Ethics & Public Policy Center

Of Course Elizabeth Warren Would Raise Taxes on the Middle Class

Published in The Washington Post on October 21, 2019


Sen. Elizabeth Warren (D-Mass.) has announced that she will soon explain how she will pay for her health-care plans. If she doesn’t say she’ll raise taxes on middle- and upper-middle class people significantly, don’t believe her.

That’s because every country that does have a large public-sector health insurance program that covers most citizens pays for it with taxes much higher than Americans are used to paying. There may occasionally be such a thing as a free lunch, but there is no such thing as a free doctor’s visit or hospital stay. Someone pays, and it’s not just society’s rich.

France and Germany are good examples of large continental European countries that have extensive publicly funded health insurance programs. France pays for it with a series of taxes on everyone’s wages. Employers pay 13 percent of an employee’s total salary (or 7 percent for wages not exceeding 2.5 times the minimum wage) for health insurance. Employees pay 9.7 percent for “social security” surcharges (in France, this refers to all transfer programs, not just retirement pensions) and debt repayment on up to about 98 percent of their total salaries. So that’s a payroll tax rate of up to 22.7 percent for social services, as economists largely agree that the employer’s share of a payroll tax ultimately falls on the employee in the form of lower wages.

Click here to read the rest of this piece at the Washington Post’s website.

Henry Olsen is a senior fellow at the Ethics and Public Policy Center.

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