Low Tax is Not What We Need

Low tax never made anyone’s life good.

Consider India. Millions of Indians pay no tax at all, and they are so miserable that suicide is at a record high. In the US, low tax means nothing to you if you can’t pay for your cancer treatment until you go bankrupt. We already have taxes that are too low.

Taxes too low!? How is that possible?

It’s very simple. The cost of a good life is not measured by how low taxes are. We forget that only the rich can afford high quality with low tax, because they can buy anything they want. That’s why they always want to cut their own taxes.

What we want is the best quality of life, and that’s very different from mere low taxes. Let’s attempt to determine what gives us high quality of life. Here’s what I think.

First, high quality of life isn’t very dramatic. The elements of a good life are pretty basic: clean air, clean water, safe housing, healthy food, competent medical care, and a few more. All of these will cost much more if they aren’t paid for with taxes.

We don’t really need public transit, right? But if we have nothing but private cars a simple trip downtown in any US city will cost a fortune, the trip will take much longer, and parking will be a bear. Good public transit is much better, and far cheaper. Scope it out yourself, beginning with car cost, insurance, and maintenance. Cars are damned expensive.

But perhaps medical care is the easiest element to illustrate why low tax can mean high cost.

It’s not a contradiction at all. As literally every modern nation except ours knows, the cost of national medical care is about half the cost of individually purchased healthcare.

Did that come through? We pay twice as much.

Look at it from the other end. Let’s say a new nation wanted to have health care for everyone. They might decide that $2,000 a year for every person is enough. That would work fine if everybody had the same income, because everyone would have the same advantages. Unfortunately, not everyone has the same income. Capitalists earn a lot, and the poor don’t earn enough to buy health care.

If health risks for the poor are not shared, any serious disease will easily kill them, which will cost everyone more. Repeal of the Affordable Health Care Act would cause 44,000 additional deaths each year. All of us eventually pay for these unnecessary events.

Back to our new nation. What happens if health care is paid for with private insurance? The cost for health care would be $2,000 plus the extra cost the insurance companies would add. Don’t forget that insurance premiums provide no health care at all, and capitalism demands that profit be maximized for the benefit of the owners.

In sum, we pay a lot of money to insurance companies that provide no health care at all, yet absorb a large part of the money spent on health care. And the poor are often left to die because they can’t afford the insurance. We have this gross malfunction even though we spend twice the money that countries with national health care pay.

There are other reasons we spend so much on health care. First, training for health care professionals is very expensive, which leaves new doctors with huge debt they must discharge through high earnings. In other countries the government pays for their training, and they don’t have to earn a huge salary just to get by. Second, the cost of medications is determined by capitalists, who, as we have seen, have no compunction about pure greed. They apparently do not understand that they are not making fly swatters, that health care is a sacred duty. Third, charges for care often have little relationship to the quality of care because they are controlled by profit-maximizing capitalists. In countries where the government manages all the elements of health care, all costs are kept at a fair and consistent level. Providers are paid fairly and everyone gets all the care they need, paid for with taxes, because that’s the most efficient and fairest way.

In virtually the same way, all the other elements of good living—clean air and water, healthy food, safe housing, and so on—are most efficiently paid for with tax revenue and/or managed by the government. Everyone benefits and the cost to individuals is much lower. Imagine having to pay for clean water by yourself—think Flint—with corporations allowed to dump whatever they wanted to into the water supply. Imagine your house wired by some dodo unclear on the concept of electrical codes.

But, some say, government just can’t do anything right. That is nonsense. Government services, from federal to local, are full of programs that are well managed and efficiently priced.

It’s not low taxes we need, it’s the best services, and that has very little to do with low taxes. Low tax virtually guarantees higher cost.