Germany"s model public option is bankrupt

Discussion in 'Politics' started by Wyldgusechaz, Oct 10, 2009.

  1. Wyldgusechaz

    Wyldgusechaz New Member

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    The German model has been in existence since 1883 and now covers 9 of 10 German workers and has a payroll tax rate of 14.9%. Its failing and there will need to be a tax hike above the 14.9% to get it to solvency.

    A person making $50000 would have to pay $7500 in taxes to be in the German model. And thats before the expected tax hike.
     
  2. B_Nick4444

    B_Nick4444 New Member

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    says it all, but I think some around here will not get it
     
  3. lpsg_funcock

    lpsg_funcock New Member

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    Germany doesn't actually have a public option -- it's all administered by private insurance companies (AOK, Barmer, etc.).

    The health insurance (called "Krankenkasse", which means Sick Cash Register) is forced upon all German citizens at about a 14+% rate + an equal match from the individual's employer! (read over 28% of a worker's gross income!!!!!) And, this doesn't cover everyone in Germany.

    My humble opinion? Government involvement leads to catastrophe.

    What does the government do well?
     
  4. Gl3nn

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    Lol, if you think that's bad, just look at some other european countries. Very high taxes... but I don't mind. I'm very happy with social security here.
     
  5. sargon20

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    #5 sargon20, Oct 10, 2009
    Last edited: Oct 10, 2009
  6. B_Nick4444

    B_Nick4444 New Member

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  7. jimcord

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    I don't think they will be happy for too long in Denmark! These lazy folks needs to get off government welfare and actually create some real jobs which create real income, you can't pay taxes which were generated from tax dollars!

    Denmark: A Case Study in Social Democracy
    Mises Daily by Per Henrik Hansen | Posted on 7/22/2003 12:00:00 AM

    In a previous article—"Denmark: Potemkin Village"—I documented the downside to Denmark. Despite its reputation as a showcase of political utopia, 40 percent of its adult population live on government transfer income, full-time, all-year. A little more than a third of these people are pensioners and the rest are working age. About one third of the people who actually hold a job work for the government or government-owned companies. The effective tax level is around 70 percent, not the 50 percent that is usually reported (the lower figure comes about by disregarding the effects of the sales tax and excise taxes).

    My article led to many questions and comments from readers. One reader admitted that the Danish welfare state is very expensive but claimed that it is worth the price. If high taxes buy a society where people feel secure, where crime levels are low, and where people are well educated and live long and healthy lives, maybe the high taxes aren't such a terrible thing!

    For now, let's ignore the ethical question associated with all coercive redistribution. Instead, let's look at the extent to which safety, security, and quality of life really do characterize Denmark.

    People can feel socially secure in Denmark—at least for now. People don't get rich from welfare but they can live a comfortable life. Practically all people are eligible for one program or another. But the system is unsustainable in the longer run. In the early 1970s only about 300,000 people of working age lived full-time all year on government welfare. Today it is about 900,000. The population size has remained unchanged at around 5 million. In the not too distant future, more people are going to be pensioners and fewer people will be working age. At some point, the trough will be empty.
     
  8. sargon20

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    A favorite canard. 'For now'. 'You just wait and see'. Life is lived in the now. Not yesterday. Not tomorrow. The now. We are happy now. And that is all anyone can strive to be. Happy now.


    The goal of anyone's life is happiness. And there is no correlation between being 'rich' and being 'happy'. There is a myth that richness=happiness. It's not true and has lead to untold unhappiness because the vast majority of people will never ever make it 'rich' but they can make it 'happy'. Once you are comfortable and no worries about food and shelter the happiness index flattens out.
     
  9. eurotop40

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    YouTube - REGULATION VACATION CELEBRATION!
     
  10. midlifebear

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    LOL! Excellent video, eurotop40. Yes, "Come to Somalia, where there has been no interfering government since 1991!"

    Despite the "sky is falling" positions of the OP and his acolytes, Germany -- as the rest of Europe -- is doing fine. Just ask any posh 'Mericuhn who only buys Mercedes, Audis, BMWs, and VWs? Or ask any of the throngs of German tourists plying the streets of Manhattan these days, gawking at the odd way 'Mericuhns behave.
     
  11. B_Nick4444

    B_Nick4444 New Member

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    Some would disagree:

    An object lesson for us all is the present deplorable state of Germany. It shows what happens when a society is encouraged by its leaders to turn its back on freedom and opt for security at any price.

    A generation ago Germany, thanks to its great postwar leaders Konrad Adenauer and Ludwig Erhard, had an exemplary economy--one of the world's best in quality and performance. It was modeled on America's and put entrepreneurial freedom, hard work and innovation before all other considerations. The Germans turned their backs on their hideous past of violent aggression and became wealthy, proud and self-disciplined global citizens.

    Today the German economy is a model--especially for the rapidly expanding nations of the Third World, such as China and India--for what not to do. Stagnant production, static or falling productivity and appalling levels of unemployment are the salient factors. Unemployment figures have recently been revised upward to 4.5 million but could be as high as 6 million when the "hidden unemployed" are taken into account. These figures are close to those of 1932, at the depths of the Great Depression and just before Hitler came to power. So many being unemployed was one reason Hitler's bid for power was successful.

    Forbes.com: Germany's Dismal Future
     
  12. midlifebear

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    Well, we ALL know how unbiased Forbes Magazine is; especially since Forbes Sr. died and his ultra conservative Republicans-must-rule-at-any-cost son now controls the reigns of that publication. It was a better respected rag when Forbes Sr. romped around on his Harley in leather drag, enjoyed a raucous S@M sex life, and would escort Lis Taylor around as his beard for public functions. Forbes Magazine has certainly seen better days.
     
  13. Sergeant_Torpedo

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    What it says, and I am sorry for all you cadavour sniffers and partisan politicians, is that the German voters haven't chosen wisely. The professionals appointed to manage the funds have been derelict in their duty, but they will still get their big fat pensions. The right wing solution: make low paid hard working people work another year or two to get their meagre pension, only allow the articulate middle classes expennsive medical care. This shouldn't be too hard for German intellectuals to digest, after all they live in a nation that, within living memory, allowed, promoted, and accepted forced labour and slave labour (Ford Germany) - when the tyrants decide to rob Peter they always get the support of Paul.
     
  14. sargon20

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    The part of government they like is the part that makes sure wealth stays concentrated at the top. Untouchable in any way. That part of government can stay. You know the phrases 'strong on defense, tough on crime, etc'.

    Defense department - safe
    Justice department - safe
    IRS - cut
    SEC - cut
     
    #14 sargon20, Oct 10, 2009
    Last edited: Oct 10, 2009
  15. midlifebear

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    The Forbes article -- for those who missed the end of the piece -- insists that Germans now accept they must take "Thatcher-like" measures to help jump start their economy.


    Hmmm. . . any friends on LPSG in the UK interested in commenting how well Thatcher's reign made everything wonderful during those years? Anyone?
     
  16. B_Nick4444

    B_Nick4444 New Member

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    how would you dismiss Martin Feldstein who is the George F. Baker Professor of Economics at Harvard University and President Emeritus of the National Bureau of Economic Research?


    Germany has an approach to economic policy that served it extremely well for several decades after World War II and that in some ways have continued to serve it well. It would be wrong to lose sight of the economic miracle of Germany's postwar economic recovery and the decades of strong growth, low inflation, and low unemployment. In the mid-1970s, German unemployment was less about 2.5 percent, less than half of that of the United States, and its inflation rate was close to zero. During those years, Germany also experienced a very satisfactory rate of real economic growth that substantially narrowed the gap between per capita real GDP in Germany and in the United States.

    But the German policy approach that worked so well in those years has ceased to perform as well. Although the inflation rate has remained low, the unemployment rate has risen to nine percent and the rate of real economic growth over the past several years has declined to significantly less than that of the United States. In the very short run, Germany's GDP has actually been declining and its budget deficit is approaching the three percent limit imposed on European Union countries by the Masstricht treaty. Looking ahead to the very long run, Germany faces even higher taxes than those that it faces today as a result of the increasing cost of providing services and pension benefits to an ageing population. The difficulty, both political and economic, of raising taxes also limits Germany's ability to share in the proposed European and NATO defense activities.

    Education in Germany has fallen from its earlier status as a model for other nations to a very poor level. Recent OECD studies put both the secondary and university education systems of Germany in the bottom half of OECD countries. Substantially fewer students in each age cohort go on to complete a university degree in Germany than elsewhere. The quality of the education is generally regarded as inferior to that available elsewhere in Europe and in the United States. Although I am not well enough informed about education in Germany to be confident about my views about the reasons for this poor performance, I am struck by two features: the universal free education and the "democratization" of the university governance.

    Germany's Economic Ills
     
  17. sargon20

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    Can a program run by the government actually be bankrupt if the government isn't bankrupt? It's like saying Windows Vista is bankrupt.
     
  18. eurotop40

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  19. eurotop40

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    I think you forgot one important issue, and that is the cost of reunification.
    But wait until the US will go bankrupt with the war expenses (and I am not happy about that since I have investments there...).
     
  20. Ericsson1228d

    Ericsson1228d Member

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    This sentiment seems to be right out of the Obama playbook. Ah, give everyone everything now, worry about paying for it later. I, for one, am disgusted about the widespread acceptance of mortgaging future generations for transient gains now.

    Living "in the moment" is fine when you are 16, but completely irresponsible as an adult, or for a government.
     
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