Quote · Modern Wisdom
Why Everyone Is Drowning In Debt (and how to get out) - Caleb Hammer - #1123
Where this was said
UK vs US: Who's Better Off Financially?
At 55:19 · chapter starts 52:14
Chris distills the entire UK-US financial debate into a single line: the UK is a great country to be poor in and a terrible country to be rich in; America is the inverse. [1] — Chris Williamson "The UK is a great country to be poor in and a terrible country to be rich in, and America is a terrible country to be poor in and a great c…" 55:19 Caleb agrees the data follows — productive people leave the UK in droves while the safety net keeps the less mobile in place. Chris elaborates on the tall-poppy syndrome that makes financial success socially punishing in British culture, then drops a remarkable statistic: Britain spends more on working-age welfare every year than it collects in income tax, with the shortfall borrowed annually. Caleb counters with American tax data — the bottom 50% pay just 1% of all income tax; the top 1% pay roughly 30% — making the US more progressive than most assume, what it lacks is a VAT to fund Scandinavian-style programmes. The conversation moves to austerity versus stimulus: the UK went conservative after 2008 and only recovered to 2007 GDP levels about a year and a half ago, while the US pumped money into the economy and recovered within a couple of years. Chris notes the irony that left-right economic archetypes have blurred — the UK's conservative austerity objectively failed, while America's liberal spending worked.
The UK cushions poverty with an NHS, generous welfare, and social housing but tax burdens and tall-poppy syndrome punish wealth creation. The US offers massive upside but a brutal floor. After accounting for everything you get free, Americans still end up with more disposable income in their pockets.
The UK spends more on working-age welfare annually than it collects in income tax, with the shortfall borrowed every single year.
The bottom 50% of US earners contribute just 1% of all federal income tax. The top 1% pay roughly 30%. Most people, including a socialist guest on Caleb's show, believe the wealthy pay nothing. The US is actually the most progressive major Western nation for income taxation — what it lacks is a VAT.
The bottom 50% of US earners contribute just 1% of all federal income tax, making the US one of the most progressive income tax systems among major Western nations.
The UK's GDP only recovered to its 2007 pre-recession levels approximately a year and a half to two years before the episode's recording, illustrating the long-term damage of austerity policies.
The top 1% of US earners pay approximately 30% of all income taxes, and the top 10% pay around 50%, contrary to popular belief that the wealthy pay little or nothing.
