Apr

8

Government Deprivation

April 8, 2021 |

Patrick Boyle  writes:

The article states: "The offer from Washington reflects Biden’s broader goal of ending what officials have described as a race-to-the-bottom on global taxation that has deprived governments of revenue needed to fund basic services and investments." 

I was surprised to see that governments are suffering this deprivation and wondered what percentage of GDP is collected by various governments worldwide.  It would appear that the US Government collects 27.1% of GDP as taxes while spending 38.1% of GDP.  Singapore seems to get by with 14.1% of GDP in taxes.

Here is the full list on wikipedia:https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio

Stefan Jovanovich  writes

As a economic denominator GDP has always troubled me since it pretends that there is an absolute equivalence between the Department of Education's paying for further studies of whole word instruction and parents' struggles to show their children that understanding the American language depends on recognizing the sounds of syllables and using the alphabet to write and read the notations of those sounds.  

In this particular example, the fiction of GDP is even worse: what the Federal Government spends on the 21st century's answer to phrenology counts as output because it is paid for in dollars.  What the parents do gets no accounting at all.

Assessing American public spending right now is tricky because this is the first time in our history as a nation that we have done what William James wanted and found a moral equivalence of war without the spending on arms and destruction.  There have been no net deaths in Trump's war against Covid; measured against the mortality rates for an average flu year, the casualty rate has been negative.  Instead of incurring debt to build ships, planes and other military assets that will be pure waste, that, unlike the capital equipment used in the "private" sector will have no residual value other than as scrap, this Federal war has spent it's money on direct transfers to people's bank accounts,  raises for hospital employees, and what has been effectively a continuation of the Census' part-time employment for official counting.  

There has been no wartime inflation because the largest part of the "spending" has been no spending at all but simply a non-recourse loan from the government to taxpayers that they have chosen to save.  

This really is different this time.

 

Patrick Boyle  writes:

I frequently see an argument from the left where any tax reduction is described as a government giveaway to the rich.  It is based on the idea that 100% of income belongs to the government and if you get to keep any at all is a gift.

It is one thing when a government increases taxes for their own benefit, but I don't think I can think of another example of a government encouraging other nations to tax its companies.  In fact trade wars are often fought over issues like this.  It is hard to view such a push from the new administration as anything other than a hatred of wealth generation.

Stefan Jovanovich  writes

f PB could offer a specific example of a "trade war" that became an actual war - one where the politicians spend money without limit and have their armies and navies work to kill people, it would help.  I looked through the list of conflicts for the past four centuries and I could not find one that was fought over tax rates and currency exchange terms.  As for how much money the U.S. government can tax, there is no limit.  The Constitution gave Congress total authority with the only limit being that direct taxes had to be apportioned by population among the states.   That was eliminated by the 16th amendment.

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