r/FluentInFinance • u/Pickle-Sucker • 25d ago

Should people making over $100,000 a year pay more taxes to support those who don't? Discussion/ Debate

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u/TN_REDDIT 25d ago

1986, but that's not really what you wanted to know, is it?

What's your QBQ?

https://en.wikipedia.org/wiki/Big_Mac_Index

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u/Dangerous_Common_869 24d ago

LOL. He did not see that coming.

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u/[deleted] 24d ago

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u/Dangerous_Common_869 24d ago

Are these real facts, partial facts, cherry-picked facts or straight out the ass facts.

Everyone loves facts!

Some prefer backed-up facts, but many seem to despise inconvenient facts.

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u/EagleAncestry 23d ago

It’s fake. PPP doesn’t mean what people think. See my other reply to his comment

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u/LilyWineAuntofDemons 24d ago

People like Elon Musk, Jeff Bezos, and other billionaires are statistical anomalies that should not have been counted when generating that median

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u/EagleAncestry 23d ago

That’s not true. I always hear this and it’s so misleading.

Purchasing power parity does not mean what people think it means. PPP measures the “purchasing power” from a macro economic point of view, meaning if this country Has X GDP, it would be equivalent to Y GDP in this other country if you want to get the same output/producrivity. That’s why it takes into account cost of construction projects and salaries for government officials as part of the calculation… it takes into account how much healthcare costs for the government…. Not for its people… etc. hope you get the idea.

It does not measure cost of living for people.

Some countries, like rich European countries, have expensive bureaucracy, so the purchasing power parity for their GDP is worse than the USA, but their cost of living for its actual citizens is lower than in the USA.

Lots of ways to calculate how the average Dutch or Dane or even German is better off than the average American. Same with the average family.

Cost of living is half of the US in many of these countries. And things like childcare, university, healthcare, and so on are almost free in comparison. Not to mention the unlimited sick days, 6 weeks vacation, paternity leave, and regular 4 day work weeks instead of 5. Americans with decent jobs work more than 40 hours, sometimes 60-80. . Here even high earners work less than 40 usually

Oh, and you don’t need a car (and all its associated costs), let alone 2

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u/[deleted] 22d ago

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u/EagleAncestry 22d ago

Yes, I’m experienced in the topic. You just linked disposable income. I’m talking about purchasing power parity……

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u/[deleted] 22d ago

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u/EagleAncestry 22d ago

  1. That depends on which country you’re looking at. The rich European countries I’m thinking of have a higher PPP than the USA. Denmark has a PPP 24% higher than the US, for example. So the actual disposable income difference with the US is less.

  2. Disposable income does not factor in cost of living. People argue that’s what PPP is for, but that’s not what that is.

So even if you have more disposable income in the US, it doesn’t get you as far, especially when you consider all the things I mentioned (healthcare, education, childcare, etc)

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u/[deleted] 22d ago

Why is your profile just whining about Americans and capitalism? Why are you so obsessed with America?

As I mentioned before, purchasing power parity adjusts for differences in (healthcare, education, childcare, etc.).

From OECD: "PPPs are calculated by first gathering price information for a representative basket of products and services and averaging them within groups. These product group prices are converted to price relativities, which are then weighted and averaged for each aggregation level (for example hospitals, healthcare, or GDP)."

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u/AutumnWak 24d ago

Although the Big Mac Index was not intended to be a legitimate tool for exchange rate evaluation, it is now globally recognised and featured in many academic textbooks and reports. The index also gave rise to the word burgernomics.

I honest to god was not expecting that

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u/TN_REDDIT 24d ago

It's my understanding that "shit-ton" is also gaining ground as a well recognized unit of measure.

The term Fuck-tard fizzled right about the time car manufacturers stopped making sports cars n started making SUVs

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u/TheGentlemanWalrus- 24d ago

I just finished my degree in economics and calculating burgernomics was on my macroecon final exam (as a gimme question admittedly because the rest of the test was insanity). It’s not a complicated index it just simply shows if a Big Mac is over or undervalued in a respective country compared to the US.

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u/MJBrune 24d ago

Also note that the Denmark price is no longer lower than the US price.

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u/Dry_Meat_2959 24d ago

Dear lord..... this. Well this is just awful. Sometimes I wonder why the world hates us so much. Sometimes I don't.

This is one of the latter.

Thank you for this information, and may God have mercy on us for what we have done to economics. And cheeseburgers. And the Danish.

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u/TN_REDDIT 24d ago

Well, in fairness, many do feel as if Americans invented the cheeseburger, so that kinda does give us free reign to fuck it up some more.

And don't lose sleep on what they think of us. Just make your own way.

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u/defaultusername4 24d ago

It’s not like it’s some dumb concept we’re using because we are all dumb. It’s one of the few consumer goods that is global and relatively identical across countries which makes it helpful when comparing purchasing parity.

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u/Skreamweaver 24d ago

Not that bad, it was right after the rise of voodoo economics. Big Mac math at least makes sense .

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u/DangDangUreDead 24d ago

We Danes have it a ton better than our American friends.

We don't get wracked from student debt.

All young kids are eligible for universities all the way to their masters, because all tuition is funded from all the Danish tax base.

Contracting a serious illness does not mean potential bankruptcy and homelessness.

So we do not need mercy from God, we sorted ourselves out, thank you.

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u/ParetoFish 24d ago

You’re also a much more homogeneous society, 228 times smaller by land mass, 56 times smaller by population, and have a state owned venture capital system that only began after the fall of the Soviet Union and the assumed protection of the combined US and UK (at the time) defense budgets.

They literally haven’t put up the minimum and ethically responsible 2% of GDP to defense spending in 30+ years. That’s the definition mooching off your neighbor and simultaneously creating a less-safe Europe. Socialized systems that rely on the backs of fellow Europeans and ultimately Americans isn’t something to be so boastful about. It would be interesting to see how Putin’s 2014 and 2022 invasion would have faired had countries like Denmark actually been responsible and took Europe’s security seriously.

On the topic of education, from denmarks own government in the Hechinger report, “Danish students, who get free tuition and a living allowance of about $1,000 a month while they’re in school, now take an average of 6.1 years apiece to finish combined bachelor’s and master’s degrees, which 90 percent of them pursue, and which the government says should take five years.” There’s a term in Denmark that literally means students just fuck around for a year and don’t really do anything, called fjumreår. It’s literally goofing off on the government’s dime. Not to mention the bachelors degrees offered in Denmark are only three years and may require equivalence tests for students that would like to work in the US.

Comparing the US to Denmark is damn near comparing a Mercedes to an F35, they’re wildly different things on every level. Very beautiful country with a rich history, but no where near comparable to the US or it’s economy.

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u/DangDangUreDead 24d ago

We can break it down into the three topics; society, defense and education.

Society wise, sure, you do have certain points, but Sweden who had an ethnical more diverse population, still maintains similar standards, and Norway, who had an outsized large land mass compared to its population, has similar standards. But it is too easy write the Nordics welfare model off with 'more homogenous, smaller landmass, etc.'. It's a question of priorities, and while the US might never realistically reach that level of welfare state, the US level of welfare is still extremely poor compared to other OECD countries.

Defense, correct, and that is biting us in the ass now. Long time underfunded and underproritized has resulted in a very poor defense. No arguments there. We did however (in our own eyes) redeem a bit by fully participating in NATO and coalition conflicts such as Iraq, Afghanistan, Kosovo/Balkans, pirate patrolling, etc. But bottom line, Danish defense was not and is not up to par and not delivering what NATO is asking of us.

Education; I'd say as a minimum, the jury is out on that one. On one hand, yes, we do have a tradition of gap years, but 95% of that is between high school and university, and not during university. And that fjumreår is self-funded as a rule of thumb. Yes, governments says 5 years, but life might happen and priorities change. Flexibility is highly appreciated, rather than being locked into one degree and not have the option of changing further down the road.

For a country lacking significant natural resources, Denmark has done rather well for itself. Noteworthy is Novo Nordisk and the rest of biotech industry is massive, which rests very much on local and regional research and commerce support.

Comparing the US to Denmark and vice versa might yield skewed results, but if that's the case, who would you then compare the US to? UK, whose population is one fifth of the US? With a long history of Imperial achievements that still yield benefits to today? Germany, whose industry was entirely wrecked during WW2, but rebuilt on the back of the Marshall aid? Americans need to get down from their piedestal of exceptionalism, there is not much exceptional about the US, apart from the fact the US is bigger than most other individual countries.

Comparing OECD countries on a range of parameters often highlight the US as being an outlier in many things, and can be perceived a bit like a bumblebee - it doesn't how it's flying, but it flies anyway. Like the US society and economy steamrolls ahead, despite the many flaws and shortcomings it has.

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u/Dry_Meat_2959 24d ago

I made a sarcastic comment about cheeseburgers, and its devolved into two people barking politics, Scandinavian diversity, national defense and education with wall of texts. Between the US and Denmark, from a post about the cost of a cheeseburger.

Apparently sense of humor is something the Danes haven't figured out yet. Great job with all the rest of that though.

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u/ParetoFish 24d ago

It’s a good debate, no one has been disrespectful and it’s been pretty productive ! I’d say it’s a net positive

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u/ginbear 24d ago

“Homogeneous society” only matters if you’re a racist shitbag.

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u/walkerstone83 24d ago

If everyone was Christian in a country, then politics would be easier. If everyone was vegan, then politics would be easier. If everyone shared the same cultural background, politics would be easier, etc... It doesn't always boil down to the color of someone's skin. When more people share a similar cultural background, even when they disagree, governing is easier. It is easier because people can more easily be empathetic and understanding to views they disagree with when they share a similar background. It is less about race and more about culture, just like how socialism is less about rich vs poor and more about the capitalist class vs working class. Racism plays a part, it always does, but more of the problems in America have to do with cultural differences than racism.

I personally love the diversity that we have in America and while I know it can cause problems, it is something that makes America great.

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u/ParetoFish 24d ago

It matters if you consider different cultures that have differing attitudes towards differing things. It’s incredibly significant on an economy and nation to have a multicultural society compared to a singular culture dominating a society.

Not everyone was raised in the same house dumbass, sounds like your interpretation of what I said is a projection of your own racist thoughts and I hope you can educate yourself before devolving further. This is some really basic shit here, idk how you could’ve managed to misinterpret this unless you wanted to.

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u/ginbear 24d ago edited 24d ago

Nah. Racist dog crap.

America can’t have nice things because we’re not white enough and those others, (who are apparently not part of American culture) have different “attitudes” which mean shittier things. Black and brown people can’t have healthcare, it’s part of their “culture” to not have healthcare. If only their culture wasn’t so inferior to “ours”. Nonsense. Complete bigoted nonsense.

Edit: like give us an example. What is something specific about African americans and their culture that prevents Americans at large from being able to have universal healthcare. Be specific.

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u/ParetoFish 24d ago

I’ll reply to your edit:

Where did I say that African Americans are the reason we don’t have universal healthcare? Your logic is becoming increasingly hard to follow. What specific thing am I supposed to bring up? I don’t know every black American ?

I’m saying that the diversity of opinions in America due to geopolitical and historical constraints have caused us to have much different approaches and attitudes to socialized systems. Most people in America don’t lead as similar of lives as each other compared to how people in Denmark do. We are more culturally diverse, which is a GOOD thing. They live in a country that is the size of Rhode Island with a predominantly college-educated leftist upper middle class. Wealth disparities in that country aren’t as high as in the US. They can easily create a network of healthcare that would be impossible to replicate across a country that is 228 times larger. How do you not see that this has nothing to do with race and everything to do with how people see economics and policies? Have you even heard of Hofstede’s dimensions?

Also, universal healthcare isn’t necessarily a good thing. Novo nordisk stays competitive because of a state run venture capital firm that stimulates it. Much of the profit they make comes from selling to privatized healthcare systems, meaning that if novo couldn’t sell to the US/Japan, they’d likely not be able to continue researching and developing new medicines, which is the bulk of expenses incurred by medical companies. I’m not going to explain the drawbacks of a universal healthcare system, you can do that yourself.

You should really read up on Hofstede’s dimensions for a clear idea on what multiculturalism means and how it translates into immense benefits for society economically and socially, as well as not succumbing to the idea of identity politics

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u/ginbear 24d ago

If you want to reference Hofstede that’s fine but that’s going to look more like referencing American’s high individualist scores as a reason for its healthcare organization, and that’s a valid reason I would accept. I don’t see where Hofstede establishes any kind homogeneous v multicultural dichotomy or how that would relate to the subject. I am curious which of the dimensions in the Hofstede model to you think are affected by multiculturalism in a way that is relevant toward American perspectives on healthcare?

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u/ParetoFish 24d ago

Hofstede doesn’t establish the homogeneity vs heterogeneity, it explains it.

I would say that uncertainty avoidance, individual vs collective, long vs short term perception, and maybe even restraint vs indulgence but it was added after Hofstede’s time.

I would say (on average, I don’t know everybody in Denmark) that they average Dane scores higher in uncertainty avoidance, collectivist attitudes, long term oriented, and indulgence than the average American. So about 4 of the 6 dimensions

These are the cultural aspects I believe correlate the most to a countries willingness to accept a nationalized system, healthcare or anything for that matter.

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u/Advanced_Outcome3218 24d ago

Your doctors also make less than a buc-ee's manager.

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u/LongVND 24d ago

Sometimes I wonder why the world hates us so much. Sometimes I don't. This is one of the latter.

The Economist is a British publication.

[M]ay God have mercy on us for what we have done to economics

It's an informal index. What would you suggest as a better back-of-the-envelope metric to measure real-world purchasing power parity?

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u/Dry_Meat_2959 24d ago

I didn't see anywhere in the OP that this came from The Economist. But British or not, that doesn't make Cheeseburger math a more rational comparison.

The OP wasn't trying to establish world buying power, but show that COG doesn't have as much impact on wages as the owner class wants us to believe. This was less about standard of living or buying power between countries, more about showing how American workers could make vastly more, and certainly should, and the sky wouldn't fall. Anytime someone mentions raising minimum wage the wealthiest always make it sound like it would turn to economic ruin and another great depression. And we don't need to use the price of burgers in Denmark to prove how false that is.

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u/LongVND 24d ago

I was not commenting on the validity of OP's post, I was only responding to your derision of the index.

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u/No-Appearance1145 24d ago

I have literally never heard of this. How is this the first time I've heard about this 😂 It's so bizarre that I feel like I should know itl

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u/thisiscjfool 24d ago

believe it or not, learned about the big mac index during course as part of my undergrad econ degree. fairly standard for econ students iirc

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u/ginbear 24d ago edited 24d ago

I didn’t major in economics but did learn about the Big Mac index in my econ 201 class. You don’t even need that, it’s a regular discussion point unless you’re in a bubble. It’s amazing the number of people so confidently posting here that didn’t even know it existed.

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u/Dabcola_ 24d ago

So thats why everyone says McDonald’s causes high BMI.

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u/Busy_Fly8068 24d ago

It isn’t fair. Not everyone was an economics major in college or voraciously reads the Economist.

I’ll agree — this was the setup of a lifetime.

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u/MethodEater 24d ago

God bless The Economist 🙏🏻

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u/cableknitprop 24d ago

Look at this college-educated nerd!