Many Americans do not realize how much money the US government spends. When you include all three levels, it comes to $32K/person/year [0]. This is much higher than countries that are considered "social democracies" such as Finland, France and Canada. If you look at wealthy blue cities like NYC or SF, the spending is on the order of $50K/p/y, comparable to Norway.
It is not realistic to believe that we can become a nice wholesome European country if we just raise taxes a bit. The extra money will just be squandered and stolen.
I don’t think Americans would enjoy the alternative of defaulting on that debt, or the counterfactual of not having raised that debt in the first place
> It is not realistic to believe that we can become a nice wholesome European country if we just raise taxes a bit. The extra money will just be squandered and stolen.
Why, in your view, doesn't the same thing happen to them?
Simply put the people in those countries who spend the money care about the people who gave them the money.
They view themselves as stewards of these resources and genuinely want to spend them optimally to ensure the best return for everyone in society including future generations.
That isn't the case in America and will never be the case.
I would not put this on America being a failed state. Rather the more 'successful' European countries are far more homogenous in demographics than America ever will be. In Denmark, nearly everyone has the same cultural background and similar values, and are striving for a relatively unified vision/goal for the country. In America, there is such an overwhelming diversity in values and cultures, and added animosity between different groups of people that there is more infighting over government&private resources and less efficient use of them.
>It is not realistic to believe that we can become a nice wholesome European country if we just raise taxes a bit.
This feels like a strawman. I can't recall ever hearing someone advocate for raising taxes and not changing a single other thing about the government. These ideas are all interconnected and someone advocating for increased taxes very likely has ideas about how spending should change too.
That's like increasing your going out budget at the same time as moderating your excessive drinking.
The more money that's up for grabs, the higher the incentives for fraud and general abuse.
I think the people that believe in a more efficient welfare state should look to reallocate the money. No one would complain. Instead it's always the promise that just [X] more billion from [billionaire] and we could solve homelessness
>I think the people that believe in a more efficient welfare state should look to reallocate the money. No one would complain.
Are you simply calling the entire government a "welfare state" or do you believe that something like military spending is off the table for making more efficient? Because people very obviously would complain about shifting military spending to social programs and military spending is almost certainly the biggest differentiator in spending between us and those "'social democracies' such as Finland, France and Canada" that OP was talking about.
Of course you should make military spending more efficient. But again, to avoid partisan bickering, you should shift spending in the category. Don't cut waste in department A and allocate to department B. Maybe shift from buying fewer jets and more drones. It doesn't have to be political, it's not a money problem. Government takes more than enough money.
Again, percentage of government money that goes to social programs is less relative to military, but only as a percentage. Look at things like spending on public healthcare (Medicare / Medicaid) or public education, America spends as much as social democracies in absolute terms. Just relative terms its less because we're a wealthy country and produce a lot of wealth that we tax. It's not a money problem
Military spending has been trending downwards the entire time I’ve been alive. All that’s happened is increased spending elsewhere and even more debt. With very little apparent improvement to those social services spending outcomes. Usually the the opposite.
I might agree with cutting military spending if it’s an actual measurable impact to my finances. But I sure wouldn’t be for reallocating it to the black hole that is other federal spending. Fix the outcomes first. We already spend more on healthcare than most of those social democracies. Show me similar outcomes per dollar spent and then we can have a conversation about increasing it. Until then, it’s just more money funneled to the fraud and grift machine. Not that the military isn’t that too, but the difference to me is once you get the population “hooked” on such budgets you can never reduce it. The military is at least able to be reduced as shown in the past 30 years. Everything else is growing faster than those reductions.
I would also be generally for cutting military budget if it was 100% reallocated to reducing the debt. But that’s almost impossible since money is fungible.
TLDR; we’ve already tried reallocating and utterly failed at showing any reasonable outcomes.
Maybe we should approach this from the opposite angle. If it isn't military spending, what do you think the differentiator is between the US and those "social democracies" that OP mentioned? Do you think Americans are inherently more corrupt than the French?
As a thought experiment, it'd be interesting to imagine how things would play out if each taxpayer could adjust little sliders on each category to allocate where they personally would like their taxes to go.
Agencies could recommend funding levels, Congress could recommend an allocation and if a taxpayer didn't change it, that default would take effect. But if a taxpayer preferred, they could say, "no, I won't be funding DOD this year". Or space nerds might say "I'm sending 100% of my tax dollars to NASA!"
Of course no one would likely choose to do boring stuff like paying interest on debt. So we'd probably end up with incredibly well-funded national parks and cool space missions, and also a crippling recession due to defaulting on the national debt.
It is interesting because in a roundabout way this is essentially asking what taxes are for in the first place. You will probably get some kind of “tyranny of the majority/rich”.
For example, if you have a country on the older side, most people will vote to heavily fund social security at the expense of education. As the demographics change, would be no mechanism to correct the issue. Demographics become destiny.
Similarly, taxes allow rich areas to prop up poor areas of the country. California subsidizes the majority of states for example.
Part of the genius of taxes as a technology is that it allows (forces) a large group of people to coordinate to solve problems that they wouldn’t have otherwise. In the ideal case, it allows smart, forward thinking people to solve collective issues.
> California subsidizes the majority of states for example.
California doesn't pay taxes though, people in California do.
Not trying to be pedantic but this is a common framing that is, at its core, completely incorrect. States don't subsidize states because taxes aren't earmarked based on what state they came out of, it's all just government reallocation of wealth by one means or another.
Even if you were to accept this framing, California's net contribution does not cover the shortfall from 26 states, so the statement would be wrong even if it wasn't deceptive.
The point is that taxes can be allocated to things you do not directly benefit from.
I am aware of the fact that states do not subsidize states, but actually drilling down to the taxpayer level makes the argument even stronger. As long as there are regional differences in benefits from federal funding, you get the same effect.
The farming states benefit disproportionately from farm subsidies. Oil producing states benefit disproportionately from oil subsidies. And states near DC benefit disproportionately from federal bureaucracies.
On principle collective issues can be solved, effectively many pay over 50% taxes (accounting for all taxes) yet not all issues are solved.
One could deduct taxes aren't solving collective issues, otherwise there wouldn't be any given The U.S is the biggest economy in the world yet millions can't even effort decent Healthcare.
> For example, if you have a country on the older side, most people will vote to heavily fund social security at the expense of education
You don't even need a country to be on the older side. Canada's age demographic distribution is normal compared to other countries but since the older population has greater political capital (they donate and vote more), they predominantly benefit from political action at the expense of the younger class. The Liberal party won the previous election in large part by stoking fear in boomers about Trump and the USA, while ignoring issues that the younger generation faces.
In 2015, Canada ranked well above the US and 5th on the World Happiness Report. We now rank 25th. If you break that down by demographics, Canadians over 60 still rank in the top 10, but Canadians under 25 rank 71st. It's the largest gap between the young and the old of all developed nations, and a key indicator of what the priorities of government have resulted in.
Another indicator: For the first time in recorded Canadian history, men over 65 now out-earn men aged 25 to 34. Youth unemployment is ~15%. More than one in five young Canadians is underemployed. Young Canadians under 45 have seen virtually no real income growth since 2000.
Organizations don't work well when their budget can change dramatically from one year to the next. There's no ability to take on long-term plans when another, popular department takes 50% of your budget, or someone in your PR department makes a gaffe. Long-term employees get laid off and won't return in a few years when your budget goes back up.
Off on a bit of a tangent, I 100% agree with you, and that was probably the best feature of California's Prop 13 from 1978. After it passed, the projected income to Sacramento was rock-solid for decades. California doesn't have an income problem; it has a spending problem.
Still, I would welcome the opportunity to let Sacramento know that, in my opinion, they spend too much on education and welfare and not enough on infrastructure.
I always think as an individual I would like this. But at scale I worry it would incentivize each department to advertise themselves to the public, which seems to me like a waste of funds.
I already dislike the reelection cycle (politicians incentivized to always be fundraising) and would hate to see that happen per department.
It would probably be wasteful initially but I doubt it would be more wasteful than bad policy that doesn't actually prioritize what the electorate wants.
I think a ranking system might be easier. People are good at ranking priorities.
The idea breaks down for the rich who are being taxed the most, because nobody wants them to have any say.
You could maybe do it for some percentage of taxes. Perhaps only for things that are desirable but not necessities (maybe Symphonies, science, high arts funding, sports funding, humanities education, BBC, other things people think they shouldn't pay for).
Although that would make people ask for a slider to reduce their taxes (to zero, thank you).
I like your idea, and I wish that it could be practically implemented.
As with voting, implementing your idea would be subject to exploitation. For it to work, you would need a way of ensuring that each taxpayer/voter was authorized to vote, and voted only once. You would need to somehow prevent "harvesting" too.
Those who have an interest in exploiting the system would lobby for built-in weaknesses that they could exploit.
I like this idea, but limit it to $1000. Everything in government is funded, but each person can direct $1000 to general fund, a specific department, an initiative, or a registered non-profit.
"crippling recession due to defaulting" - we will just borrow more as usual. Not like our taxes are enough to fund the nation in any year (war or no war).
I would guess that's a poor thought experiment, because most of us - myself included - don't have a good grasp of what various things cost to make work. And then when you look at the relative points on the sliders you think "Oh, but X is much more critical than Y, surely I can't spend so little on it relative to my spending on Y".
Not to mention the complex semantics and effects of debt in sovereign finance, and actions like increasing or decreasing the money supply etc.
You'd also have some very large but currently unknowable number of people underfunding Medicare and Social Security but still expecting to be able to draw out of it when they're older and demanding they be allowed to do so when they're seniors.
I would guess that we don't know because we don't interact with it at all and this would have us interact with it. No doubt that few people would really study very hard or that this would suddenly make everyone experts, but I suppose having to deal with it a tiny bit might lead to a tiny sense of the mechanics or scale. Like when you have to sit through the airplane safety talk, my guess is most people are still just going to thrash around over seats in an emergency of maybe ask each other what to do, but I guess people now know they're supposed to wear their seatbelts or that there's a mask in the ceiling? And you also probably do get a few more citizen experts than you had before.
Still, yeah, as an experiment it doesn't seem likely to work. There is probably something to putting people a little closer to the action though.
I live in a place with basically zero property taxes (except a pittance for the school). No public roads, no fire, almost no police, no parks, no public utilities.
It's absolutely glorious. I can buy exactly what I need. My monthly utility bills are way lower than anywhere else I've lived.
I cannot believe the populace has been duped into thinking so much of what we fund so direly must be done publicly that armed tax agents need to drag them to prison if they refuse to fund it that way. It is important to remember that everything that is taxed, the underlying method that will be used to enforce that is violence, and very carefully limiting that employ of mass violence.
> I live in a place with basically zero property taxes
The biggest financial culture shock between the UK and the US is the property tax situation. The UK has a "council tax" paid by the _occupier_ (i.e. the renter, if a house is rented) that pays for local services, and it's in the low thousands of pounds per year regardless of the value of a house.
This line of reasoning seems to be without any deeper thought.
If taxpayers should have the freedom to decide how the money that is taken from them is spent, then why shouldn't they have the freedom to decide how much money they pay?
If taxes aren't collected because the ends justify the means, then the only other option is that they are collected to punish the taxpayers.
The former can be morally justifiable, but how do you justify the latter?
Taxes do not fund spending. This is a foundational myth of neoliberalism, closely related to the "A national economy is run like a household" myth.
The alternative is Modern Monetary Theory, which states that the government and banking sector money creation fund spending, and governments cannot run out of currency.
Taxes control the money supply and mop up excess funds, which controls inflation.
Bonds set interest rates.
Spending is a strategic and political choice, not something limited by "the deficit" - which is literally just the difference between spending choices and taxation choices.
One very obvious tell is how Republicans make a lot of noise about the deficit and the debt, but always raise both when they're in office.
Always. Why? Because they spend government money lavishly on themselves and their patrons, and cut taxes for themselves and their patrons.
This doesn't "create jobs", it clogs up the system with sclerotic piles of cash that drive an extractive economy that sits on top of the productive economy most people live in.
This is very different economically to stability spending - welfare, healthcare, and such - and investment spending, such as direct funding of education and R&D.
In the MMT, the most significant drivers of inflation are corporate profiteering and supply shocks.
This is also how I see it, and honestly it is hard to understand it any other way. In the current year, it seems very clear that governments can get away with incredible debt spending, as long as it's mostly in the right direction.
Look, we spend a lot on things people want, right? We are living in your sliders world.
I hate these sorts of websites because they have a very intellectual starch to them but are very superficial. I also hate this frame of mind that's like, "nobody would choose to do boring stuff." People aren't stupid. I hate this "voters are stupid" frame of mind. It's unelectable, and it's always said by people who complain about political problems because they misunderstand and think that political problems are math problems. Like that all we need are more sliders. In this specific case, people love paying mortgages, they instantly understand the math of interest rates, and many many people are strongly incentivized to help people understand the magic of mortgages: that you get to both live in the thing you buy, which is useful, and that because you're living in it, people are willing to loan you 10x more than your income to buy it, a kind of leverage that isn't available anywhere else but people who will cut your fingers off if you don't pay them. We are living in your sliders world.
>Look, we spend a lot on things people want, right?
I'd say we spend a lot on things a few people who can maintain/expand power see ROI for power on. Sometimes that's things, sometimes that's just cash for voters and future voters.
The sliders world is more about consent via revenues of the governed, rather than the tax crop they really are.
we can go into an actual, interesting conversation about government spending. personally, i think your pessimistic, slightly nihilist, "people who can maintain/expand power" POV is just a different side of the same "voters are stupid" coin, in that it is also unelectable (no Mag7 CEO or top-500 billionaire could win an election today, people like Mark Zuckerberg and Elon Musk even pay huge commissions to study it for them, and anyway, most of the top-500s are heirs, and the ones who are only slightly less wealthy but way, way less powerful lose elections all the time) but appeals to this cynical, conspiracy-minded BS that distracts from hard truths like:
people like paying for medical innovations. people are consenting to that. i mean, they certainly feel it is unfair when they have something they must pay for in order to survive, but in general, people have been choosing "expensive medical innovations" as an alternative to "dying" since the advent of the venture pharmaceutical system.
slider world CANNOT fix the problem that for some people, medical innovations are expensive. people will pay ANY price to cure a terminal illness suffered by their child, for example - there is no MARKET PRICE or AUCTION PRICE or VALID PRICE, i mean you can put a number into the slider, but you can see how "average of current + creditable worth" would be the answer to "what would you pay to cure your kid's terminal illness?"
and this is so, so much more interesting to talk about than taxes or vague nihilism about power. but no. it's too unorthodox. are you getting it? the website is stupid, why is it so hard to say that?
To some extent? But the sliders would probably be even more extreme. If you are 70 years old you’ll probably vote to put everything on Uncle Sam’s credit card and let younger generations deal with it after you’re dead.
Unfortunately, much of that gets dispersed into an unfathomably complex web of private and profit-seeking interests, with much less actually going to individual beneficiaries.
Social Security almost entirely flows to beneficiaries, as do programs like SNAP, where overhead is around 6-7% (admittedly, fraud might be a good bit higher than that); likewise Medicare is one of the most efficient systems at getting money directly to medical providers (although fraud might be a problem there too, estimates range from 10%-25%).
Yup, Medicaid and SNAP are extremely efficient. Social Security is almost completely disbursement charges but those disbursements aren't means tested so even quite wealthy individuals receive them. Additionally you mentioned that Medicare gets money to medical providers but I suspect that was meant to mean medical insurance providers - rather than health care providers (like doctors) since the system is partially direct payments but mostly runs through intermediary privatized companies and, of extreme note here, is that Medicare is famously barred from cost negotiations so while our Canadian healthcare system can talk to a pharma manufacturer and tell them "The price for this drug is unreasonable, we won't cover it unless it's cost competitive to biosimilars" Medicare just needs to roll over and accept whatever made up numbers it's given.
The benefits that are intended to go exclusively to the impoverished though, those are extremely means-tested and often have work requirements or other hoops to jump through.
> Social Security is almost completely disbursement charges but those disbursements aren't means tested so even quite wealthy individuals receive them.
Only to those who paid into the system and far less than they personally could have earned on investing the same dollars.
Yeah, one of the problems I have with taxes is that if I pay $100 into taxes I don’t get $100 of value back. Everyone should get at least as much as they put in back. Also, some other people should get more back. But we shouldn’t spend more than we make as a government.
Assuming the presence of a sovereign wealth fund which does work somewhat logically for programs like social security - that would make sense. The government should sensibly invest money they're holding onto... however, it's unrealistic to ever expect the government to tolerate a level of risk and thus a rate of return above what you're personally comfortable with so it's unrealistic to assume that the government will be as efficient with money as you'd personally be if they'd never taken that money.
Additionally, a lot of these programs will pay out beyond what you've personally put in - programs like Medicaid are nearly entirely social subsidies to ease poverty and financial distress, so I'm not certain where you'd find the money to pay for them if not looking at either other people's taxes or debt.
As a taxpayer I expect the money I give to the government to be evident in some social projects but I don't personally expect that for each dollar I pay that I'd see a dollar in benefit to me personally. I have a belief that I indirectly benefit from the expenditure of charitable safety net programs even if I never expect to collect from them directly - the improvement in the lives of those around me is to my personal benefit by making society more just and egalitarian as well as reducing the incentive for crime which is a difficult to measure but observable direct benefit to myself.
The fact that so much of our budget goes to debt servicing is probably my personal biggest objection as it is effectively just a wealth extraction from our earn national budget to some select individuals.
It's quite true. Take Medicaid grants to states for example, which then goes out to 50 different systems of disbursement to private entities. Enrollees on plans are often done so through private insurers, many hospitals are run as for-profit including being owned by PE groups, etc.
The US spends the most per capita[0] on healthcare in the world, all to receive a healthcare system that still requires lots of citizens to carry private insurance. I've never dug deep into why, but it sure is noteworthy.
The private insurance expenditure is part of that per capita number. US healthcare isn't "A system", its a number of interrelated systems that have lots of expensive hand-offs. We also spend a ton on lifestyles diseases because no one walks and culturally we eat like shit on average.
> We also spend a ton on lifestyles diseases because no one walks and culturally we eat like shit on average.
And there's a pretty straight line between that and government subsidies for sugar and processed foods in general, not to mention car-based infrastructure, although the latter doesn't stop other countries from not having crippling obesity rates.
> And there's a pretty straight line between that and government subsidies for sugar and processed foods in general
No there isn't. Sugar subsidy accounts for 1.7 cents per 12-ounce can of soda. Soda in the US is generally inelastic, and research has shown that a 10% increase in price results in lessss than a 5% decrease in consumption. Americans just like sugar and sitting, culturally.
And acknowledging the very obvious instances of regulatory capture that directly harm quality of life is political suicide for anyone with even the smallest amount of access to power.
It’s hard getting normies to admit that if soft drinks weren’t so heavily subsidized by the government at every step of manufacture and distribution, there would be less overall obesity.
The graph shows both public and private expenditure. If you only consider the public per-capita expenditure it's more than every other nation on the graphs public + private per-capita spending.
The data behind the graph is probably from OECD, which does not use a public/private classification. Mostly because in many OECD countries, "public" healthcare is largely funded by private insurance.
According to OECD data, US healthcare spending in 2023 was 28% from government schemes, 55% from health insurance, 11% out-of-pocket, and 5% from other sources. For most countries, the health insurance category is further split into compulsory and voluntary categories, but that distinction does not really exist in the US.
All US health insurance spending is reported in the compulsory health insurance category. Probably because the bulk of the spending is from employment-based insurance, which is effectively mandatory. (You usually can't opt out and take cash instead.) Naive aggregators then combine government spending and compulsory insurance and report that as public spending.
Playing devil's advocate - the measure of success of welfare isn't in the budget spent on it but public outcomes. That said, it is true more taxes or expenditure aren't the panacea that the left might think it is.
If clinics and hospitals do not bill 1k dollars each visit, 100k+ for a simple surgery, and pharmacy does not sell medicine 10x the price, US gov't do not need that much allocation for healthcare.
They only bill that much because they need the average amount of money collected for a procedure to pencil.
They get that cash price amount from a tiny amount of people, 70% of that price from private insurers, 30-60% from Medicare, less from Medicaid. Even then, they have to basically litigate the bills through private insurance appeals.
If they had one payer which had a single reimbursement rate, they wouldn't have to do these shenanigans.
Given that reality, I wonder why it is that spending in this category seems to be so much less effective in the US relative to other nations? Why is the US #22 in general quality of life [1], and the bottom of many rankings of health system performance [2]?
Speaking as a Canadian, I wonder if at least part of it is the attitude that investments in these areas are "welfare" and not simply a part of the portfolio of essential services that are delivered by the state to citizens?
It may just be my cynicism talking, but it seems that it comes down to the power of lobbyists. In the US, the healthcare companies control the government. Elsewhere, the government controls the healthcare companies.
The media narrative is a factor too. Like I have extended family, friends, and work colleagues in the US, many of whom are wealthy and well-traveled and even a lot of them will still loudly assert obviously disprovable untruths like "well at least we don't die in waiting rooms like in Canada" or "at least we don't have death panels deciding who gets to have life-saving treatment" or worst of all "ehh I mean I have good insurance, and outcomes are much better here for top-5%ers, so I don't really care about the rest of the system." All while decades of TV hospital dramas depict a well-oiled medical system delivering effective and efficient care to people with nary a whisper about how it's getting paid for.
It's got to be desperately frustrating trying to fight this kind of thinking when you've got whole communities who have never even thought to question it.
My main hope at this point is with bottom-up type efforts. Let Mamdani show people that an effective city government can fill potholes and operate a few at-cost supermarkets. Let that be the start of citizens expecting more than chainsaw-waving and twitter meltdowns for their tax dollars.
> Speaking as a Canadian, I wonder if at least part of it is the attitude that investments in these areas are "welfare" and not simply a part of the portfolio of essential services that are delivered by the state to citizens?
Also speaking as a Canadian, I don't understand the distinction you're drawing.
The distinction is in whether there's a value judgment. Is healthcare and welfare something we assume is part of the package living in a developed nation, or is it an indulgent extra, subject to suspicion and scrutiny above and beyond what essentials like military spending get?
I would say that the mainstream Canadian view is the opposite of this. We expect healthcare funding and many are supportive of the strikes when it gets cut, but we are much more likely to treat military budget as the purchase of a lot of unnecessary toys.
If anything this speaks to the cost of welfare in America.
The corollary is that many suggestions to reduce welfare spending would lead to even less actual welfare being delivered, without addressing systemic cost problems.
The distribution itself does not tell you much; you have to normalize by the share of GDP (or some other measure of production/activity) that the federal budget constitutes.
Also, as other commenters mention, the specifics of how money is disbursed or spent, matters. If, say, pharmaceutical companies are allowed to massively over-charge, than the same level of care would mean a higher level of spending than in other world states.
The problem is that our public health care system could cover the entire country at no additional cost…if our health care spending per capita was inline with other nations with better health outcomes.
One of the most generous welfare states with one of the best safety nets. I' not really aware of any place better. Maybe one of the small countries like Lichtenstein.
By the way, the 1040 instructions have a pie chart like this (ref https://www.irs.gov/pub/irs-pdf/i1040gi.pdf, page 122). Not that most people do taxes themselves, or have a reason to read to page 122 of instructions for a single form. But still it's there and perhaps a nice gesture by the IRS.
Breaking it out into pie charts etc like this can be really helpful. In my view the real kicker with taxes is the opaqueness. Kinda like a meal card versus paying for every meal, or like using a credit card versus paying with cash, it's hard for humans to really grasp what's going on unless they're involved.
Of course it would be impractical to pay taxes separately to every waiting hand in government bureaucracy. But on the other hand maybe the number one goal shouldn't be ease of use, either. Maybe a little friction when paying for public services could be a good thing for citizens who are interested in a healthy country - my opinion.
I feel like legislation that resulted in every taxpayer getting an itemized receipt like this would be hugely popular and a massive PR win for the representatives that sponsored it.
I can only conclude that the reason it hasn't been done is because they don't actually want you to know.
I can’t help wondering about the categorization. For example, we spend more on “agricultural subsidies” than “NASA & space” or “EPA & environment”, but for some reason the former gets hidden under the “all other” category while the latter two get their own distinct categories. The author might not have a political motivation for those choices, but it’s the kind of choice that will likely influence the political conclusions the reader will make from the data.
The DoD was named such by the act of Congress that established it. The President does not have the authority to rename it, no matter how much he pouts about it.
Touché on the actual renaming, but I kind of prefer “war” anyways. It’s a refreshing removal of euphemisms, of which I believe we have way too many.
If you are on a plane and they announce they are collecting “service items” people might be confused and hand over their “service weapon” if they forget that one means trash and the other means gun. Good thing we have the TSA to prevent this kind of misunderstanding.
I’ve always known the breakdown in my head, but seeing the raw numbers by category was pretty eye opening - particularly how much I’m contributing per month to support something like say, aggressive wars in the middle east that are driving up my gas prices.
I really wish we would get away from this line of thinking. For state and local governments, yes, your taxes are put into accounts and are then spent according to the budget.
For the federal government, no. Money that is paid in taxes is effectively eliminated. The total number of dollars that exist in circulation is reduced. When the federal government spends money, it is creating all new money. It can’t run out. It’s not your tax money that is being spent.
> The total number of dollars that exist in circulation is reduced.
Not accurate. Dollars are a liabilities on the books of the Federal Reserve. Tax payments to the federal government only cause a liability shift from commercial banks’ reserves at the FED to the TGA, it doesn’t really change the net amount of dollars in circulation.
The most you could argue is that it momentarily reduces the net commercial banks’ liabilities (which economists call M*) until the Treasury distributes those dollars again to the broad economy
Somewhat off topic, but I've always wanted to know _who_ gets my tax dollars more than what they were spent on. For example, a middle class salary to someone building bombs in Ohio is different than a wealthy investor who owns shares in some educational company that provides standardized tests to local public schools.
I would be more likely to share this w others if the domain name didn't have an f-bomb in it. It doesn't bother me that much, but I really don't want to share it in certain circles...
Hey Wayne, I bought wheretheheckdidmytaxesgo.com and will make it live after work today. Sorry about the profanity! It’s just how I felt after seeing the stats firsthand :)
And also completely meaningless as a credit rating in the context of creditworthiness specifically means the ability to repay. And they can always print dollar bills to do so.
Now whether that $1 in 20 years will buy anything is an entirely different story.
This is great. I'd also recommend Covid money tracker. US printed nearly $12 trillion in response to Covid, something like 25% increase in money supply. And it is my contention that this has driven inflation (both asset - think meme stocks, rise in crypto etc - as well general levels that started to appear by 2022)
It has, as has similar efforts worldwide which also saw similar or worse levels of inflation. We were dealt a shit hand and the thinking was it's less pain overall compared to the alternative.
That said, the amount of fraud that was perpetuated here without any follow-through on enforcement is ... extremely not good.
Most of the fraud was the business loans, that they then forgave. That structure innately gave them the opportunity to take their time investigating them, after the benefit was already produced. They just chose not to.
Now consider that the Defense budget is ~$1 trillion and the Department of Defense has never passed an audit [1] and the administration is seeking $1.5 trillion next year [2].
> Interest per Second - General - The U.S. pays $31,688/second in debt interest — $1,901,285 every minute. Your share of that: $3893.33 [plugged in "normal" amount], gone before it bought anything.
...I thought I was already sufficiently terrified by the debt numbers...
It's way too high, but it's not by far the largest. It's barely higher than national defense and not that much higher than Medicaid/health. And it's only the highest because of the artificial split between income taxes and payroll taxes, where this page only considers income taxes. If you look at all federal spending, Social Security is the largest, then Medicare, then interest comes in at #3.
You have clearly never met fresh-out-of-basic or back-from-deployment sailors, then.
They build used car dealerships and strip clubs within walking distance of bases. Sailors blow thousands in an evening at the club, and then drive home in $75k vehicles purchased at predatory interest rates.
Despite significant, potentially life-changing enlistment and re-enlistment bonuses, housing stipends and more - many (or most) enlistees leave the service in debt or near penniless.
