Choosing to Fall Behind

We’ve gotten used to thinking that America is the greatest country in the world. Obviously, we’re a rich and powerful nation that has historically been a land of opportunity for most of our citizens. We have accomplished so much. Yet we are falling behind other advanced nations. Not because of external circumstances, but by choice.

Eduardo Porter, writing in the NY Times, points out that: “Every developed country aspires to provide a better life for its people. The United States, among the richest of all, fails in important ways. It has the highest poverty and the highest infant mortality among developed nations. We provide among the least generous unemployment benefits in the industrial world. Not long ago one of the most educated countries in the world, the United States is slipping behind. The reason is not difficult to figure out: rich though we are, we can’t afford the policies needed to improve our record.”

Why are we falling behind? Mr. Porter explains:

“Citizens of most industrial countries have demanded more public services as they have become richer. And they have been by and large willing to pay more taxes to finance them. Since 1965, tax revenue raised by governments in the developed world have risen to 34 percent of their gross domestic product from 25 percent, on average.

The big exception has been the United States. In 1965, taxes collected by federal, state and municipal governments amounted to 24.7 percent of the nation’s output. In 2010, they amounted to 24.8 percent. Excluding Chile and Mexico, the United States raises less tax revenue, as a share of the economy, than every other industrial country.

No wonder we can’t afford to keep more children alive.”

http://www.nytimes.com/2012/08/15/business/economy/slipping-behind-because-of-an-aversion-to-taxes.html?ref=eduardoporter

Here are two principal reasons why we can’t afford to do what needs to be done.

Reason 1: We no longer have a progressive tax system. When you factor in the various kinds of taxes we pay, it turns out that the people who could afford to pay more are taxed at roughly the same rate as everyone else.

taxday2012table

http://ctj.org/ctjreports/2012/04/who_pays_taxes_in_america.php

Reason 2: It’s hard to believe, but the US is responsible for at least 40% of the world’s total military spending. We spend 5 times as much as China and 10 times as much as Russia. Unless we’re going to fight the rest of the world, or maybe counter an invasion from outer space, we are wasting a whole lot of money that could be spent toward making this the greatest country in the world.

http://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures

We are choosing to fall behind.

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