First off: I live in a country where the highest tax bracket is 52% and one reaches it pretty quickly. I’m an experienced technical writer by profession and could probably make USD 75-85,000/year if I returned to the US. I’ve worked in The Netherlands for over seven years and almost the entire time have had the benefit of what’s called the 30% ruling. Under this plan, the first 30% of the income of expats who qualify (based on age and earning capacity, primarily, though the tax authority here can be capricious) is untaxed. For the next 2 1/2 years, I will still benefit from this ruling. After that, half my income goes to the taxman.
When that time comes, I will probably complain a bit, as will my wife who earns a great deal more than I do. That said, we took on a mortgage three years ago and are generally happy to continue living here, even after our taxes go up. When we moved here, there were no austerity measures in place and the euro was a great deal stronger, but the system here mostly works. First responders are responsive, the city is clean, there are very few homeless. While we live in a college town about the size of Cambridge (123,000) and a little larger than Santa Barbara (90,000), even Amsterdam basically works as well – more homeless, more crime, but we’re not talking San Francisco levels of either.
I want to suggest that my tax euros go towards making the place I live a place I want to live. (Yes, I also pay a very small portion of Geert Wilders’ salary. It’s another price one pays to live in a democracy.) I don’t have a hard time saying that I don’t necessarily want those at the next income level above me to take a tax hike so that I can get a break. I don’t know much about the capital gains, inheritance, or corporate tax laws here. I also can’t speak for my family and friends in the US (where the top tax rate is much lower than it is in Nederland). That said, I think most of them aren’t so interested in tax cuts of their own, but would like to see higher taxes on the very wealthy so that the infrastructure of the US might work again.
NPR suggests, in a blog entitled State of the Union: 5 Things To Watch, that President Obama will introduce a plan to raise taxes on the wealthy in order to provide a tax break to working families. I know that money is tight all over, especially now that the 85 richest people in the world have as much wealth as the 3.5 billion poorest, and I would’t begrudge any working family whatever break they can manage. I would, however, say that tax increases on the wealthy might benefit working families in more ways:
- After school programs so that kids have something to do while whatever parentage they have in the home can work until quitting time without worrying about what junior is up to
- And on the subject of schools: smaller class size and better supported teachers.
And on that topic: When did public school teachers, who do some of the hardest and most thankless work, become the bogeymen for all that is wrong in America? - Funding for public hospitals
- training programs for the unemployed and underemployed
- Fully staffed mental health facilities and VA hospitals
For a start.
When I moved to San Francisco in 1985, there were homeless, but they were mostly holdovers from the late 60s and people who followed expecting the city to resemble the parking lot at a Grateful Dead show. (A fine dream, but one that generally only existed at some music festivals.) That’s a bit disparaging, I know, but that was my experience of SF’s street population, such as it was when I was relatively young. The issues in San Francisco become much bigger with successive booms and busts and of course it’s happening again and on a larger scale with the most recent boom. With all the money that city has had for the last three decades, it’s never been able to address its own social issues, or think big enough to tackle them effectively. Higher taxes on business and the wealthy – if put to good use – might help. I use SF as an example I know (not that I know too many people who can still afford to live there – of 70 or so close friends who lived there when I left in 2002, I’m certain of four, two of whom managed to buy their own houses at auspicious times. Cities large and small across the US have impossible tasks of making the infrastructure work for the greatest numbers of people. I’m sure there’s more to say on the matter, but I think NPR’s bloggers, and possibly Obama as well, have it wrong if they think tax cuts are the only possible balance to tax increases on the wealthy. It’s not a zero sum game, either. Do those at the top really feel that a better functioning society isn’t to their benefit too?
ETA: I’ve now skimmed much of the SOTU address and was rather glad to see that Obama addressed these things as well. Of course with the Republicans in charge of both houses, we’re in for a rocky, suicide pill-laden two years, but I’m hopeful.
Joe Jots 