Category Archives: tax related issues

the cost of our system

Petrol taxes in the US vs Europe

Petrol taxes in the US vs Europe

We have done quite a bit of traveling overseas in the past 3 years and are always amazed at how much higher petrol is. We have seen prices in the $6 – $8 per gallon range. The other thing we noticed is how much new and nicer all of the road infrastructure is. I decided to do a bit of research and discovered that most of the difference in the price lies in taxes. To my mind, this makes sense as it charges the users for repair and maintenance. In our country, the tax charged only covers a small portion of what is required and we rely on funds from both Federal and State budgets for the remainder. I suppose this accounts for the decline in the condition of our road infrastructure. Which system do you think is fairer and works better?

Broken Healthcare

Broken Healthcare -From an American traveling abroad

I was having a fancy dinner with a new friend when I received the phone call no mother wants to hear. 

“Mom, I have to go to the hospital,” my son said. 

Just then the waiter began bringing out our food. I jumped up, threw down some cash on the table, and gathered my belongings. My son was doubled over in pain and had been vomiting nonstop for two hours.  Ordinarily, I would rush home and bring him to the hospital, but we weren’t home in New York. We were almost 5,000 miles away. 

I was helping my son settle in Spain

We had recently arrived in Spain, where my son planned to spend the year playing soccer. He’s only 16 and had never been away from home, so I rented an apartment for a few weeks to make sure he settled in before heading back to New York.

I arrived at his residence and one of his coaches drove us to the hospital. My friend from dinner, knowing I didn’t speak Spanish, kindly accompanied us. As I signed papers I didn’t understand, I fleetingly wondered how much this emergency visit would cost but was thankful he had health insurance through his soccer academy. 

The nurses triaged him quickly, taking his vitals and making sure he was stable. Then I assumed we were in for an hours-long wait, as we probably would’ve been in the US.   

It turned out to be nothing serious, but I was worried about the cost

When they examined my son an hour and a half later, the doctor explained that it was likely a bad stomach virus. I was relieved it wasn’t appendicitis. They did blood work and administered an IV filled with four types of medications.

Now that my son was improving, I began worrying about the cost. When the doctor said my son would need four prescriptions, I added that up in my head, too. I was told I’d have to pay out of pocket for the medications, and since we weren’t residents, it could be pricey. In the US, an emergency room visit could set us back a few thousand dollars and medications could run into the hundreds. I braced myself for the bad news. 

“How much?” I asked. 

“If you were a resident, it would be about 50 cents to 2 euros, but unfortunately, you’ll have to pay between 2 and 10 euros per medication. I’m sorry.” 

I nearly fell out of my chair laughing. This proves how needlessly expensive healthcare is in the United States. I talk about this in my recent book, “Knocked Down: A High-Risk Memoir,” where I highlight gaps in healthcare and how a lack of accountability can change a person’s life. Two to 10 euros for medicine seemed more than fair. 

Early the next morning, I headed out to fill the prescriptions. I was told to find the closest pharmacy, hand over the script, and they would give me the medication on the spot. This sounded too easy. Often I had to fight with my insurance company to cover medications, and then I’d have to wait precious hours to get the prescription filled. In Spain, the total cost was 12 euros and the whole process took less than five minutes.

The normal reaction to a story like this is but how much do citizens of Spain have to pay in taxes? Also, how about the overall quality of care? Ok, here are a few facts. The overall quality of care is comparable between the two countries. The overall tax burden in the USA (including all taxes: income, property, sales, etc. (on average) is 24.7%. In Spain, it is 34.7%. Using the average US family income of $71,000 this amounts to an extra $7,100 or about $2,200 per person for the average family of 3.2. So there, that explains it. Or does it? One more fact. The average per capita cost of healthcare in the US is just under $12,900 while it is just under $4,000. The difference is almost $9,000 per person in hidden tax. The issue we have is cost. Why is it so much higher here? I have answered that question in several prior postings.`

Who is paying for the outrageous cost in our country? It breaks down into about thirds with 1/3 paid for in the form of Medicare and Medicaid, 1/3 paid via company healthcare plans (which reduces funds for salaries), and another 1/3 paid out of pocket in the form of premiums, copays, and deductibles.

I Want to Run for President (inspired by “Designated Survivor” streaming on Net Flix)

I Want to Run for President (inspired by “Designated Survivor” streaming on Net Flix)

You probably think this is a joke. It is not, but I realize it is not doable. If I did the following would be the basis of my platform:

I would only serve for one term and put all of my efforts into that term, with no reelection campaigning.

I would run as an independent and not take funding from any source in excess of $1,000. Regardless of the amount, I would not take any donation from a SuperPAC.

If I was fortunate enough to fill a Supreme Court position, I would only consider moderate Judges that were not registered members of a Political Party.

I would call for an independent third-party audit of all government departments. Audit firms would be interviewed with the understanding that their fees would be paid out of the first 3 years’ of savings, not to exceed 25% of those savings. The scope of the audit would cover staffing & administrative efficiency and marketplace wage analysis.

I would not spend any taxpayer funds on the White House to “improve” or upgrade other than routine repairs and maintenance.

I would restrict funding of White House social functions other than for certain international relations. I will not be wearing a suit while working at home.

I will introduce a bill that requires all those serving the country to abide by the healthcare, retirement, and other benefits enjoyed by the rest of the voters.

I would make Healthcare reform my highest priority. Our country has by far the highest annual per capita cost of first-world countries at over $11,000. At the same time the WHO ranks us 37th in terms of quality of care. Our costs are 2 ½ times the cost of the EU average per capita cost. Almost all of the EU countries rank ahead of us in terms of quality of care. I would direct that we evaluate several other successful systems, selecting the best and most efficient practices resulting in a healthcare reform bill. Healthcare should be a right, not a benefit for the wealthiest country in the world. An efficient system will do this and at the same time is the single issue capable of both reducing tax and the budget deficit.

I would impose military intrusion into any country experiencing internal civil conflict, regardless of our economic considerations. I would aggressively support methods to target terrorist strongholds, regardless of the country, but favor technology-based solutions rather than those that are manpower intensive.

I would appoint the most qualified staff available since I have no political favors to repay. My VP candidate would need to be in complete agreement with my platform.

I would be a vocal advocate for term limits with a phase-in period. We need representation that sees their role as a “service” and not as a career. Anything beyond 10 – 12 years combined service in the Senate and/or Congress is a career. I also would submit a bill that would change the Congressional Reps’ terms from 2 years to 4. A 2-year term is ridiculous as they spend 1 year working and the next running for reelection. I like the idea of 50% of the positions being up for election every two years.

I would introduce a tax bill that would reduce the burden on the middle class. It would be tied to the healthcare reform bill which would pay for much of the tax reduction. It would include a fraction of increases to the top 5%. I would recommend that at least a portion of tax be based on “wealth” as opposed to the income in a specific year. This will prevent the very wealthy from paying no tax.  My thinking is that every family with a net worth exceeding $1 million would pay .5% of the equity up to $5 million, 1% on the net worth from the next $5 million, and 1.5% on the next $10 million and 2% on anything over $20 million.

Our country competes in a Global economy. To support our businesses, I would eliminate the corporate income tax and also taxes on dividends. While initially, this may sound like a windfall the free-market system would eventually respond with more competitive pricing. Today companies jump through hoops to avoid paying taxes and as a result, less than 9% of all Federal revenues are from companies.

The last tax reduction had both good and bad news The good news is the increased standard deduction made filing easier since it reduced the number of returns needing to itemize and it also helped out very low-income families. The bad news is that the top 10% of income earners received 2/3rds of the tax reduction benefit and the middle class received almost no benefit. The middle class is the “engine” of our economy. Over the past 20 years, the average middle-class family income has only risen 8% while GDP has doubled. Does this seem fair?

I would appoint a bipartisan commission comprised of both major parties and independents to evaluate systems employed by other countries that have much lower gun death rates without allowing citizens to own sufficient arms for protection and sport hunting. I would instruct the commission to only consider “evidence-based” data with the objective of crafting a gun safety bill.

Our country has 4.5% of the world’s population and we incarcerate almost 25% of all the inmates in the world. About 50% of crimes are drug-related and almost 2/3rds of all prisoners are repeat offenders. Other first-world countries with less crime have incarceration rates that are a fraction of ours. I would appoint a commission to review other systems with the objective of crafting a bill to improve our numbers and reduce the cost to the taxpayer. More prisons are not the answer!

I would introduce a bill that would either eliminate or severely restrict special-interest lobbying. The bill would restrict any federal election campaigning (or fundraising) to the period 4 months prior to the election. The bill would also cap what would be allowed for total spending. So much for a Representative, so much for the Senate and so much for President.

I believe we need to think long-term when it comes to the environment. I will support any legislation that provides for a reasonable transition from our current coal and natural gas energy dependence to renewable sources. I think a 10 -15- year plan is reasonable. Several renewable sources are already cost-effective. The phase period will provide time for current providers to amortize their fixed cost and transition to either renewables or install systems that greatly reduce emissions from existing plants. For more detail on this please refer to an earlier post titled: “Electricity Energy Sources: Costs, Emissions & Carbon Footprint”.

Considerable detail on these issues is provided in my book:

If you agree with most of my platform, please pass along the link to this blog and recommend that they review this week’s posting.