Socialist Health Care: Does it Work?

[Economist]

Sure can, but if you take free money from the government and then ***** about others doing the same, you're what we call a hypocrite.

I'm just saying, if someone is offered something cheap/free, then they're probably going to take it. Besides, if someone is a taxpayer, they might disagree with the tax, but since they're paying for it anyone, they might as well use the resource. Or sometimes they don't have much of the choice, like maybe someone can't afford to send their kid to a private school after taxes, but they would prefer a system in which they were taxed less and public schools were not available.

Back up your statement with figures, not just a priori arguments. The poor also pay a lower tax rate. I'd be interested to see if the ratio of taxes paid by the wealthy vs. the poor outstrips the ratio of state university enrollment of the wealthy vs. poor. I doubt very highly that it does.

Regardless, federal grants are need-based and many scholarships are more easily obtained by minorities or those of limited means.

https://www.amazon.com/dp/B0006C0DBI/?tag=pfamazon01-20

I've heard difference people making this claim at different times, and I'm not trying to say it's absolutely true (although I currently believe it). One of the main reasons I wanted to bring it up, was not because I expected people to agree with me (as I realize it'd take more pursuasion them some guy you don't know on a forum). But rather to show people that their preconceived notions about various gov't programs may be incorrect. It's not completely clear cut that public higher education benefits the poor more than it benefits the rich (it may even work in the opposite direction). Furthermore, other programs (like Social Security) tend to redistribute wealth from poor to rich, although this is not what these programs were set up to do.

By the way, I realize that federal grants are often need based, but that doesn't completely matter in the argument I was making. The actual cost of sending a kid to a public university is still fairly high (I've heard that it maybe as high as $40K - $50K a year at some schools). The reason it only costs a student a small fraction of that is because the tax payers foot the bill on the rest. So when you go to public universities which are fairly highly ranked, you will notice that many students come from rich families and pay in state tuition (which is really a bargain). On average, who do you think has an easier time getting into a strong public school? Someone who comes from a rich family or a poor family?

Also, the poor probably pay more taxes than you think. When you take into account all taxes (not just income taxes) you'll find that taxes are fairly substantial for the poor. Things like sales taxes have been said to harm the poor much more than the rich. Furthermore, marginal tax rates can be very high for poor people in some cases.

 

[turbo]

Also, the poor probably pay more taxes than you think. When you take into account all taxes (not just income taxes) you'll find that taxes are fairly substantial for the poor. Things like sales taxes have been said to harm the poor much more than the rich. Furthermore, marginal tax rates can be very high for poor people in some cases.

This is a point that many people miss. Sales taxes, taxes on gasoline, diesel, heating oil, clothing and non-food essentials like toilet paper, cleaning supplies, etc simply cannot be escaped. People with substantial incomes often don't have to pay more taxes for these essentials than poor people. The impact of regressive taxation is felt keenly here in Maine, where our northern climate and rural-type population densities make any increase in the prices (or taxes) on fuel oil (for heat) or gasoline and diesel (for commutes, or for forestry/agriculture) very painful. These increases cannot easily be evaded and they hit the bottom line directly.

 

[Economist]

This is a point that many people miss. Sales taxes, taxes on gasoline, diesel, heating oil, clothing and non-food essentials like toilet paper, cleaning supplies, etc simply cannot be escaped. People with substantial incomes often don't have to pay more taxes for these essentials than poor people. The impact of regressive taxation is felt keenly here in Maine, where our northern climate and rural-type population densities make any increase in the prices (or taxes) on fuel oil (for heat) or gasoline and diesel (for commutes, or for forestry/agriculture) very painful. These increases cannot easily be evaded and they hit the bottom line directly.

Exactly! That's what I was trying to say, that many taxes hit the poor a lot harder than the rich. This is why I've heard economists say, "People think we have a progressive tax system, but when you look at ALL taxes, you'll find that we actually have a regressive tax system."

 

[mheslep]

You have posted links to right-wing sites that support your skewed view with no reliable statistics.

Right-wing sites? The NY Times? The Economist? :rofl:

 

[mheslep]

Things like sales taxes have been said to harm the poor much more than the rich. Furthermore, marginal tax rates can be very high for poor people in some cases...

This is a point that many people miss. Sales taxes, taxes on gasoline, diesel, heating oil, clothing and non-food essentials like toilet paper, cleaning supplies, etc simply cannot be escaped...

Guys - don't forget: Its the lotteries, the lotteries, the lotteries which are overwhelmingly paid by the poor.

 

[Economist]

Right-wing sites? The NY Times? The Economist? :rofl:

For real, how can someone say these are right-wing? Especially the NY Times.

Guys - don't forget: Its the lotteries, the lotteries, the lotteries which are overwhelmingly paid by the poor.

LOL. Yeah, that's true too

 

[wildman]

Also, the poor probably pay more taxes than you think. When you take into account all taxes (not just income taxes) you'll find that taxes are fairly substantial for the poor. Things like sales taxes have been said to harm the poor much more than the rich. Furthermore, marginal tax rates can be very high for poor people in some cases.

In the US, the poor have to pay a 15% payroll tax off the top even if a person only makes a few dollars. This is an atrocious tax on the poor especially since it is only on the first $100,000 a person makes.

 

[drankin]

In the US, the poor have to pay a 15% payroll tax off the top even if a person only makes a few dollars. This is an atrocious tax on the poor especially since it is only on the first $100,000 a person makes.

I don't like paying taxes anymore than the next guy but to what country might you comparing our 15% tax to?

 

[ShawnD]

I don't like paying taxes anymore than the next guy but to what country might you comparing our 15% tax to?

Canada might be a good comparison.

USA tax from $0 - $7,825 is 10%
Canada tax from $0 - $9,600 is 0%

USA tax from $7,551 – $30,650 is 15%
Canada from $9,600 - $37,178 is 15%

USA from $30,651 – $74,200 is 25%
Canada from $37,178 - $74,357 is 22%

USA from $74,201 – $154,800 is 28%
Canada from $74,357 - $120,887 is 26%

USA from $154,801 – $336,550 is 33%
Canada at "over $120,887" is 29%

USA highest bracket (over 336k) is 35%
Canada highest bracket (over 120k) is 29%
USA tax
Canada Tax

edit: don't worry about adjusting for currency either. For the past month or so, Canadian dollars are worth more than American dollars.

edit again: I also found this article comparing the two countries. I haven't read it yet, but it looks interesting Canadian and American economies compared

edit: another link from that comparison article: Canadian and American health care compared

 

[D H]

In the US, the poor have to pay a 15% payroll tax off the top even if a person only makes a few dollars. This is an atrocious tax on the poor especially since it is only on the first $100,000 a person makes.

Fine. Let's eliminate Social Security.

This post is incorrect for many reasons. First, the employees only pay half of the tax. The employer pays the other half. Suppose the tax were eliminated. Most employers would not give their employees a 7.65% pay raise as a result. Calling the tax a 15% tax on the employees is a misdirection at best. Another misdirection: The Medicare part of the tax (1.45%) has no upper limit.

Social security is supposedly similar to a retirement account. At least that is what the silly annual letter than I get from the SSA implies. In actuality it is a pay-as-you-go Ponzi scheme. Let's call it what it is: a wasteful, regressive welfare program that transfers wealth from the working middle class to the elderly who didn't have the wherewithall to save while they were working.

 

[mheslep]

Canada might be a good comparison.

Doesn't Canada have a big VAT on top of that income tax?

 

[ShawnD]

I'm not familiar with that term. Can you define it?

 

[mheslep]

i.e. a sales tax
http://en.wikipedia.org/wiki/Value_Added_Tax

 

[ShawnD]

6%
It will be 5% on January 1.

 

[mheslep]

Ok, since the US has no federal VAT, then for your comparisons posted above you should add 6% (5%) to all the Canadian figures?
...
USA tax from $7,551 – $30,650 is 15%
Canada from $9,600 - $37,178 is 21%(20%)
and so on

 

[Evo]

In the US, the poor have to pay a 15% payroll tax off the top even if a person only makes a few dollars. This is an atrocious tax on the poor especially since it is only on the first $100,000 a person makes.

I have never seen this and I am looking at a paystub. What exactly are you referring to?

Ah, I see from DH's post it's Social Security. Social Security is 6.2%

 

[BobG]

In the US, the poor have to pay a 15% payroll tax off the top even if a person only makes a few dollars. This is an atrocious tax on the poor especially since it is only on the first $100,000 a person makes.

I have never seen this and I am looking at a paystub. What exactly are you referring to?

Ah, I see from DH's post it's Social Security. Social Security is 6.2%

I think he's referring to the combination of SS tax, Medicare, and income tax or the entire SS tax including the part employers pay (a self-employed person has to pay the entire SS tax, although half is deducted from your income as an employment expense). A single non-self employed person might come close to 15%, but I think the end tax after deductions would be quite a bit less.

Fine. Let's eliminate Social Security.

This post is incorrect for many reasons. First, the employees only pay half of the tax. The employer pays the other half. Suppose the tax were eliminated. Most employers would not give their employees a 7.65% pay raise as a result. Calling the tax a 15% tax on the employees is a misdirection at best. Another misdirection: The Medicare part of the tax (1.45%) has no upper limit.

Social security is supposedly similar to a retirement account. At least that is what the silly annual letter than I get from the SSA implies. In actuality it is a pay-as-you-go Ponzi scheme. Let's call it what it is: a wasteful, regressive welfare program that transfers wealth from the working middle class to the elderly who didn't have the wherewithall to save while they were working.

I can't say that's a totally inaccurate statement, but part of the issue is that the 'victims' forced by law to pay into the scheme aren't willing to write off everything they've paid into Social Security as an expensive lesson learned. If the government isn't going to fulfill its promises to its citizens, then every Congressman from the 30's to the present should lose their Congressional pension plus spend at least a few months in prison. There's probably not much hope that Congress would vote for that solution.

Ok, since the US has no federal VAT, then for your comparisons posted above you should add 6% (5%) to all the Canadian figures?
...
USA tax from $7,551 – $30,650 is 15%
Canada from $9,600 - $37,178 is 21%(20%)
and so on

I don't think you could directly apply a sales tax to income unless all workers are spending 100% of their income. Unless buying on credit is as common in Canada as it is in the US, in which case maybe you're not adding enough to the tax.

 

[ShawnD]

Ok, since the US has no federal VAT, then for your comparisons posted above you should add 6% (5%) to all the Canadian figures?
...
USA tax from $7,551 – $30,650 is 15%
Canada from $9,600 - $37,178 is 21%(20%)
and so on

Sort of yes and sort of no. Sales tax does not apply to rent, medical, dental, food, lawyer fees, or financial services. These are what make up the bulk of peoples' expenses.
Example:
I start with 100% income
20% taken in taxes
35% goes to rent
5% for food (I don't eat much)
7% for insurance (financial service, no tax)
33% left over for spending (or saving, which will be spent eventually)

0.33 * 6% tax = ~2% tax (on total income)

Due to the exemptions, GST is a progressive tax. Yes poor people spend a greater percentage of their pay checks, but they spend a much greater percentage of it on things that are tax-exempt (rent, food, dental, etc).

 

[mheslep]

0.33 * 6% tax = ~2% tax (on total income)

Fair enough for the daily expenses. However, Id say that changes if you include the major purchases of a car (lots of poor as we're defining them here still can buy a cheap car) and possibly even a low cost home / condo / duplex.

 

[Economist]

Check this short blog article out. Seriously, it probably takes like 1 minute to read.

http://gregmankiw.blogspot.com/2007/11/where-would-you-rather-be-sick.html

 

[mheslep]

Also see this Fraser Institute sourced report for for a http://www.marketwire.com/mw/release.do?id=591038".

In 2005, the average Canadian family earned an income of $60,903 and paid total taxes equaling $28,467 (46.7 percent).

Im not familiar with the source nor the methods used

 

[drankin]

So, I think that it is fair to say that the current tax on Americans (including deductions) is at least as good as any other developed country. It would seem to me that we treat our poor relatively well. Again, if you have to declare bankruptcy to pay for expenses that saved your life, you were at least able to do so and continue living... in the USA.

 

[ShawnD]

Also see this Fraser Institute sourced report for for a http://www.marketwire.com/mw/release.do?id=591038".

Im not familiar with the source nor the methods used

Keep in mind that the Frasier institution is a bunch of retarded lolbertarians. That number of http://www40.statcan.ca/l01/cst01/famil21a.htm is family income, meaning 2 people, meaning 2 separate tax filings, and completely separate tax brackets from a single person making 60k. If you take a leap and just assume husband and wife make the same income, that goes to 30k per person. I make just a bit more than that right now, and my income tax is about 20% of gross income.

I have no idea how they come up with 46% tax. My first guess would be that they add up all the taxes that are applied on every money transaction. Let me give an example of how this works. Let's say I make $1000 and pay $200 in income tax. That's 20%. Then I buy $800 in alcohol, which is about 99% tax (feel free to google search what tax-free ethanol is actually worth). So that's another $792 in tax. Add that to the original $200 income tax to get $992 of tax paid on $1000 of income. OMG T4X RATES ARE 99.2%!
They can make up any stats they want if they tried hard enough.

Stats Canada has a much different story. http://www.statcan.ca/Daily/English/060330/d060330a.htm
Median family gross income for 2004: $55,800
Median family income tax for 2004: $8,600
55800 - 8600 = $47,200 net
(55800 - 47200) / 55800 * 100 = 15.4% tax.

Remember that this include all write offs. Your children are huge tax writeoffs, education is written off, interest on loans for investment purposes is written off (bussiness loans, margin calls, etc). One big difference between Canada and the US is that interest on a mortgage for your primary residence is tax-free in the US, but not in Canada, so Canada's tax rate is a bit higher.

Anyway, the whole point was to show that you don't need to tax people up the ass to pay for socialized medicine. Canada probably does have higher taxes in a lot of cases, but it's very managable. This isn't france where there's no reason to actually work for anything.

 

[Economist]

I have no idea how they come up with 46% tax. My first guess would be that they add up all the taxes that are applied on every money transaction. Let me give an example of how this works. Let's say I make $1000 and pay $200 in income tax. That's 20%. Then I buy $800 in alcohol, which is about 99% tax (feel free to google search what tax-free ethanol is actually worth). So that's another $792 in tax. Add that to the original $200 income tax to get $992 of tax paid on $1000 of income. OMG T4X RATES ARE 99.2%!
They can make up any stats they want if they tried hard enough.

Well, methodologically you are supposed to account for all taxes. If someone only makes $10,000 a year, but doesn't pay any income taxes it is not correct to say they pay 0% taxes. Especially considering that they probably still paid a substantial amount of their income on some forms of taxes (I wouldn't be suprised if someone in this boat still would up paying around $1500 - $2000 in taxes for the entire year). I'm not sure how they calculated the tax rate, but I imagine they used the standard economic way, which is to figure how many dollars went to taxes and divide it by the salary or something similar.

 

[ShawnD]

If they're accounting for total taxes taken, then it should be easy to start removing the ones that don't apply to me.

http://www.hc-sc.gc.ca/hl-vs/tobac-tabac/research-recherche/stat/ctums-esutc/2004/summarya-sommairea_e.html site lists all the prices of tobacco in 1997. Highest one, as expected, is Newfoundland (the overall tax rate in that crap-hole is easily twice that of Alberta). I'm in Alberta so the taxed amount of those daily cigarettes is 6.08*[(41.02-9.96)/41.02] = $4.60
That's per day, so multiply by 365 = $1,680

There's a lot of voluntary tax out there, and most of it doesn't apply to most people. Most people don't smoke, most people don't binge drink, and most people don't buy lottery tickets. Aside from income tax and the 5% sales tax, the biggest taxes I can think of are gasoline and property tax. Tax on gasoline is about half the purchase price, so that's about 50 cents per litre ($1.90 per gallon). Property tax is about 1% of property value, so that's maybe $4,000 per year if you live in a city with an ok or better economy. Scale up or down as needed.

 

[mheslep]

If they're accounting for total taxes taken, then it should be easy to start removing the ones that don't apply to me.

I don't think that's useful either. The thread is about nationalized health care so by virtue of the topic we're only interested in average information. The idea is to weigh the costs vs the benefit, that is, how much total revenue a country using nationalized health care takes from its citizens vs what you get for it medically, so you need typical information. Then, theoretically, you have some predictive power. So in this case, how much total tax does the Canadian government take from a guy making an average salary? Well you go out and (do what Fraser Inst. did) pole a bunch of people and average income tax, all the lottery tickets, the smokes, the telephone taxes(check your bill), the airline ticket taxes, the social security (US name) taxes, the sales tax (did you buy a car?, a condo?), etc., everything the federal government takes in as revenue since it all goes into one pot in effect. In this case looks to me like its 46%.

BTW, $10 for smokes!

 

[ShawnD]

I don't think that's useful either. The thread is about nationalized health care so by virtue of the topic we're only interested in average information.

I was thinking more in terms of median and mode because each of them are not as strongly affected by outliers, so they give a better representation of distribution.

Let me give you an example. Numbers 1,2,3,4,5,100,100.
The median is 4, so if you divided it at 4 you could say "half of the people are below this point, half the people are above this point". Looking at the median, or quintiles, or percentile, gives a good idea of where things are. If you said "20% of people are below the poverty line" it actually means something; 2/10 randomly chosen people are poor. If you said something like "the poverty line is at $20,000 and the average income is $30,000" what exactly does that mean? How are the numbers distributed? How many people are poor? Unless you include a standard deviation, the mean is useless. The median is useful because it doesn't need a standard deviation.
In the above example, the mean is 30.7. This number means nothing. The number 30 is not part of that set, nor is anything even close to 30. Outliers such as bums and rich people can have a strong effect on the mean. They generally have less of an effect on the median since they just cancel each other out, so it's like you're not even including the outliers, assuming you have an equal number of outliers on each end.

Real world data relating to this: PPP by average, PPP by median

Averages:
USA ~$43,000 on both lists
Canada ~$35,000 on both lists

Medians:
USA ~ $48,000
Canada ~ $43,000

As you can see, the numbers change quite a bit when you look at the median instead of the average. It's also good to see that the median is higher than the average. This would indicate that the mean is low because of unemployed people; not because the bulk of the population is poor (this is good because we have low unemployment rates. If the unemployment was 50%, the median would be really screwed up, in which case the mode would be the best indicator, and it would say that unemployment was rampant). If the opposite were true, and each country had 100% employment with mostly low paying jobs and a few Warren Buffet jobs, the mean would be higher than the median. As always, correct me if these assumptions are wrong.In my previous post, I excluded the tax on cigarettes and alcohol because 1) they don't apply to most people and 2) they are voluntary. You are forced to pay income tax, but nobody forces you to smoke. You are forced to pay property tax (it's included in your rent if you're a renter), but nobody forces you to drink. A person representing the mean, median, and mode would be a nonsmoker who has a beer or glass of wine on rare occasions. If you're a smoker or an alcoholic, the statistics don't apply at all, so you have to include the full cost. I assume it sucks to be a smoking alcoholic in Canada.

The idea is to weigh the costs vs the benefit, that is, how much total revenue a country using nationalized health care takes from its citizens vs what you get for it medically, so you need typical information. Then, theoretically, you have some predictive power. So in this case, how much total tax does the Canadian government take from a guy making an average salary? Well you go out and (do what Fraser Inst. did) pole a bunch of people and average income tax, all the lottery tickets, the smokes, the telephone taxes(check your bill), the airline ticket taxes, the social security (US name) taxes, the sales tax (did you buy a car?, a condo?), etc., everything the federal government takes in as revenue since it all goes into one pot in effect. In this case looks to me like its 46%.

Yes, the average is 46% (the way they calculated it). What is the median? If you pointed at somebody who represents the bulk of the population, such as the middle 80% (exclude the top and bottom 10%), how much would that guy be paying? It's probably not 46%.

BTW, $10 for smokes!

Yeah, it sucks hard. This week it was also announced that there is a smoking ban in the entire province of Alberta. This officially makes smoking more illegal than drinking. You can drink at the bar until you pass out, but you better not light a cigarette! Those things kill you!
What's funny about this is that the city of Edmonton, Alberta passed a smoking ban about 1 year ago. Take a guess where all the smokers went. They started going to the River Cree Casino which is located on native reserve land just west of the city. City laws don't apply to reserve land, so you could smoke as much as you wanted. My friends and I would go there all the time just to smoke, hang out, watch TV at the bar, and eat somewhat nice food. I don't even like smoking, so it was really more of a protest than anything else. Methinks the provincial ban is due to businesses complaining that indians are stealing all their business.

 

[gsingh1015]

Universal health care is a basic human right - enshrined in most european countries. There are different models but most of them are successful. OK the taxes are higher in Europe but at the end of the day taxes belong to the people and not governments and if they are ploughed back into the public in the form of better public services, social security and pensions then the vast majority of people don't mind paying higher taxes. I work as a doctor in the UK and have on many occassions treated US visitors who absolutely marvel at our system! Most of it is evidenced based and is one of the most cost effective systems in the world! We may not be as good as Sweden, France or Germany but when it comes to the crunch - when it really matters - no system in the world can beat our National Health Service.

 

[t-money]

Universal health care is a basic human right - enshrined in most european countries. There are different models but most of them are successful. OK the taxes are higher in Europe but at the end of the day taxes belong to the people and not governments and if they are ploughed back into the public in the form of better public services, social security and pensions then the vast majority of people don't mind paying higher taxes. I work as a doctor in the UK and have on many occassions treated US visitors who absolutely marvel at our system! Most of it is evidenced based and is one of the most cost effective systems in the world! We may not be as good as Sweden, France or Germany but when it comes to the crunch - when it really matters - no system in the world can beat our National Health Service.

What was the primary reason patients from the U.S came into be treated. I say this because a lot of Brits come to the U.S for Dental work, because their universal healthcare system does not do teeth very well.

 

[ShawnD]

What was the primary reason patients from the U.S came into be treated. I say this because a lot of Brits come to the U.S for Dental work, because their universal healthcare system does not do teeth very well.

They were probably tourists.

 

[mheslep]

Universal health care is a basic human right - enshrined in most european countries.

Any argument for this or do you assert as an article of faith? What then are the basic human rights? How about food, education? University education? Employment? Housing? Telephone? Internet access? Transportation? I'll stick with Life, Liberty, and the Pursuit of Happiness, thank you.

There are different models but most of them are successful. OK the taxes are higher in Europe but at the end of the day taxes belong to the people and not governments and if they are ploughed back into the public in the form of better public services, social security and pensions then the vast majority of people don't mind paying higher taxes. I work as a doctor in the UK and have on many occassions treated US visitors who absolutely marvel at our system! Most of it is evidenced based and is one of the most cost effective systems in the world! We may not be as good as Sweden, France or Germany but when it comes to the crunch - when it really matters - no system in the world can beat our National Health Service.

By what standard or metric to you assert? To what degree do you credit pharmaceutical advances for NHS success? Care to express an opinion on these figures showing the US has the highest life expectancy in the world?
http://bp0.blogger.com/_otfwl2zc6Qc/Rzmah0RKkiI/AAAAAAAACxM/_yTMErbhbmE/s1600-h/le1.bmp"
http://mjperry.blogspot.com/2007/11/beyond-those-health-care-numbers-us.html"
Numbers on the right are corrected to remove homicides and accidents, i.e. non health care related deaths. US 76.9yrs
NY Times piece background piece by http://post.economics.harvard.edu/faculty/mankiw/mankiw.html"
http://www.nytimes.com/2007/11/04/b...773f35bd&ei=5090&partner=rssuserland&emc=rss"

 

[mheslep]

They were probably tourists.

Maybe, but a lot of Brits are voting with their feet and coming to the US to stay. The flow is definitely from the UK to the US.

 

[gsingh1015]

Why do Americans come here! Tourists? Visiting family? or may be just so that people can ask silly questions!
As to basic human rights - health has the same place as life and liberty along with education and a clean water supply. As to happiness - there can be no happiness if your child is dying in front of your eyes and you have no medical access because you can't pay the bills. But then you cannot explain such simple concepts to people who think a right to carry arms is more important than universal health care!

 

[gsingh1015]

Oh and by the way the British dental system is the one of the worse in the developed world - you know why? Because it largely private and not adequately supported by the health service! No wonder some people have to pull their own rotting teeth out because the dentists are too busy doing dental implants! May be its time to nationalise the dental services!

 

[mheslep]

Oh and by the way the British dental system is the one of the worse in the developed world - you know why? Because it largely private and not adequately supported by the health service! No wonder some people have to pull their own rotting teeth out because the dentists are too busy doing dental implants! May be its time to nationalise the dental services!

Why not nationalise everything?