Tuesday, February 08, 2011

An Argument for Higher Taxes

Every so often somebody will take a survey of the various nations to see who are the happiest people. They will then publish a list, ranking the world’s nations by how happy they are. I was looking at one of these list a few weeks ago and noticed that the USA was way down the list, perhaps close to the middle of the range along with many impoverished and third world countries.

A few days later, in another publication, I saw a list of countries, listing their rates of taxation. I was startled to see that it was almost exactly the same list. The higher the taxes, the happier the people. How could this be? I went on to discover that the happiest people, with the highest taxes, also had some of the highest rates of entrepreneurship and successful businesses. So much for the idea that high taxes hurt business.

Norway for example, has free education and free health care for everybody, meaning they have a very healthy, highly educated population, which leads to successful businesses, a healthy economy, and happy people. People are not hampered by student loans and businesses don’t have to pay out huge sums to provide health care for their employees. Sure, they have high taxes, but you get what you pay for.

In turns out that in countries such as Norway, Denmark, Sweden, etc. the people see taxes in much the same way as they see any other expenditure. The emphasis is not so much on how much it costs, but what do they get for their money. Instead of seeing taxes as something the government forces on us and that we should we resist as much as possible. The happiest countries see taxes as a way to buy the things they want. For example good education, health care, good highways, and public art are all things that are considered to be good value for public money. Politicians are held accountable for giving good value for the money spent, not just on keeping the taxes low.

The Governor of Kansas just dissolved the Kansas Arts Commission to save money. I never considered the Kansas Arts Commission a particular extravagant organization and certainly not a waste of money.

It is interesting that a report just came out in the US indicating that Federal taxes are at a 60 year low as a factor of the overall economy. In other words, taxes have not been lower since the Truman Administration, yet we seem unhappy about just about everything.

Could it have something to do with the fact that our schools are suffering, college costs, and medical care are outrageous, and arts organizations are begging for handouts, while the governments are in debt, refusing to tackle a tax code that taxes us at rates that are among the lowest and most inconsistent in the world.

Something to think about.