 
What’s more progressive about America’s system compared to Scandinavia? Isn’t the top marginal effective tax rate for most of the countries over 50 percent?


Those top rates in Scandanavia generally start at about 1.2 to 1.5 times average income. In the US, persons in that same income range have marginal rates in the range of 40% to 60% of the highest marginal rate.

Also, those Scandanavian countries collect a significant % of their revenues via a VAT consumption tax. Highly regressive.
 
What’s more progressive about America’s system compared to Scandinavia? Isn’t the top marginal effective tax rate for most of the countries over 50 percent?

I was in Sweden the past Fall for over a week watching my kid play bandy. While there in the hotel lobby one night with some Swedish parents whose kids were competing against ours one of them shared this with us as a history lesson on the apple TV by the hotel bar. They shared it in response to one of our parents who was talking about how "progressive" they are. Put aside Stossel's partisan view. They shared it as an accurate reflection of history and how regressive their tax system actually is today.

https://www.youtube.com/watch?v=0lxD-gikpMs
 
Those top rates in Scandanavia generally start at about 1.2 to 1.5 times average income. In the US, persons in that same income range have marginal rates in the range of 40% to 60% of the highest marginal rate.

Also, those Scandanavian countries collect a significant % of their revenues via a VAT consumption tax. Highly regressive.

Highly regressive - bingo.
 
Those top rates in Scandanavia generally start at about 1.2 to 1.5 times average income. In the US, persons in that same income range have marginal rates in the range of 40% to 60% of the highest marginal rate.

Also, those Scandanavian countries collect a significant % of their revenues via a VAT consumption tax. Highly regressive.

This is all true, but not the whole story. The middle class does pay a higher percent of their income in the nordics than in the US (though if you consider compulsory payments in the US like employer-side payroll taxes and employer premium contributions, which behave a whole like lot like individual taxes in practice, the picture looks very different), they also get a lot more in benefits. To me, if you are going to talk about a system in terms of progressivity, you need some measure of income - taxes + government transfers.

But regardless, the progressive left in the US generally seems to want to have their cake and eat it too. They want Nordic style benefits (which is fine), without Nordic level taxes. Generally, in the Nordics, taxes are in the low to mid 40s as a percent of GDP. I don't have updated US data since the most recent tax cuts, but prior to that we were at 27% of GDP (near the very bottom of the OECD countries), and it's certainly less now. That's just far too low if you want to provide anything approaching comprehensive social benefits. And you can't get there just taxing the rich (though we should tax them more), you need broad based taxes in addition that tax the middle class.
 
In graphical form, we are a low tax country.

oecdtotal0418.jpg
 
Well, they're also the world's happiest people.

ALOT of that is cultural differences The US population wouldn't remotely be the world's happiest people if you were paying 60% marginal rate on income over $60K.
 
socialists failed not only history but also math and economics

the evidence is everywhere and overwhelming: economic success and greater freedom automatically follow from the abandonment of socialism, socialist policies, and socialist thinking

how are you going to help the poor, or anyone else, if you screw up the economy?
 
I agree with you that there are some counterbalances. I was just showing some examples of why their system is more regressive than ours. I also excluded things like the child tax credit and EITC which increase progressivity. My general point is, as you say, since Bernie wants Nordic style benefits through more progressivity, he is to the left of the current Nordic model. Alot of american progressives have bought into this line that Bernie would be to the center or to the right of european policies. Not true.


This is all true, but not the whole story. The middle class does pay a higher percent of their income in the nordics than in the US (though if you consider compulsory payments in the US like employer-side payroll taxes and employer premium contributions, which behave a whole like lot like individual taxes in practice, the picture looks very different), they also get a lot more in benefits. To me, if you are going to talk about a system in terms of progressivity, you need some measure of income - taxes + government transfers.

But regardless, the progressive left in the US generally seems to want to have their cake and eat it too. They want Nordic style benefits (which is fine), without Nordic level taxes. Generally, in the Nordics, taxes are in the low to mid 40s as a percent of GDP. I don't have updated US data since the most recent tax cuts, but prior to that we were at 27% of GDP (near the very bottom of the OECD countries), and it's certainly less now. That's just far too low if you want to provide anything approaching comprehensive social benefits. And you can't get there just taxing the rich (though we should tax them more), you need broad based taxes in addition that tax the middle class.
 
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socialists failed not only history but also math and economics

the evidence is everywhere and overwhelming: economic success and greater freedom automatically follow from the abandonment of socialism, socialist policies, and socialist thinking

how are you going to help the poor, or anyone else, if you screw up the economy?

This line of argument usually goes something like:

Liberal: We are trying to emulate Scandinavian countries, they are obviously doing fine.

Conservative: Those are capitalist economies, idiot!

Liberal: Right, but they provide a much greater social benefits, like health care, child allowances, paid leave, etc. Let's do that.

Conservative: But that's socialism!
 
ALOT of that is cultural differences The US population wouldn't remotely be the world's happiest people if you were paying 60% marginal rate on income over $60K.

I don't want to do that, certainly. I just want to tax the fuck out of the uber rich and close any loophole that allows companies like Amazon, Verizon, Comcast, Pfizer, etc. etc to have a negative tax rate.
 
I don't want to do that, certainly. I just want to tax the fuck out of the uber rich and close any loophole that allows companies like Amazon, Verizon, Comcast, Pfizer, etc. etc to have a negative tax rate.
Companies that are in significant growth phases in their life cycle can take advantage of the hundred percent capital expensing. The Big Driver however is stock compensation. The tax rules here actually make a lot more economic sense than the book rules.

https://www.vox.com/2019/2/20/18231742/amazon-federal-taxes-zero-corporate-income
 
If Amazon takes a 1.5 billion dollar stock Compensation deduction then their employees are paying ordinary tax on 1.5 billion in compensation. The same as if Amazon had paid them a cash bonus.
 
so it’s better for the employees or no difference?
 
No difference really they pay ordinary income on the fair market value of the stock they receive or on the cash they receive. If the stock decreases or increases in value after the time they receive it than they would have capital gain or loss on it when they sell it. When stock compensation is issued usually the employee gets about 60 to 65% of the shares they were awarded because the 40% goes to paying taxes
 
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