Posted on 07/01/2002 7:33:42 AM PDT by xsysmgr
Two years ago, politicians and bureaucrats at the European Commission announced their intention to turn the 15 nations of the European Union into "the most competitive knowledge-based economy in the world by 2010." This is a tall order. Smothered by oppressive tax rates and burdensome regulations, Europe trails the United States by a wide margin.
Thanks in large part to the Reagan tax cuts and other free-market policies, per-capita national income in America is now 50 percent higher than it is in Europe. Our growth rate over the last decade has been about 60 percent higher, and our unemployment rate is about 50 percent lower. Tax policy is America's biggest advantage. Taxes consume about 29 percent of economic output in the United States. This is too high, but America is like the Cayman Islands compared to Europe, where tax collectors seize 42 percent of gross domestic product.
So how is Europe planning to surpass the United States? Could it be that Europe's welfare states are planning to cut tax rates? Ireland already has shown that tax cuts are a recipe for prosperity. Thanks to Reagan-style tax-rate reductions, including a corporate income tax rate of just 10 percent, Ireland has become the "Celtic Tiger" and is now the European Union's second richest country.
Sadly, the politicians representing Europe's welfare states have little interest in cutting taxes. Indeed, they censured Ireland for cutting tax rates and growing too fast! Apparently, the French and the Germans consider supply-side economics a crime.
But if European politicians refuse to cut taxes and reduce bloated welfare states, how can they overcome America's economic lead? The answer, unfortunately, is that they want to undermine American tax policy so the U.S. economy will grow slower. In other words, Europe's socialist politicians want to make the United States more like Europe so we lose our competitive advantage in the world economy.
Already, the Europeans have dragged America before the World Trade Organization four times in an effort to compel our lawmakers to impose higher taxes on U.S. corporations. And the European Commission also is attempting to force American companies with Internet sales to pay European taxes — even if they have no operations in Europe.
Both proposals would hurt U.S. job creation, but the one that would inflict the most damage on our economy is the EU's "Savings Tax Directive." This scheme would require U.S. financial institutions to become tax collectors for Europe's welfare states. American banks would be required to compromise the privacy of their clients by reporting the money that foreigners have invested in the U.S. economy.
The EU nations want this private financial information so they can tax Europeans on income earned in America. This is an outrageous assault on American sovereignty. Every nation should have the right to determine how income earned inside its borders is taxed. France and Germany have no more right to interfere with our tax laws than we have to interfere with theirs. If they're worried that jobs and capital are fleeing Europe, maybe they should cut their tax rates instead of trying to turn American companies into deputy tax collectors.
The stakes in this battle are enormous. Foreigners have invested about $9 trillion in the U.S. economy, and most of that is financial capital — deposits in U.S. banks and investments in U.S. companies. But a significant amount of that money would leave America if the "Savings Tax Directive" is approved. The cost would be immense: With less money available, it would be harder for families to obtain mortgages and consumers to borrow money. American businesses would lose capital, making them less competitive and reducing job creation.
The good news is that America isn't obligated to participate in Europe's tax cartel. We can say no to the "Savings Tax Directive" and the proposed cartel falls apart. But news reports indicate that the IRS and the Treasury Department want the United States to join Europe's "OPEC for politicians." Never mind that this is the equivalent of economic treason: putting the interests of revenue-hungry European governments above America's economic interests.
President Bush has done a good job defending the United States against terrorism. Now he needs to protect our economy. He should order the IRS and the Treasury Department to reject Europe's "Savings Tax Directive." And if the leaders of these bureaucracies refuse to defend America's national interests, he should fire them and replace them with people who support the president's tax-cutting agenda.
— Daniel Mitchell is the McKenna senior fellow in political economy at the Heritage Foundation, a Washington-based public policy research institute.
Europe defines unemployment differently thanthe U.S.
If Europe defined unemployment the same, Europe's unemployment would be comparable to the U.S.
I lose about 42 percent of my gross income to state, federal and local taxes and I live in the USA. I include sales taxes and property tax on my home.
#1 Yes, #2 yes.
That's the difference.
This may not always be the case. When I was living in Canada, I was told that there are certain countries that hold reciprocity agreements with the U.S. Basically, the tax systems in these countries are similar enough to the U.S. that the IRS does not require you to report regular income earned in these countries. I don't know how many countries there are like this, but Canada is one of them.
Prove it!
Unemployment benifits are not paid to non-seekers in the US. Stop looking for a job and lose your benifits. Yes, you have to prove you are looking for a job. Also benifits end after a certain period whether you find a job or not in the US.
You can check this at the Dept. of Labor Web site.
They perform "telephone" surveys to determine who is out of work.
If you haven't made a contact in past 4 weeks (perusing want ads does not count) you are not considered in the work force (unless collecting unemployment insurance).
I fail to see how that proves your point?
This statement is incorrect.
Let's say you lost your job, have run out of unemployment benefits but are proactive in looking for work, you are considered unemployed.
However let's assume that you have made all the possible contacts and now you a relegated to merely looking at the want ads, you are NOT considered looking for work, and are not considered unemployed (by Dept. of Labor standards).
This is not an option in the US. No one mearly looks at want ads if they face eviction and starvation. People will find work if motivated strongly enough. It may not be work they would like, but it will be work.
At $5.15 per hour, one faces eviction and starvation.
There are people in this world who live on less than $1 a day. They would literally kill for a 5.15 per hour job. At any rate you are wrong. I have lived on less than that. It can be done, in fact you can save money if you learn how to be creative.
Sure you did, in 1955 you were earning 75 cents per hour at minimum wage.
However, since then prices have gone up a bit (even you might agrree with that).
lol...that was the year my dad was born. You'll forgive me if my memory of 1955 working conditions is a bit hazy?
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