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Americans Want Improved Social Security and Medicare and less Military Spending

Shifting from Defense to Offense

Clearly high taxes for supporting retirees and the poor and disabled is not crippling Finland.

While I cannot claim to be an expert on the retirement systems of other nations, it is worth mentioning that the payroll tax rates of other major developed economies like France, Germany and Sweden, are all significantly higher than the US, and yet their economies are all outperforming ours, including in the area of global competitiveness. Sweden’s retirement system taxes, paid by the employer, total over 31% of payroll. In France workers contribute 13.4% of each paycheck to fund the national retirement scheme, with employers paying another 18.2% of payroll, for a total of 31.6%. Even in Germany, workers and employers each pay 9.95% of payroll in to the retirement fund -- and yet Germany still manages to be the second largest net exporter in the world after China, outstripping the US this year. And, unlike the US, Germany boasts a consistently positive trade balance. Clearly, using a payroll tax to fund a decent retirement program does not mean destroying competitiveness or crippling business.

What does separate the US from these other developed nations is the staggering amount -- 53% of the discretionary federal budget -- that the US spends on war and the military. Finland, in comparison, spends just 3.4% of its federal budget on its military, the same as Germany. France, one of the world's larger military spenders, devotes 5.4% of its budget to its military.

The answer then is clear: If the US, where Social Security on average only provides a meager 30% of pre-retirement income to retirees, is to expand benefits, the money will have to come from a combination of higher taxes on the wealthy, higher taxes on employers, and from dramatic cuts in US military spending.

Despite all the pro-war propaganda, and the scare stories about terrorism put out by the government and the corporate media, Americans get this. A poll conducted earlier this year by The Hill, found that 49% of Americans supported cutting military spending to reduce the nation’s budget deficit, while only 23% favored cutting Social Security and Medicare. Meanwhile 69% said they opposed cuts in those two programs.

And cutting military spending is, in fact, what Sen. Sanders is calling for in his proposal to defend and expand Social Security: full FICA taxation on all income, not just the first $113,400 of income, and several hundred billion dollars a year in cuts in the military budget. Others are demanding even bigger military budget cuts, of as much as 25-50% of the current $1 trillion a year level of spending on war and preparations for war. (Even a 50% cut in the US military budget, by the way, would still leave this country spending far more than several of the next-largest spenders, like Russia and China, combined.)

story | by Dr. Radut