Do Bagladesh, Haiti and Peru have Medicare-style programs soon to cost $1 trillion annually? Hopefully the question quickly answers itself.
Ideally it also answers Washington Post columnist Catherine Rampell’s puzzling lament that “The GOP’s recent tax-and-spending bill is a huge transfer of wealth from the poor to the rich.” Without defending the vastly overrated tax and spending (there's no growth in tax cuts largely directed at the middle class) bill brought to us by Republican happy talkers, Rampell’s comment on the “One Big, Beautiful Bill Act” (OBBBA) is contradictory. The “poor” by their very description don’t have wealth to transfer, let alone “huge” amounts of wealth.
As her own Post colleague Glenn Kessler pointed out to readers when then-President Biden made a similar argument about tax cuts for billionaires, Biden’s empty rhetoric similarly rated exposure. As Kessler noted, the top 400 U.S. taxpayers alone hand over more annually to the federal government than do the bottom 70 percent combined.
Crucially, and as evidenced by the traditional inflow of the world’s poorest into the United States (a beautiful thing, I say), the bottom 70 percent of U.S. taxpayers are decidedly not poor. They’re quite well to do. Read this paragraph’s opening sentence and ask yourself if so many would risk so much to work in a majority poverty country? Hopefully this question similarly answers itself, while also vivifying that even in a majority well-to-do nation, the rich pay nearly all the taxes.
Which raises further questions about what Rampell could possibly mean. No doubt she might point to the much-commented on Medicare cuts that are part of the OBBBA. Without saying who is right on the reductions (or lack thereof), please return to this write-up’s opening paragraph to ask how many poor countries budget close to $1 trillion annually for programs like Medicare. Tick tock, tick tock…
It's a long or short way of pointing out that absent the richest of rich Americans and the enormous amounts of annual taxes (forget “tax rate” and just look at nominal dollar amounts handed over) they pay, there’s quite simply no program like Medicare. All of which rejects anything associated both with Medicare and “a huge transfer of wealth from the poor to the rich.” The accusation is both logically and empirically false. The rich pay for most everything government does, and to the extent that their critics think they get something back from it, it’s not from the poor.
Rampell ultimately confirms all this, either on purpose or unwittingly. She writes that we don’t have Medicare-for-all because “Americans don’t have the stomach for the middle-class [her emphasis] taxes such a huge expansion of the safety net would require.” More realistically, if the federal government only had middle class earnings to tax, there would be neither debt nor big programs like Medicare. Basic economics, along with markets for debt confirm the latter as my upcoming book, The Deficit Delusion: Why Everything Left, Right, and Supply Side Tell You About the National Debt Is Wrong, argues.
Without calling for higher taxes on the rich, Rampell writes that “Rich people and corporations can definitely afford to pay higher taxes.” Sure, but can the U.S. afford such excessive taxation?
The answer to the above is oddly enough supplied by Rampell, or was in 2024. Writing about Donald Trump’s bank-borrowing history and his alleged inflation of his assets in order to borrow, Rampell lamented that Trump’s accession of funds “ultimately reduced resources available for other, honest borrowers.” If only Rampell would apply the latter to taxation, along with the borrowing and government spending that it funds.
